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Jun 11 - 01:24 AM
Tech Targets: EUR/USD, GBP/USD, AUD/USD, NZD/USD, USD/JPY - UOB
First appeared on eFXplus on Jun 11 - 12:06 AM

EUR/USD: Neutral (since 05 Jun 18, 1.1700): A stronger corrective rebound to 1.1900 is not ruled out.

After closing higher for four consecutive days, EUR slipped last Friday and closed -0.26% lower at 1.1766. Despite the ‘weak’ price action, we continue to detect a positive undertone and are not ruling out the possibility that EUR could stage a stronger corrective rebound to 1.1900. Only a break of the ‘key support’ at 1.1690 (level remains the same) would indicate the current positive bias has eased

GBP/USD: Neutral (since 04 Jun 18, 1.3355): GBP has moved into a correction phase. No change in view.

When we turned neutral on Monday (04 Jun, spot at 1.3355), we held the view that GBP has moved into a correction phase. We added the positive shorter-term momentum could “lead to a move higher to 1.3465”. GBP hit a high of 1.3472 yesterday before easing off quickly. Despite the pull-back, the underlying tone is still positive and another push higher towards the next resistance at 1.3520 is not ruled out (even though the odds are not high). Only a move back below the ‘key support’ at 1.3350 (level unchanged) would indicate that the current mild upward pressure has eased.

AUD/USD: 0.7600 Shift from bullish to neutral; AUD has moved into a consolidation phase. 

Our recent bullish expectation  was proven wrong quickly as AUD took out the ‘stop-loss’ level at 0.7565 last Friday (low of 0.7560). While the outlook for AUD still appears to be positive from a longer-term perspective, shorter-term indicators suggest that AUD has moved into a consolidation phase and is expected to trade sideways from here. Only a break back above last week’s top near 0.7675/80 would indicate that AUD has started the next up-leg towards 0.7740. In the meanwhile, we expect AUD to consolidate and trade sideways, likely within a 0.7530/0.7680 range.

NZD/USD: Neutral (since 22 May 18, 0.6945): Rebound could ‘overshoot’ to 0.7080. No change in view.

NZD traded within a relatively narrow range yesterday before ending the day largely unchanged (close at 0.7026, -0.07%). We have indicated in recent updates that despite the patchy momentum, the rebound in NZD could ‘overshoot’ to 0.7080. While this scenario still seems valid to us, NZD could not afford to consolidate further as this will result in a rapid loss in momentum. In other words, NZD has to stage the next ‘up-leg’ soon or the risk of a break of the ‘key support’ at 0.6980 would increase quickly. Looking ahead, a break of 0.6980 would not change the current neutral outlook but suggest that the current mild upward pressure in NZD has eased.

USD/JPY: Neutral (since 21 Feb 18, 107.35): Still neutral, likely in a 108.70/110.30 range.

We have held the same view that since last Monday (04 Jun, spot 109.55) wherein we expect the positive bias in USD could lead to a probe of the top of the expected 108.50/110.50 consolidation range. After touching a high of 110.26 on Wednesday (06 Jun), the shortterm USD strength faltered as it subsequently closed lower for two consecutive days. From here, there is no change to the neutral outlook and USD is expected to continue to trade sideways, albeit likely within a narrower 108.70/110.30 range

Source:
UOB Research/Market Commentary

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