OPEC reached a deal to cut output for the first time since 2008 as to manage market prices were made at the formal meeting in Algiers. The agreement was possible because Iran will be exempt from capping production, a major concession by Saudi Arabia. Full details will be determined for each country by the next meeting in November. The key takeaways surround a change in Saudi attitude both in their willingness to deal with Iran, and in their approach to recognising the benefits to production cuts and higher prices. Barclays see the agreement as significant, but UBS recognise further details need to be established regarding implementation, duration, and most importantly which members will be allocated what prices. Morgan Stanley’s response addresses the current oversupply and that the main impact will only be recognised come early 2017.
AUD/USD is catching an updraft off positive cross component flows but is mainly stuck in a ten pip range following its first breach of 0.7700 since August 8th. The OPEC agreement resulted in overall commodity strength hereby Aussie strength. AUD/JPY topside flows can be favoured to continue higher with targets at the 9th September high of 77.71.
GBP/USD early bounce undermines the trend as it touched 1.3059 as it broke away from 1.3016 at the 10 day moving average. Expected Asian range can be expected in the support of 1.3015 and resistance at 1.3059. Yesterday’s downtrend was on course for 1.28600, a two time proven support with upside potential is extensive with a main target up to 1.34500.
| GBP/JPY |
9/29/2016 4:46 AM |
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Trend daily chart  (=) |
Trend weekly chart  (=) |
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GBP/JPY Intraday: towards 132.30. |
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Pivot: 130.55
Our preference: long positions above 130.55 with targets @ 132.30 & 132.80 in extension.
Alternative scenario: below 130.55 look for further downside with 130.20 & 129.65 as targets.
Comment: the RSI is bullish and calls for further advance.
Supports and resistances:
133.25 ***
132.80 ***
132.30 ***
131.98 Last
130.55 ***
130.20 ***
129.65 *** |
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