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Ichimoku Report May 3rd
EURUSD – Shot Down by the Kumo, 1.3000 in its sights
After kissing the kumo (which ended up being a kiss of death) the pair has sold off 3 straight weeks and found much lower ground. However the price action has been finnicky with the pair finding plenty of downside rejections with the last 7 down-close candles so the gains are not to be had going into the weekend. Ultimately, we feel this pattern will continue unless it should do something new – aka break and close below the previous weeks low. Should it do that, we feel a strong move to 1.3000 is under way. However we like pullbacks at this point considering how much it has rejected. Our first choice would be the Tenkan which sits at 1.3500 but this may not be easy so 1.34.12 will do (last weeks high) as we feel the Tenkan will reject this time.
GBPUSD – Killed by the 20ema
Three attempts, three failures. Try as hard as it did, the pair simply could not break nor even close above it. However it has for 3 weeks now found support at the weekly tenkan so it could do this again which is just below at 1.5162. If this gives way, then the pair should head to 1.5000 and possibly back to the yearly lows at 1.4781. Overall, the pair is very in decisive with heavy wicks on both sides. The thick Kumo will make gains hard so this is not surprising. Sellers can wait for the 20ema and buyers can get aggressive at the tenkan although we feel the yearly low would be a better wait. the 38.2% fib of the 10′ high to low is parked at 1.5416 and has not allowed the pair to close above it so the line of least resistance is clearly down.
AUDUSD – You like watching paint dry?
Yep, for once in a while, this aussie is simply boring to trade. Stuck within a 9385 – 9145 range and gaining nothing the last two weeks (and not much for the last month) the pair has found support at the expanding triangle top and weekly Tenkan. If you want to buy and are not expecting much, then you can take positions here with stops below the 20ema or new longs there. Sellers can take the 09′ highs at 9412 with small stops for a move back down. Perhaps my comments about the aussie will get it moving as it may take it personally but the pair has not liked the topside or downside as of late. Line of least resistance is still up and the longer the pair holds here, the more likely it will head for higher ground.
USDCAD – Attempting a base but can we trust?
In parity we trust? I would not write this statement on the Loonie bills anytime soon. Simply because it has the Tenkan, 20ema and Kijun to contend with. Everytime it gets within range of them, it gets rejected shortly after. They are falling at a slow sauntering pace but nevertheless, falling. This should continue to add pressure and the massive kumo is towering above so we doubt the pair will see 1.1000 till 2011. Sell at the next line up, or for brave people, buy in the low 99cents and target parity and 1.0100.
USDJPY – Is it for real? Above the Kumo?
As we have been writing, we felt this was highly likely and the inevitable (unlike Mr. Smiths prediction for Neo). We actually like this formation as the fibs from the 09′ highs – lows come in line with the flat kumo top ahead and 95 yen. Our plan from last week still holds with a likely sell coming at 95 on 1st attempt. We hope to get a play back down to the flat top where if the 20ema and Tenkan can climb to will offer a solid buy but the longer it stays above the kumo, the more likely it will attract buys. Could be a major turning for the USDJPY with long term implications.
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