Mizuho Corporate Bank

EUR
Comment: Edging to yet another new record high 1.6020 while consensus opinion is very much that US dollar weakness will trough imminently and that it will strengthen for the rest of this year. We disagree. The Euro is not overbought, futures positions are well below last year’s record, and note the massive Ichimoku ‘cloud’ which should prop up prices next month (and more). For today expect consolidation between 1.5880 and 1.6050.
Strategy: Attempt tiny longs at 1.5975, adding to 1.5900; stop below 1.5825. Short term target 1.6020/1.6050, then 1.6150.

EUR/JPY
Comment: Hovering at the highest levels this year, and some of the most expensive levels ever. Again today we shall be watching for sings of forming an interim top because the Euro is terribly overbought against the Yen.
Strategy: Attempt small shorts at 164.70; stop well above 165.00. Short term target 163.30, then 161.50.

GBP
Comment: Rallying back up to the top of the Ichimoku ‘cloud’ and the psychological 2.0000 level, underlining the fact that the market is looking for direction. Watch for an upside attempt today, probably setting off a decent round of short-covering.
Strategy: Buy at 1.9930; stop below 1.9700. Add to longs on a sustained break above 2.0050 for 2.0500.

JPY
Comment: Still little to add as we remain trapped in a small range around a very thin Ichimoku ‘cloud’ and below the 61% retracement area. Again today we shall watch for more signs of topping, possibly a slow move which may take several days, with bearish pressure increasing if we hold below 104.20 for the rest of the week.
Strategy: Attempt shorts at 103.00, adding to 103.50; stop above 104.15. Short term target 102.80/102.50, then 101.00.