Morning Report: Markets Stable As Greece Saga Drags On

Market Commentary  

FX market surprisingly resilient after Greek vote in a rerun of last weeks price action with the Asian gap lower filled during the European session; all action in stocks, bonds and commodities: EUR ends only modestly down, traders remain reluctant to place big bets. Global macro mood shifting bearish as investors startled by China moves to prop up stock market; US rates break hard lower; CRB collapses, WTI Crude down 8%; soft wages, labour participation rate, Europe seen weighing on Fed. ECB further haircuts Greek collateral used for ELA; seen as turn of the screw to banks; debate now more political than economic; markets start looking for potential next victims; Italy, Portugal both down 4%.

EURUSD tumbled across the board after the Sunday referendum hitting a one-week low of 1.0967, but then the pair climbed back to 1.1095 high on Varoufakis news as Yanis Varoufakis announced that he would be stepping down even though Greece voted “NO” in Sunday’s referendum.

GBPUSD was relatively stable and traded in the recent range of 1.5530 to 1.5630 amid the ongoing Greek crisis, the rejection terms in the Greek referendum boosted safe-haven flows into Britain’s currency. British government bond prices tracked German debt sharply higher following Sunday referendum, but then retreated the gains on an upbeat US business activity.

USDJPY fell to a fresh one-month low of 121.72 in the opening of Asian session as with the otyher majors the pair rebounded afterwards and closed at 122.57, In a quarterly review of regional economies, the BoJ maintained its upbeat assessment on regional sectors of the economy, saying they are recovering owing to a pick-up in output and tightening job markets

Technical  Commentary 

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

  • Asian gap filled during European trade as range trade persists 1.0950’s support with 1.1280 resistance, another failure towards 1.1280 suggest a break of 1.09 to open 1.08. over 1.1280 opens 1.1340 upside
  • Daily Order Flow bearish; OBV down, Linear Regression and Psychology bearish but attempting midpoint test
  • Monitoring intraday price and Order Flow indicators on a test of 1.13 or 1.08

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

  • Testing primary trendline support at 1.5550 while this level holds potential to retest recent highs failure at 1.55 opens symmetry corrective target at 1.5285.
  • Daily Order Flow bearish; OBV sideways, Linear Regression and Psychology pierce midpoints bearish
  • Monitoring intraday price action and Order Flow indicators on a test of 1.5550 or 1.6010

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

  • 121.80 supports and the 122 remains the key pivot to the upside advance while these areas support target a retest of 124 enroute to 2015 highs. Failure at 121 opens deeper correction to 120
  • Daily Order Flow bullish ; OBV sideways to up, Linear Regression and Psychology continue to rotate around midpoints with bearish bias
  • 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

  • Rejection at previous ternlinde support as resistance has price retesting 133/34 support in range trade, breach of 133 opens retest of 2015 lows while above 138 opens 143
  • Daily Order Flow bearish; OBV down, Linear Regression and Psychology bearish but testing midpoints from below
  • Monitoring intraday price action and Order Flow indicators at 138 and 133

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