Asian Session Notes: 12/16/13

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By mdelapaz | December 16, 2013 1:49 PM EST

Fx Instructor

USDJPY

Resistance: 103.37 moderate / 103.76 minor / 103.92 minor

Support: 102.97 moderate / 102.66 moderate / 102.37 minor

In the end we have a false breakout in USDJPY Friday with a long wick to form a shooting star in the daily charts suggesting pullback risk. Daily indicators has stochastic oscillating just under 80 while macd has already topped off crossing lower with mean reversion a possibility. In the lower time-frames we have stochastic in waiting to push oversold in 4H charts while macd has crossed lower. Hourly charts for their part has a bearish stochastic with macd looking to ease under the zero line. At this point we may be forming a tripple top in the daily charts with the long daily wick indicative of bulls pulling back. Look for a push below 102.97 in European trade to get the bears going. Alternative entry will be coming off the 103.37 daily pivot, note we risk a false breakout above the said price.

EURJPY

Resistance: 142.02 moderate / 142.20 minor / 142.62 moderate

Support: 141.43 moderate / 141.22 moderate / 140.98 moderate

As with USDJPY we have long wick for the daily chart in EURJPY possibly defining the second high of a daily top. On an even bigger picture the weekly close is a shooting star following a break early in the week of the 140.98 61.8 Fibretracement level of the sell-off from 2008. Among indicators we have daily stochastic coming off overbought levels while macd is topping out. From the lower timeframes we have mixed signals as 4H stochastic crossed up while macd sees a new bear cross. Hourly charts are the opposite with a new bullish crossover in macd and bearish stochastic. At this point we have very little conviction in the market despite a huge potential from a weekly shooting star. We prefer looking for a close under 140.98 on a daily scale before taking big trades. For intraday trades consider shorts of 142.02 at the open of European markets.

AUDUSD

Resistance: 0.8963 moderate / 0.9000 psychological / 0.9031 minor

Support: 0.8909 minor / 0.8890 moderate / 0.8845 strong

Friday turned out to be a consolidation day for Aussy following two sharp drops in the daily charts with the close turning out to be a spinning top. Indicators however continue to be bearish with daily macd’s now crossing lower and stochastic easing down to oversold areas suggesting we look for a test of the key support at 0.8845. From the 4H picture we have stochastic poised at a beasr cross while macd is flat below the signal line and under zero. Hourly charts for their part has macd looking to cross lower while stochastic is oversold. We have seen prices eased through the daily pivot at 0.894. Along with the bearish big picture we are now looking for prices to ease down to the key support level at 0.8845. Note we have Chinese flash manufacturing PMI at 0145GMT a possible catalyst for movement.

EURUSD

Resistance: 1.3762 moderate / 1.3790 minor / 1.3810 moderate

Support: 1.3710 minor / 1.3690 moderate / 1.3650 moderate

Euro turned out to be a high wave candle as we saw a bounce in New York trade for long shadows in the daily charts. Note we still had a bearish body and can view things as a confirmation for the daily fractal. On the weekly close we do have a shooting star suggesting a second peak has been formed for a double top pattern. Daily indicators has stochastic coming off overbought level while macd is heading up. Intraday we have a bearish macd with stochastic poised to see a bearish crossover from the 4H picture though we also have a piercing pattern. Hourly charts for their part has stochastic reentering overbought levels while macd is heading up. Immediate risk calls for a possible retest of the highs at 1.3810 though we would still look for a top and shorts around the area with stops above 1.3832.

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