EUR/USD: Setbacks have stalled out for now by 1.2585, ahead of the latest minor bounce. Wednesday’s close should however be somewhat concerning for bears, with the market putting in the first bullish close in 6 trading days and also taking out the previous daily high to set up a potential bullish reversal. Nevertheless, we retain a bearish outlook while the market trades below 1.2925, and look for any rallies into Thursday to be well capped on a close basis below 1.2800. Back below 1.2585 renews downside pressure and exposes direct retest of 1.2480-1.2520 further down.
USD/JPY: The market has not been able to hold onto to its fresh multi-year lows set in Tuesday trade below 84.00, with the price rallying since and threatening a break back above initial resistance by the 10-Day SMA just over 85.00. However, while the market trades below the 10 and 20-Day SMAs on a close basis, the downtrend remains intact and deeper setbacks below 83.60 cannot be ruled out. A close above the 20-Day SMA will be required at a minimum to offer some form of relief to downside pressures. The market has not closed above the 20-Day SMA since mid-June when the pair was trading over 90.00.
GBP/USD: Although the inter-day structure looks quite bearish at present following the latest break below 1.5500, there is a shorter-term risk for some form of a bounce into Thursday trade to allow for recently oversold technical studies to unwind. However, we expect any rallies to be well capped ahead of 1.5700 in favor of the next downside extension towards the 100-Day SMA by 1.5100. Setbacks have been supported for now by the 50-Day SMA. Ultimately, only a break back above 1.5700 would negate outlook and give reason for pause.
USD/CHF: Has managed to break to yet another multi-week low below 1.0300 to now potentially open a fresh downside extension towards the yearly lows from January by 1.0130 over the coming sessions. However, at this point, it is still too difficult to call, and with medium-term studies looking stretched, we would be more inclined to be looking for opportunities to buy rather than sell. The market has still managed to hold above 1.0300 on a close basis and the recent multi-week range is more or less intact with the market just as easily seen bouncing sharply back towards 1.0600.The information contained herein does not constitute legal or investment advice. All documents attached hereto are subject to review and modification by FXCM's General Counsel unless indicated otherwise. FXCM and its affiliates assume no responsibility for errors, inaccuracies or omissions in these materials. They do not warrant the accuracy or completeness of the information, text, graphics, links or other items contained within these materials. FXCM and its affiliates shall not be liable for any special, indirect, incidental, or consequential damages, including without limitation losses, lost revenues, or lost profits that may result from these materials.