EU Session Bullet Report – Investors seek safety after Paris Attacks

Tragic events in Paris over the weekend sent shock waves around the globe as investors’ seek safe assists such as US treasuries and GOLD, something that might continue in the short term. In FX this means Strength for JPY, CHF and even USD. Actually, EUR/USD opened with a gap lower to 1.0730 from 1.0773 Friday night. USD/JPY also gapped from 122.60 to 122.20 while GOLD opened 7 dollars higher to 1090 compared to Fridays close. Stock markets also gapped lower around the world as confidence took a hit to the worse.

For the week ahead, markets will continue to absorb the Paris events. In terms of economic news, Inflation data could be the main driver in the market in addition to geopolitical developments. In particular, UK CPI and US CPI would be closely watched on Tuesday. An upside surprise in US CPI would further solidify the case for a Fed rate hike in December.

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Green lines are resistance, Red lines are support.

EUR/USD
Pivot: 1.077
Likely scenario: Short positions below 1.077 with targets @ 1.067 & 1.0625 in extension.
Alternative scenario: Above 1.077 look for further upside with 1.083 & 1.086 as targets.
Comment: As long as 1.077 is resistance, look for choppy price action with a bearish bias.

GBP/USD
Pivot: 1.517
Likely scenario: Long positions above 1.517 with targets @ 1.524 & 1.5275 in extension.
Alternative scenario: Below 1.517 look for further downside with 1.514 & 1.5095 as targets.
Comment: The next resistances are at 1.524 and then at 1.5275.

AUD/USD
Pivot: 0.708
Likely scenario: Long positions above 0.708 with targets @ 0.715 & 0.717 in extension.
Alternative scenario: Below 0.708 look for further downside with 0.704 & 0.7015 as targets.
Comment: Even though a continuation of the consolidation cannot be ruled out, its extent should be limited.

USD/JPY
Pivot: 123.05
Likely scenario: Short positions below 123.05 with targets @ 122 & 121.6 in extension.
Alternative scenario: Above 123.05 look for further upside with 123.4 & 123.6 as targets.
Comment: As long as 123.05 is resistance, look for choppy price action with a bearish bias.

USD/CAD
Pivot: 1.3265
Likely scenario: Long positions above 1.3265 with targets @ 1.335 & 1.338 in extension.
Alternative scenario: Below 1.3265 look for further downside with 1.3225 & 1.318 as targets.
Comment: The next resistances are at 1.335 and then at 1.338.

USD/CHF
Pivot: 1.002
Likely scenario: Long positions above 1.002 with targets @ 1.0095 & 1.0125 in extension.
Alternative scenario: Below 1.002 look for further downside with 0.999 & 0.9945 as targets.
Comment: The RSI is mixed to bullish.

GOLD
Pivot: 1080
Likely scenario: Long positions above 1080 with targets @ 1103 & 1112 in extension.
Alternative scenario: Below 1080 look for further downside with 1074 & 1067 as targets.
Comment: The RSI is well directed.

OIL
Pivot: 42.2
Likely scenario: Short positions below 42.2 with targets @ 40.08 & 39.2 in extension.
Alternative scenario: Above 42.2 look for further upside with 42.86 & 43.3 as targets.
Comment: As long as 42.2 is resistance, likely decline to 40.08.

DAX
Pivot: 10745
Likely scenario: Short positions below 10745 with targets @ 10475 & 10395 in extension.
Alternative scenario: Above 10745 look for further upside with 10870 & 11000 as targets.
Comment: The RSI advocates for further decline.