FX Weekly Commentary - Oct 23 - Oct 29 2011

8/3/2019 FX Weekly Commentary - Oct 23 - Oct 29 2011

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Markets look to Europe for direction to startthe week. The EU Summit this weekend

brought together the EU leaders on working

towards a solution for the debt crisis, the

result was no closer for a sustainable solution

that will be accommodating for all the nations

involved. The solution has a deadline for

Wednesday and is likely to give confidence to

markets if released Wednesday, the initial will

be positive giving a boost to risk assets

including the stock markets. If no solution is

provided by the deadline we will likely see a

collapse to lows for world markets. So this

week is very critical for market direction for

the months to come. We will likely continue in

current range for most currency pairs and the

stock markets preceding this meeting on

Wednesday. Currently we are trading at highs

of the range we carved out last week, givinginterest to go test the other range extreme.

Keep a close eye on the EU summit this week,

for it will be the catalyst for the next major

move in the markets, and do not be fooled by

initial reaction to the news for we may see

much volatility leading up to Wednesday.

Fundamental Outlook

Elite Global

Trading Forex Weekly CommentaryOct 23th Oct 29th 2011 Volume 1, Issue 25

In this issue:

GBPJPY: Has the same look as the EURJPYwith holding it's downward channel. Looking

lower from current levels is favored at the

moment. With 122.60 holding as upside

resistance, we look for a move down towards

119.60.

Outlook: Bearish Bias, with a risk move on tapa move lower for this pair is highly probable

and will likely look to go test key support

around 119.60 area. A break of this will bring

into site the lows at 116.84.

UK Pound Sterling / Japanese Yen

Fundamental

Outlook

USDJPY

EURAUD

1

AUDUSD

GBPUSD

USDCAD

2

EURUSD

NZDUSD

EURJPY

3

Event Risk 4Contact Info

Disclaimer5

EURAUD: Has come off it's range highs of

1.4086 down to support at 1.3360 area, with

the 1.3317 area holding as support we look

for a move back up towards 1.3727-1.3826

over the weeks to come, this would be very

supportive of another Risk Off move.

Outlook: Neutral, this move to the upside will

play well with the markets reacting negatively

to the EU solution and the S&P taking a dive

down towards lows. Resistance levels on the

way up are, 1.3474, 1.3492, 1.3535,

1.3665. If a risk on move continues we will

likely see this pair move back down towards

1.3317, 1.3201, 1.3160.

Euro / Australian Dollar
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2/5

Elite Global

Trading

Oct 23th Oct 29th 2011 Volume 1, Issue 25

AUDUSD: A favored risk currency that islooking for reason to go test new levelsaround 1.0480-1.0500. At the moment with

the EU not convening again until Wednesday

for a solution to be presented and

implemented, this pair will likely fall back into

it's range that it held last week between

1.0380-1.0120. The Aussie has gained the

most against the USD in the month of October

and looks to be ready for a reversal back to

lower levels in the weeks to come, a strong

risk averse move that could be starting this

week with negative news out of Europe whichwill send the markets in to a tail spin back

towards lows.

Outlook: Neutral, the move from .9387 in thefirst week of October looks to be coming to an

end and one more push higher is possible if

we get a strong Risk On move in the markets,

other wise we will look for a key reversal

signal to the downside. Untli we get

confirmation of either mover we are still

trading in a range and here are key levels to

watch for, 1.0340, 1.0306, 1.0274, 1.0250,

1.0214, 1.0177, 1.0139 and 1.0117. Below

1.0117 we look for a move back down

towards .9900.

Australian Dollar / United States Dollar

GBPUSD: Broke above congestion resistanceon Friday at 1.5850 to reach its key

resistance point at 1.5950, a continuation of

this move up would bring into light some

levels such as 1.6000, and 1.6104. In order

for this break up to sustain we will need to

have a risk on move across multiple marketsgiving reason for more dollar selling. Currently

the daily is at a top and is reaching extremes,

which may indication of exhaustion of this run

up. A move back towards lows in the weeks to

come is likely for this pair. Moves to the

upside are favored at the moment, but a

reversal back to lows is coming near for this

pair.

Outlook: Neutral, a move to new highs willlikely happen if we get positive commentary

out on Wednesday from the EU, which will

give a strong risk on push if the EU has

solutions that will be implemented. If not the

market will take a turn down to reverse back

to a risk averse move to test lows. For this

pair watch for support at, 1.5846, 1.5802,

1.5785, 1.5725, 1.5650. A break below

1.5650 area we look for a move back down to

test 1.5540 area.

UK Pound Sterling / United States Dollar

USDCAD: Has made highs starting the monthof October at 1.0656 and just hit a low of the

month last week at 1.0042. A move to higher

highs near 1.0800 area is favored as long as

price stays above 1.0007 on a daily close. The

USD dollar has been holding it's recent lows

as well and looks to move higher which will

give a boost to this pair. If the risk trends

Fade over this week we will likely see this pair

start to move towards the highs in the weeks

to come.

