Home Tech Targets: EUR/USD, GBP/USD, AUD/USD, NZD/USD, USD/JPY – December 11
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Tech Targets: EUR/USD, GBP/USD, AUD/USD, NZD/USD, USD/JPY – December 11

The British Pound has been on the back foot after the decision to pull the Brexit vote from Parliament. Other currencies are moving in both directions. What’s next?

Here is their view, courtesy of eFXdata:

EUR/USD: Neutral (since 21 Aug 18, 1.1485): EUR is caught in a consolidation range for now.

EUR edged above the top of our expected 1.1300/1.1440 consolidation range yesterday but dropped sharply after touching 1.1443. The price action reinforces our current view wherein EUR is “caught in a consolidation range for now” (we have held the same view since last Monday, 03 Dec). The underlying tone has weakened somewhat and the 1.1440/45 level is likely strong enough to cap any EUR strength for the next several days. However, the bottom of the expected range at 1.1300 is a strong support and while a move below this level would not be surprising, lackluster momentum suggests a break of the next support at 1.1265 is unlikely.

GBP/USD: Neutral (since 21 Aug 18, spot at 1.2795): GBP is under pressure but next support at 1.2400 may not come so soon.

After trading sideways for several days, GBP suddenly lurched lower and cracked several strong support levels and crashed to a low of 1.2507. Downward momentum has picked up strongly and GBP is still clearly under pressure. From here, a move below 1.2500 would not be surprising but the next support at 1.2400 may not come into the picture so soon. On the upside, only a move above the 1.2680 ‘key resistance’ would indicate that the current downward pressure has eased.

AUD/USD: Neutral (since 13 Sep 18, spot at 0.7170): AUD is still under pressure but a break of 0.7130 would come as a surprise.  No change in view.

There is not much to add to last Friday’s (07 Dec, spot at 0.7230) update. As highlighted, AUD is not out of the woods yet and a dip to 0.7160 is not ruled out. That said, after the weak daily closing on Friday (NY close of 0.7197, -0.52%), the probability of a break of 0.7160 has increased (we previously ascribed a low probability for a break of 0.7160). However, the sharp decline in AUD from last week’s 0.7394 peak is running ahead of itself and a breach of the next support at 0.7130 would come as a surprise. All in, AUD is expected to stay under pressure unless it can reclaim the 0.7270 ‘key resistance’ (level was at 0.7300 last Friday).

NZD/USD: Neutral (since 07 Dec 18, 0.6880): NZD has moved into a consolidation phase.No change in view.

We just shifted from a bullish to neutral stance last Friday and there is no change to the view. As highlighted, NZD has moved into a consolidation phase even though the near-term bias is tilted to the downside but for now, any weakness is considered as part of a 0.6820/0.6930 consolidation range. That said, after the weak daily closing last Friday (NY close of 0.6861, – 0.29%), a dip below 0.6820 is not ruled out but the next support at 0.6790 is unlikely to yield so easily.

USD/JPY: Neutral (since 09 Oct 18, 113.10): USD has moved into a consolidation phase.

USD tried but failed once again to move below the 112.20 support but the subsequent strong rebound from a low of 111.23 yesterday came as a surprise (USD touched 112.21 last Thursday, 06 Dec). While the ‘key resistance’ at 113.40 is still intact, the strong daily gain of +0.54% (NY close of 113.33) is enough to indicate that the recent downward pressure has eased. From here, USD is deemed to have moved into a consolidation phase and is expected to trade sideways, likely within a broad 112.40/113.90 range

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Yohay Elam

Yohay Elam

Yohay Elam: Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I've accumulated. After taking a short course about forex. Like many forex traders, I've earned a significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I've worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts.