EUR/USD: 1.2521Very Short-Term Trend:
Weak downtrend
Outlook: EUR declined to 1.2471 yesterday but then started a modest recovery. Right now the prices are well below the declining 100-hour moving average, but above the 21-hour moving average. So, the initial bias today is on the upside and there is a chance that a larger recovery back toward 1.2580 is under way. We need firm break below yesterday's low at 1.2471 to confirm that the expected decline twd 1.2345 is indeed under way. On the upside, gains above 1.2530 will indicate that a rally toward 1.2580 is most likely under way....
Strategy: Holding short from 1.2580 is favored. Stop=1.2535.
GBPUSD: 1.5612
Very Short-Term Trend: Weak downtrend
Outlook: GBP/USD declined to 1.5540 but then staged a strong rally. As I write this GBP is moving above the 1.5610 level which means our short from 1.5670 has been stopped out. Now, the hourly chart does not become positive with this move up from yesterday's low, but it is more neutral now and a short position can't be justified at the moment. However, based on the daily chart, I remain bearish and I will look for an opportunity to re-position from the short side again later this week.
Strategy: The hypothetical short from 1.5670 was stopped out at 1.5610 with 60 pts profit.
USDJPY: 79.59
Very Short-Term Trend: Sideways
Outlook: Our stop at 79.40 has survived so far, but the speed of the decline from last week's top is a disturbing sing that something is wrong with our bullish case here. Still, if the market manages to build a base abv 79.40 and rallies abv 79.80 again, the bullish case will remain valid. So, for now I retain my previous expectations for a strong rise from here, but only as long as 79.40 stays intact.
Strategy: Holding long from 79.81 is favored. Stop=79.40
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