Euro Price Action Confounds. All Signs Risk Negative purpose Market Supported

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By Joel Kruger, technical strategist April 24, 2012 05: 44 GMT very well taken Euro support above 1.3100 all signs point to more risk of trade but no real still follow USD/JPY back under pressure and looking at the EUR/CHF 80.00 test still very interesting cross to watch despite the action prices poor despite a sweep of the fundamental concern which have been weighing on correlated risk assetsoverall, these markets have been strangely well supported. A lot of lower eurozone PMIs, disorders policies for Sarkozy by France, the issues surrounding the status of the AAA rating Dutch and an ever weakening of Spanish debt situation, all contribute to a very unstable perspective euro zone should as a result of the theory to a more significant risk off the coast of the reaction that we have seen. Launch signs of slowdown in China, a weakness in emerging markets, and the latter more soft than expected Auatralian ICC, who sealed the agreement for a rate cut in May and the ability to remain supported markets becomes more confusing still.

However, we cannot ignore action award, and with the Euro being the key market for watching, inability to fall below 1.3100 Monday leaves us with a much more cautious. We will wait for a break extended 1.3200 or return 1.3000 for a more clear directional bias. Other markets key to monitor Tuesday include USD/JPY, with the pair even when retreating and potentially taking a retest to support key 80.00 and EUR/CHF, which continues to trade in a very tight range, but which may be at risk for a commitment of the SNB to vigorously defend 1.2000 workshops. In the future, the Fed will meet Wednesday and the market players could be contained on building more risk of the event.

ECONOMIC CALENDAR

TECHNICAL OUTLOOK

EUR/USD: The last series of setbacks are at a standstill before of any multi-week 1.3000 key support and of here still cannot exclude the risk of additional consolidation over 1.3000, before in view of the resumed bearish. Upward closure of last Friday opens the door for additional gains in upcoming sessions, but ultimately, the gatherings to 1.3400 expected well capped. A break and back close daily under 1.3000 is now required to put pressure on the disadvantages and to accelerate downward for 2012 early to 1.2660 depressions.

USD/JPY: The last withdrawal of 2012, senior UST is considered as corrective and it seems that the market has finally found a solid $ 80.00 support. The setbacks are stalled at the top of the daily and weekly Ichimoku clouds and we expect for the formation of a fresh medium term already low somewhere around 80.00, before the next major to the extension back to and possibly through 84.20. Overall, this is a market that underwent a major structural change in the last months and we see the pair in the early stages of a long-term up-trend. Ultimately, only a narrow back under 78.00 weekly deny. Dips to 80.00 should therefore be used as great purchase.

GBP/USD: The recent break back above 1.6000 opens now the door costs upside to the peak of October 2011 at 1.6165. However, additional gains beyond 1.6165 should be difficult to get, and once more see us risks for a bearish reversal for renewed weakness back to support key by 1.5800. A break and closing below 1.5800 will accelerate and decreases. Ultimately, only a weekly closing above 1.6165 would deny underlying bearish bias.

USD/CHF: Our constructive prospects for base remains well intact, with the latest setback very well taken in charge by psychological barriers at 0.9000. It seems now that the market could be looking to carve a bass like fresh and we will monitor for additional upside to upper range recently 0.9335 on the next sessions. Over 0.9335 should accelerate earnings to the heights of 2012 by 0.9600 still in place. Ultimately, only back under 0.9000 delays and gives reason to pause.

-Written by Joel Kruger, technical currency strategist

To contact Joel Kruger, E-mail jskruger@dailyfx.com. Follow me on Twitter @ JoelKruger

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April 24, 2012 05: 44 GMT

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