EU Session Bullet Report – USDJPY surges – ECB awaited

October 21, 2015

A trendless pattern with the exception of USDJPY is developing in the markets. EURUSD and GBPUSD have both traded sideways for the past 2 days, unable to take a new direction. The market is waiting for the long awaited ECB rate decision tomorrow along with cues that ECB President Mario Draghi might give regarding increasing the QE Programme in order to revive the EU economy. So Far, EURUSD trades 0.15% higher at 1.1355 however it looks unable to break the 1.1370 resistance.

USDJPY is trading over 120.00 boosted by the surge in the Japanese Nikkei. So far in 2015, USDJPY range (115.855 – 125.855) in percentage has been 8.35%, which is the lowest since 1976 (Average % range from 1971 to 2014 was 17.48%).

Today’s calendar is again thin. Notable exception for the day is the Bank of Canada rate decision which is expected to not be changed and remain at 0.5%. The CAD has lost its momentum since OIL failed to sustain over $50 and is trading back around $46.

Trading Quote of the Day: “The most valuable commodity I know, is information kid” Gordon Gekko – Wall Street – the movie

Currency Updates:

EURUSD

Pivot: 1.1395

Likely scenario: Short positions below 1.1395 with targets @ 1.1305 & 1.1265 in extension.

Alternative scenario: Above 1.1395 look for further upside with 1.145 & 1.1495 as targets.

Comment: As long as 1.1395 is resistance, look for choppy price action with a bearish bias.

USDJPY

Pivot: 119.55

Likely scenario: Long positions above 119.55 with targets @ 120.15 & 120.35 in extension.

Alternative scenario: Below 119.55 look for further downside with 119.2 & 118.9 as targets.

Comment: The pair has broken above a bullish triangle pattern and remains on the upside.

GBPUSD

Pivot: 1.541

Likely scenario: Long positions above 1.541 with targets @ 1.5465 & 1.551 in extension.

Alternative scenario: Below 1.541 look for further downside with 1.537 & 1.5325 as targets.

Comment: The next resistances are at 1.5465 and then at 1.551.

AUDUSD

Pivot: 0.7305

Likely scenario: Short positions below 0.7305 with targets @ 0.724 & 0.7225 in extension.

Alternative scenario: Above 0.7305 look for further upside with 0.7345 & 0.738 as targets.

Comment: A break below 0.724 would trigger a drop towards 0.7225.

GOLD

Pivot: 1169

Likely scenario: Long positions above 1169 with targets @ 1184.5 & 1190 in extension.

Alternative scenario: Below 1169 look for further downside with 1163 & 1158 as targets.

Comment: The RSI is mixed to bullish.

USDCAD

Pivot: 1.301

Likely scenario: Short positions below 1.301 with targets @ 1.293 & 1.29 in extension.

Alternative scenario: Above 1.301 look for further upside with 1.305 & 1.308 as targets.

Comment: The RSI is mixed to bearish.

USDCHF

Pivot: 0.9585

Likely scenario: Short positions below 0.9585 with targets @ 0.9525 & 0.95 in extension.

Alternative scenario: Above 0.9585 look for further upside with 0.9615 & 0.9645 as targets.

Comment: The RSI is mixed to bearish.

OIL

Pivot: 46.95

Likely scenario: Short positions below 46.95 with targets @ 45.12 & 44.45 in extension.

Alternative scenario: Above 46.95 look for further upside with 47.6 & 47.95 as targets.

Comment: As long as 46.95 is resistance, likely decline to 45.12.

DAX

Pivot: 10210

Likely scenario: Short positions below 10210 with targets @ 10050 & 9970 in extension.

Alternative scenario: Above 10210 look for further upside with 10300 & 10340 as targets.

Comment: As long as the resistance at 10210 is not surpassed, the risk of the break below 10050 remains high.

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