2011 12 29 Migbank Daily Technical Analysis Report

8/3/2019 2011 12 29 Migbank Daily Technical Analysis Report

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MIG BANK /Forex Broker 14, rte des Gouttes dOr CH-2008 Neuchtel Switzerland

Tel +41 32 722 81 00 Fax +41 32 722 81 01 [email protected] www.migbank.com

Please note: None of the strategies below represent trading advice or trading recommendations of any kind. Please refer to our full disclaimer.

WINNER BEST SPECIALIST RESEARCH

MA

S-TERMMULTI-DAY

L-TERMMULTI-WEEK

STRATEGY/POSITION

ENTRYLEVEL

OBJECTIVES/COMMENTS STOP

EUR/USD Await fresh signal.GBP/USD Await fresh signal.USD/JPY Await new buy trade setup above 80.00.USD/CHF Looking to sell.USD/CAD Awaiting new buy trade setup.AUD/USD Await fresh signal.GBP/JPY Await fresh signal.EUR/JPY Await fresh signal.EUR/GBP Sell limit 3 0.8425 0.8325/0.8142/0.8050 0.8525EUR/CHF Sell Stop 3 1.2130 1.2010/1.1526/1.1002 1.2250GOLD SHORT 1 1705 1300 (Entered 12/12/2011) 1605SILVER SHORT 2 34.1300 26.0700/23.3400 (Entered 01/11/2011) 34.1300

DISCLAIMER &DISCLOSURESPlease read the disclaimer and thedisclosures which can be found atthe end of this report

DAILY TECHNICAL REPORT29 December, 2011

Ron William, CMT, MSTA

Bijoy Kar, CFA

Notes: Entries are in 3 units and objectives are at 3 separate levels where 1 unit will be exited. When the first objective (PT 1) has been hit the stop will be moved to the entry

point for a near risk-free trade. When the second objective (PT 2) has been hit the stop will be moved to PT 1 locking in more profit. All orders are valid until the next report is

published, or a trading strategy alert is sent between reports.
http://www.migbank.com/mailto:[email protected]://www.migbank.com/http://www.migbank.com/mailto:[email protected]://www.migbank.com/


2/15

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Probes lower under 1.2946.

EUR/USD has registered a lower high at 1.3199 and is currently probing

under 1.2946.

Our cycle analysis successfully signalled increased volatility within the

first two weeks of December across risk proxies, including the equity

and commodity markets.

Watch for a sustained close beneath 1.3000 (psychological level) to

resume EUR/USDs multi-month downtrend into 1.2870 (2011 major low).

Inversely, the USD Index has extended its recovery higher to 80.75 so far

today, (a move worth over 10% f rom the summer 2010 lows).

Speculative (net long) liquidity flows are strengthening once again and will

continue to help resume the USDs major bull-run from its historic

oversold extremes (momentum, sentiment and liquidity).

Special Report:EUR/USD A Fall From Grace ? Decline Targets 1.3770/1.3410. VIDEO

MIG Bank Webinar: Why the US dollar is likely to gain up to 30% in 6-12 months.US Dollar Interview on Bloomberg

S-T TREND L-T TREND STRATEGY

Await fresh signal.

EUR/USD

Ron William, Technical Strategist, E-mail:[email protected], Phone: +41 32 7228 454

