Asian Session Notes 3/7/13: Looking for a risk appetite

AUDUSD

Resistance: 1.0243 moderate / 1.0267 minor / 1.0289 moderate

Support: 1.0215 moderate / 1.0186 moderate / 1.0151 moderate

Wednesday saw the Aussy getting rejected from the daily EMA lines to see a ‘Dark Cloud Cover’ with prices now under the 38.2 Fib of the mean reversal rally monday. Among indicators we still have daily stochastic heading up and macd with its new bullish cross though releases earlier suggests sentiment is turning with the Trada Balance at a bigger than expected deficit of AUD $1.06 billion against a -510 million consensus forecast. In the lower time frames we has stochastic pushing oversold while macd is poised to cross lower in 4H charts. Hourly indicators has a bullish stochastic and bearish macd. Look for shorts under 1.0215 or coming off 1.0243 with hourly ‘shooting star’ or ‘grave stone doji’. Note we are still looking for a follow through sell-off to a weekly double top breakout.

NZDUSD

Resistance: 0.8295 minor / 0.8320(23) strong / 0.8349 minor

Support: 0.8256 moderate / 0.8222 moderate / 0.8192 minor

After brief attempts to rally up past the daily EMA lines Kiwi eventually saw a big black candle getting rejected from the strong resistance at 0.8320(23), 21D EMA and 38.2 Fib retracement of the sell-off from February 14. Daily indicators has stochastic in the process of crossing lower inline with the bearish macd and new dead crosses among the EMA lines. In 4H charts candlesticks suggests building bearish momentum while stochastic has pushed oversold and macd is crossing lower. Hourly indicators has stochastic oscillating around 20 and macd heading lower. Going forward focus should be on further weakness for Kiwi with shorts on a close under 0.5256 in hourly charts or coming off the 38.2 Fib area at 0.8320(23), the 38.2 Fib and 21D EMA.

USDJPY

Resistance: 94.11 minor / 94.45 strong / 94.77 minor

Support: 93.67 moderate / 93.24 minor / 92.84 moderate

Wednesday saw USDJPY rallying on broader dollar gains following a strong ADP number. Note we have triggered a daily flag pattern and a bounce off the 21D EMA with the key resistance at 94.45 now in sight. Indicators have daily stochastic crawling in overbought levels while macd is bottoming out, poised to cross higher. In the lower timeframes we have buys isgnals from both hourly and 4H charts. In the latter we have stochastic overbought while macd has opened. Hourly charts for their part has macd heading higher and stochastic just crossing up. For now we prefer a buy on dips to 93.67 or following a push past 94.45. Projected high calls for the psychological 95.00. On the fundamental side we have BoJ Governor Shirakawa presiding over his last monetary policy meeting with Kuroda taking the helm on the 19th.

GBPUSD

Resistance: 1.5000 psychological / 1.5045 minor / 1.5079 moderate

Support: 1.4966 minor / 1.4926 moderate / 1.4859 minor

At the close we have Cable under the psychological 1.5000 area following strong jobs numbers out of the US private sector. This effectively gives us a lower low in the range play for the last two weeks. With yesterdays drop daily stochastic has crossed lower while macd remains flat. In the lower time frames we have an oversold 4H stochastic while macd has just crossed lower. Hourly charts for the moment has bullish in stochastic while macd is bottoming out. Note that our sell-off was basically a dollar issue and not Cable weakness, as such we are looking for a push back above the 1.5000 region to signal that the previous range play remains valid. Consider buys on an hourly close above 1.5000 with stops under 1.4966.