Morning Report: NFP’s To Decide Dollar Direction

Market Commentary  

Volatility remains high with Greece effectively saying to creditors ‘I’ll pay you at the end of the month’. Again, nothing is resolved as Tsipras heads to parliament with a deal that is likely to be hotly contested even by those in his own party and traders continue to watch the dizzying headlines coming on the wires. EURUSD will remain choppy and price action erratic as the market re‐prices risk premium in Europe. Higher EURUSD on the back of higher bund yields is partially a product of hedges being unwound not necessarily because of interest rate differentials and thus this correlation will eventually breakdown. NFP’s today will be will be the main focus.

GBPUSD traded largely in tandem with the Euro, the pair rallied to 1.5441 high and slipped back to 1.5360s. BoE kept interest rates at a record low of 0.5 percent as it waited to see the recovery of economy from a sharp slowdown earlier this year. German Chancellor Angela Merkel said EU might need to consider changing the bloc’s treaties if that was needed to keep Britain in the EU.

The greenback gained against the yen as benchmark US Treasury yields declined from eight-month highs. BoJ board member Harada stated: the weak yen is an overall positive for Japan’s economy and that the yen may be at a “very good place” now; if the pace of the yen’s decline was to accelerate further,players feel it would increase the likelihood of verbal jaw boning from BoJ official’s.        

Technical  Commentary 

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

While 1.11 contains downside reactions expect retest of 1.1466 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 testing midpoints from above

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

eu2015-06-05 07_13_19-

GBPUSD: Short Term (1-3 Days): Neutral – Medium Term (1-3 Weeks) Bearish                      
Rejection on initial test of topside of descending channel at 1.5450, while this 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 but stalling

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

gu2015-06-05 07_15_29-

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

123.50 ascending trendline support stems profit taking decline, while 122 remains intact bull target a retest and break of high en route to 128

Daily Order Flow bullish ; OBV sideways to up, 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

uj2015-06-05 07_17_21-

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 up, Linear Regression and Psychology bullish but stalling retesting midpoints from above

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

ey2015-06-05 07_18_59-

 

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