EUR/USD

EUR/USD daily chart, Bloomberg Finance LP

USD Index daily chart, Bloomberg Finance LP
http://www.migbank.com/research/howard/2011-06-17_migbank_daily-technical-analysis-report_special-focus-EURUSD.pdfhttp://www.migbank.com/research/howard/2011-06-17_migbank_daily-technical-analysis-report_special-focus-EURUSD.pdfhttp://www.migbank.com/research/howard/2011-06-17_migbank_daily-technical-analysis-report_special-focus-EURUSD.pdfhttp://www.migbank.com/research/howard/2011-06-17_migbank_daily-technical-analysis-report_special-focus-EURUSD.pdfhttp://www.migbank.com/research/howard/2011-06-17_migbank_daily-technical-analysis-report_special-focus-EURUSD.pdfhttp://www.youtube.com/watch?v=8JxLscMBUHY&feature=player_embeddedhttp://www.youtube.com/watch?v=8JxLscMBUHY&feature=player_embeddedhttp://www.fxstreet.com/webinars/sessions/session.aspx?id=8e1265eb-a0b4-4b43-87d3-e5be91699f54http://www.fxstreet.com/webinars/sessions/session.aspx?id=8e1265eb-a0b4-4b43-87d3-e5be91699f54http://www.fxstreet.com/webinars/sessions/session.aspx?id=8e1265eb-a0b4-4b43-87d3-e5be91699f54http://www.fxstreet.com/webinars/sessions/session.aspx?id=8e1265eb-a0b4-4b43-87d3-e5be91699f54http://www.bloomberg.com/video/75644864/http://www.bloomberg.com/video/75644864/mailto:[email protected]:[email protected]:[email protected]:[email protected]://www.bloomberg.com/video/75644864/http://www.fxstreet.com/webinars/sessions/session.aspx?id=8e1265eb-a0b4-4b43-87d3-e5be91699f54http://www.youtube.com/watch?v=8JxLscMBUHY&feature=player_embeddedhttp://www.migbank.com/research/howard/2011-06-17_migbank_daily-technical-analysis-report_special-focus-EURUSD.pdf


3/15

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Under 1.5429 targets 1.5272 immediately.

GBP/USD failed to see a re-test of the 1.5770-80 ceiling. Yesterdays

fall under 1.5582 breaks down the short-term positive structure, now

warning of a fresh leg lower and re-test of the zone near 1.5272.

Italian ten year yields saw a minor pulback yesterday and have once

again moved above 7.000% in the run up to todays auction. We

continue to expect a minimum return to 7.483% before the potential for

a pullback.

Weakness in cable may be limited to trend line support from 1.3503,

which curently rests at 1.5125. In any event, cable is expected to be

stronger then most in a US Dollar strenthening phase, hence our

bearish view in EUR/GBP.


Await fresh signal.

GBP/USD

Bijoy Kar, Technical Strategist, E-mail:[email protected], Phone: +41 32 7228 424

GBP/USD hourly chart, Bloomberg Finance LP

GBP/USD daily chart, Bloomberg Finance LP
mailto:[email protected]:[email protected]:[email protected]:[email protected]


4/15

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Weakening beneath 78.24 (DeMark Level).

USD/JPY is still weak beneath 78.24 (DeMark Level), as pricecontinues to hold within a multi-day trading range (see hourly chartbelow).

Confirmation beneath 77.25 (pivot level) would help trigger a third price

retracement back to pre-intervention levels and potentially even a new

post world war record low beneath 75.35.

Sentiment in the option markets continues to suggest that USD/JPY

buying pressure remains overcrowded as everyone continues to try and

be the first to call the market bottom, within the end of this multi-year

contracting pattern.

This may first inspire a temporary, but dramatic, price spike through

psychological levels at 75.00 and perhaps even sub-74.00. Such a move

would help flush out a number of downside barriers and stop-loss orders,

which would create healthy price vacuum for a potential major reversal.

The medium/long-term view remains bullish, as USD/JPY verges toward

a major long-term 40-year cycle upside reversal. Expect key cycle

inflection points to trigger over the next few weeks, offering a sustained

move above our upside trigger level at 80.00/60, then 82.00 and 83.30.

Please select the link below to review our special coverage on USD/JPY.

Special Report: USDJPY Verging on a major 40 year cycle reversal VIDEO

Webinar: USD/JPYs Long-Term Structural Change

Media Reports: CNBC /Squawk Box &Bloomberg


Awaiting renewed buy trade setup above 80.00.


