Asian Session Notes 7/19

GBPUSD

Resistance: 1.56660 minor / 1.5680 minor / 1.5722(30) strong

Support: 1.5616 minor / 1.5587 strong / 1.5553 moderate

Wednesday saw Cable bouncing off the 21D EMA after a sharp intraday sell-off to close once more above the 55D EMA while stochastic remains overbought in daily charts and the macd is heading up. We are still set for a run to the 200D SMA, 1.5722(30) a strong resistance level. In 4H charts we have stochastic oscillating around 80 reinforcing the notion of an uptrend though stochastic is now flat below the signal. Hourly charts are mixed with stochastic heading lower and macd above the signal. We prefer taking the buy side of the market though indicators are mixed suggesting caution for the moment. Consider longs on a close above 1.5660 or on a bounce off 1.5616.

EURUSD

Resistance: 1.2316 minor / 1.2364 moderate / 1.2401 minor

Support: 1.2274 minor / 1.2243 minor / 1.2210 moderate

Euro is in a correction for the sell-off since late June with the daily stochastic now pushing to overbought levels and macd’s crossing higher. We are looking for the 38.2 Fib retracement at 1.2364, also the 21D EMA line. In intraday charts we appear to have a bullish bias with the 4H macd line just above the signal and stochastic poised to reenter overbought levels. Hourly indicators are mixed with stochastic just coming off overbought levels while macd is still pointing up. For now we suggest remaining sidelined though we would like to take buy side for another at pushing to the 21D EMA. Consider longs from just above 1.2243 around the European open or on a close above 1.2316.

NZDUSD

Resistance: 0.80005 moderate / 0.8046 minor / 0.8074 strong

Support: 0.7981 minor / 0.7950 minor / 0.7924 moderate

In the end we saw Kiwi bouncing off its lows for a long tail in the daily candle. We now have the stochastic indicator in overbought levels while the maced line is still below its signal. The possible head and shoulder pattern remains in play. In the lower time frames we have a bullish confluence from 4H indicators with stochastic overbought and macd just crossing higher though candlesticks suggests a loss of momentum. Hourly charts for their part has a bearish divergence in stochastic while macd is topping off. Consider shorts at market with stops above the days highs, our objective to form the right shoulder, at least test the 0.9724 moderate support.

AUDJPY

Resistance: 81.76 moderate / 81.98 minor / 82.36 strong

Support: 81.48 minor / 81.23 minor / 80.93(01) moderate

The turn around in New York trade for AUDJPY gave us a long tail at the close unfortunately for a hanging man in the daily candlesticks. As a low level bearish reversal candle we are looking for a confirmation with a black candle today. Among indicators we have stochastic overb ought and daily macd poised to cross higher though prices are just under the 200D SMA. From the 4H picture we have a bearish divergence in stochastic while macd is flat above the signal line. In hourly charts we have a bear cross in both stochastic and the macd’s. Immediate risk calls for weakness with the 21D EMA at 80.93(01) as our key objective for the day.

AUDUSD

Resistance: 1.0391 moderate / 1.0424 minor / 1.0472 strong

Support: 1.0355 minor / 1.0326 moderate / 1.0291 minor

Aussy managed to push past and close above the previous swing highs at 1.0328, a strong resistance then, dragging daily indicators up with stochastic now overbought and the macd lime crossing higher. From the lower time frames we have 4H stochastic oscillating around the 80 region while macd is heading up to suggest a bullish trend. Hourly indicators has macd bullish with stochastic poised at a new bullish crossover. With Business Confidence Surveys coming out at 0130GMT it would b best to wait for its release. Nonetheless we prefer taking the buy side of Aussy from just above 1.0326(28) or on a close above 1.0391. An index read of +4 or higher should impress.

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