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EURUSD Technical Analysis 2015, 16.08 - 23.08: ranging with waiting for direction - page 2

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Sergey Golubev, 2015.08.20 14:47

Technical Forecast For EUR/USD and NZD/USD by UBS Group (based on efxnews article)

UBS Group AG made technical forecast for EUR/USD, USD/CHF and NZD/USD. This technical forecast may be valid for today and tomorrow and related to the trading strategies which aee using UBS itself for example.

EUR/USD: "We recommend playing a cautious long for a test of the higher end of recent range of 1.0800-1.1200." As we see from the chart - this long is already going on with 1.1461 as a final bullish target for the end of the week. By the way, the more real intra-day target is 1.1213 which is intermediate resistance on the way to the bullish breakout for example.



NZD/USD: "Look to establish fresh shorts between 0.6640 and 0.6750, with a stop above 0.6825, targeting a test of the low from earlier this month." To say it shorter - UBS are waiting for the price to be between 0.6640 and 0.6750 to open sell trade with stop loss above 0.6825. The real targets in this case may be the following: 0.6496 and 0.6466. By the way, this NZD/USD forecasting is more intra-day one than daily technicals: as we see from the chart - the price is breaking symmetric triangle pattern from below to above to go to 0.6648 where we can place a sell order from.



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Sergey Golubev, 2015.08.21 06:51

The Case For Tactical EUR Rally; Where To Target? - Morgan Stanley (based on efxnews article)

Ongoing EUR rally projecting its potential target in the near-term along with its year-end target for the pair:

  1. "Strong investment outflows from the eurozone since the beginning of the year, and the use of EUR as a global funding currency, not just for portfolio investment but also for longerterm business investment, were major contributing factors to the EUR’s steep decline earlier in the year. Without these investment and funding outflows the structural commercial inflows to the eurozone, resulting from the regions’ current account surplus, have the potential to push the EUR higher."
  2. "When a dovish Fed fails to spur markets to take on more risk, then it is time to take a cautious approach. Sharply falling commodity prices tell the same story, suggesting non-commodity currencies that either run current account surpluses or positive net foreign asset positions will rally. Hence, USD markets will likely stay split - USD benefiting from EM repatriation flows, while staying offered against surplus currencies. We expect the EUR and the SEK to benefit most from declining cross border investment flows and rising cross border liquidation flows."
  3. "European banks overseas lending data, another indicator of the use of the EUR for foreign funding, also showed a setback in the pace of gains in the second quarter of the year...While foreign investor portfolio inflows to European assets have been currency hedged, suggesting little in the way of direct currency impact from foreign inflows or outflows, the subsequent hedging activity is a significant EUR driver."
  4. "We believe there is scope for a EURUSD rebound to 1.15, with the EUR also outperforming on many of the crosses, especially against EM and commodity-related currencies...However, we reiterate our longer term bearish EURUSD view with 1.05 projected for year-end."

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