USD/JPY

USD/JPY hourly chart, Bloomberg Finance LP

USD/JPY daily chart, Bloomberg Finance LP
http://www.youtube.com/watch?v=rDHE6uEqm6whttp://www.youtube.com/watch?v=rDHE6uEqm6whttp://www.youtube.com/watch?v=rDHE6uEqm6whttp://www.youtube.com/watch?v=rDHE6uEqm6whttp://www.fxstreet.com/webinars/sessions/session.aspx?id=d77a35a0-4a11-44fa-a883-c95e01661d21http://www.fxstreet.com/webinars/sessions/session.aspx?id=d77a35a0-4a11-44fa-a883-c95e01661d21http://www.fxstreet.com/webinars/sessions/session.aspx?id=d77a35a0-4a11-44fa-a883-c95e01661d21http://www.fxstreet.com/webinars/sessions/session.aspx?id=d77a35a0-4a11-44fa-a883-c95e01661d21http://www.cnbc.com/id/45301945http://www.cnbc.com/id/45301945http://www.cnbc.com/id/45301945http://65.55.53.237/id/15840232?video=3000062126&play=1http://65.55.53.237/id/15840232?video=3000062126&play=1http://65.55.53.237/id/15840232?video=3000062126&play=1http://www.bloomberg.com/news/2011-11-24/dollar-may-rise-20-to-94-yen-on-elliot-wave-rebound-technical-analysis.htmlhttp://www.bloomberg.com/news/2011-11-24/dollar-may-rise-20-to-94-yen-on-elliot-wave-rebound-technical-analysis.htmlhttp://www.bloomberg.com/news/2011-11-24/dollar-may-rise-20-to-94-yen-on-elliot-wave-rebound-technical-analysis.htmlmailto:[email protected]:[email protected]:[email protected]:[email protected]://www.bloomberg.com/news/2011-11-24/dollar-may-rise-20-to-94-yen-on-elliot-wave-rebound-technical-analysis.htmlhttp://65.55.53.237/id/15840232?video=3000062126&play=1http://www.cnbc.com/id/45301945http://www.fxstreet.com/webinars/sessions/session.aspx?id=d77a35a0-4a11-44fa-a883-c95e01661d21http://www.youtube.com/watch?v=rDHE6uEqm6w


5/15

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Likely within the midst of a short-term correction.

USD/CHF has broken out of its tight hourly range that had developed

over the holiday period. However, while under 0.9548, a further

corrective downswing is possible. Focus remains on movements inEUR/CHF over coming days and particularly into next year. EUR/CHF

is now nearing our trigger level at 1.2130. This has the potential to kick

start the SNB and may lead to a spike higher in USD/CHF if they were

to react to further strengthening of the Swiss Franc.

Italian 10 year yields continue to trade near and above 7.000%, with the

results of todays auction being a likely driver of near-term directional

bias. Fresh highs are still anticipated in this maturity, with scope then

for a minor pullback in yields, maintaining downside pressure on

USD/CHF. Next year is also likely to see a return to focusing on rollover

funding issues for the Italian economy.

10 year yields in Spain and Italy are currently trading at 5.217% and

7.092% versus 6.478% and 7.355%, before the US Dollar based swap

agreement. These yields were trading at 5.084% and 6.767%

respectively yesterday.


Looking to sell.

USD/CHF hourly chart, Bloomberg Finance LP


USD/CHF

USD/CHF daily chart, Bloomberg Finance LP


6/15

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Unwinding from intraday resistance at 1.0425.

USD/CAD is unwinding sharply from intraday resistance at 1.0425, which

coincided with a short-term DeMark exhaustion signal.

We prefer to wait for a strong directional confirmation higher before

initiating a buy trade setup.

A sustained break under 1.0220 now suggests further downside into

1.0000.

Meanwhile, the bulls need to push back above 1.0425 and 1.0524 (25

Nov swing high), in order to trigger a larger breakout from the rates multi-

month triangle pattern.