Outlook: Neutral, a break above 1.0264 willgive strong indication the move to the upside

will be continuing. A hold of the 1.0007 level

gives strong indication to this move to the

highs of 1.0600 area. Levels support are,

1.0042, 1.0007. Resistance to watch for on

upside is 1.0142, 1.0157 1.0187, 1.0264,

1.0349. Current range the pair is trading in is

1.0042 low to 1.0264 high.

United States Dollar / Canadian Dollar


3/5

NZDUSD: Structure of this pair looks verysimilar to AUDUSD, but lagging in some ways.

We are reaching important levels of

resistance that may hold and be positioning

this pair as well for a risk off move back down

to key levels of support. As with other pairs

that have made a strong move off the

bottoms that were create in the beginning of

October the move to the upside is becoming

exhausted and a reversal lower can be

expected, so keep this in mind when trading

these risk pairs.

Outlook: Neutral, with bullish activity still incontrol with this pair we do consider that this

move up can still extend to higher levels, but

favor a move back down to key support levels

around .7760. Support levels to watch for are

.7975, .7940, .7888, .7860, .7760. Range

has been established last week and should be

respected until a break occurs.

New Zealand Dollar (Kiwi) / United States Dollar

Elite Global

Trading


EURJPY: Has just come off it's lows of the yearat 100.75 and rallied up to 107.67 for the

month of October, we have broken above

bearish trend line and now fallen back below,

with this trend line holding the structure for

another move down is likely, key level to

watch for is 1.0360 area. A move to this level

is likely before another break higher. Currently

we are in a range between 106.60-105.00. A

break below 104.75 will resume this down

trend to lower levels.

Outlook: Bearish Bias below 107.70. With theweek starting off with risk off on the mind with

the EU not coming to any closer to solutions,

we will likely see this range continue and

possible break lower. Support levels to watch

for are 105.03 104.75, 104.22, 103.60,

103.40.

Euro / Japanese Yen

EURUSD: With no resolution in the EU areversal of this move up is on deck. A

continued move up will need to be with a

resolution on Wednesday that will give the

markets confidence that the EU has an

implemented plan that will bring relief to the

debt crisis. Daily price entering resistance

around 1.3913-1.3950 gives reason for a

reversal back to lows. If a move above these

levels we will see 1.4013 which is also a 61.8

retracement of the 1.4549 move down to

1.3146. Structure looks like another highabove 1.3914 will be formed prior to reversal.

1.3824-1.3801 is support for this move up to

new highs this month. As of the weekend

summit that the EU held, we have no forward

movement that gives any markets confidence

and is likely going to give markets the desire

to sell-off coming into Monday's open inEurope and NY. The current range that was

created last week is still in affect between

1.3900-1.3660. We will look for opportunities

within that structure until we get confirmation

from the markets reaction of the EU summit

on Wednesday. We are at the high of the

range at the moment.

Outlook: Neutral, currently trading at high ofrange and a move lower is expected to start

the week. Support levels to watch for are

1.3824, 1.3801, 1.3778, 1.3774, 1.3703and 1.3660. A break below of 1.3660 we look

for the 1.3623 to be hit, and a close the

1.3660 we look for 1.3542 to be tested.

Euro / United States Dollar


4/5

Elite Global

Trading


Sunday:AUD: PPI 8:30pm

CNY: HSBC Flash Manufacturing PMI

10:30pm

Monday:EUR: French Flash Manufacturing PMI 3am

EUR: German Flash Manufacturing PMI

3:30am

EUR: Flash Manufacturing PMI 4am

EUR: Industrial New Orders 5am

NZD: CPI 5:45pm

EUR: ECB President Trichet Speaks 6pm

Tuesday:EUR: GfK German Consumer Climate 2am

GBP: Current Account 4:30am

GBP: BOE Gov King Speaks 4:45am

CAD: Retail Sales 8:30am

CAD: BOC Rate Statement 9am

EUR: Belgium NBB Business Climate 9am

USD: CB Consumer Confidence 10am

NZD: NBNZ Business Confidence 8pm

AUD: CPI 8:30pm

Wednesday:EUR: Economic Summit

USD: Core Durable Goods Orders 8:30am

USD: New Home Sales 10am

CAD: Monetary Policy Report 10:30am

NZD: Official Cash Rate 4pm

NZD: RBNZ Rate Statement 4pm

JPY: Monetary Policy Statement

Thursday:JPY: BOJ Press Conference

EUR: German Prelim CPI

USD: Advance GDP 8:30am

USD: Pending Home Sales 10am

JPY: Prelim Industrial Production 7:50pm

Friday:EUR: French Consumer Spending

CHF: KOF Economic Barometer

USD: Personal Spending 8:30am

USD: Revised UoM Consumer Sentiment

9:55am

Weeks Event Risk


5/5

Any reliance you place onsuch information is thereforestrictly at your own risk.

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while we endeavor to keep the

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News letter Authors:

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James [email protected]

Tel: 786-759-0348

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FX Weekly Commentary - Oct 23 - Oct 29 2011

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Transcript of FX Weekly Commentary - Oct 23 - Oct 29 2011