Mizuho Corporate Bank

EUR
Comment: Consolidating between the 9 and 26-day moving averages. For today expect more of the same.

Strategy: Attempt small longs at 1.3645; stop below 1.3600. Target 1.3725.

EUR/JPY
Comment: The bounce from the 160.65 low this week has been smaller than expected hinting at another downside probe this week. We shall continue with a very cautious stance and be prepared to turn positions as necessary as we move into consolidation and possibly a deeper correction mode.

Strategy: Attempt tiny longs at 161.00; stop/reverse below 160.45 for 160.00, maybe 159.00. Cover longs ahead of 164.00.

GBP
Comment: Consolidating above 2.0150, a fairly pivotal level, and likely to do so again today. Any rally is likely to be capped at 2.0450 and we got a ‘shooting star’ on the monthly candle suggesting we will hold below 2.0656 for several months. For this morning expect a downside probe, then random moves around 2.0300.

Strategy: Attempt small longs at 2.0205, adding to 2.0150; stop well below 2.0100. Target 2.0400.

JPY
Comment: Clinging to weekly trendline support but bounces from here have been a lot smaller than we had pencilled in. The US dollar is still oversold, momentum is very bearish and we have completed a large ‘bearish engulfing’ candle on the monthly chart. This suggests another push lower this week.

Strategy: Attempt small shorts at 118.50, adding to 119.00; stop above 119.65. Add to shorts on a sustained break below 118.00 for 117.20.