Currency snapshot (major pairs)

Dollar index trading at 95.67 (-0.2%)

Strength meter (today so far) – Euro +0.11%, Franc +0.06%, Yen +0.51%, GBP +0.26%

Strength meter (since last week) – Euro +0.11%, Franc +0.06%, Yen +0.51%, GBP +0.26%

EUR/USD –

Trading at 1.116

Trend meter –

• Long term – Sell, Medium term – Sell, Short term – Sell

Support                      

• Long term – 1.06, Medium term – 1.08, Short term – 1.09            

Resistance –

• Long term – 1.16, Medium term – 1.143, Short term – 1.132

Economic release today –

• Markit services PMI declined to 52.8 in August.
• Sentix investor confidence improved to 5.6
• Retail sales grew by 2.9 percent in July from a year ago.

Commentary –

• The euro is marginally higher today, after taking a beating last week. Active call – Sell EUR/USD at 1.116 with stop loss at 1.15 and target at 1.01. However, in the short run, Euro might ride higher.

GBP/USD –

Trading at 1.333

Trend meter –

• Long term – Sell, Medium term – Sell, Short term – Sell

Support –

• Long term – 1.2, Medium term – 1.27, Short term – 1.29

Resistance –

• Long term – 1.39, Medium term – 1.35, Short term – 1.34

Economic release today –

• UK services PMI rose to 52.9 in August.
• BRC retail sales report will be released at 23:00 GMT.

Commentary –

• The pound remains well bid as services PMI expanded beating estimates. We expect the pound to reach parity.

USD/JPY –                      

Trading at 103.2

Trend meter –

• Long term – Sell, Medium term – Range/ Sell, Short term – Sell

Support –

• Long term – 91, Medium term – 98, Short term – 98

Resistance –

• Long term – 111, Medium term – 107, Short term – 107

Economic release today –

• Labor cash earnings grew 1.4 percent in July from a year ago.
• Markit services PMI declined to 49.6 in August.

Commentary –

• The yen is the best performer of the day despite Kuroda’s assurance of further easing. Active call – Buy Yen @119.5 with stop loss around 123.8 and target at 114 and 110, 108.9 and 98.5. All targets reached, new target 90 added. Yen may retrace to 111 per dollar if BOJ intervenes.

USD/CHF –        

Trading at 0.979

Trend meter –

• Long term – Buy, Medium term – Range, Short term – Range/Sell

Support –

• Long term – 0.9, Medium term – 0.927, Short term – 0.95

Resistance –

• Long term – 1.037, Medium term – 1.01, Short term – 0.994

Economic release today –

• NIL

Commentary –

• Franc is moving in line with Euro again. We expect Franc to strengthen against Dollar to as high as 0.86 area in the medium term.