Daily Global Macro Technical Trend Bias/Key Levels (Wed 06 Jun)
Kelvin Wong June 6, 2018 12:49 AM
FX – Mix bag with USD/JPY uptrend intact supported by risk on behaviour
- EUR/USD – Trend bias: Short-term recovery scenario remains intact. Yesterday, 05 June, the pair had continued to trade in a sideways fashion within 79 pips. On a positive note, it has managed to shaped a minor higher low of 1.1651 versus the previous low of 1.1616 printed on 01 Jun as seen on its hourly chart. In addition, the recent days of sideways movement has formed an impending minor bullish continuation/consolidation pattern; “Ascending Triangle” in place since the 31 May 2018 high of 1.1724. No change, maintain bullish bias in any dips with adjusted key short-term support at 1.1616 (the lowest point of the “Ascending Triangle”) for a further potential push up towards the next intermediate resistances at 1.1760 (former minor swing low areas of 21 Nov/12 Dec 2017) follow by 1.1880/1940 (38.2% Fibonacci retracement of the decline from 16 Feb 2018 high to 29 May 2018 low + former minor swing low area of 09/10 Jan 2018 that was rejected on 14 May 2018 + also now the potential breakout target of the aforementioned minor “Ascending Triangle”). On the other hand, failure to hold at 1.1616 negates the recovery process for a slide to retest last week’s low of 1.1510 and a below it exposes the lower limit of the key major support zone at 1.1430 (the former resistance of a basing configuration that occurred in May 2015/Jun 2016 + 50% Fibonacci of the multi-year up move from Jan 2017 low to 16 Feb 2018 high of 1.2555).
- GBP/USD – Trend bias: Residual push up before risk of sideways/consolidation movement. The pair had continued to inch higher as expected and printed a current intraday minor higher high of 1.3417 in today, 06 Jun Asian session. Elliot Wave/fractal analysis suggests that the on-going short-term mean reversion rebound in place since 29 May 2018 low of 1.3205 may take a pause coupled with the 4 hour Stochastic oscillator that is coming close to an extreme overbought level of 93. No change, maintain bullish bias in any dips with a tightened/adjusted key short-term support at 1.3340 (05 Jun 2018 minor swing low + lower boundary of a minor ascending range configuration in place since 29 May 2018 low) for a further potential residual push up to target the next intermediate resistance at 1.3480 (former minor range congestion support from 04/18 May 2018 + 23.6% Fibonacci retracement of the on-going down move from 17 Apr 2018 high to 29 May low of 1.3205). However, a break below 1.3340 invalidates the short-term rebound scenario for a continuation of the medium-term down move to target the next support at 1.3200/3160 (29 May 2018 swing low area + 50% Fibonacci retracement of the multi-year up move from Oct 2016 low to 17 Apr 2018 high of 1.4377).
- AUD/USD – Trend bias: At risk of resuming its medium-term down move. The pair had indeed staged a push down to hit the first intermediate support/target zone of 0.7600/7585 as it printed a low of 0.7595 in yesterday, 05 Jun U.S. session. It staged a bounce back up in today, 06 Jun Asian session on the back of a better than expected Q1 AU GDP (3.1% y/y versus a consensus of 2.8% y/y). It still remains below the predefined key major resistance of 0.7670/7690 (the pull-back resistance of the former major bearish “Ascending Wedge” support from Jan 2016 and the former medium-term swing low area of 20 Mar 2018). No change, maintain bearish bias with key resistance remains at 0.7690 for a potential push down to retest 0.7585 and a break below 0.7585 (an hourly close below it) opens up scope for a further potential down move to target the next intermediate support at 0.7515 (the minor swing low of 01 Jun 2018 & the lower boundary of the minor ascending channel from 09 May 2018 low). On the other hand, a clearance above 0.7690 invalidates the bearish scenario for a further squeeze up towards the next resistance at 0.7800 (medium-term swing high of 13/19 Apr 2018 & close to 50% Fibonacci retracement of the entire down move from 26 Jan 2018 high to 09 May 2018 low).
- NZD/USD - Trend bias: Sideways. No change, maintain neutrality stance between 0.7060 (former minor swing high area of 04 May 2018 + Fibonacci projection/retracement cluster) and 0.7000 (yesterday, 05 Jun U.S. session low). A clearance (an hourly close) above 0.7060 triggers a potential squeeze up to retest a significant medium-term resistance at 0.7190 (the former range support from 08 Feb/20 Mar 2018 before the recent bearish breakdown that led to a decline of 330 pips + 61.8% Fibonacci retracement of the decline from 13 Apr 2018 high to 16 May 2018 low). On the flipside, failure to hold at 0.7000 opens up scope for a decline towards the next intermediate support of 0.6960 (the former minor swing low area of 01 Jun 2018) and below exposes the next support of 0.6900 (psychological + minor ascending trendline from 15 May 2018/the start of the current short-term rebound).
- USD/JPY - Trend bias: Up move remains intact. The pull-back from its 109.99 Asian session high of 05 Jun 2018 had managed to stall around the 109.60 adjusted key short-term support as per highlighted in yesterday report. It printed an intraday low of 109.47 in yesterday, 05 Jun U.S. session before it staged a rebound. In addition, the hourly Stochastic oscillator has flashed a bullish divergence signal at its oversold region which indices a lack of downside momentum follow through is yesterday’s slide from 109.99 to 109.47. No change, maintain bullish bias in any dips with key short-term support remains at 109.60/47 (excess) for a further potential push up to target theintermediate resistance at 110.10/30 (minor swing high of 24 May 2018 + 61.8% Fibonacci retracement of the decline from 21 May high to 29 May 2018 low) and above it opens up scope for a further rally towards 110.60 next (upper boundary of the aforementioned minor ascending channel + Fibonacci retracement/projection cluster). However, failure to hold at 109.60/47 negates the bullish tone for a deeper pull-back to retest the next intermediate support at 109.35 (the minor swing low of 04 Jun 2018) and below it triggers a further extension towards 109.10/109.00 support next (psychological + former minor range resistance from 29/30 May 2018 + minor ascending trendline from 30 May 2018 low).
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