2011 12 05 migbank daily technical analysis report
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8/3/2019 2011 12 05 Migbank Daily Technical Analysis Report
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MIG BANK / Forex Broker14, rte des Gouttes d’Or CH-2008 Neuchâtel Switzerland
Tel +41 32 722 81 00 Fax +41 32 722 81 01 [email protected] www.migbank.com
Please note: None of the strategies below represent trading advice or trading recommendations of any kind. Please refer to our full disclaimer.
WINNER BEST SPECIALIST RESEARCH
MA
S-TERMMULTI-DAY
L-TERMMULTI-WEEK
STRATEGY/POSITION
ENTRYLEVEL
OBJECTIVES/COMMENTS STOP
EUR/USD Await fresh signal.
GBP/USD Await fresh signal.
USD/JPY Await new buy trade setup above 80.00.
USD/CHF Await fresh signal.
USD/CAD Awaiting new buy trade setup.
AUD/USD Awaiting new buy trade setup.
GBP/JPY Sell limit 3 123.00 122.00/121.00/120.00 124.00
EUR/JPY Await fresh signal.
EUR/GBP Sell limit 3 0.8700 0.8565/0.8485/0.8285 0.8835
EUR/CHF Sell stop 3 1.2130 1.2030/1.1526/1.1002 1.2230
GOLD Awaiting new sell trade setup.
SILVER SHORT 3 34.1300 29.9700/26.0700/23.3400 (Entered 01/11/2011) 34.1300
DISCLAIMER &DISCLOSURESPlease read the disclaimer and thedisclosures which can be found atthe end of this report
DAILY TECHNICAL REPORT5 December, 2011
Ron William, CMT, MSTA
Bijoy Kar, CFA
Notes: Entries are in 3 units and objectives are at 3 separate levels where 1 unit will be exited. When the first objective (PT 1) has been hit the stop will be moved to the entry
point for a near risk-free trade. When the second objective (PT 2) has been hit the stop will be moved to PT 1 locking in more profit. All orders are valid until the next report is
published, or a trading strategy alert is sent between reports.
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DAILY TECHNICAL REPORT 5 December, 2011
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Sharp recovery following positive news.
EUR/USD extended sharply higher, as six central banks, reduced their USD
funding costs to ease the debt crisis. The impact was very positive for
investors around the world and has encouraged traditional “risk appetite”
markets, such as EUR/USD, AUD/USD and S&P500 to turn back higher.
Expect the recovery to be limited into 1.3610, then 1.3730 and perhaps
even 1.3850-90. Probability still favours a bearish reversal at these levels.
Meantime, support can be found at 1.3380 and 1.3146. A sustained close
beneath 1.3146 (Oct swing low) will re-establish the larger downtrend from
April and target 1.3000 (psychological level), then 1.2870 (2011 major low).
Inversely, the USD Index is maintaining its recovery higher and still targetsits recent 9-month highs near 80, (a move worth almost 10%).
Speculative (net long) liquidity flows have unwound from recent spike highs
(3 standard deviations from the yearly average). This will likely remain
strong and help resume the USD’s major bull-run from its historic oversold
extremes (momentum, sentiment and liquidity).
Special Report: EUR/USD ˝A Fall From Grace˝ ? Decline Targets 1.3770/1.3410. VIDEO
MIG Bank Webinar: “Why the US dollar is likely to gain up to 30% in 6-12 months.”
US Dollar Interview on Bloomberg
S-T TREND L-T TREND STRATEGY
Await fresh signal.
EUR/USD
Ron William, Technical Strategist, E-mail: [email protected], Phone: +41 32 7228 454
EUR/USD
EUR/USD weekly chart, Bloomberg Finance LP
USD Index daily chart, Bloomberg Finance LP
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DAILY TECHNICAL REPORT 5 December, 2011
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Meets resistance close to a 50% retrace, in the daily timeframe.
