Daily Global Macro Technical Trend Bias/Key Levels (Tues 26 Jun)

FX –  USD strength setback in progress

  • EUR/USD – Trend bias: Mean reversion rebound resurfaces. The pair had broken above the 1.1605 adjusted key short-term resistance as per highlighted in the previous reported dated on last Thurs, 21 Jun) after it printed a low of 1.1508 on 21 Jun 2018. The pair is now likely to be undergoing a potential mean reversion rebound phase to retrace the decline seen from 27 Mar 2018 high to 21 Jun 2018 low. Flip to a bullish bias in any dips above the 1.1630 key short-term support (minor swing low areas of 22/25 Jun 2018) for a further potential rebound to target the next intermediate resistance at 1.1840/1880 (minor range resistance from 07 Jun/14 Jun 2018 + 38.2% Fibonacci retracement of the decline from 27 Mar 2018 high to 21 Jun 2018 low). On the other hand, a break below 1.1630 reinstates the bearish tone for a slide to test the lower limit of the key long-term support at 1.1470/50 (the former resistance of the major basing configuration from Mar 2015 to Mar 2017).
  • GBP/USD - Trend bias: Mean reversion rebound resurfaces. The pair had failed to meet the expected downside target/support of 1.3020/3000 as it only printed a low of 1.3100 on last Thurs, 21 Jun before BOE monetary policy meeting. The pair has now broken above the 1.3220 adjusted key short-term resistance coupled with a bullish divergence signal seen in its daily RSI oscillator at the oversold region. These observations suggest that the multi-week downside momentum has started to ease and the pair is likely to be undergoing a potential mean reversion rebound phase to retrace the decline seen from 17 Apr 2018 high to 21 Jun 2018 low. Flip to a bullish bias in any dips above 1.3210 key short-term support (former minor swing high of 20 Jun 2018 + 50% Fibonacci retracement of the on-going rebound form 21 Jun 2018 low to 22 Jun 2018 high) for a for potential push up to target the next intermediate resistance at 1.3445/3470 (swing high areas of 07/14 Jun 2018). On the other hand, a break below 1.3210 reinstates the bearish tone for a slide back towards the 1.3020/3000 support (minor swing low areas of 05 Oct/03 Nov 2017 + psychological).
  • AUD/USD Trend bias: Mean reversion rebound resurfaces. The residual push down target/support of 0.7330/7300 as per highlighted in the previous report has almost been met (printed a low of 0.7345 on 21 Jun 2018). The 4 hour Stochastic oscillator has flashed a bullish divergence signal at its oversold region and still has room to manoeuvre to the upside before it reaches an extreme overbought level of 94.  Flip to a bullish bias with key short-term support at 0.7385 (former minor swing high area of 22 Jun 2018 + close to 61.8% Fibonacci retracement of the on-going rebound from 21 Jun 2018 low to 25 Jun 2018 high) for a further potential push up to target the next intermediate resistance at 0.7480 (former minor swing low area of 30 May 2018 + 38.2% Fibonacci retracement of the decline from 06 Jun 2018 high to 21 Jun 2018 low. However, failure to hold at 0.7385 reinstates the bearish tone for as slide to retest the 0.7330/7300 support (09 May 2017 swing low area + 61.8% Fibonacci retracement of the up move from Jan 2016 low to 26 Jan 2018 high).
  • NZD/USD – Trend bias: Mean reversion rebound resurfaces. Cleared above the 0.6890 upper limit of the short-term neutrality zone. Flip to a bullish bias above key short-term support at 0.6880 (former minor swing high areas of 21/22 Jun 2018) for a potential rebound towards the 0.6970/6990 intermediate resistance (former minor swing low area of 14 Jun 2018 + 61.8% Fibonacci retracement of the recent decline from 06 Jun 2018 high to 21 Jun 2018 low). However, failure to hold at 0.6880 reinstates the bearish tone for a slide back to test the 0.6780 support (key medium-term range support in place since 11 May 2017).
  • USD/JPY - Trend bias: Sideways. Mix elements now with the on-going medium-term uptrend since 26 Mar 2018 low at risk of shaping a corrective decline within a longer-term “Triangle Range” structure in place since Jun 2015 after the bearish break of the former 109.90 key short-term support. Prefer to turn neutral first between 109.25 and 109.90. An hourly close below 109.25 opens up scope for a corrective decline towards the next support at 108.10/107.80 (the former medium-term swing low area of 08 Sep 2017 + 50% Fibonacci retracement of the up move from 26 Mar 2018 low to 21 May 2018 high) in the first step. On the flipside, a clearance above 109.90 sees a squeeze up to retest the next intermediate resistance at 110.55 (minor swing high of 21 Jun 2018 + minor descending trendline from 15 Jun 2018).
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