Forex Technical Update
Euro: Euro's bull run accelerated from 1.4124 levels to 1.4413 levels last week. Euro is currently trading around 1.4400 levels with the 4-hourly and daily stochastics extremely overbought. However, if Euro holds above 1.43 levels (38.2% retracement of the recent rise); further upside to the extent of 1.4535 could be witnessed. Caution is required while initiating fresh positions with the bearish divergence condition in the charts. Medium term outlook 1.40 (eur/usd - 1.4405).
Pound: Cable after plunging to 2.0243 levels early last week on account of unwinding of carry trades; rebounded to the extent of 2.0570 levels. Currently Cable is trading around 2.0540 levels, and rally is still in force to the next resistance of 2.0592 as long as Cable holds above 2.0435 (21 Days EMA in Daily chart). Breaking of this level can further push Cable to the levels of 2.0652 (Recent Top). Although, the daily charts are overbought, the 4-hourly and hourly charts still has scope for an upside movement. Avoid initiating longs at these levels. Key Focus of the week is FOMC rate decision on Wednesday. Medium Term outlook 2.0200 (gbp/usd - 2.0543).
Yen: Yen continued to trade in a sideways range and witnessed a move of about 65 pips in the last trading session. Currently Yen is trading around 114.22 levels and is facing resistance at 115.00 levels (38.2% Retracement of the recent fall). The overall outlook remains bullish for Yen below 116.00 levels (61.8% Retracement and 55 Days EMA). Medium term target - 112.00 (usd/jpy - 114.22).
Rupee: Rupee recovered strongly after touching 39.93 levels last week. Rupee opened slightly strong at 39.38 and made an intraday high at 39.35 today. Consolidation around these levels is expected for sometime. Exporters should look for opportunitues to cover their exposures at spikes near 40.00 Medium Term target: 39.00 (Friday's closing 39.46).
Swiss Franc: Swissy remained highly volatile last week. It strengthened to the extent of 1.1619 levels on Friday. Currently, the pair is trading around the 1.1630 levels (close to the recent low of 1.1600). Although the 4-hourly stochastic is in the oversold region, it has flattened. The overall outlook remains bullish for Swissy below 1.1800 levels (55 Days EMA in the daily chart). Medium term outlook remains 1.15. (usd/chf-1.1636)
Gold: Gold strengthened almost $40.00 last week recovering from $745 levels. Gold continues to record fresh new highs and is currently trading around $792 levels (nearing our mentioned Medium Term Target). The overall outlook remains bullish on Gold. However, the charts are extremely ovebought and initiating positions at these levels is not advisable. Medium term outlook $800. (Gold-$792.3)
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