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30 Mar 2015
EUR/USD far from being done - JPMorgan
FXStreet (Bali) - The bigger EUR/USD downtrend looks stretched, but far from being done, notes Thomas Anthonj, FX Strategist at JP Morgan.
Key Quotes
"The latest bounce from 1.0462 (last low) in EUR/USD already failed to reach and challenge the preceding breakout point at 1.1098, which in combination with yesterday’s keyreversal day down leaves the bears in their comfort zone and keeps 1.0072 (76.4 % of the 2000-2008 rally) in focus."
"Another attempt to break above 1.1098 in favor of a broader recovery to 1.1267/79 (int. 38.2 %) can however not be excluded as long as key-support at 1.0613/01 (pivot/minor 76.4 %) has not been broken decisively on hourly close (i.e. below 1.0575). Only such a break would support a straight extension of the broader downtrend to 1.0072 and possibly to projected wave 3 Fib.-targets at 0.9652 and at 0.9298."
"So above 1.0613/01 the market keeps the option to challenge and break above 1.1098, which would shift the focus on the first major T-junction at 1.1267/79."
"Only a decisive break above the latter (i.e. an hourly close above 1.1300)-would cause serious discomfort for Euro bears as the upside would be open for extensions to 1.1534 (previous high) and most likely to the main T-junctions on higher scale at 1.1699 and at 1.1811(int. 38.2 % on higher scales), where the bulls and bears would ultimately have to fight it out."
Key Quotes
"The latest bounce from 1.0462 (last low) in EUR/USD already failed to reach and challenge the preceding breakout point at 1.1098, which in combination with yesterday’s keyreversal day down leaves the bears in their comfort zone and keeps 1.0072 (76.4 % of the 2000-2008 rally) in focus."
"Another attempt to break above 1.1098 in favor of a broader recovery to 1.1267/79 (int. 38.2 %) can however not be excluded as long as key-support at 1.0613/01 (pivot/minor 76.4 %) has not been broken decisively on hourly close (i.e. below 1.0575). Only such a break would support a straight extension of the broader downtrend to 1.0072 and possibly to projected wave 3 Fib.-targets at 0.9652 and at 0.9298."
"So above 1.0613/01 the market keeps the option to challenge and break above 1.1098, which would shift the focus on the first major T-junction at 1.1267/79."
"Only a decisive break above the latter (i.e. an hourly close above 1.1300)-would cause serious discomfort for Euro bears as the upside would be open for extensions to 1.1534 (previous high) and most likely to the main T-junctions on higher scale at 1.1699 and at 1.1811(int. 38.2 % on higher scales), where the bulls and bears would ultimately have to fight it out."