US Session Bullet Report – Month end flows and equity markets giving direction

Global stocks fell to their lowest point in 2 years as emerging markets and commodities prices stayed under pressure. European shares partially recovered some of the losses however most major indexes remained near 2015 lows. Earlier Asian shares fell after China released yet another round of disappointing manufacturing data.

Gold fell to 1124 on worries that US interest rates would rise later this year and because of the China slowdown. EURUSD retreated from its highs as equity markets recovered some of its losses. USDJPY hit 119.25 however bounced to 120.00 in a very similar fashion as in the last 3 trading sessions.

There were mixed messages from FED members yesterday and investors will be looking at FED’s Yellen speech on Wednesday for further clues. Beware of month-end portfolio adjustments: Some dealers are expecting a number of intraday price moves to go unexplained. Expect a number of the currency moves to be linked to month-end adjustments.

Trading quote of the day:

“Vision without action is a daydream. Action without vision is a nightmare.”

– Japanese proverb

EURUSD
Pivot: 1.121
Likely scenario: Long positions above 1.121 with targets @ 1.1295 & 1.133 in extension.
Alternative scenario: Below 1.121 look for further downside with 1.1185 & 1.1145 as targets.
Comment: The RSI lacks downward momentum.

GBPUSD
Pivot: 1.521
Likely scenario: Short positions below 1.521 with targets @ 1.513 & 1.509 in extension.
Alternative scenario: Above 1.521 look for further upside with 1.5245 & 1.5285 as targets.
Comment: The RSI is mixed to bearish.

AUDUSD
Pivot: 0.701
Likely scenario: Short positions below 0.701 with targets @ 0.6935 & 0.69 in extension.
Alternative scenario: Above 0.701 look for further upside with 0.7035 & 0.706 as targets.
Comment: The RSI lacks upward momentum.

USDJPY
Pivot: 119.2
Likely scenario: Long positions above 119.2 with targets @ 120.35 & 120.65 in extension.
Alternative scenario: Below 119.2 look for further downside with 119 & 118.7 as targets.
Comment: The pair has broken above a bearish channel upper boundary.

USDCAD
Pivot: 1.334
Likely scenario: Long positions above 1.334 with targets @ 1.3445 & 1.3485 in extension.
Alternative scenario: Below 1.334 look for further downside with 1.3295 & 1.3245 as targets.
Comment: The RSI is supported by a bullish trend line.

USDCHF
Pivot: 0.9755
Likely scenario: Short positions below 0.9755 with targets @ 0.9665 & 0.964 in extension.
Alternative scenario: Above 0.9755 look for further upside with 0.9775 & 0.981 as targets.
Comment: The RSI lacks upward momentum.

GOLD
Pivot: 1135
Likely scenario: Short positions below 1135 with targets @ 1121 & 1116 in extension.
Alternative scenario: Above 1135 look for further upside with 1140.5 & 1148 as targets.
Comment: As long as 1135 is resistance, likely decline to 1121.

OIL
Pivot: 45.3
Likely scenario: Short positions below 45.3 with targets @ 44.35 & 43.7 in extension.
Alternative scenario: Above 45.3 look for further upside with 45.75 & 46.4 as targets.
Comment: As long as the resistance at 45.3 is not surpassed, the risk of the break below 44.35 remains high.

DAX
Pivot: 9608
Likely scenario: Short positions below 9608 with targets @ 9235 & 9130 in extension.
Alternative scenario: Above 9608 look for further upside with 9753 & 10020 as targets.
Comment: The RSI is bearish and calls for further decline.

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TIME IS IN GMT(+3)

Report prepared by the easy-forex VIP desk at 06:20 GMT.

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