FOREX FOLLOW UP : EURUSD / USDJPY / EURAUD

EUR/USD

I refer to the Oct.11th post : « Warning for more downside if quote below 1,11 persists »

  • The cross is now a few tens of pips off its 2015 long term support in the 1,0450-1,0550 area.
  • The EURO oversold level lies at 20 which might look low but this level does NOT necessarilly guarantee a bounce as one can see in September 2014 ane March 2015.
  • The EURO short/mid (and even long ..) term outlook does not look bright with the Italian referendum looming early December .
  • A 0,25 % hike in US Fed rates in December is fully priced , more than 0,25 % is not.
  • European investors holding significant positions denominated in USD should start to think of partially hedge the USD risk and so take profit on USD bought at lower levels . Do not take me wrong, i am not EUR bullish but i do not either believe the current USD strength will go on at such a speed.
  • In a nutshell : 1/ A bounce is possible from 1,05 area 2/ A negative (for the italian government ) result in referendum might have as a consequence to trigger a move to parity.

eurusd181116

USD/JPY

I refer to the Oct.6th post : « USD/JPY (103,90) …  Bullish setup …… »

Technical elements shown in october have produced their effects and cross is now at 110,50. The trend remains clearly up but some reaction is due from here and the 200 days MA around 107 should act as support .

EURAUD

I refer to the Oct.21th post : « EUR/AUD Break of 1,4350-1,4450 support »

AUD thanks to its strong correlation to a very weak GOLD is as weak as EUR versus the USD so this cross is rather stable in current environnment. After having touched 1,40 a while ago short of our 1,36-1,37 targets  we are now at 1,4350 . NEUTRAL from here.