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DB—KEY RISK/TRADE IDEAS

From the FXWW Chatroom: MARKET UPDATE: The harrowing events in Manchester overnight have brought a somber tone to the European open. Risk sentiment is subsequently a little softer than where we left it yesterday, weighing on JPY crosses and bringing into question some of the more heavily populated positions. In the longer run, as awful as they are, these events are unlikely to have a lasting impact on the market. European data this morning (EZ PMIs and German IFO) should begin to dictate price action. The plethora of Fed speakers continues this afternoon with Kashkari and Harker on the tapes.

EUR:

EURUSD –            Support: 1.1165 (low this week), 1.1143 (pre-election Nov-16 high)          Resistance: 1.1264 (high last week), 1.1300 (high on 2016 election)

Despite trading only 40-points from its YTD high, it feels as though EURUSD is running out of steam in the near-term. Yesterday we saw buying interest of downside protection in the options market as well as better supply from longer-term players in spot. To me it feels as though the next 50/75 points to the topside will be much more of a struggle than the previous 50. EZ PMIs and German IFO this morning should dictate early price action. Our overall view remains unchanged and are still of the belief we are at the earlier stages of a larger trend higher.

GBP:

GBPUSD –            Support: 1.2888 (low last Thurs), 1.2865 (low last week)                                 Resistance: 1.3048 (high last week), 1.3480 (Jul-16 high/double top)
EURGBP –            Support: 0.8597 (200dma), 0.8559 (100dma)                                                         Resistance: 0.8660 (high this week), 0.8745 (level into March BOE)

Manchester bombing incredibly upsetting but not a market mover.  Some believe it helps May, but I am not so sure that is clear.  EURGBP saw some heavy demand above .8630 yesterday, it seems to be one of the favored EUR longs to hold.  Our initial expectation of Cable trading through 1.30 ha

JPY:

USDJPY –             Support:    110.25 , 109.88 (200 DMA)                                                                      Resistance:  111.66 (55 DMA) 112.15 (trend channel break)
EURJPY –             Support:    124.20,  122.10 (TL support)                                                                   Resistance:   126.47 ( April 2016 High)

Another Trump spanner thrown in the works as the Russia story just won’t go away. Dips starting to become less pronounced as the market becomes more ambivalent. Still remain of the opinion that selling low UsdJpy is a poor risk reward option despite the political noise. Target all but met in EurJpy so cut longs for now and watching for signs of the overbought conditions being unwound.

CHF:

USDCHF –          Support: 0.9718 ( trend line support)                                                                        Resistance:  0.9859 (pivot break)
EURCHF –           Support: 1.0873 (Consolidation break)                                                                    Resistance:  1.1000/10 (July/Sep 2016 highs)

Not a great deal new to add in CHF.  New range in EurChf seems well established, High 1.09’s to mid 1.08’s. UsdChf breaks previous lows in the 9810/60 zone and in line with our bullish Eur view is set to test TL support. With Eur crosses generally bid EurUsd remains a more favoured expression of dollar bearishness.

AUD/NZD:

AUDUSD –          Support: 0.7450 (hourly T/L), 0.7389 (last weeks low)                                       Resistance: 0.7535 (55,200DMA), 0.7554 (100DMA)
NZDUSD –           Support: 0.6862 (weeks low), 0.6819 (RBNZ low)                                               Resistance: 0.7055 (Apr high,100DMA), 0.7111 (200DMA)
AUDNZD –          Support: 1.0610 (May low)                                                                                           Resistance: 1.0809 (61.8% Fibo of May selloff), 1.0934 (May High)

AUD and NZD broke their respective

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