Forex Technical Analysis for September 8, 2011

EUR/USD Technical Analysis for September 8, 2011

The EUR/USDfound support at the 1.40 area on Wednesday as the German high courts ruled that it was in fact legal for the German government to help bailout the Greek government. However, the ruling also stated that any future bailouts would have to be voted on in Parliament. This effectively assures that there won’t be another one, but that is an argument for the future. The bottom of the range sees a bounce – this suggests we are going higher from this point, but we prefer selling for the long run, and will do so if and when we get closer to 1.45 or so. If we fail to make another run all the way to that level, this could be a signal that the pair is going to break down through the bottom of the range. We prefer selling rallies at this point, but only after a fairly large move.

AUD/USD Technical Analysis for September 8, 2011

The AUD/USD pairrose on Wednesday, and even broke above the gap formed at the beginning of the week. The 1.05 level has held as massive support, and as such – we like buying on dips or even a break above the daily high from Wednesday. The AUD is a pure interest rate play at this point, and traders will be looking for yield wherever they can. We only buy until we get below the parity level, and that is over 600 pips below.

EUR/CHF Technical Analysis for September 8, 2011

EUR/CHFsat still on Wednesday, which is understandable after a 1,000 pip range on Tuesday. The pair is now pegged to 1.20 effectively, as the Swiss National Bank has decided that the level was where they were willing to defend it at that point. The 1.20, the weekly trend line we broke, and the SNB can all be supportive on a pullback. If the 1.20 area produces a hammer or engulfing bullish candle, we are ready to go long this pair. Until then, we think this pair will be very, very quiet.

NZD/USD Technical Analysis for September 8, 2011

The NZD/USD pairrallied during the Wednesday session, although it did not manage to gain enough to clear the top of the shooting star-like candle from Tuesday. The trend is up still, and we aren’t ready to bet against this trend just yet. Because of this, we are looking for a break above not only 0.84, but 0.85 as well to go long. A short isn’t possible until we are below the 0.8000 level.

USD/JPY Technical Analysis for September 8, 2011

USD/JPYcontinues to drift higher, even after falling initially during the Wednesday session. The pair fell from the 77.50 level all the way down to the 77 area. The 77 handle proves to be supportive again, and the market bounced. We don’t sell because of the Bank of Japan’s various intervention policies, but we do buy if we get a signal. For now, we are waiting to break the top of the Thursday candle in order to go long for about 150 pips or so.

GBP/USD Technical Analysis for September 8, 2011

The GBP/USD pairrose during the Wednesday session, but failed to close above the 1.6000 level. The resulting candle is a “shooting star-like” candle that appears at the bottom of the recent range. This shows that the bulls tried to rally at the bottom, but haven’t concretely done so. Because of this, we are more likely to look for a rally to short if and when it comes. If not, we would sell on a break lower, but we think the 1.5750 area is the key to going short – if we close below that level, this pair becomes a longer-term sell.

USD/CAD Technical Analysis for September 8, 2011

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The USD/CAD pair fell on Wednesday, after failing to close above the 0.99 level the day before. The oil markets are starting to come back into play as the storms in the Atlantic could have an adverse effect on oil production out of the Gulf of Mexico. The gap from the weekend has been filled, and now we are simply waiting to see if we can go lower. If we do, this pair becomes a screaming sell. If the CL (Light Sweet Crude) contract gets above $90, this pair is a screaming sell. We don’t buy until this pair gets above the parity level.

USD/CHF Technical Analysis for September 8, 2011

The USD/CHF pairhad a very quiet day on Wednesday, which is understandable since the day before had roughly an 800 pip range. The pair hasn’t pulled back yet, but after the recent action in it, we like the idea of buying pullbacks, especially around the 0.83 – 0.85 range. The pair is being supported by a central bank willing to buy unlimited currency, and as such – we are no longer willing to sell this pair. The CHF is no longer a safe haven currency because of this, and as such, this pair will rise on any shocks to the system. Until we get the pullback however, we are simply waiting.

 

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