Tech Targets: EUR/USD, GBP/USD, AUD/USD, NZD/USD, USD/JPY - UOB
EUR/USD: Bearish: Downside potential likely limited to 1.1145.
We turned bearish EUR yesterday and there is no change to the view. While we expect EUR to head lower from here, the downside potential appears to be limited to 1.1145.
Resistance is at 1.1350 but only a move above 1.1395 would indicate that our bearish expectation is wrong (would lower stop-loss only when there is a clear move below 1.1230).
GBP/USD: Neutral: In a broad 1.4000/1.4350 range now.
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We have held a neutral view for more than 3 weeks and since then; both rally and dip in GBP have been unsustainable and short-lived. As indicated yesterday, a move below 1.4105 would indicate that GBP has moved back into a consolidation range (recent high of 1.4348 did not reach our rebound target of 1.4380).
In other words, there is no change in our neutral view and we expect this pair to trade in a broad 1.4000/1.4350 range for now.
AUD/USD: Neutral: Break above 0.7750 would indicate resumption of bullish trend.
While upward momentum continues to improve, we prefer to wait for a clear break above the major 0.7750 resistance before turning bullish.
That said, this appears to be likely scenario unless there is move back below 0.7580/85 (0.7635 is already a strong support).
NZD/USD: Neutral: Back into range trading, likely between 0.6760 and 0.6970.
As highlighted yesterday, only a clear move above the 0.6965/70 resistance would indicate the start of a bullish phase. The surprising rapid drop from the high of 0.6952 took out the strong 0.6870 support and from here, NZD has likely moved back into a consolidation range, likely between 0.6760 and 0.6960.
USD/JPY: Neutral: Bearish phase ended, in a broad 108.40/111.00 neutral range.
The break above 109.60 earlier indicates that the bearish phase that started in the middle of last week has ended. The outlook for the next couple of weeks is viewed as neutral and we expect USD to trade sideways, likely within a broad 108.40/111.00 range.
