Asian Session Notes: 10/30/12

AUDUSD

Resistance: 1.0339 moderate / 1.0362 minor / 1.0385 minor

Support: 1.0325 minor / 1.0305 minor / 1.0269 minor

Aussy is just above the daily EMA lines though for the moment we are ignoring the EMA given the sideways market and repeated violation. We have Daily stochastic pointing lower while the macd is also heading up. We appear to be forming the second high of a double top in daily charts. In the lower timeframes we have mixed signals as stochastic comes off oversold levels while macd is heading lower. Hourly indicators for their part has a confluence of buys with stochastic poised to push overbought and macd in the process of crossing higher. Given the mixed signals and tight ranges AUDUSD is a possible straddle with buys on a close above 1.0339 or shorts on a close under 1.0325.

EURJPY

Resistance: 103.62 minor / 104.04 moderate / 104.56 strong

Support: 103.15 minor / 102.90 minor / 102.56 minor

We have EURJPY with a high wave spinning top yesterday, this just above the 21D EMA suggesting a turnaround may be in the making. Among indicators we have daily macd heading lower while stochastic crossing up. Note overall trend for the pair has been bullish with higher lows and higher highs in the past month. In the lower time frames we have 4H macd poised to cross higher while stochastic for its part is just under the threshold looking to push overbought. Hourly charts for their part also see a confluence of buys with an earlier surge up as Japanese markets opened. Bias for now calls for further gains though we suggest looking for a close above 103.15 first. We should point out that the bear market in the previous days has been shallow compared to previous daily level pullbacks which went all the way down to the 55D EMA.

GBPUSD

Resistance: 1.6052(57) moderate / 1.6087 minor / 1.6111 minor

Support: 1.6016 minor / 1.5990 minor / 1.5955(59) moderate

Following Fridays spinning top we have a bear market from Monday trade with the move reinforcing the idea of lower highs and lower lows from the daily charts. With the sell-off daily macd’s have once again crossed lower while stochastic is heading down and prices just above the 55D EMA. We should be looking for the next lower low over the course of the week. Intraday we are seeing a mixed set of signals with 4H stochastic heading up while macd is pointing lower and candlesticks suggesting a loss of bearish momentum. Hourly charts for their part has macd crossing up while stochastic is also in the process of getting a bullish cross. Given the moderate immediate resistances we prefer looking for a rejection from the 1.6052(57) region, 34D EMA. Alternative entry will be a close below 1.6016.

EURUSD

Resistance: 1.2924 minor / 1.2955 minor / 1.2997 minor

Support: 1.2886 moderate / 1.2867 moderate / 1.2825 minor

Monday saw a close under the 34D EMA in Euro opning the possibility of further weakness with the said price line acting as a nice bounce off point before. Indicators has macd’s heading lower while daily stochastic is just above the oversold threshold looking to push lower. Note we face moderate supports in close succession. From the 4H picture we have a bullish divergence in stochastic while macd is flat with signal line and main line at the same levels. Hourly charts for their part has a confluence of buys with macd’s beginning to open up while stochastic is poised under the overbought threshold. Price charts themselves has a double bottom. Immediate risk calls for the double bottom to be triggered with a push past 1.2924 though we expect limited upside given the bearish trendline.