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Forex Trading: Asian Session Recap and Ranges

Posted by Akhilesh Ganti on Oct 21, 2013 11:10:00 PM

Another quiet session as the market prepares for the delayed release of the US Non-Farm Payroll report. Given Washington's shenanigans, the release might not be viewed with the normal dose of gravitas as expectations of a weaker October report, due out on 11/8, and the possibility of major revisions will likely come to the fore. Nevertheless, this is what the market is expecting:

{Source: Bloomberg}
US NFP preview sep13 resized 600

A look at weekly charts for EURUSD, GBPUSD, USDJPY & AUDUSD

(click to enlarge)
techs 102113

EUR/USD is targeting its key resistance at 1.3711. The medium-term bullish momentum does not appear to be abating and as long as initial support levels at 1.3650, 1.3590 and key support at 1.3415 holds then a potential test of 1.4000 on a multi session basis could be in the cards.

GBP/USD is carving out a widening range between support at 1.5880 and the resistance at 1.6260 that is usually symptomatic of a consolidative phase. Overbought conditions argue for a cautious approach but if 1.5880 holds then the possibility of a test of key resistance at 1.6391 exists.

USD/JPY broke through the lower bound of the triangle formation to test key support at 96.50. The subsequent rebound has seen the pair re-test the breached ascending trendline that sits at moderate resistance at 98.40. A clean break of this will negate the short-term bearish scenario as the focus shifts back to 99.20. The pair has been consolidating since May of this year as it looks to correct its overbought state and as long as major support at 95.80 holds, another attempt at the 103.76 key resistance level could be in the offing.

AUD/USD's breach of key resistance at 0.9345 has seen the pair make its way to resistance at 0.9680. The yield advantage that this pair holds -vs- the rest of the majors should continue to give it a boost as it looks to test 0.9715, which is the 50% retracement level of the down move from 1.0582 to 0.8841, with an eye on key resistance level at 0.9792. Conversely, a break of 0.9500 would be needed the stem the bullish tide.  



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