Currency snapshot (major pairs)

Dollar index trading at 96.22 (-0.42%)

Strength meter (today so far) – Euro +0.28%, Franc +0.60%, Yen +1.43%, GBP +0.04%

Strength meter (since last week) – Euro +1.26%, Franc +1.30%, Yen +2.54%, GBP +0.48%

EUR/USD –

Trading at 1.11

Trend meter –

• Long term – Sell, Medium term – Sell, Short term – Sell

Support

• Long term – 1.06, Medium term – 1.08, Short term – 1.09   

Resistance –

• Long term – 1.16, Medium term – 1.116, Short term – 1.116

Economic release today –

• Eurozone GDP grew 0.3 percent q/q in second quarter up 1.6 percent from a year back.
• Consumer price index up 0.2 percent in July from a year ago. Core CPI is up 0.9 percent.
• Unemployment rate for June came at 10.1 percent.

Commentary –

• Euro is still hovering around 1.11. Active call – Sell EUR/USD at 1.116 with stop loss at 1.15 and target at 1.01

GBP/USD –

Trading at 1.316

Trend meter –

• Long term – Sell, Medium term – Sell, Short term – Sell

Support –

• Long term – 1.2, Medium term – 1.27, Short term – 1.29 

Resistance –

• Long term – 1.39, Medium term – 1.35, Short term – 1.34

Economic release today –

• M4 money supply rose 1.1 percent in June.
• Net lending rose to £5.2 billion.

Commentary –

• The pound is treading water around 1.315 awaiting further cue. We expect the pound to reach parity.

USD/JPY –                      

Trading at 103.3

Trend meter –

• Long term – Sell, Medium term – Range/ Sell, Short term – Sell

Support –

• Long term – 91, Medium term – 98, Short term – 100

Resistance –

• Long term – 111, Medium term – 107, Short term – 107

Economic release today –

• Bank of Japan increased ETF purchases from ¥ 3.3 trillion per annum to ¥ 6 trillion per annum.
• Vehicle production declined by 1 percent y/y in June.
• Construction orders declined -2.4 percent y/y.
• Housing starts declined -2.5 percent y/y in June.

Commentary –

• Yen gained sharply and turned best performer of the week as BoJ eased less than expected. Active call – Buy Yen @119.5 with stop loss around 123.8 and target at 114 and 110, 108.9 and 98.5. All targets reached, new target 90 added. Yen may retrace to 111 per dollar if BOJ intervenes.

USD/CHF –        

Trading at 0.973

Trend meter –

• Long term – Buy, Medium term – Range, Short term – Range/Sell

Support –

• Long term – 0.9, Medium term – 0.927, Short term – 0.95

Resistance –

• Long term – 1.037, Medium term – 1.01, Short term – 0.994

Economic release today –

• KOF leading indicator rose to 102.7

Commentary –

• Franc rose sharply on risk aversion after BoJ action. We expect Franc to strengthen against Dollar to as high as 0.86 area in the medium term.