Cable Range Proving Persistent
Dailyfx | Apr 07, 2015 01:31PM ET
- USD/JPY rebounds from Gann support
- S&P 500 rallies sharply ahead of key pivot
- Volatility expansion looming in the pound?
Foreign Exchange Price & Time at a Glance:
Charts Created using Marketscope – Prepared by Kristian Kerr
- USD/JPY has moved steadily higher since rebounding off the 3rd square root relationship of the year’s high at near 118.70
- However, our near-term trend bias is negative on USD/JPY while below 120.60
- A move under 118.70 is needed to trigger a fresh leg lower in the exchange rate
- A minor turn window is eyed Tuesday/Wednesday
- A close back over the 61.8% retracement of the March range at 120.60 would turn us positive on USD/JPY
USD/JPY Strategy: Square.
|
Instrument |
Support 2 |
Support 1 |
Spot |
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Resistance 1 |
Resistance 2 |
|
USD/JPY |
118.00 |
*118.70 |
119.90 |
120.20 |
*120.60 |
Charts Created using Marketscope – Prepared by Kristian Kerr
- S&P 500 rallied sharply on Monday
- Our near-term trend bias is higher in the Index while above 2040
- A move through key resistance at 2108/25 is needed to confirm that the broader trend is resuming
- A minor turn window is eyed early next week
- A close under 2040 would turn us negative on the Index
S&P 500 Strategy: Like the long side above 2040.
|
Instrument |
Support 2 |
Support 1 |
Spot |
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Resistance 1 |
Resistance 2 |
|
S&P 500 |
*2040 |
2063 |
2080 |
2090 |
*2108 |
Focus Chart of the Day: GBP/USD
A pretty clear range has developed in Cable over the past few weeks. The top end of it has been defined by the 38.2% retracement of the February to March decline around 1.5000 while the bottom end has seen the 1st square root relationship of the year’s low at 1.4755 act as strong support. On the surface the congestion sub 1.5000 suggests this action is likely just a pause before another move lower, but we have learned over the years to not read too much into these things. The range extremes mentioned are the clear key pivots with traction above or below them needed to get us excited about any sort of directional volatility. Until that happens we will happily remain “agnostic”. However, it is probably worth mentioning that our timing work suggests that if the broader downtrend is going to try to re-assert itself then next week would be the ideal time for it to do so.
--- Written by Kristian Kerr, Senior Currency Strategist for DailyFX.com
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