Monday October 18, 2010 - 12:15:46 GMT
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FX Thoughts for the Day - www.fxthoughts.com
FX Thoughts for the day : 18-Oct-2010 - 1208 GMT
EURO, JAP YEN and EURO-YEN
Read our current comments and trade recommendations on EUR-USD, USD-JPY and EUR-JPY by registering at
Our comments on Dollar-Swiss, Sterling Pound and Australian Dollar are given below
USD/CHF @ 0.9604/07...Chances of some upmove, wait and watch
R: 0.9650 / 0.9680-90 / 0.9750
S: 0.9539-20 / 0.9467-50 / 0.9392
Dollar-Swiss is in the middle of a possible upmove towards 0.9700-50 in a couple of days. The pair tested a Support at 0.9472 last week, followed by an upmove towards 0.9650 today. Please note that 0.9472 is a very significant Support on the pair, a break below which may see 0.87 in the coming weeks/month. Since the markets have honoured this Support last week and moved up, there are chances of a upmove towards 0.9700-800 before the pair sees another sharp fall. Though, if we do not see this rise, we may consider selling on dips below 0.9450. Currently, we would want to stay away.
GBP-USD @ 1.5870/73... Bullish
S: 1.6010-20 / 1.5950
As we pointed out yesterday that further dollar weakness would be lead by cable, which is playing out since yesterday. We continue to remains bullish on cable and believe the minor trend remains firm as long the pair stays above 1.5940. A break below 1.5940 will turn the outlook neutral and offer a window for cable to fade towards 1.5850.
Reiterating what we said in Morning Briefing today:
"All eyes will be on FED Chairman, Ben Bernanke, whether he gives any clue to another round of asset purchases. However, we would warn our reader against what we believe is a risk of "Bubble of Hope". When QE1 was announced in early 2009, market was caught off-guard and asset prices zoomed overnight and dollar got bashed badly. This time in our opinion market could be over-prepared and is vulnerable to a setback post US Fed Speech."
GBP 10K long @ 1.6013, SL 1.5940, TP open.
AUD/USD @ 0.9846/49...Buy dips
R: 0.9910-30 / 1.00 / 1.01
S: 0.9800-10 / 0.9750 / 0.9670-50
As expected, Aussie moved down to touch a low of 0.9801 in the European session today. We missed our long order by 1 pip. In the coming sessions today, we may see the pair move up towards 0.9900-20 followed by another dip towards 0.9850-40 tomorrow, where we may again consider buying for a rise towards 0.9950-1.00, this week.
Limit Buy Order:
AUD 10K Long at 0.9800, SL 0.9710, TP Open.
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