Currency snapshot (major pairs)

Dollar index trading at 95.63 (-1.02%)

Strength meter (today so far) – Euro +1.00%, Franc +1.26%, Yen +1.34%, GBP +0.83%

Strength meter (since last week) – Euro +1.30%, Franc +1.22%, Yen +1.24%, GBP +0.56%

EUR/USD –

Trading at 1.129

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 – 1.143, Short term – 1.132

Economic release today –

• Trade balance for June came at £29.2 billion.
• Zew survey economic sentiment rose to 4.6 for August compared to -14.7 in July.

Commentary –

• Euro jumped sharply on weaker dollar, testing key resistance at 1.13 area. Active call – Sell EUR/USD at 1.116 with stop loss at 1.15 and target at 1.01

GBP/USD –

Trading at 1.298

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 –

• Retail price index rose by 1.9 percent y/y in July.
• House price index rose by 8.7 percent y/y in July.
• PPI input rose by 4.3 percent y/y.
• PPI output rose by 0.3 percent in July.
• CPI rose by 0.6 percent.

Commentary –

• The pound is up today as inflation surprised on the upside and the dollar weakened. The pound is likely to remain on the weaker side over the coming months. We expect the pound to reach parity.

USD/JPY –                      

Trading at 99.9

Trend meter –

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

Support –

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

Resistance –

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

Economic release today –

• NIL

Commentary –

• The yen is the best performer today, slipped below 100 per dollar. 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 0.961

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 –

• NIL

Commentary –

• Franc is up in line with the euro, slightly better performer. We expect Franc to strengthen against Dollar to as high as 0.86 area in the medium term.