GBP/USD has met initial resistance close to the 50% retrace of the 1.6167 –
1.5423 fall. A further push under 1.5577 in the hourly timeframe will
continue to weaken the near-term structure, warning of an increasedlikelihood of continuation back towards 1.5423. Alternatively, a push back
over 1.5726 will warn of a fresh leg higher in the recovery from 1.5423.
A return to stresses in the Euro-Zone, driving sovereign yields higher, is
anticipated and thus Sterling has the capacity to be deemed as a safe
haven.
With the above in mind it may be advantageous to sell into a break under
the recent 1.5577 low, for a near-term return to 1.5423.
Alternatively buying at lower levels for a return to range bound trading is a
medium-term option.
S-T TREND L-T TREND STRATEGY
Await fresh signal.
GBP/USD
Bijoy Kar, Technical Strategist, E-mail: [email protected], Phone: +41 32 7228 424
GBP/USD hourly chart, Bloomberg Finance LP
GBP/USD daily chart, Bloomberg Finance LP
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Minor rebound capped at 78.24 (DeMark™ Level).
USD/JPY’s minor rebound is still being capped at 78.24 (DeMark™ Level) .
Moreover, downside risks remain, with the growing probability of a third
price retracement back to pre-intervention levels (PIR III) and potentiallyeven a new post world war record low beneath 75.35 (PINL).
Sentiment in the option markets continues to suggest that USD/JPY buying
pressure remains overcrowded as everyone continues to try and be the first
to call the market bottom.
This may inspire a temporary, but dramatic, price spike through
psychological levels at 75.00 and perhaps even sub-74.00. Such a move
would help flush out a number of downside barriers and stop-loss orders,
which would create healthy price vacuum for a potential major reversal.
The medium / long-term view remains bullish, as USD/JPY verges toward a
major long-term 40-year cycle upside reversal. Expect key cycle inflection
points to trigger into November-December this year, offering a sustained
move above our upside trigger level at 80.00/60, then 82.00 and 83.30.
Please select the link below to review our special coverage on USD/JPY.
Special Report: USDJPY Verging on a major 40 year cycle reversal
Webinar: USD/JPY’s Long-Term Structural Change
Media Reports: CNBC Bloomberg
S-T TREND L-T TREND STRATEGY
Awaiting Renewed Buy Trade Setup.
Ron William, Technical Strategist, E-mail: [email protected], Phone: +41 32 7228 426
USD/JPY
USD/JPY daily, weekly chart, Bloomberg Finance LP
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DAILY TECHNICAL REPORT 5 December, 2011
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Back over 0.9252 will suggest end of corrective phase.
USD/CHF exhibits an hourly structure in the fall from 0.9331 – 0.9066 that
suggests the correction from the former may now be complete. However, a
push back over 0.9252 is required to confirm this, negating a re-test of the0.9000 level.
We are wary of selling at current levels as downside pressure from rising
Euro-Zone yields has eased somewhat following the reduction in the interest
rate offered on USD based swap lines. Spanish and Italian government
bonds remain elevated, currently trading at 5.337% and 6.264% versus
6.478% and 7.355%, before the six party central bank agreement.
Looking at the German sovereign yield curve in particular we note that
yields are lower across all maturities when compared with a week ago (withthe exception of 6 months). Assuming German yields are not pressured to
the upside, this should also act to ease downside pressure in USD/CHF.
Movement in USD/CHF is likely to be affected by EUR/CHF should the latter
rate get closer to the 1.2130 region, which marks the lower end of the recent
trading range.
S-T TREND L-T TREND STRATEGY
Await fresh signal.
USD/CHF hourly chart, Bloomberg Finance LP
Bijoy Kar, Technical Strategist, E-mail: [email protected], Phone: +41 32 7228 424
USD/CHF
USD/CHF daily chart, Bloomberg Finance LP
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Sharp Setbacks hold steady.
