Morning Report: Draghi Holds The Line; EUR Bid, Bunds Offered

Market Commentary  

EURUSD traded with a bid tone yesterday and hit 1.1284 high as German Bunds 10-year yields advanced to 0.897% their highest levels since November 2014, ECB Mario Draghi said he was willing to look through bond market volatility. Draghi expected a stronger economic recovery and higher inflation expectations, reiterated that the ECB is aiming the higher volume and plans to maintain a steady monetary policy stance. Attention once again reverts to the details regarding a Greek debt deal as the June 5th deadline looms.

GBPUSD dropped a full cent to 1.5249 low after the release of UK PMI came in below the forecasts.The UK Markit/CIPS Service PMI was down from 59.5 in April to 56.5 in May, missed the forecast 59.2. Interbank reports suggest Real money and leveraged names remain on the cable offer towards 1.5350.

USDJPY climbed to day high of 124.68 after the release of better than expected US ADP employment data while EURJPY surged to 140 handle for the first time since 13 Jan . Bank of Japan Governor Kuroda said that global economy has been recovering moderately while he sees more divergence in monetary policy in US, EU and Japan                   

Technical  Commentary 

EURUSD Short Term (1-3 Days): Bullish – Medium Term (1-3 Weeks) Bearish

While 1.11 contains downside reactions expect retest of 1.11466 and 1.15 above, only below 1.1050 concerns near term bullish bias

Daily Order Flow bullish ; OBV sideways to down, Linear Regression and Psychology bullish but stalling

Monitoring intraday price and Order Flow indicators on a test of 1.15 or 1.1050

eu2015-06-04 07_35_11-

GBPUSD: Short Term (1-3 Days): Neutral – Medium Term (1-3 Weeks) Bearish

Descending trendline support prompts corrective reversal now targeting topside of descending channel at 1.5450, while 1.54 caps upside still potential to test 1.5050 support before a more sustained corrective phase

Daily Order Flow bearish; OBV sideways to down , Linear Regression and Psychology bearish

Monitoring intraday price action and Order Flow indicators on a test of 1.5050 or 1.5450

gu2015-06-04 07_43_17-

USDJPY: Short Term (1-3 Days): Bullish  – Medium Term (1-3 Weeks) Bullish

First test of 125 attracts profit taking while 125.50 caps upside expect pullback to 123.50 to attempt base for next leg higher below 122 concerns near term bullish bias.

Daily Order Flow bullish ; OBV sideways to down, Linear Regression and Psychology rolling over to test midpoints from above

Monitoring intraday price action and Order Flow indicators on a test of 125.50 or 122

uj2015-06-04 07_44_12-

EURJPY: Short Term (1-3 Days): Bullish – Medium Term (1-3 Weeks) Bearish.

Profit takers emerge on primary test of the topside of the projected channel at 140/141, bullish bias remains in place above 137.

Daily Order Flow bullish; OBV sideways to down, Linear Regression and Psychology bullish but stalling

Monitoring intraday price action and Order Flow indicators on a retest of 140/141

ey2015-06-04 07_47_35-

 

Posted in Forex Analysis, tagged with on