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FX Daily Hotline 
13 October 2014     By C Dichio, Analyst

Chart of the day: Euro firms v A$...

 

The Australian Dollar weakened again on Friday, and the 'Gainers & Losers' sections below reflect this.  The Euro, for example, recorded a 0.6% gain versus the Aussie.  The chart shows the single European currency firming within the short-term range that has been forming ever since the September recovery from oversold hit the July barrier at A$1.4603; near the 200-day moving average.  Interestingly, support during the current ranging phase is offered by the 50-day MA line, which had previously acted as resistance (April to August). 

We will consider purchasing in the event of a sustained clearance of the A$1.4600 hurdle for the potential towards the A$1.5000 sideways area.

 

Daily Comment:

 

Both the above currencies (and others) have eased against the Japanese Yen

The Australian Dollar/Yen pairing (the subject of Friday's Chart of the Day) dives towards the May floor at Y93.043.  That action has also taken the RSI to a low level.  However, should the spring low yield, next chart support is not until the mid-March low at Y91.085.

The Euro/Yen rate recently developed resistance along the lateral area around Y138; near both the long and short-term MAs.  Here, the September low at Y135.78 is under pressure, and should it fail, next support is around Y134, though the important platform is not until the November floor at Y131.22.

We will consider selling the New Zealand Dollar v Yen upon a breach of minor support around Y84.  The chart pattern is very top heavy, with important support not until the February floor at Y81.43.

Elsewhere, the Australian currency has registered a 1% loss against the Canadian Dollar.  The recovery from oversold did not get very far, to C$0.9863.  Should the late-September low at C$0.9706 yield, the risk of further slippage towards the C$0.9600 region will have increased.

 

 

Gainers / Losers
Top 5 Gains.
SymbolStockClose% Change
BRLUS$/Brazilian Real2.4291+1.3%
GBPAUDGBP/Australian Dollar1.8509+0.9%
TRYNew Turkish Lira per 1 US Dollar2.2875+0.8%
AUDAustralian Dollar/US Dollar0.8737+0.6%
EURAUDEuro/Australian Dollar1.4539+0.6%
Top 5 Losses.
SymbolStockClose% Change
AUDJPYAustralian Dollar/Japanese Yen93.496-1.3%
TWI ADSPAustralian Dollar Index133.76-1.0%
AUDCADAustralian Dollar/Canadian Dollar0.9726-1.0%
AUDCHFAustralian Dollar/Swiss Franc0.8313-0.8%
NZDJPYNew Zealand Dollar/Japanese Yen84.138-0.8%
    
The FX Model Portfolio
Date Stock Code Type Open Price Current Price % P&L Stop Comment
4 Sep 2014 Euro/South African Rand EURZAR Short 13.8896 14.041 -1.09% 14.4
  • We watch to sell NZ$ v Yen and buy Euro v A$ (Chart of the Day).

 

Daily Analysis

Symbol Name Comment Close 1 day Support Resistance
DXYUS Dollar IndexPossibly reasserting the advance after a brief correction from overbought.85.912+0.5% 83.864/84.93788.708/86.746
EUREuro/US DollarCounter move from oversold finds intraday resistance at 1.2791.1.2628-0.5% 1.2466/1.25011.2995
GBPUSDBritish Pound/US DollarRecovery from oversold finds intraday resistance at 1.6227.1.6076-0.3% 1.5855/1.5944?1.6644/1.6416
CADUS$/Canadian DollarOverbought uptrend yields to ranging beneath resistance at the early-2014 high.1.1199+0.1% 1.0887/1.10721.1725/1.1279
JPYUS$/Japanese YenRetreats from the overbought 'Peak' KDR of 1 Oct; near the mid-2008 ceiling. Potential top.107.66-0.2% 106.81110.66/110.09
ZARUS$/South African RandReverses up from the 50-day MA after correcting from overbought and the early-2014 peak.11.12+0.5% 11.166/10.962811.8723/11.3909
KRWSouth Korean Won per 1 US DollarOverbought rally struggles beneath this year's earlier highs.1070.45+0.6% 1031.35/1038.41089.71/1082.9/1074.75
CHFUS$/Swiss FrancCorrection from overbought finds intraday support at 0.9469.0.9571+0.3% 0.9126/0.93010.9839/0.9751
EURGBPEuro/Pounds SterlingRecovery from oversold and the 2012 low (0.7755) slows by potential resistance along 0.79.0.7854-0.3% 0.7694/0.77550.8066/0.79?
EURJPYEuro/Japanese YenFinds resistance at the 50 and 200-day MAs. Tests the early-Sept floor (135.78).135.96-0.7% 131.22/134.11/135.78141.23/137.94
EURCHFEuro/Swiss FrancFailed break above the small base area. 'Bull trap' potential towards 1.205 region.1.2087-0.2% 1.203/1.20451.2178/1.214
GBPJPYGBP/Japanese YenCorrects from overbought. Extends the s-t fall into the broad trading band starting near 175.173.073-0.4% 169.35197.453/180.715
GBPCHFGBP/Swiss FrancOverbought rally pauses. Dips under the July high (1.5434). Potential 'bull trap'.1.5389+0.0% 1.4766/1.49691.5692/1.5536
CHFJPYSfr/Japanese YenExtends the correction from overbought past the Sept low (112.579).112.509-0.4% 111.7/112.116117.01/113.763
AUDJPYAustralian Dollar/Japanese YenDives towards the May floor. RSI low.93.496-1.3% 91.085/93.04397.929/96.033
AUDNZDAustralian Dollar/New Zealand DollarRally from the multi-month base continues to find resistance at the early-Sept high.1.1114-0.4% 1.0624/1.09191.1313/1.1296
AUDAustralian Dollar/US DollarRetraces the recovery from oversold. The early-Oct low is holding.0.8737+0.6% 0.8316/0.86430.9112/0.8899


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