USD/CAD’s sharp setbacks are holding steady today, following the recent
short-term DeMark™ exhaustion sell signal.
A directional confirmation above 1.0658 is still needed to unlock the
recovery into 1.0850 plus. This would extend the upside breakout from the
rate’s ending triangle pattern, which was part of a major Elliott Wave cycle.
Only a sustained close beneath 1.0120 and parity unlocks bearish setbacks
into the long-term 200-day MA at 0.9852 and 0.9726 (31st
Aug low).
EUR/CAD remains beneath its 200-day MA, still within a large multi-month
trading range. The strong multi-month distribution pattern is likely to
breakdown further into support levels at 1.3570 and 1.3380.
CHF/CAD has also broken back beneath its 200-day MA at 1.1375, while
breaching a multi-week trading range. This follows the dramatic price slide
lower (which was triggered by the SNB intervention). The cross-rate has
retraced more than half of its 2011 gains.
S-T TREND L-T TREND STRATEGY
Awaiting New Buy Setup.
Ron William, Technical Strategist, E-mail: [email protected], Phone: +41 32 7228 454
USD/CAD
USD/CAD daily, weekly chart, Bloomberg Finance LP
EUR/CAD and CHF/CAD daily chart, Bloomberg Finance LP
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Extended recovery beneath 200-day MA.
AUD/USD has extended its recovery into key resistance at 1.0340 (61.8%
Fib-Oct 28th
decline) and 200-day MA which is currently holding at 1.0412.
The bears must sustain below 1.0000 to further compound downside
pressure on the rate’s multi-year uptrend and push back towards 0.9611.
Elsewhere, the Aussie dollar remains strong against the New Zealand
dollar. However, near-term price activity is mean reverting back into the 200-
day MA. Expect a sharp setback to ensue over the multi-day horizon.
The Aussie dollar has triggered a mild recovery against the Japanese yen
and is now trading back above the neck-line of its two-year distribution
pattern. Watch for further downside scope into support at 72.00 which would
signal further unwinding of risk appetite.
S-T TREND L-T TREND STRATEGY
Awaiting New Sell Trade Setup.
AUD/USD
Ron William, Technical Strategist, E-mail: [email protected], Phone: +41 32 7228 454
AUD/USD daily, weekly chart, Bloomberg Finance LP
AUD/NZD and AUD/JPY daily chart, Bloomberg Finance LP
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DAILY TECHNICAL REPORT 5 December, 2011
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Rising wedge warns of exhaustion.
GBP/JPY appears to be losing upside momentum, forming a rising wedge in
the hourly timeframe. This suggests that the corrective phase from 119.38
may be reaching exhaustion.
The bias now returns to negative again, with scope for a degree of support
to manifest, should a fall to the 120.00 region materialise.
We now seek a break over the resistance of the rising wedge, to complete
this formation. In particular we seek a slow-down in momentum ahead of a
potential period of weakness.
A failure to hold over 119.38 will warn of a return to 116.84.
Over a longer period of time a substantial recovery higher is favoured,
initially towards 163.09.
S-T TREND L-T TREND STRATEGY
Sell limit 3 at 123.00, Objs: 122.00/121.00/120.00, Stop: 124.00
GBP/JPY
GBP/JPY daily chart, Bloomberg Finance LP
Bijoy Kar, Technical Strategist, E-mail: [email protected], Phone: +41 32 7228 424
GBP/JPY hourly chart, Bloomberg Finance LP
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In the final phases of a short-term correction higher.
EUR/JPY appears to be in the final phases of a correction higher from the
recent low at 102.49.
We also view the fall that has taken place since 111.60 as being correctivein nature, suggesting potential for a return to this same level.
However, the EUR component of this pair is highly affected by the
movement in EUR/USD. A break under 1.3146 in EUR/USD will end the
rising phase seen since 2010. This would likely be associated with a fall
back down to 100.76 and potentially lower.
Given the above clash between the structure and events in the Euro-Zone,
we prefer to wait on the side lines.
