Daily Insight: GBP/AUD, EUR/JPY Hitting Highs

Market Snapshot:
Disparity was seen amongst the FX markets last week as the greenback continues to sit between a fine line of bullish and bearish.

Whilst AUD, EUR and CAD bearish momentum increased we saw demand for GBP and EUR increase. This resulted with GBP/AUD sitting at its highest level since April 2010 and EUR/JPY breaking to its highest since Jan 2011.

As the Fed considers paying banks lower interest rates on their reserves, the bank's retort is to threaten to charge company and consumers a fee for depositing (this is on top of their near-zero deposit rates btw...).

The banks are arguing the interest rate cut will force them to seek riskier ways of making money, to cover the short-fall they incur if they do not charge a depositing fee.

Recent meetings are strongly hinting at the 'tapering' of its $85bn asset purchase program, which have so far provided the markets the fuel to see them at record highs.

GOLD H4:

Please refer to Wednesday's report for the previous analysis of Gold.

So far that has all gone pleasantly well. The bearish channel within the bearish channel remains to be (of all things) bearish. The support levels have all been respected, for short periods of time, before being broken so these levels now apply as resistance for any bullish gains. However taking into consideration the bearish momentum then I shall see any such gains as merely a retracement, with more losses to follow.

Now we are beneath the 1250-60 range my eventual target is now 1180.

However next target is around 1223-29 support zone. Any bullish retracements towards 1260 could be seen as 'better' prices to get short (assuming bearish setups appear near these resistance levels, of course).
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USD/CHF D1:

Please refer to Wednesday's report for the previous analysis of USD/CHF.

To Quote: "If we see a bullish close today then this could be assumed to be a swing low to initiate long positions. Only a clear break beneath the support zone would make me reconsider this view"

Originally this analysis did indeed perform very well after rejecting the 50% fibs level to finish the day back near the MR1, so the swing low had been assumed. Then it came crashing back down again....

However due to the nature of the bullish run from 24th Oct low I still believe the current decline to be corrective (so we are seeking another high).

As long as we remain above the green zone (and broken trendline) I will keep the bullish bias. However until we get a clearer buy signal you may be safer keeping to intraday trading within the bearish channel (which runs parallel to the broken trendline).
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