jeudi 9 avril 2015
EUR/USD, GBP/USD: Revisiting Long-Term Charts - Citi
Posted on 12:27 by nice news
In its weekly note to clients, CitiFX revisited the set-ups of the long-term charts in EUR/USD and GBP/USD.
Starting with EUR/USD, Citi notes that it has struggled to sustain above 1.10 and has instead formed a double top within the bearish channel where the neckline was at 1.0714 before breaking today and the pattern targets 1.0392.
"It is also interesting that in the face of weak US payroll numbers and the alleged short positioning in the market on EURUSD, the pair did not manage to rally much over the Easter holiday period. That, to us, suggests that perhaps the market is not so “long USDs” and the downtrend that appears to be resuming here might catch momentum," Citi argues.
"The channel base is at 1.0175 and falling while the long-term chart below suggests we may see a move to as low at 0.90...If the overall multi-year bear market is going to be similar to that seen between 1992 and 2001 then we should head towards the 0.90 area by early 2016," Citi projects.
Like EUR/USD, Citi notes that GBP/USD seems to be tracking a similar path as it did in the late 1990s
"We continue to believe that GBPUSD is likely to follow a similar path to that period (albeit that the move has been a little faster in this leg than that seen after the 1998 turn). Thus, we would not be surprised if GBPUSD tested levels in the 1.35 – 1.37 range. Good interim support from the 1993 and 2010 lows resides in the 1.4168 – 1.4231 range," Citi projects.
Starting with EUR/USD, Citi notes that it has struggled to sustain above 1.10 and has instead formed a double top within the bearish channel where the neckline was at 1.0714 before breaking today and the pattern targets 1.0392.
"It is also interesting that in the face of weak US payroll numbers and the alleged short positioning in the market on EURUSD, the pair did not manage to rally much over the Easter holiday period. That, to us, suggests that perhaps the market is not so “long USDs” and the downtrend that appears to be resuming here might catch momentum," Citi argues.
"The channel base is at 1.0175 and falling while the long-term chart below suggests we may see a move to as low at 0.90...If the overall multi-year bear market is going to be similar to that seen between 1992 and 2001 then we should head towards the 0.90 area by early 2016," Citi projects.
Like EUR/USD, Citi notes that GBP/USD seems to be tracking a similar path as it did in the late 1990s
"We continue to believe that GBPUSD is likely to follow a similar path to that period (albeit that the move has been a little faster in this leg than that seen after the 1998 turn). Thus, we would not be surprised if GBPUSD tested levels in the 1.35 – 1.37 range. Good interim support from the 1993 and 2010 lows resides in the 1.4168 – 1.4231 range," Citi projects.
EUR/USD, GBP/USD: Revisiting Long-Term Charts - Citi
Categories: EUR/USD, GBP/USD: Revisiting Long-Term Charts - Citi
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