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Article / 05 December 2017 at 15:39 GMT

FX Board: Another AUDUSD tease; EURUSD and USDJPY still in limbo

Head of FX Strategy / Saxo Bank
Denmark
  • EURUSD failed to move on from yesterday's breakout attempt
  • EURGBP moves suggest hope persists for EU summit breakthrough
  • Gold looks increasingly heavy as it posts its lowest levels in weeks

usd
 The US dollar fought for change today but didn't quite make it. Pic: Shutterstock

By John J Hardy

Please see today's FX Board PDF attached to this post for the latest Notes of Interest, Trend and Trend Heat readings, as well as a few thoughts on key chart developments below.

Charts:

EURUSD
EURUSD never got out of the box today after trying to bounce yesterday as the euro was generally offered across the board over the last couple of sessions. The key downside pivot remains near 1.1800, which could set in motion a larger correction back to 1.1500 on the cascading implications in a C-wave style correction. Stay tuned, given what has been a rather treacherous market in many of the major pairs recently.
eurusd
 Source: Saxo Bank

EURGBP
EURGBP bounced off the critical 0.8750 after the market got encouraging news of Brexit negotiation progress. Alas, the sharp bounce as nervous shorts were squeezed out has unwound rather quickly, suggesting many continue to hope for a breakthrough ahead of next week's EU summit.
eurgbp
 Source: Saxo Bank

AUDUSD
AUDUSD teased with a rally overnight on supportive developments that suggested we might see an attempt on higher resistance levels unfold here. Alas, if the pair continues to weaken into a close near or below 0.7600 today, the bears will find encouragement for maintaining the course for new lows for the cycle from here – into the 0.7330 and 0.7160, for example. (The downside from today's highs may have been on a brutal selloff in copper that didn't get underway until the early European session this morning and therefore after the AUD had rallied on Reserve Bank of Australia news and other developments overnight.)
audusd
Source: Saxo Bank
 
XAUUSD
Gold is looking very heavy here, posting its lowest levels in weeks and trading down into the last shreds of the range resistance into the $1260 area and already now up against its 200-day moving average. If the USD punches back stronger, we could be headed much lower – perhaps towards $1225.
xauusd
Source: Saxo Bank

– Edited by Clare MacCarthy

 

John J Hardy is head of FX strategy at Saxo Bank 
Download document

FX Board for Tuesday, December 5, 2017

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