Keane Insights: Next Weeks Trading Plan

The week ended with a bang Friday.  Spain's Prime Minister hinted that the government may be softening to requesting support from the ECB pending more details regarding the available plans.  USD Non Farm Payroll report came in much better then expected lowering the possibility for QE in the near future.  These two pieces of news pushed and pulled at each other until the US open.  Then the majors screamed higher against the USD.  Heading into next week all eyes will be on the EURUSD resting at weekly highs, for any push above resistance.  The AUDUSD and USDCAD will also be in focus as they test the extremes of their respected channels.  Everyone have a great weekend and keep your trade KEANE into the open Monday

EURUSD DRAGHI"S MOVE ONCE AGAIN

It was a tricky day to trade the EURUSD .  Trading seemed clear enough to start the day in Europe.   Spanish Prime Minister Mariano Rajoy suggested that he would consider requesting support from the euro zone’s bailout fund.  This was a step forward for Madrid who had up to this point ruled out the possibility of asking for support.  Mr. Rajoy declined to specify Spain’s course of action before the ECB provides more information about the European Financial Stability Facility and the euro zone’s temporary rescue fund.  This places the ball back in the ECB’s court after European Central Bank Presidient Mario Draghi Thursday said the ECB is ready to resume government bond purchases, but only after a government makes a request to the euro zone’s rescue funds and accepts conditions.  Now all that is necessary is for the ECB to hammer out the details with Germany.  Which off course will be a difficult trick to perform.

Trading became a bit cloudy after the release of the NFP report which was better than expected.  Thus diminishing the expectations of QE in the short-term from THE USA.  This is when the tug of war began.  A stronger NFP should have translated into a stronger dollar as it did in the USDJPY.  But with two stories competing Draghi won out once again.

From a price action point of view the EURUSD looks to be set to close near the highs of the week around 1.24.  The cross is now above support at 1.2330 and past trend line resistance at 1.2280.  Any move back down to the 1.2280 level could attract buyers.  A break of 1.24 exposes 1.25.

Sup          1.2330                         1.2285

Res           1.24

Keane Insight:  Any move back towards past trend line resistance at 1.2285 could find buyers.  Could gap higher over the weekend with positive EUR news.

 

GBPUSD TRIANGLE ACTION

The GBPUSD followed risk higher on Friday after news from Spain and a better than expected NFP report.  The cross moved up to trend line resistance around 1.5650 after testing support at 1.55.  The cross appear to be in a triangle on the 4hr chart.  The ascending trend line at 1.5510 creates support.  A breakout above trend line resistance could expose Thursdays high at 1.5675 followed by the 50 fib from the May lows at 1.5782.

Sup  1.5510

Res  1.5650

Keane Insight:  See if the triangle is respected into the Asian Monday Open.

AUDUSD SHALLOW WEEKLY RANGE

The AUDUSD finished near the highs of the week after trading inside a 140 pip range for the majority of it.  The pair tested channel resistance at 1.0580 once again Friday. Daily price support is strong at 1.0420.  This level supported the pair throughout the week.  A break of trend line resistance could expose the pair for a test of the 1.0630 level.  Heading into the open Monday any bounce of trend line resistance could lead to a retest of 1.0420 level.

Sup         1.0420

Res         1.0630

Keane Insight:   Watching for a bounce of resistance into trading Monday

NZDUSD HEADING TO THE TOP OF THE CONSOLIDATION ZONE

throughout the week it appeared that as long as the NZDUSD could remain above .8060 it would eventually pop higher.  Friday was the day the pair put together the momentum to move higher.  The pair is once again in the consolidation zone that the cross traded in throughout the month of March and April.  Within the consolidation zone resistance begins at .8235.  In the short-term support begins at the day lows at .8120 and resistance is at .82.

Sup             .8120

Res              .82

Keane Insight:   A break of the daily range to the top or bottom could lead to a test of the broader consolidation range

USDCAD AT CHANNEL SUPPORT

This USDCAD traveled in a narrow 100 pip range throughout the week.  channel support combined with parity rejected most moves lower.  It looks as though the pair is attempting to close below parity but above trend line support at .9980.  A push below channel support could find support at .9920.  Resistance still begins at 1.00.

Sup         .9980

Res          1.01

Keane Insight:  Could bounce of the bottom of the range into the Asian open.  Watching for gaps into the open

USDJPY RANGE RANGE RANGE

The USDJPY has manged to stay within a 60 pip range for most part of the last month.  The cross could break higher if expectations for further QE diminish lead ing to higher interest rates on USD bonds.  The pair is closing the week at the range top at 78.60.  A break of this level could expose 79.15.  Channel support can still be found at 78.

Sup   .78

Res    78.60

Keane Insights:  Watch USD yields for hints.

 

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