EURJPY Technical Analysis 2015, 02.08 - 09.08: ranging for reversal

Forum on trading, automated trading systems and testing trading strategies

Press review

Sergey Golubev, 2015.08.03 11:19

Skandinaviska Enskilda Banken: Outlooks For EUR/USD, USD/JPY, AUD/USD, SP500 (based on efxnews article)

EURUSD: rejection from the 55-day MA
'The up and down move on Friday became the third consecutive rejection from the 55d ma band (since the return below it a month ago). The behavior is showing that bearish forces are at play and increasingly so given the return to a negative slope. We are thus looking for additional selling.'

USDJPY: new attempt to be above the key level
'Given the violation of the B-wave high (and a three wave setback from Thursday’s peak) there’s a high probability of a soon more successful break higher (targeting a new trend high). For today we see 124.37 as the trigger point for the next step higher.'

AUDUSD: Signs for sellers
'The spinning candle (small net move and big spikes to both sides) and the spring bottom are both signs of exhaustive sellers. There’s clearly a potential for the pair to bounce back to retest the 2001 trend line (or even back up to the 0.75- area) during the coming week.'

S&P 500: Higher again
'As long as the recent correction low remains unbroken a positive view should be kept in place (the July candle also developed into a mildly bullish piercing pattern). The entire structure since May can also be seen as an inverted head and shoulders formation, here seen as an upside continuation pattern.'

Forum on trading, automated trading systems and testing trading strategies

Press review

Sergey Golubev, 2015.08.03 12:30

Societe Generale: EURUSD and Non-Farm Payrolls (based on efxnews article)

Societe Generale made some review for Non-Farm Employment Change report (Change in the number of employed people during the previous month, excluding the farming industry) which will be on Friday:

1. "There’s a risk that we see edgy markets in the meantime...At the risk of sounding like a broken record, the case for raising rates to less unusually low levels does not rest on wage growth or inflation returning in earnest first. Rates are too low, and capital is misallocated as a result."
2. "More than the wage data however, we’d focus on the unemployment rate. We look for a solid 240k increase in non-farm payrolls, a 2.2% increase in hourly earnings and a drop to 5.2% from 5.3% in the unemployment rate."
   
3. "Anything that gets the front end of the curve higher in the US should be negative for EUR/USD. A meander back above 1.10 is possible in the early part of the week, but we’d like to sell against 1.11 and look for a break lower in August."
   

Just to remind that previous NFP data was 223K, and forecasting for this Friday is aroud 224K for example (from 222K to 225K), so if Societe Generale is looking for 240K as anactual data for this Friday - it merans to be more bearish for EURUSD. Because in case of NPF: actual > forecast = good for currency (for US Dollar in our case). So, it means: more bearish for EURUSD with some key support levels to be broken. And Unemployment Rate is forecadting to be 5.2% from 5.3% by SG.



Thus, I think - it may be good bearish breakdown during this high impacted news event.

Forum on trading, automated trading systems and testing trading strategies

Press review

Sergey Golubev, 2015.08.03 19:39

Deutsche Bank - Get Ready For An August-October 'Jump' In USD/JPY (based on efxnews article)

Deutsche Bank made a forecast for USDJPY for August-October 2015 and for 2016:

• August-October 2015
  "We believe the USD/JPY could jump to a ¥125-128 level over the next few months in reflection of robust US economic indicators."
  
• 2016
  "We expect the USD/JPY to strengthen in August-October and edge upward to only around ¥130 throughout 2016."

Let's evaluate this situation using Pivot Points and s/r levels.

1. S/R levels
   If we look at USDJPY W1 timeframe so we see the price broke symmetric pattern from below to above with 125.85 as the nearest resistance level, and it is located for now between 120.40 support and 125.85 resistance.
2. Pivot Points
   The price is located to be above yearly Central Pivot at 114.36 and below R1 Pivot at 127.96. It means the bullish market condition with secondary ranging.

Instrument	S1 Pivot	Yearly PP	R1 Pivot	R2 Pivot
USD/JPY	106.88	114.36	127.96	135.22

If we summarize above mentioned data so we can understand the following: the price is on primary bullish condition with the nearest target as 125.85. The next target is R1 Pivot at 127.96, and we may expect for this next target to be broken by the end of this year for example.

As to 2016 so it may be much easier - R2 Pivot level is located at 135.22, and it will be the next target in 2016 if the price will break 127.96 by the end of this year.

Thus, the forecast of Deutsche Bank was confirmed: ¥125-128 during August-October 2015, and around ¥130 in 2016.