Asian Session Notes 2/20/2013

EURJPY

Resistance: 125.97(02) moderate / 126.53 minor / 126.94 minor

Support: 125.55 minor / 125.20 minor / 124.91 minor

An early follow through rally off the New York trade has EURJPY currently testing the hypotenuse of a two week long descending triangle, 125.97(02) area. Daily indicators has stochastic poised to push overbought though macd is still decidedly bearish. In the lower time frames we have a confluence of buys with stochastic poised to push overbought while macd is also heading up. Note we have the 4H candle in the previous period ‘Wellington Market’ with a decent body size, suggesting buying interest despite what is usually a boring time for the market. Hourly charts has stochastic overbought while macd is also heading up. For now with prices just under the hypotenuse and indicators bullish we prefer looking for a close above 125.97(02) before going long.

GBPJPY

Resistance: 145.13 minor / 145.88 minor / 146.52 minor

Support: 144.42 minor / 143.84 moderate / 143.15 minor

Tuesday saw GBPJPY bouncing off the 34D EMA with a hammer for a daily candlestick. This gives us a higher low against Friday’s 142.76 and a bounce off the 50 Fib retracement for the rally from January 23. Among indicators we have a mixed view with stochastic coming off oversold areas while macd is heading lower. From the 4H picture we have mixed signals with stochastic off oversold areas while macd is flat below its signal line. Hourly’s has macd just crossing up while stochastic has also just crossed lower though we may be oscillating around 80 to suggest a bullish trend. For now we prefer a buy on dips to 144.42 or seeing a close above 145.14 for a bullish entry, projected highs are at 145.88. Note GBPJPY has been using the 34D EMA as a strong bounce off point lately.

EURUSD

Resistance: 1.3438 moderate / 1.3464 minor / 1.3496 minor

Support: 1.3405 strong / 1.3381 minor / 1.3358 minor

After stalling for much of Tuesday we saw EURUSD finally rallying in New York trade as gains in equities could no longer be ignored. At the close we saw the pair above the 34D EMA nad now completely out of the daily EMA lines generating a follow through rally to the bounce off 23.6 Fib and 55D EMA at 1.3316. Daily indicators has stochastic with a bullish divergence while macd is now poised to cross higher. In the lpwer time frames we have a confluence of buys in 4H macd and stochastic the latter overbought. Hourly charts for its part has stochastic heading up along with macd and a flag pattern triggered. For now we are looking for a rally to the previous low highs, 1.3519 to establish the return of bullish sentiment. For now we prefer looking for a buy on dips to the key 1.3403 support from the daily charts.