Daily Technical Report: Major And Cross Currencies - May 24, 2013

EUR/USD - European Session

The pair stabilized above the ascending support level again , and is trading above Linear Regression Indicator 34. This makes us think that the downside move has weakened. An upside move is likely after repeatedly failing to stabilize below 1.2905; the pair has to stabilize above 1.2970 followed by a breach of 1.3030. We suggest a bullish move since the Risk/Reward Ratios is convenient.

The trading range is among the key support at 1.2805 and key resistance at 1.3085.

The general trend over short term basis is to the downside, targeting 1.2560 as far as areas of 1.3270 remains intact.

GBP/USD

The pair moved to the upside on Thursday, but remained limited below 61.8% correction of the ascending channel starting from 1.4833 and ending at 1.5605. Stability below the referred to level at 1.5130 keeps might bring back the bearish move, pointing out that stability above 1.5130 might trigger a positive signal on Stochastic.

The trading range is among key support at 1.4920 and key resistance at 1.5220.

The general trend over short term basis is to the downside, as far as areas of 1.5770 remains intact targeting 1.4355.

USD/JPY

The pair stabilized below 102.50 and Linear Regression Indicators, which might extend the bearish move. The Relative Strength Index (RSI) is still showing a negative bias, forcing us to suggest a downside move. The suggested bearish move is considered a correction within the overall ascending channel.

The trading range is among key support at 100.00 and key resistance at 102.80.

The general trend over short term basis is to the upside, as far as areas of 96.50 remain intact targeting 105.60.

USD/CHF

The bearish harmonic Butterfly Pattern is confirmed as the pair stabled below 23.6% correction of CD Leg of this pattern, which might extend the downside move to test the first target of the pattern at 0.9610. Breaking 0.9610 might extend the bearish move, and will remain valid if the pair stabilized below 0.9770.

The trading range is among key support at 0.9540 and key resistance at 0.9770.

The general trend over short term basis is to the downside, stable at levels 0.9775 targeting 0.8860.

USD/CAD

The pair dropped sharply yesterday but remained stable above 1.0300 and the significant support 1.0270. Stability above these levels keeps the positive possibility. Linear Regression Indicators tend to be positive, supporting the suggested bullish move.

The trading range is between the key support at 1.0215 and the key resistance at 1.0540.

The general trend over short term basis is to the upside, with steady daily closing above levels 0.9800 targeting 1.0485.

AUD/USD

The AUD/USD trading is assuming steady character within the bearish channel seen on the graph. Stochastic is reflecting a bearish bias, while the pair attempts to maintain a trading position above 0.9725. We believe the potential downtrend is still likely, and stability below 0.9780 supports this outlook.

Expected trading range is between the key support at 0.9495 and the key resistance 0.9880.

Short-term trend is downside, targeting 0.9400 if 1.0710 remains intact.

NZD/USD

The NZD/USD is stable above 0.8065 although the general bias is bearish as a result of breaking out of the bearish channel. Stability above that level compels us to assume a neutral position, where it contradicts the negativity the linear regression indicators are supporting. Momentum indicators are inclined to positivity and the pair must go back below the aforesaid level for us to suggest a longer run for bearishness. Until then, we will stand aside.

The expected trading range expected is between the key support at 0.8000 and the key resistance 0.8160.

Short-term trend is bullish, targeting 0.7715 if 0.8400 remains intact.

GBP/JPY

Two days of heavy volatility, as the GBP/JPY pair fluctuates sharply. The pair rebounded on Thursday towards the broken support near 155.00 level, and resumed the sell-off during the Asian session. The downside breakout below 155.00 suggests a potential deeper correction.

EUR/JPY

The EUR/JPY pair rebounded sharply towards the 132.50 level, before resuming the strong sell-off again. The bearish scenario remains favored as long as the price is holding below 132.50 level. However, holding back above 131.00 is concerning . Accordingly, we will move to the sidelines and wait for a break below the ascending trend line -shown on image- for further confirmation.

EUR/GBP

After completing a minor pullback towards 0.8528, the EUR/GBP resumed the bullish wave, heading towards the main upside target at 0.8600 and 0.8630 levels. The bullish setup remains intact, as price has broken out of the bullish falling wedge pattern and the 50-days SMA. We will maintain our bullish view.