A sustained hold over the 200 day moving average will turn the medium-
term outlook more bullish.
S-T TREND L-T TREND STRATEGY
Await fresh signal.
EUR/JPY hourly chart, Bloomberg Finance LP
Bijoy Kar, Technical Strategist, E-mail: [email protected], Phone: +41 32 7228 424
EUR/JPY daily chart, Bloomberg Finance LP
EUR/JPY
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Failed downside break warns of a larger corrective phase higher.
EUR/GBP failed to gain momentum again, this time in the hourly timeframe,
after breaking under 0.8528. This now warns of a larger rise higher, back
towards the 0.8700 region. As has already been seen, following the recent
push under 0.8530/31, this failure to garner momentum is a hallmark of this
currency pair in recent trade. Thus the strategy remains to sell, but at
higher levels.
Given the precarious situation in the Euro-Zone, it is anticipated that if yield
curve deterioration continues then Sterling could be viewed as a safe haven.
Italian and Spanish government bond yields have eased back somewhat
after the coordinated cut in USD based swap lines amongst selected central
banks. However, a lasting solution still appears a long way off with the
recent intervention simply easing a dire situation.
Our bias remains mildly bearish with trade continuing under both the 200
day and 50 week moving averages. We keep an eye on the 1.3146 level in
EUR/USD. A push under this level will mark a clear breakdown of
confidence in the EUR, which would then likely have a knock on effect on all
EUR crosses.
S-T TREND L-T TREND STRATEGY
Sell limit 3 at 0.8700, Objs: 0.8565/0.8485/0.8285, Stop: 0.8835.
EUR/GBP hourly chart, Bloomberg Finance LP
EUR/GBP daily chart, Bloomberg Finance LP
EUR/GBP
Bijoy Kar, Technical Strategist, E-mail: [email protected], Phone: +41 32 7228 424
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A re-test of the 1.2123/31 region favoured.
EUR/CHF continues to trade in a tight range failing to meet the 1.2500 level.
Following the recent six bank dollar swap rate coordination, yields in many
Euro-Zone sovereign bond markets have fallen back, easing the downside
pressure in EUR/CHF.
Our strategy is to trade opportunistically from a momentum perspective,
awaiting a return to the 1.2000 region. Should a re-test of the 1.2000 region
take place with a fall under 1.1973 also following, this would warn of the end
of the recovery seen since 1.0075, increasing the probability of a return to
this level.
Near-term, a break back under 1.2226 will warn of a failure to re-test the
1.2500 region, suggesting an earlier return to 1.2123/31. In any case, a re-
test of the base of the recent trading range is anticipated over coming
sessions.
The failure of this pair to break over the 50 week moving average over
recent weeks is also an initial warning that the prior downtrend may not be
over. The large cluster of stops that is likely to be placed around the 1.2000
level is also anticipated to aid any short positioning, questioning the ability of
the SNB to hold back the possible flow of funds into Swiss Francs.
S-T TREND L-T TREND
Sell stop 3 at 1.2130, Objs: 1.2030/1.1526/1.1002, Stop: 1.2230.
EUR/CHF weekly chart, Bloomberg Finance LP
EUR/CHF
EUR/CHF hourly chart, Bloomberg Finance LP
Bijoy Kar, Technical Strategist, E-mail: [email protected], Phone: +41 32 7228 424
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Remains negative beneath $1800.
Short-term price activity remains negative beneath resistance at $1800,
despite the recent push higher. Only a close above here would develop a
more sustained recovery into $1845.
Meanwhile, there is still heightened risk for a much larger decline if we
confirm a weekly close beneath $1600/04 and $1530 (200-day MA/swing
low), which has not been breached in 3 years!
A number of “bargain hunting” trend-followers will be watching this
benchmark “line in the sand” for repeat support or a potential big squeeze
lower into $1300 and perhaps even $1040-1000.
