FXDailyDose – November 26, 2013

November 26, 2013 in FX Daily Dose

FX Daily Dose

Currency pair

Near-term Outlook

Comments – Overall Outlook

USD/JPY

bullish Yesterday we had mentioned that USD/JPY should find support in the range of 101.10 to 101.35. The support came at 101.33. Our outlook stays exactly same as what we had mentioned in yesterday’s Forex Daily Dose that if the support holds in the range of 101.10 to 101.35 then USD/JPY should target 102.30 to 102.50 resistance range next. On the other hand any break below 101.10 should bring further consolidation towards 100.40/100.50 and a jump from there.

EUR/USD

Neutral Yesterday we had mentioned that EUR/USD may fall towards 1.3465 to 1.3485 support zone. It fell but support came at 1.3490 i.e. 5 pips above the indicated support. Our outlook stays as same as yesterday. We are neutral for the short-term and expect the resistance to hold in the range of 1.3560 to 1.3580. With this resistance another drop should take place again towards 1.3465 to 1.3485 support zone. In case of a break below 1.3460 the focus will turn towards further consolidation to 1.3399/1.3400. However if the resistance of 1.3580 fails then EUR/USD should target 1.3680/1.3688 resistance.

USD/CAD

bullish Yesterday we had mentioned that we expect a break over 1.0568 and first resistance at 1.0585. The break took place and USD/CAD went as high as 1.0583 and found resistance 2 pips below the indicated resistance. The fall took it to 1.0522. Our outlook is still mildly bullish and we consider the recent drop to be a psychological one before going beyond 1.0500 ranges. We now expect a support over 1.0515. If this support holds and USD/CAD breaks above 1.0585 then the next target should be 1.0609. However this outlook will neutralize if USD/CAD breaks below 1.0500. Apart from this we wish to repeat what we had mentioned yesterday ” In case USD/CAD manages a break over 1.0609 then it should target 1.0640 next. We also wish to mention the historical price action which shows that the pair is in a strong resistance zone. During August 2010 the pair had faced a strong resistance at 1.0673 and from there it had fallen strongly first to 0.9445 and then to 0.9406. The next peak was at 1.0657 during October 2011 and that too had proven to be a very strong resistance. The pair had some bumpy ride after that before falling to 0.9633. The next resistance was faced at 1.0609 during July 2013.”

CAD/JPY

Neutral Yesterday we had indicated that CAD/JPY may face a resistance near 96.86, however the resistance was faced well below that and at 96.52. There is no change in our outlook from yesterday that even though the overall outlook is mildly bullish but resistance is expected near 96.86 and even if there is a break above 96.86, a strong resistance should come at 97.11. On the downside a good support should hold at 95.95. However, if this support fails then further consolidation may take place towards 95.42 support. The volatility is very low and the price action is in a sideways range between 96.11 and 96.52. A breakout on either side should take place sooner or later and that keeps the immediate outlook as neutral for CAD/JPY.

GBP/USD

Neutral The outlook for GBP/USD remains same as yesterday. With 1.6260 resistance holding we expect consolidation towards 1.6060 or more. Only a break over 1.6260 will turn the focus for further upside towards the psychological resistance of 1.6500 ranges. We will repeat what we had mentioned yesterday “GBP/USD is once again struggling at the resistance trend line which has been in place for past 4 years. Because of this resistance zone we stay neutral even if the sentiments are all bullish. Please do check this GBP/USD alert of yesterday.”

EUR/GBP

Neutral Yesterday we had mentioned that EUR/JPY should face resistance at 0.8385. The price is just below that after touching 0.8378. There is no change in our outlook from yesterday and we will repeat what we had indicated yesterday as “The overall outlook for EUR/GBP stays bearish but the immediate outlook is neutral. On the upside a resistance is expected at 0.8385 and if that holds then a retest of 0.8300 will be expected. Overall a break below 0.8300 is required to expect further significant weakness towards 0.8225 to 0.8240 support zone or more.”

EUR/AUD

bullish Yesterday we had indicated the possibilities of a move towards 1.4873 for EUR/AUD. The price moved towards that level but found resistance at 1.4843 and the pair broke the indicated minor support of 1.4742 and fell to 1.4709. Some more downward consolidation take place towards 1.4645 before another recovery. Our immediate outlook for EUR/AUD is neutral though overall we stay bullish as long as support holds over 1.4645. If support over 1.4645 holds then further gains towards 1.4920 to 1.4960 resistance cannot be ruled out. However considering the psychological resistance of the approaching 1.5000 level we need to be cautious as any attempt to sustain over this level have been falling since June 2010. The first attempt had failed in June 2010 at 1.5015 and after the pair had gone into a downtrend to go as low as 1.1605. The second attempt had failed at 1.4994 and the third at 1.5031.

USD/INR

Neutral There is no change of our outlook for USD/INR from yesterday and we will just repeat what we had mentioned yesterday: “Resistance is expected below 63.02 and with that some deeper moves may come, however as long as USD/INR remains between the support of 61.71 and resistance of 63.02, our outlook stays neutral. In fact even a break below 61.71 will be expected to come up against a very strong support at 61.50. As we have been mentioning that USD/INR is stuck between the psychological levels of 60.00 and 65.00 after failing to test 70.00. Note: Within next 6 months we expect a break below 60.00 to test 58.74/58.80 level.”

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