Morning Dealing Room Technical Report

September 29, 2015

Market Comment

Australia

The S&P/ASX 200 index jumped 1.42% or 71.384pts to 5113.49 (day range: 5113.5 – 5031.8) on Monday. The index is above its 20d MA (@ 5086) and below its 50d MA (@ 5304). 61% of the index constituents are above their 20D MA (vs 49% the previous session) and 37% of the shares are above their 50D MA (vs 32%).

Foreign Exchange

The US dollar was mixed, rising against the GBP, CAD and AUD while falling against the EUR, JPY and CHF on Monday. On the economic data front, Personal Income rose 0.3% in August compared to 0.4% the prior month while Personal Spending rose 0.4% MoM in August vs 0.3% the prior month. Pending Home Sales fell 1.4% MoM in August vs a rise of 0.5% the prior month.

The Euro rose against most of its major counterparts with the exception of the CHF and JPY. In Europe, no major economic stat has been released.

The Australian dollar fell against most of its major pairs with the exception of the NZD.

Last %1D %YTD
EUR/USD 1,1234 0.35 -7.14
GBP/USD 1,5206 0.17 -2.38
USD/JPY 119,77 -0.69 0.05
EUR/CHF 1,0940 -0.19 -8.92
EUR/JPY 134,5500 -0.32 -6.96
EUR/GBP 0,7388 0.19 -4.87
AUD/NZD 1,1037 0.28 5.31
AUD/JPY 83,8900 -0.96 -14.15
EUR/AUD 1,6039 0.63 8.31
USD/CAD 1,3365 0.21 15.01
USD/CHF 0,9738 -0.56 -2.06
AUD/USD 0,7005 -0.27 -14.31
NZD/USD 0,6347 -0.60 -18.60

Currency Updates:

Medium Term Strategy: Forex Pair of the day

EUR/USD – the upside prevails
The pair is trading in the middle of a bullish channel in place since March and is now supported by the 50-days moving average at 1.1150. In addition, the daily RSI has completed a pullback towards a former declining trend line in place since May. Then, as long as 1.0810 holds as a strong support, further advance is likely with 1.1730 as a first target (horizontal resistance) and 1.2050 in extension (overlap, July 2012 bottom). Only a break below 1.081 would turn the outlook to bearish with a first alternative target set at 1.0450 (March low) and 1.02 (horizontal support and overlap).

Intraday Technical Strategy

AUD/USD Intraday: bullish bias above 0.698.
Pivot 0.6980
Our preference Long positions above 0.698 with targets @ 0.7035 & 0.706 in extension.
Alternative scenario Below 0.698 look for further downside with 0.6935 & 0.69 as targets.
Comment A support base at 0.698 has formed and has allowed for a temporary stabilisation.

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