Morning Report: Yet Another Weekend Of Greek Risk

Market Commentary  

USD managed to regain composure after the battering post FOMC, a soft CPI reading took it to lows of the day yesterday but a sterling Philly Fed reading saw a solid bounce off yesterdays lows.

EURUSD rose to print a one-month high of 1.1436 after news reported that European creditors would extend Greece’s existing aid program until year’s end, this wire report was quickly rebuffed by officals and we have subsequently given back 100 pips from the highs. Euro zone leaders will hold an emergency summit on Monday to try to avoid a default after bank withdrawals accelerated and government revenue slumped since Greece and its creditors remain deadlocked over the repayment.

GBPUSD continued its uptrend and hit 1.5928 high on broad US dollar weakness and signs of UK economic recovery. UK retail sales ex fuel in May rose 4.4%, slightly softer than the forecast 4.5%, while sales including fuel increased by 4.6%YoY,in line with the forecast.

The USD weakened to a weekly low of 122.48 against the JPY in London session and then found support at that handle and closed at 122.95. BoJ leaves policy as is, vote 8-1, keeps upbeat view of economy, maintains asset purchases, policy meetings to be cut to 8 from current 14 next year A Reuters poll reports a third of Japanese firms see profit plans hurt with USDJPY 120-125, 53% hurt if JPY weakens more against USD to 130, most firms reluctant to unwind cross share-holdings.

Technical  Commentary 

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

  • Focus shifts to 1.1465 high a break here target an initial symmetry target of 1.1610 ahead of the daily equality corrective objective at 1.18. Caution on potential triple top with pin bar yesterday but only below 1.1150 concerns near term bullish bias, a breach of pivotal 1.1050 is needed to reverse.
  • Daily Order Flow bullish; OBV sideways to down, Linear Regression and Psychology bullish but lacking momentum
  • Monitoring intraday price and Order Flow indicators on a test of 1.16 or 1.1050

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

  • No snap back from potential double top attention shifts to symmetry target of 1.6010 ahead of equality corrective target 1.6350/1.64, Initial support comes in at 1.57 trendline support, only below 1.55 concerns bullish bias
  • Daily Order Flow bullish; OBV sideways to down , Linear Regression and Psychology bullish
  • Monitoring intraday price action and Order Flow indicators on a test of 1.57 or 1.6010

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

  • 122 pivotal support while 122.50 contains downside expect test of 125, failure at 122.50 opens pivotal 122 and the 121 corrective equality target below.
  • Daily Order Flow bearish ; OBV sideways, Linear Regression and Psychology rotate around midpoints
  • Monitoring intraday price action and Order Flow indicators on a test of 128  or 122/21

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

  • While 141.75 area caps the advance look for a retest of 137 as potential base for next leg higher for symmetry swing objective at 143.60’s
  • Daily Order Flow bearish; OBV sideways to down, Linear Regression and Psychology pierce midpoints from above
  • Monitoring intraday price action and Order Flow indicators at 141.75 or 137/36

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