In terms of the big picture, a directional confirmation above 1.0680 is still

needed to unlock the recovery into 1.0850 plus. This would extend the

upside breakout from the rates ending triangle pattern, which was part of

a major Elliott wave cycle.

EUR/CAD has breached the base of an important multi-month distribution

pattern. A sustained break beneath 1.3393-79 (19th

Sept low/61.8% Fib),

now signals an important breakdown into 1.3140 and provides substantial

correlation pressure onto EUR/USD.


Awaiting new buy trade setup above 1.0425.Ron William, Technical Strategist, E-mail:[email protected], Phone: +41 32 7228 454

USD/CAD

USD/CAD daily chart, Bloomberg Finance LP

USD/CAD hourly chart, Bloomberg Finance LP


7/15


8/15

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Under 119.38 to trigger a daily bear flag.

GBP/JPY is approaching the 119.38 level under which will trigger a daily

bear flag with scope then for a re-test of the 116.84 region. However, it

is anticipated that strong support will be seen if a return to 116.84 can

be realised.

This is in line with our longer-term view, where it is anticipated that a

much larger recovery will develop with scope for a return to 163.09 and

then potentially on to 192.65. However, signs of basing are still not

evident, with the bias still to the downside in the near-term.

Again, there is scope here for the Sterling element of this pair to offer

some strength in the event that Euro-Zone related stresses lead to

further Yen cross weakness.


Await fresh signal.

GBP/JPY

GBP/JPY daily chart, Bloomberg Finance LP


GBP/JPY hourly chart, Bloomberg Finance LP


9/15

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Under 100.76 now warns of a further extension lower.

EUR/JPY broke out of its tight range bound trade yesterday and in doing

so has broken under 100.76. This now negates the larger corrective

structure that we had previously highlighted. Instead, this break

suggests scope for a further swing lower back down to levels not seen

since 2000/2001.

With this in mind a sustained break under 100.76 will target 99.98

(01/06/2001 low) initially and then 88.97 (26/10/2000 low).

We now look to see if the current break lower can be maintained,

looking for an opportunity to sell should the right set up present itself.


Await fresh signal.

EUR/JPY hourly chart, Bloomberg Finance LP


EUR/JPY daily chart, Bloomberg Finance LP

EUR/JPY


10/15

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Grinds higher towards the target zone for short entry.

EUR/GBP continues to grind higher towards our target zone for short

entry. Hourly structure remains weak and is suggestive of the potential

for further downside, to break out of the base of the daily falling channel.

With this in mind a return towards 0.8068 is favoured over coming

weeks.

Shorts in EUR related crosses may be easier to maintain without being

subject to false breaks in either direction, now that EUR/USD has

broken clearly under the key 1.3146 level.

Rising yields in the core Euro-Zone sovereign bond markets is a

continued concern and one that may impact the FX markets going

forward. Within this environment Sterling may well be judged as a short-

term safe haven, further adding to the potential for downside pressure

ahead. Focus remains on the Italian bond market where the results of

auctions throughout the first half of the year will be watched closely.


Sell limit 3 at 0.8425, Objs: 0.8325/0.8142/0.8050, Stop: 0.8525

EUR/GBP hourly chart, Bloomberg Finance LP

EUR/GBP daily chart, Bloomberg Finance LP

EUR/GBP



11/15

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Approaches trigger level at 1.2130.

Stop moved to 1.2250 and first objective moved down to 1.2010. This

strategy will be negated on a push back over the lower high at 1.2242.

EUR/CHF continues to exhibit a structure in the hourly timeframewarning of the potential for a large extension lower, with scope for

1.2000 initially and then 1.1800. It is anticipated that if a break under the

recent low at 1.2170 can be achieved, then momentum follow through

may lead to the targeting of clustered stops under both 1.2123/30 and

1.2000.

Should this cross re-test 1.2000 again, there is likely to be a large

number of stops under this level protecting the trades of those who have

aligned themselves with the SNB. A failure to remain above this key

level will warn of a return to the larger down-trend, as can be seen in the

weekly chart insert on the left.

