As The Neckline Lies

Sunrise Market Commentary Fixed Income: Political developments supportive for core EMU bonds Political developments over the weekend are supportive for global core bonds, but strong technical resistance (contract high; inverted channel) come into play. In France, presidential candidate Hollande beat current president Sarkozy in the 1st round of the French election and in the Netherlands, the government fell as Dutch budget talks collapsed. Currencies: EUR/USD fails to take out first resistance at 1.3213 On Friday, the euro was rather well bid. EUR/USD tested the 1.3213 resistance but failed to sustain above this level. EUR/GBP stayed below the 0.8222 previous range bottom, confirming the break of earlier last week. Cautious sentiment on risk will probably cap the topside ...

EUR/USD Remains in a near-term range-trade, as the upside targets at 1.3290/1.3300 zone, stay intact for now. However, the downside was so far protected at 1.3170, 20 Mar low, where yesterday’s fall found support. Hourly studies are rather neutral, while 4H ones, still in the positive territory, started pointing lower. Upside rejection below 1.3283 would signal possible completion of 4H head and shoulders pattern, with break below 1.3170 base, also neckline, required to confirm. On the upside, break above current range and clearance of key near-term barriers at 1.3290/1.3300 would open way for fresh extension of short-term uptrend of 1.3000, 15 Mar low. Res: 1.3264, 1.3290, 1.3300, 1.3331 Sup: 1.3213, 1.3190, 1.3170, 1.3140 GBP/USD Four-hour chart shows the near-term price action in ...

EUR/USD The pair comes under increased pressure after yesterday’s failure to clear initial resistance at 1.3280, resulted in fresh weakness. Loss of day low at 1.5757 filled the gap, extending losses through last Friday’s low at 1.3153, also main bull trendline off 1.2622, 13 Jan low, after downgrade of a number of European countries was announced. Break below daily 20 day SMA, currently at 1.3117 to open way towards next targets at 1.3100/1.3090 zone, with key near-term support at 1.3025, to come in focus. Corrective action on oversold hourly conditions, faces strong resistance at 1.3200/30 zone that is expected to limit the upside for now. Res: 1.3163, 1.3200, 1.3220, 1.3230 Sup: 1.3126, 1.3100, 1.3090, 1.3025 GBP/USD Yesterday’s failure to clear 1.5800 congestion, also bear ...

EUR/USD Rallies higher after rather positive news from Greece, to recover last Friday’s losses that found support at 1.3150. Today’s gap higher opening suggests possible extension towards 1.3300/20 barriers, where 90 day SMA limited upside attempts. The recent rally suggests that most of the optimism regarding Greece’s deal have already been priced in, although positive hourly studies support the latest advance, along with wider picture’s outlook. Clearance of 1.3320 MA is required to resume short-term rally and open 1.3400 and Fibonacci level at 1.3425. Immediate barriers lie at 1.3285/1.3300 zone, while downside remains protected at 1.3220/00 zone, also 20 day SMA and only loss of the latter to trigger further weakness and cover today’s gap. Res: 1.3275, 1.3285, 1.3300, 1.3320 Sup: 1. ...

Forex News and Events: It is difficult to choose what has been the most notable event of the last 24 hours. At one point yesterday it seemed like the unequivocal answer would be the news that Greece’s political parties had finally managed to reach a long-overdue agreement on austerity measures – the crucial piece required to pave the way for a new EUR130bn bailout. However, after the conclusion of yesterday’s Eurogroup meeting, Greece’s proposed package of budget cuts was rejected as not going far enough and Europe’s policymakers sent the Greek Finance Minister back to Athens to resume budgetary wrangling. This time round, who knows how long it will take to produce an accord. This is now a market which has grown extremely sceptical of Greece’s ability to comply with Eurozone rules, and ...

EUR/USD The pair ticks lower in the mi-European session and beginning of US session, after fresh strength from yesterday’s base at 1.3075, failed to sustain gains above 1.3200 mark. Initially positive sentiment on near-term studies is now fading, with immediate risk of retesting support zone at 1.3160/50, today’s intraday low / 20 day SMA, however, while main bull trendline at 1.3100 and strong support at 1.3075 hold, broader bullish structure would stay intact. Loss of 1.3075 would weaken the near-term structure and confirm completion of Head and Shoulders pattern on hourly chart, as the neckline lies at 1.3075. On the upside, lift above 1.3232, to resume bulls towards 1.3300 next. Res: 1.3212, 1.3232, 1.3258, 1.3300 Sup: 1.3160, 1.3145, 1.3132, 1.3111 GBP/USD The recent rally ...

Fundamental News: Today’s highlights: · German ZEW Economic Sentiment + BoE Gov King Speaks (E.U. + G.B., 10:00 GMT) · Interest Rate Decision (CAD, 14:00 GMT) EUR/USD EUR/USD: The single currency held close to the daily highs after a French debt auction, the first one after France lost its AAA rating by S&P. The markets were expected to be quiet today as the US markets are closed for the holiday EUR/USD creep back a bit after lows in the Asian market dropping to 1.2680 area and the pair has spent the end of the market day inside a narrow range below that level, amid thin liquidity. As the markets close in the UK, EUR/USD is quoting around 1.2665, 0.3% above its opening price. The French government sold €8.59 billion of debt on Monday, with borrowing costs declining from levels seen ...

Forex News and Events: It’s another non-farm payrolls Friday, and in typical fashion the FX markets are subdued with few participants willing to commit to big bets ahead of the risk event. Despite dropping to new 15-month lows in the Asian session, EURUSD has managed to recover its losses early in the European session, and is now loitering around the 1.2800 mark. The December non-farm payrolls are due at 13:30 GMT, and markets are now looking for an increase of 155k compared to 120k seen the month prior. It is possible that expectations for today’s payrolls are even higher than these estimates after yesterday’ ADP employment change smashed expectations at 325k in December (versus 178k expected, 206k prior). Nevertheless, even though the magnitude of that upside surprise is large, we ...

EUR/USD Continues to head lower, as losses accelerated after breaking below 1.3300 handle. Loss of the last barriers at 1.3280 and 1.3258, 30 Nov low / channel support, opens way towards 1.3211, 25 Nov low and 1.3200, weekly H&S neckline, break below which to complete the pattern and focus 1.3145, with extension towards psychological level at 1.3000 not ruled out. Negative hourly studies favor this scenario, however, oversold conditions may delay bears in favor of corrective bounce. Initial resistances lie at 1.3280/1.3300, ahead of 20 day SMA, currently at 1.3320 and maintaining bear-tone. Only regain of today’s highs at 1.3380 zone would provide near-term relief. Res: 1.3280, 1.3290, 1.3300, 1.3300 Sup: 1.3229, 1.3211, 1.3200, 1.3145 GBP/USD Has nearly fully recovered today’s ...