Euro Briefing

European action was limited but NY managed to spark things up if only slightly. EUR/USD opened NY near 1.3110 & spiked the pair to 1.3070 as USD/JPY lifted-off from 100.00. Bears couldn’t push further as EUR/JPY buys aided to cushion EUR/USD sales. EUR/JPY rallied from 131.07 to 131.35 & allowed EUR/USD to touch 1.3102 ahead of the Philly Fed data. The numbers beat solidly & firmed the USD again. EUR/USD hit a session low of 1.3066 before rebounding. EUR/JPY went on a stop loss run & hit a high of 131.88. EUR/USD lifted from the lows & the rallied picked up steam after Portugal’s govt survived a no confidence vote. The pair briefly traded above 1.3120 but could manage no added gains as EUR/JPY buys subsided. Heading into the close EUR/USD sat near 1.3110 to leave it down only slightly on the day. Another failed attempt to hold below the 200 DMA is encouraging to bulls and suggests dip buyers lurk. Bears are becoming frustrated & a break above the July 11 high may see them relent. Should that high be cleared there is not much resistance until the June highs near 1.3415.

EUR/USD Update

• Softer in Asia led by GBP/USD macro sales USD/JPY bargain hunting 
• No EZ tier on data - expect range trading into Bernanke's testimony
• Momentum studies edge higher with shorter MAs
• Last week's 1.3208 high & 1.3253 falling 20 day upper Bolli resistance
• 1.3107 5 DMA & yesterday's 1.3050 low support       

GBP/USD: FOREX SIGNAL 16 JUL 2013

BUY A GBP/USD 1.5104

take profit 1.5124

stoploss 1.5074

EUR/USD back to mid-range after Fitch's DownGrade

• Bounce off bottom of range stalls ahead of 1.3080-00 offers
• Fitch's downgrade of EFSF to AA+ has pair back to mid-point of s-t range
• Mkt still somewhat directionless for now, hemmed between 100 & 200 DMAs
• Dips sub-1.30 bought, result in long lower wicks on candles, bulls assert a bit
• Stops above 1.3100 may have more impact than stops sub-1.2980/85       

Dollar climbs with Bernanke's Testimony in Focus

       The U.S. dollar climbed Monday with investors looking ahead to Federal Reserve Chairman Ben Bernanke's testimony later in the week.

U.S. retail sales in June rose a seasonally adjusted 0.4%, less than economist expectations of a 0.9% rise, according to data released Monday. Last month's rise was fueled by increases in gasoline prices and auto demand. Separately, the Empire State manufacturing survey for July rose for the second month, posting a reading of 9.5 from 7.8 last month.

The ICE dollar index, which tracks the U.S. currency against six rivals, pared earlier gains after the retail sales data but remained higher than Friday's close. The ICE dollar index was 83.193 in recent trade. It traded at 83.26 earlier Monday and closed at 82.997 late Friday in North America, when the dollar had risen modestly amid euro-zone concerns, but still ended the week down 1.7%.     

EUR/USD - Tight consolidation in Asia

• Tight consolidation in Asia - inside day Fri - China data close to f'casts
• No EZ tier one data - focus on U.S. retail sales & slew of earnings
• Momentum studies head higher - bullish MACD cross
• Rejection of lower Bolli last week targets falling 1.3338 upper band
• Late NY 1.3032/1.3091 range are initial support/resistance       

Euro Briefing

Bears prevailed early for EUR/USD as the USD was firm & risk soft on China's Fin Min stating sub-7% growth isn't a big problem. The pair slipped from 1.3060 at the open & was pushed along as above f/c US PPI spurred Fed taper ideas. Stops at 1.3020 & 1.3000 were hit. Little follow through was seen (1.2999 low) & the mkt was caught short into a soft U. of Michigan report. EUR/USD lifted as intra-day bears covered & EUR buyers against AUD, NZD & GBP emerged. EUR/USD climbed off the lows & cleared sov offers near 1.3060 & 1.3080 on Bullard's dovish stance. Early rumors France was to be downgraded came true. Fitch's downgrade to AA+ from AAA spiked the pair from NY's 1.3092 high to 1.3032 but since Fitch was only catching up to Moody's and S&P mkt reaction was limited. The pair recovered & sat near 1.3065 into the close. A bullish engulfing candle is in place this week after the 1.2740/60 support test failed. RSI is biased up & the US loses some yield advantage. A bounce back to the June highs cannot be ruled out now with such a powerful technical signal.

