Though I am still holding on to my long E$ position with the market looking poised for a rebound, I must admit that I have kinda lost my market rhythm this week and find myself with the consensus (which is not a good thing). In a situation like this, I will be happy to square my position ahead of the weekend with a small profit and steer clear until after the Italian election. Market's next fundamental focus will be ECB's announcement of LTRO2 at 1100GMT which is in another about an hour's time.
London order book:
Stop loss: 1.3150/30, 1.3160, 1.3260 and 1.3310
Limit: 1.3150/30, 1.3160 and 1.3245/55
Note that there will be a 1.3200 option expiry at 1500GMT, so market may get "stucked" around that level.
London order book:
Stop loss: 1.3150/30, 1.3160, 1.3260 and 1.3310
Limit: 1.3150/30, 1.3160 and 1.3245/55
Note that there will be a 1.3200 option expiry at 1500GMT, so market may get "stucked" around that level.
For the E$ today, the crucial pivot point is at 1.3230/35 where recapturing and closing above the trend line it broke below yesterday will turn the technical picture around. Market is coming out of its o/s level. Shorter intraday oscillator indicators are showing waning downside momentum with bullish divergent signal and pointing to consolidation where at current level would have an upside bias but I wary that the longer one is still pointing down. Though this has increased the probability that the recent sell-off could have ended and market is ready for its next leg up, I still need E$ to stay above the trend line or better still closing above 1.3340 (which it does look like a stretch) to neutralize the bear pressure. Next week will be the last trading week for February and its closing level for the month will be closely watched for the underlying strength of the E$ in the months ahead.
Expected range for the rest of the day taking into consideration the LTRO announcement, there is an outside chance of testing 1.3100/20 but I do not think its sustainable and is susceptible to a quick rebound into the 1.3180 to 1.3250/60 range for the most part of the day.
Expected range for the rest of the day taking into consideration the LTRO announcement, there is an outside chance of testing 1.3100/20 but I do not think its sustainable and is susceptible to a quick rebound into the 1.3180 to 1.3250/60 range for the most part of the day.
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| E$ Daily chart - Re-capturing the trend line? |
USDJPY
For those who are hoping for action in USDJPY, I would recommend to have an early weekend. Technical indicators are suggesting that the consolidation to continue into next week at least and not expecting any breakout from the range of Y92.50 to Y93.80.
For those who are hoping for action in USDJPY, I would recommend to have an early weekend. Technical indicators are suggesting that the consolidation to continue into next week at least and not expecting any breakout from the range of Y92.50 to Y93.80.
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| USDJPY Daily chart - Consolidation to persist |
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