The following are the intraday outlooks for EUR/USD, USD/CNH, EUR/GBP, and AUD/USD as provided by the technical strategy team at SEB Group.
EUR/USD: More uncertainty added. After an initial move lower from the 55d ma band the pair turned bid and rose relatively sharply before giving up some of the gains ending the day more or less unchanged and with spikes on both sides. The fact that we didn’t get the a sustained rejection from within the 55d ma band keeps the door open to possibly a continue corrective move higher and especially so if managing to take out the 1.1115 resistance, breaking the pattern of falling lows since the June peak. A continued fall in US bond yields will also underpin a move higher.
USD/CNH: In a third of a third wave surge. Yesterday’s question of whether a new trend is being established can today with a greater certainty be answered yes. The internal wave pattern, together with the price action, argues that we currently are moving north within a third of a third wave, the most powerful part of a trending move. Ideally wave 3 of a lesser subdivision should end in the current area, giving way to a congestion/correction in wave 4 before continuing higher.
EUR/GBP: The break of 0.7098 points north. Already the violation (the non-sustained break) of 0.7098 yesterday strongly argues for more short covering near term. A firsthand target for a corrective move higher is 0.7176 and only beyond that point will we start considering a more profound lift.
AUD/USD: Poor follow through at a new low. Again the pair was rejected from the 2001 trend line and this time also by creating a bearish key day reversal suggesting that the longer term bear trend now has resumed. The only annoying thing is the fact that the follow through selling below the recent low point so far has been so weak. Either more selling is in the pipeline or a minor reaction higher will unfold before pushing prices lower again.