– The economic calendar in the region is empty for the remainder of the week and the regional currencies will be looking to take their cues of the broader global macro fundamental developments. The Eurozone debt crisis is the main focus and regional investors will be watching closely to see how things play out. However, even in the face of the crisis, the Scandis have managed to outperform many of the major currencies. We remain focused on the Eur
/Nordic crosses and as contrarians, continue to see these crosses approaching a major base, with medium-term and longer-term technical studies warning of a potential reversal back in favor of the Euro. However, the time for this reversal has still not come.
The recent 9.55 yearly lows have been broken and the break below now opens the next downside extension to test key psychological support at 9.50. Only back above 9.90 would delay bearish structure and force a shift in outlook.
Has broken to fresh 2010 lows by 7.75 after easily clearing barriers by 8.00 in recent trade. Daily studies are however looking stretched and we would not rule out the potential for a bounce from here. Nevertheless, a break back above 8.05 will be required at a minimum to get things moving and reaffirm basing prospects. Below 7.75 opens next support by 7.70.
Our view is highly constructive at current levels and favors continued USD
appreciation over the coming weeks. The break to fresh 2010 highs above 7.52 now officially confirms a medium-term higher low by 7.00 and opens the next upside extension towards 8.00-8.20 over the coming weeks. Look for setbacks to now be well supported in the 7.30-40 area.
The overall structure remains grossly constructive and a fresh medium-term higher low by 5.80 is now confirmed following the latest break to fresh 2010 highs beyond 6.10. From here, the risks are for additional gains, with the next key medium-term target coming in by 6.40 over the coming weeks. Any setbacks should be well supported ahead of 5.95.
The market has finally reached our 9.20 inverse head & shoulders objective after breaking out from a multi-day consolidation in the 9.10 area. From here, we look for any setbacks to be well propped by the 9.00 handle, ahead of the next upside extension towards 9.40-50 over the coming weeks.
Has been well confined to a very choppy range trade over the past several months, largely defined between 14.00 and 16.50. Setbacks have once again been well propped by 14.00 ahead of the latest sharp bounce back into the mid-range, and we continue to recommend playing the range high-lows.