EU Session Bullet Report – A Quiet Asian Open Due To Bank Holidays

EU Session Bullet Report

With Taiwan, Hong Kong and South Korea enjoying a bank holiday today, trading has been very light during the Asian session. Follow through for the USD weakness of Friday was not picked up despite the negative performance of the stock indices across the region.

Fed Chair Janet Yellen last Thursday revived prospects of an interest rate hike before the end of the year, easing concerns about slowing global growth that helped the dollar and risk assets, which have suffered on fears over China’s spluttering economy.

Last week, ECB President did not manage to give further clues as to tools the ECB will use in order to revive the economy so the EUR weakness was limited, following USD’s rally. EURUSD inverse correlation with stock markets also helped keep the pair at elevated levels, something that will continue as long as the markets are worried about global growth, especially in emerging markets.

Economic news released today include the US personal spending and income, Inflation data as well as Pending Home Sales. Nevertheless, more focus will be given to the Fed member’s speeches where traders as always will try to gauge information regarding timing of the first interest rate hike.

Trading quote of the day:

“Success consists of going from failure to failure without loss of enthusiasm.” – Winston Churchill

EURUSD
Pivot: 1.1215
Likely scenario: Short positions below 1.1215 with targets @ 1.1155 & 1.1105 in extension.
Alternative scenario: Above 1.1215 look for further upside with 1.126 & 1.1295 as targets.
Comment: As long as the resistance at 1.1215 is not surpassed, the risk of the break below 1.1155 remains high.

GBPUSD

Pivot: 1.524
Likely scenario: Short positions below 1.524 with targets @ 1.513 & 1.509 in extension.
Alternative scenario: Above 1.524 look for further upside with 1.5285 & 1.5355 as targets.
Comment: The upward potential is likely to be limited by the resistance at 1.524.

AUDUSD

Pivot: 0.698
Likely scenario: Long positions above 0.698 with targets @ 0.706 & 0.709 in extension.
Alternative scenario: Below 0.698 look for further downside with 0.6935 & 0.69 as targets.
Comment: The RSI lacks downward momentum. The pair has broken above a declining trend line and remains on the upside.

USDJPY

Pivot: 120.65
Likely scenario: Short positions below 120.65 with targets @ 120.05 & 119.85 in extension.
Alternative scenario: Above 120.65 look for further upside with 120.9 & 121.25 as targets.
Comment: The RSI is badly directed.

USDCAD

Pivot: 1.3295
Likely scenario: Long positions above 1.3295 with targets @ 1.336 & 1.342 in extension.
Alternative scenario: Below 1.3295 look for further downside with 1.3225 & 1.317 as targets.
Comment: A support base at 1.3295 has formed and has allowed for a temporary stabilisation.

USDCHF

Pivot: 0.974
Likely scenario: Long positions above 0.974 with targets @ 0.981 & 0.9845 in extension.
Alternative scenario: Below 0.974 look for further downside with 0.97 & 0.9665 as targets.
Comment: The RSI is mixed to bullish.

GOLD

Pivot: 1142
Likely scenario: Long positions above 1142 with targets @ 1151 & 1157 in extension.
Alternative scenario: Below 1142 look for further downside with 1136 & 1129 as targets.
Comment: A support base at 1142 has formed and has allowed for a temporary stabilisation.

OIL

Pivot: 44.95
Likely scenario: Long positions above 44.95 with targets @ 46 & 46.4 in extension.
Alternative scenario: Below 44.95 look for further downside with 44.35 & 43.85 as targets.
Comment: Even though a continuation of the consolidation cannot be ruled out, its extent should be limited.

DAX

Pivot: 9780
Likely scenario: Short positions below 9780 with targets @ 9350 & 9235 in extension.
Alternative scenario: Above 9780 look for further upside with 10020 & 10175 as targets.
Comment: As long as 9780 is resistance, look for choppy price action with a bearish bias.