8/6/2019 FX Weekly Commentary June 12 - June 18 2011

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June 12th

2011 June 18th

2011

Weekly FX CommentaryWeekly FX Commentary

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Authors: Anthony Rousseau & James Putra

Event Risk

Monday:CNY: CPI 10pm

Tuesday:GBP: CPI 4:30amUSD: Core Retail Sales 8:30amUSD: PPI 8:30USD: Retail Sales 8:30am

Wednesday:GBP: Claimant Count Change4:30amUSD: Core CPI 8:30amUSD: TIC Long-Term Purchase 9am

Thursday:GBP: Retail Sales 4:30amUSD: Building Permits 8:30am

USD: Philly Fed ManufacturingIndex 10amJPY: Monetary Policy Meeting Min7:50pm

Friday:USD: Preliminary UoM ConsumerSentiment 9:55am

FX Market Flash

Pair Assessment Comment

AUDUSD

AUDUSD Looking at the AUDUSD, RBA gave very little incite on any rise of rates, looking like 2012.With the USD gaining some strength we will most likely see this top at 1.0772 be the short-term top in

place giving a clear direction of a bearish outlook to 1.0357 and 1.0202 over the next few weeks. Maysee some short-term congestion, but outlook and projections close to parity stands firm.

Recommendation: Careful of congestion between 1.0500-1.0700. We may see some cycle playswith the focus on the bearish side, we are looking for targets of 1.0440,1.0350,1.0200 over the nextfew weeks, look for shorts after a rally up to resistance in the 1.0600 area.

Neutral

EURUSD

EURUSD makes a strong pullback last week after a strong move up from May low 1.3979 to 1.4706,looks like for the short term we have a lower top in place from this years high up at 1.4939, we arecautiously looking at short-side, we see possible consolidation at current levels while we get moredata from Euro countries and the ECB, talks about another rate hike in July will hold this pair up. WithUSD strengthening we may see a move back down to the 1.4100 levels before the end of June. Weare keeping a close eye on ECBs moves with more talks about rate hikes this pullback could be shortlived. Current strength is on the short-side. With the uncertainty with Greece and the aid packagethey will be receiving we see continued losses before another major move up to test highs.

Recommendation: Look the week to start off with a rally up towards 1.4410-1.4470. Looks like wemay get some cycling action with downward pressure, while we wait to see how Greece bailoutunravels, continued downside pressure this week is expected. Targeting 1.4300-1.4250 this weekafter the rally.

Neutral

EURJPY

EURJPY is still in an ascending wedge pattern that started at Mays low of 113.39 and it has beentoppling in 117.80 range. We see a possible test of 113.16 this week to come, if this 115.10 levelholds we will see a play back up to the top of the channel 117.82

Recommendation: play the cycle trades up and down, use the support and resistance as targets.Keep an eye on when the USDJPY makes it's move up we may see all Yen pairs move together.115.90 and 116.40 the 2 resistance levels that look to be hit towards the beginning of the week.

Neutral

GBPUSD

GBPUSD We expect this pair to rally back up towards 1.6300-1.6350 before we see the continueddownward push to 1.6150 range for the short term, which is a upward trend line that starts back inMay 2010 and a break of that line we see a for sure target to 1.6050. We are looking at the BOEstatement coming in a week to give reason for a break of the recent low in May at 1.6057. With thedollar starting to gain strength and QE2 ending we may see another test and a possible break of lowdown to 1.5885-1.5800.

Recommendation: Look for a rally this week up to key resistance 1.6280-1.6300, then look for thenext move down. We are still in a very uncertain range of the true direction we need a break below1.6050 for trend to fully change to bearish. Keep an eye on Inflation data out of the UK and theemployment figures. With a slowing UK economy we should see continued downward movement thisweek. Targeting 1.6150-1.6050 this week, wait for rally.

Neutral

GBPCHF

GBPCHF is looking to have the same pattern as the USDCHF, with Swiss Franc selling look for aopportunity in this pair as well. I will look to take the same type of risk as with the USDCHF in termsof position size. Look for the GBPCHF to be trading upwards of 1.4064-1.4107 in the next 3 weeks.

Recommendation: Watch for the USDCHF to start making it's move up, catch trend change on 240or Daily and ride this up with caution, the weekly is very weak still, but the Daily and 240 can producea nice move up to some resistance levels.

Bullish

USDJPY

USDJPY is creating a solid bottom in the 80.00 range, we see a move back up to 82.00 before theend of the month very likely. The BOJ will not stand for the Pair to be traded below 80.00 level, whichmakes most traders weary of shorts at current pricing.

Recommendation: Stay away from shorts at this level, look for trend change bullish and move backup to 82.00-83.50

Bullish

NZDUSD

NZDUSD: Pattern starting to form at highs, we are looking for a reversal play to the short side,looking for cycling from .8100-.8300 over the next week.

Recommendation: Step aside wait for reversal pattern to form and look for move down.

Bearish

Crude Oil

CRUDE Oil From the supply side, since OPEC didnt reach an agreement this might keep crude oilprices high and might even push them up. From the demand side, the recent economic indicatorsshow that U.S, Japan and China arent advancing as they did earlier this year. This might ease theadvances of crude oil prices. Therefore, in the short term, these forces that push crude oil prices inopposite directions may keep them at their current level of $100 per barrel for WTI and $117 for Brentoil. But the rising gap between Brent oil and WTI oil might indicate that the European oil market isfurther tightening and may even suffer more from the oil shortage from Libya than US oil marketdoes.

Neutral

Gold

Gold - US economic data for May was disappointing, including a drop in manufacturing activity,

causing sharp fall in stocks and increase in gold to $1,550. Signs of a strengthening US dollar mayalso apply pressure on gold. The short term outlook is for weakness with a positive bias in themedium term.

Neutral

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