Majors Daily Forecast 11 July 2013

EUR/USD Trading range: 1.3160 – 1.3055 Trend: Downward Sell at 1.3146 SL 1.3178 TP 1.3069

USD/JPY Trading range: 98.15 – 99.10 Trend: Upward Buy at 98.26 SL 97.94 TP 98.98

GBP/USD Trading range: 1.5185 – 1.5070 Trend: Downward Sell at 1.5172 SL 1.5204 TP 1.5084

USD/CHF Trading range: 0.9400 – 0.9505 Trend: Upward Buy at 0.9410 SL 0.9378 TP 0.9494

The current support/resistance levels are: EUR/USD 1.3069, 1.3040, 1.2992 – 1.3223, 1.3252, 1.3300 USD/JPY 97.545, 97.270, 96.825 – 98.975, 99.250, 99.695 GBP/USD 1.5084, 1.5050, 1.4996 – 1.5260, 1.5294, 1.5348 USD/CHF 0.9326, 0.9294, 0.9242 – 0.9494, 0.9526, 0.9578

Majors Daily Forecast 5 July 2013

EUR/USD Trading range: 1.2915 – 1.2810 Trend: Downward Sell at 1.2901 SL 1.2933 TP 1.2824

USD/JPY Trading range: 100.10 – 101.05 Trend: Upward Buy at 100.22 SL 99.90 TP 100.94

GBP/USD Trading range: 1.5060 – 1.4950 Trend: Downward Sell at 1.5050 SL 1.5082 TP 1.4962

USD/CHF Trading range: 0.9555 – 0.9665 Trend: Upward Buy at 0.9567 SL 0.9535 TP 0.9651

The current support/resistance levels are: EUR/USD 1.2824, 1.2795, 1.2747 – 1.2978, 1.3007, 1.3055 USD/JPY 99.505, 99.230, 98.785 – 100.94, 101.21, 101.66 GBP/USD 1.4962, 1.4928, 1.4874 – 1.5138, 1.5172, 1.5226 USD/CHF 0.9483, 0.9451, 0.9399 – 0.9651, 0.9683, 0.9735

Majors Daily Forecast 3 July 2013

EUR/USD

Trading range: 1.2985 – 1.2885

Trend: Downward

Sell at 1.2975 SL 1.3007 TP 1.2898

USD/JPY

Trading range: 100.50 – 101.45

Trend: Upward

Buy at 100.60 SL 100.28 TP 101.32

GBP/USD

Trading range: 1.5170 – 1.5060

Trend: Downward

Sell at 1.5159 SL 1.5191 TP 1.5071

USD/CHF

Trading range: 0.9485 – 0.9595

Trend: Upward

Buy at 0.9499 SL 0.9467 TP 0.9583

The current support/resistance levels are:

EUR/USD 1.2898, 1.2869, 1.2821 – 1.3052, 1.3081, 1.3129

USD/JPY 99.885, 99.610, 99.165 – 101.32, 101.59, 102.04

GBP/USD 1.5071, 1.5037, 1.4983 – 1.5247, 1.5281, 1.5335

USD/CHF 0.9415, 0.9383, 0.9331 – 0.9583, 0.9615, 0.9667

USD/JPY Uptrend Holds Pips Bellow 100

On the 1 hour chart new upward channel has formed, while on the 3 hour chart quotes are held within wide trading scope. Break above today's top and nearest resistance 99.91 would encourage further recovery of the Dollar. Immediate support is yesterday's bottom at 99.10, and consistent break below it could strengthen the Yen further down towards next target 98.21.

There are no major economic events for Japan today.

Quotes are moving just above the 20 and 50 EMA on the 1 hour chart, indicating slim bullish pressure. The value of the RSI indicator is positive and hesitant, MACD is positive and tranquil, while CCI has crossed up the 100 line on the 1 hour chart, giving over all light long signals.

Technical resistance levels: 99.91 100.77 101.50

Technical support levels: 99.10 98.21 97.40