Speculative (net long) flows also support this view having recently breached
a key downside level which may threaten over 2 years of sizeable long gold
positions. This will trigger a temporary, but dramatic setback that would
ultimately offer a unique buying opportunity in the near future.
Please select links for in-depth Gold coverage:
Special Report “Gold’s mountainous peak at risk…beneath $1600” VIDEO
Bloomberg Countdown CNBC Squawk Box MIG Bank Gold Webinar video(BLOOMBERG & CNBC REPORTS)
S-T TREND L-T TREND STRATEGY
Awaiting new sell trade setup.
GOLD
Gold weekly and daily charts, Bloomberg Finance LP
Ron William, Technical Strategist, E-mail: [email protected], Phone: +41 32 7228 454
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Key support at $30.0000.
Lowered stop to 34.1300, breakeven, thereby ensuring a risk-free trade.
Silver is holding around key support at 30.0000. Only a sustained close
below here would trigger a test of the previous swing low at 26.0700.
Macro price structure continues to focus on the downside risks, following the
major sell-off in September. Such a dramatic move traditionally produces
volatile trading ranges. This allows the market to have enough time to
recover and accumulate renewed buying interest.
Expect a large trading range to hold between $37.0000-26.0700 over the
multi-week / month horizon, with downside macro risk into $21.5165 (61.8%
Fib-1999 bull market) and $20.0000. This would still maintain silver’s long-
term uptrend and help offer a potential buying opportunity for the eventual
resumption higher.
Continue to watch the gold-silver “mint” ratio which has now accelerated
higher by 70%, suggesting further risk aversion over the next few weeks.
This also helps explain recent divergences between gold and silver.
S-T TREND L-T TREND STRATEGY
SHORT 3: 34.1300, Obj: 29.9700/26.0700/23.3400, Stop: 34.1300
SILVER
Spot Silver daily and weekly charts, Bloomberg Finance LP
Ron William, Technical Strategist, E-mail: [email protected], Phone: +41 32 7228 454
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Limitation of liability
MIG BANK disclaims, without limitation, all liability for any loss or damage of any kind,
including any direct, indirect or consequential damages.
Material Interests
MIG BANK and/or its board of directors, executive management and employees may have or
have had interests or positions on, relevant securities.
Copyright
All material produced is copyright to MIG BANK and may not be copied, e-mailed, faxed or
distributed without the express permission of MIG BANK.
Notes: Entries are in 3 units and objectives are at 3 separate levels where 1
unit will be exited. When the first objective (PT 1) has been hit the stop will be
moved to the entry point for a near risk-free trade. When the second objective
(PT 2) has been hit the stop will be moved to PT 1 locking in more profit. All
orders are valid until the next report is published, or a trading strategy alert is
sent between reports.
DISCLAIMER
No information published constitutes a solicitation or offer, or recommendation, or advice, to
buy or sell any investment instrument, to effect any transactions, or to conclude any legal act
of any kind whatsoever.
The information published and opinions expressed are provided by MIG BANK for personal
use and for informational purposes only and are subject to change without notice. MIG BANK
makes no representations (either expressed or implied) that the information and opinions
expressed are accurate, complete or up to date. In particular, nothing contained constitutes
financial, legal, tax or other advice, nor should any investment or any other decisions be
made solely based on the content. You should obtain advice from a qualified expert before
making any investment decision.
All opinion is based upon sources that MIG BANK believes to be reliable but they have no
guarantees that this is the case. Therefore, whilst every effort is made to ensure that the
content is accurate and complete, MIG BANK makes no such claim.
LEGALTERMS
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DAILY TECHNICAL REPORT 5 December, 2011
www.migbank.comRon WilliamTechnical [email protected]
14, rte des Gouttes d’Or CH-2008 NeuchâtelTel.+41 32 722 81 00
Bjioy KarTechnical [email protected]
CONTACT
Howard FriendChief Market [email protected]