ForexLive Asian market open: Big levels looming

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The line-in-the-sand in USD/JPY at 83.00 is very close and even though there was a marginal break overnight, the market has managed to close above it. Market chatter suggests that the stops below 82.80 are huge and if the BOJ aren’t spotted over the next week then we’ll probably be challenging 80.00.

AUD/USD has made a remarkable turnaround since the post RBA sell-off and .9750 is the big level to watch here with option protection and large stops above. With gold and commodity prices roaring ahead and the USD remaining friendless, it is probably only a matter of a short time before the break higher occurs.

EUR/USD is also closing in on important technical resistance around 1.3900, a major 61.8% retracement level and the 200-week MA. If this current bull move can motor straight through strong resistance levels such as this then we really are in a formidable trend.

Good luck today.

2010-10-05T21:02:44+0000

All|Asia Pacific

AUD/USD|EUR/USD|USD/JPY

Sean Lee

8 Comments

  1. So i take it you’re not convinced that aud/usd has topped fornow?

  2. Sean – Good day! I’m guessing that you might suggest “buy the dips” as a strategy for AUD today (since RBA only jumpstarted the previous trend…)? with .9750 very near, what are your thoughts?

  3. Hi Sean, I think if AUD can muster the powder to push to .9725 it would seem likely that it will break higher thru .9743 in spite of the surprise of no rate increase last night. On EUR did it drop due to the change in sessions or just profit taking? And do you think it will test 1.3897

  4. Hi Sean good morning. What’s your thoughts on usd/chf. I’m long since.99 and added another small last night. Should I keep adding more now or wait

  5. Hi BingoB, I have tried picking the bottom on a few occasions to no avail and it’s difficult to say when the fall will stop. Looking at the other majors, if USD/JPY trades below 8280 and EUR/USD trades above 13950 then I think being long USD against anything is too dangerous so I’d suggest taking the hit.

  6. Morning Rance. Any market which bounces back so strongly after a sell-off must be treated with respect. I’d be surprised if we didn’t see a concerted test of 9750 and 13900 in AUD/USD and EUR/USD respectively.
    That said, I’m still tending towards believing that we’ll see another sell-off in AUD/USD before the final push to test parity, I’m guessing 9350/9850 range in next few weeks and the parity push happens closer to Christmas when we often see the really big moves

  7. Sean, thank u for the insight…anyway, do you think the australian gov or RBA will attempt to block the nation’s currency rise to parity? And if they do have parity with usd, do you think it may hold for quite a while like the swiss franc? They’re not really export-based like japan, but do you think that yesterday’s rate hold may have to do with cushioning the aud rise? Thank u.

  8. Hi Kanov. The RBA will not try and stand in the way I think, the market is way too big and they could get seriously hurt like the SNB did earlier this year. I do think the AUD is overvalued but with this flow out of USD continuing, I think its very brave to be overly bearish AUD/USD

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