The Italian 10 year sovereign yield remains elevated, trading close to

7.000%. The new year will see further rollover funding, coupled with a

likely bout of negative growth in Italy, an unhealthy combination. Thus,

there is plenty of scope for the Swiss Franc to be sought once again as

a safe haven. The low yield available on Swiss Franc deposits is

unlikely to act as an impediment to it being demanded by investors.

S-T TREND L-T TREND

Sell stop 3 at 1.2130, Objs: 1.2010/1.1526/1.1002, Stop: 1.2250.

EUR/CHF daily and weekly charts, Bloomberg Finance LP

EUR/CHF

EUR/CHF hourly chart, Bloomberg Finance LP



12/15


13/15

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Weak bounce retested $30.0000.

Silvers weak recovery from oversold conditions has tested key support

turned resistance at $30.0000. A sustained close below here now triggers

a test of the previous swing low at $26.0700.

Macro price structure continues to focus on the downside risks, following

the major sell-off in September. Such a dramatic move traditionally

produces volatile trading ranges. This allows the market to have enough

time to recover and accumulate renewed buying interest.

Expect a large trading range to hold between $37.0000-26.0700 over the

multi-week/month horizon, with downside macro risk into $21.5165

(61.8% Fib-1999 bull market) and $20.0000. This would still maintain

silvers long-term uptrend and help offer a potential buying opportunity for

the eventual resumption higher.

Continue to watch the gold-silver mint ratio (see top chart insert) which

has now accelerated higher by 70%, suggesting further risk aversion over

the next few weeks. This also helps explain recent divergences between

gold and silver.


SHORT 2: 34.1300, Objs: 26.0700/23.3400, Stop: 34.1300

SILVER

Spot Silver hourly chart, Bloomberg Finance LP


Spot Silver daily chart, Bloomberg Finance LP


14/15

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including any direct, indirect or consequential damages.

Material Interests

MIG BANK and/or its board of directors, executive management and employees may have or

have had interests or positions on, relevant securities.

Copyright

All material produced is copyright to MIG BANK and may not be copied, e-mailed, faxed or

distributed without the express permission of MIG BANK.

Notes: Entries are in 3 units and objectives are at 3 separate levels where 1

unit will be exited. When the first objective (PT 1) has been hit the stop will be

moved to the entry point for a near risk-free trade. When the second objective

(PT 2) has been hit the stop will be moved to PT 1 locking in more profit. All

orders are valid until the next report is published, or a trading strategy alert is

sent between reports.

DISCLAIMERNo information published constitutes a solicitation or offer, or recommendation, or advice, to

buy or sell any investment instrument, to effect any transactions, or to conclude any legal act

of any kind whatsoever.

The information published and opinions expressed are provided by MIG BANK for personal

use and for informational purposes only and are subject to change without notice. MIG BANK

makes no representations (either expressed or implied) that the information and opinions

expressed are accurate, complete or up to date. In particular, nothing contained constitutes

financial, legal, tax or other advice, nor should any investment or any other decisions be

made solely based on the content. You should obtain advice from a qualified expert before

making any investment decision.

All opinion is based upon sources that MIG BANK believes to be reliable but they have no

guarantees that this is the case. Therefore, whilst every effort is made to ensure that the

content is accurate and complete, MIG BANK makes no such claim.

LEGALTERMS


15/15

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www.migbank.comRon WilliamTechnical [email protected]

MIG [email protected]

14, rte des Gouttes dOrCH-2008 NeuchtelTel.+41 32 722 81 00

Bjioy KarTechnical [email protected]

CONTACT

Howard FriendChief Market [email protected]
mailto:[email protected]:[email protected]://www.migbank.com/mailto:[email protected]:[email protected]:[email protected]:[email protected]://www.migbank.com/mailto:[email protected]:[email protected]

Documents

2011 12 29 Migbank Daily Technical Analysis Report