Asian Session Notes 3/13/2013: Looking at US retail sales for a catalyst

AUDUSD

Resistance: 1.0341 strong / 1.0367 minor / 1.0386 moderate

Support: 1.0309 minor / 1.0283 moderate / 1.0266 minor

Tuesday saw a follow through rally in Aussy despite disappointing numbers once more with the NAB Business Confidence index slipping to 1 as commodities in general rallied early in New York trade. For the moment we have prices just under the 55D EMA with an even stronger resistance at 1.0341 the weekly double top trigger. Indicators has stochastic pushing overbought while macd is rising. In the lower time frames we have stochastic just above 80 while macd is still rising though the candlestick from wellington trade is a hanging man. Hourly indicators for their part has a bearish divergence in stochastic while macd has crossed lower and price charts see a double top with its trigger at 1.0309. For now we are looking for a close under 1.0309 to trigger a bear market. Alternatively look for a rejection from 1.0341 with tight stops above the said price.

USDJPY

Resistance: 96.28 minor / 96.70 minor / 97.79 moderate

Support: 95.70 minor / 95.27 minor / 94.80 moderate

With the sudden reversal in the strong US equity open and opposition to Iwata’s nomination as BoJ Deputy Governor we have USDJPY with a sudden bearish engulfing in daily charts yesterday though indicators remain bullish with stochastic still overbought and macd pointing up. In intraday charts we are seeing mixed signals as candles in 4H charts show spinning tops and doji’s following the pullback yesterday. We have macd’s heading lower while stochastic has crossed up. Hourly charts for their part has a confluence of buys with macd just crossing up along with the stochastic. For now we prefer remaining sidelined with the mixed indicators from different time frames suggesting caution. Look for a close above 96.28 before buying or a close under 95.70 for a mean reversion plays.

EURAUD

Resistance: 1.2637 minor / 1.2675 moderate / 1.2700 minor

Support: 1.2605 minor / 1.2568 moderate / 1.2535 minor

Tuesday saw EURAUD finally pushing through the 61.8 Fib retracement level of its rally for the year following two weeks of range play above 1.2675. Among indicators we have stochastic pushing back to oversold territory while macd is heading lower and the EMA lines are seeing new dead crosses. In the lower time frames we have mixed signals with stochastic coming off oversold levels in 4H charts while macd is trying to bottom out and price actions has a series of spinning tops. Hourly indicators has a confluence of buys with stochastic just crossing higher in line with the macd. Immediate risk calls for a pullback in EURAUD though shorts off 1.2675 the breakout point aught to be considered.

AUDJPY

Resistance: 99.22 minor / 99.52(57) moderate / 100.00 psychological

Support: 98.84 minor / 98.61 moderate / 98.39 minor

AUDJPY saw a whipsaw day yesterday with a long tail at the close a considerable wick as well for a possible hanging man in the daily picture. From indicators we have stochastic flat in overbought levels while macd is rising, the gap between prices and EMA lines have widened the past few days suggesting the need for mean reversion. In 4H charts we are seeing mixed signals with stochastic just crossing up while macd is heading lower. Hourly indicators are similarly mixed with stochastic pointing higher and macd below the signal. For now we have USDJPY stuck in its own range pkay and AUDUSD looking vulnerable under key resistances. As such we prefer looking for a bearish breakout an hourly close under 98.84 will be our entry signal.