Asian Session Notes: Aussy at risk of parity, a big bearish break under 1.0149

AUDUSD

Resistance: 1.0183 minor / 1.0214 minor / 1.0240 moderate

Support: 1.0149 strong / 1.0115 minor / 1.0098 moderate

Aussy saw its weakest close yet from last Friday with the close clearly reinforcing the notion of a weekly double top breakout. Earlier we saw poor numbers out of Australia with quarterly operating profits for businesses continuing to contract while Building Approvals also fell month-on-month against expectations of a recovery. From indicators we have daily stochastic pushing further into oversold areas while macd is dropping. Intraday we have a confluence of bears in both 4H and hourly levels as stochastic pushes oversold in both while macd for the latter has just opened down. Notew we ahve an ongoing sell-off in response to the earlier releases our key objective 1.0149. A close under 1.0149 in the daily charts opens the way to parity possible under it. For now look for shorts from just under 1.0183.

USDJPY

Resistance: 93.87 moderate / 94.04 minor / 94.45 strong

Support: 93.50 minor / 93.16 minor / 92.75 moderate

Yen pairs saw a rally a day after the nomination of ADB chief Kuroda as the new BoJ Governor to see USDJPY back above the daily EMA lines with the swing highs at 94.45 within sight. Daily indicators has stochastic overbought suggesting a need for a quick bullish break to remain valid, while macd is flat. For the moment we have an ongoing confirmation hearing for Kuroda before the Diet. In the lower timeframes we have a flag in 4H charts while stochastic is overbought and macd rising. Hourly charts for their part has stochastic trying to cross up while macd is flat above the signal. For now we prefer to wait for the confirmation hearing to finish though comments so far suggests we look for a surge to 94.45 the previous swings highs possibly up to the psychological 95.00.

EURUSD

Resistance: 1.3042 moderate / 1.3084 minor / 1.3120 moderate

Support: 1.3000 strong / 1.2954(66) moderate / 1.2907 moderate

Friday saw Euro trying to generate follow through weakness to its bear trend only to see an abortive breakout out with a long tail in the daily candle. Indicators however continue to show a bearish bias with stochastic oscillating around the 20 mark while macd is dropping. Note we have a huge gap between prices and EMA lines opening the possibility of mean reversion. In 4H charts we have indecision from the candlesticks as macd remains flat and stochastic pointing up. Hourly charts for their part has a confluence of buys in the making with macd up and stochastic in the process of crossing higher. For now we prefer remaining sidelined though given the support and the loss of bearish momentum we are looking for a possible buy on dips to 1.3000 or on a push past 1.3042.