Tuesday, June 23, 2009

JPY crosses should lead the Dollar higher against Europe and lower against the Yen


Overall the underlying expectations of further Dollar gains proved correct though in the majors, given the move was already underway, it was tough to provide accurate levels to be able to jump in on the anticipated trend. I have to say the move was much slower than anticipated and does therefore just give rise to come caution but I still see further gains ahead – at least against the European currencies.


I really want to be bullish for the entire week but there is an alternative target that may shorten the life of this particular move higher and keep it in a sideways consolidation. Still, this means the upside should follow-through today again and thus we face the same issue of trying to catch the right levels to jump back in again… Overall I see minimum potential for 1.3559-81 EURUSD, 1.1003 and probably 1.1069 USDCHF and against the Pound towards 1.5934-89 at least. If we are to expect any further direct follow-through then I feel these levels are the crucial pivotal area.


Although the Dollar was firm against the European currencies it succumbed against a strong Yen and while yesterday didn’t break key support at 98.32 it has been tested this morning. Given the breakdown of the JPY crosses and the fact that their targets are still some way lower I don’t really count on seeing 95.32 USDJPY hold for too long. This probably has an initial target at around 94.44-66 before a more significant correction but overall this now seems to have a target at 93.84 once again.


AUDUSD should find temporary support around 0.7826 although this too has a much lower target over time and USDCAD surged through my lower resistance points and does seem like confirming a follow-through to 1.1630-38 at least – but ahead of that watch the 1.1155-76 area.


So the emphasis for today is basically Dollar strength with the exception of the Yen where it looks to make further lows. Thus the best return should come from the JPY crosses which should leverage from the constituent currency moves.


Today’s free analysis is for GBPJPY and can be seen on along with yesterday’s trade set ups (270 pips).


There are only a few more seats available for my seminar on price forecasting in Hong Kong on Saturday 27th June at the Excelsior Hotel in Causeway Bay. Please see for details and to register your attendance.


Good luck

Ian Copsey

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