2012 01 06 Migbank Daily Technical Analysis Report

8/3/2019 2012 01 06 Migbank Daily Technical Analysis Report

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MIG BANK / Forex Broker 14, rte des Gouttes d’Or CH-2008 Neuchâtel Switzerland

Tel +41 32 722 81 00 Fax +41 32 722 81 01 [email protected] www.migbank.com

Please note: None of the strategies below represent trading advice or trading recommendations of any kind. Please refer to our full disclaimer.

WINNER BEST SPECIALIST RESEARCH

MA

S-TERMMULTI-DAY

L-TERMMULTI-WEEK

STRATEGY/POSITION

ENTRYLEVEL

OBJECTIVES/COMMENTS STOP

EUR/USD Await fresh signal.

GBP/USD Await fresh signal. Mild bias to longs.

USD/JPY Await new buy trade setup above 80.00.

USD/CHF Sell limit 3 0.9610 0.9500/0.9306/0.9176 0.9700

USD/CAD Awaiting new buy trade setup.

AUD/USD Await fresh signal.

GBP/JPY LONG 3 119.40 120.50/121.50/122.00 118.90

EUR/JPY Possibly looking to buy short-term. Await signal.

EUR/GBP Look to sell higher.

EUR/CHF Sell Stop 3 1.2130 1.2010/1.1526/1.1002 1.2250

GOLD Stopped for profit at 1605. Two objectives met.

SILVER SHORT 2 34.1300 26.0700/23.3400 (Entered 01/11/2011) 34.1300

DISCLAIMER &DISCLOSURESPlease read the disclaimer and thedisclosures which can be found atthe end of this report

DAILY TECHNICAL REPORT6 January, 2012

Ron William, CMT, MSTA

Bijoy Kar, CFA

Notes: Entries are in 3 units and objectives are at 3 separate levels where 1 unit will be exited. When the first objective (PT 1) has been hit the stop will be moved to the entry

point for a near risk-free trade. When the second objective (PT 2) has been hit the stop will be moved to PT 1 locking in more pr ofit. All orders are valid until the next report is

published, or a trading strategy alert is sent between reports.

http://www.migbank.com/

mailto:[email protected]









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DAILY TECHNICAL REPORT 6 January, 2012

www.migbank.com

Hourly consolidation band remains intact for now.

• GBP/USD continues to trade within the confines of a month long trading

range between 1.5780 and 1.5362. A breakout is sought ahead of trade

positioning.

• Sterling is still perceived as a relative safe haven given the continued

elevated yields seen in the Italian sovereign bond market. With this in

mind, should the region near long-term trend-line support be tested,

currently at 1.5135, a degree of demand would be anticipated.

• For now a rise towards the 200 day moving average is possible,

maintaining the old range from last year. Further strengthening of the

USD may not be as aggressively witnessed in GBP/USD, given the

large move that took place in 2008.

S-T TREND L-T TREND STRATEGY

Await fresh signal. Mild bias to longs.

GBP/USD

Bijoy Kar, Technical Strategist, E-mail: [email protected], Phone: +41 32 7228 424

GBP/USD hourly chart, Bloomberg Finance LP

GBP/USD daily chart, Bloomberg Finance LP







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Bears break from multi-day range.

• USD/JPY has weakened sharply beneath 78.24 (DeMark™ Level), asprice broke from a multi-day trading range (see hourly chart below).

• Confirmation beneath 77.25 (pivot level) now helps trigger a third price

retracement, that we had been expecting, back to pre-intervention levels

and potentially even a new post world war record low beneath 75.35.

• Sentiment in the option markets continues to suggest that USD/JPY

buying pressure remains overcrowded as everyone continues to try and

be the first to call the market bottom, within the end of this multi-year

contracting pattern.

• This may first inspire a temporary, but dramatic, price spike through

psychological levels at 75.00 and perhaps even sub-74.00. Such a move

would help flush out a number of downside barriers and stop-loss orders,

which would create healthy price vacuum for a potential major reversal.

• The medium / long-term view remains bullish, as USD/JPY verges toward

a major long-term 40-year cycle upside reversal. Expect key cycle

inflection points to trigger over the next few weeks, offering a sustained

move above our upside trigger level at 80.00/60, then 82.00 and 83.30.

Please select the link below to review our special coverage on USD/JPY.

Special Report: USDJPY Verging on a major 40 year cycle reversal VIDEO

Webinar: USD/JPY’s Long-Term Structural Change

Media Reports: CNBC / Squawk Box & Bloomberg


Awaiting renewed buy trade setup above 80.00.

Ron William, Technical Strategist, E-mail: [email protected], Phone: +41 32 7228 426

USD/JPY

USD/JPY hourly chart, Bloomberg Finance LP

USD/JPY daily chart, Bloomberg Finance LP

http://www.youtube.com/watch?v=rDHE6uEqm6w




http://www.fxstreet.com/webinars/sessions/session.aspx?id=d77a35a0-4a11-44fa-a883-c95e01661d21




http://www.cnbc.com/id/45301945



http://65.55.53.237/id/15840232?video=3000062126&play=1



http://www.bloomberg.com/news/2011-11-24/dollar-may-rise-20-to-94-yen-on-elliot-wave-rebound-technical-analysis.html














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Strong resistance anticipated near 0.9550/0.9600.

• Sell limit adjusted slightly to 0.9610.

• USD/CHF has broken over 0.9470, increasing the likelihood of a return

to 0.9550 and then potentially 0.9600. However, the 0.9550/0.9600

region is expected to act as strong resistance.

• USD/CHF continues to be a tied to the fate of EUR/CHF and thus the

ability of the SNB to successfully maintain its floor in EUR/CHF at

1.2000. We remain focused on the 1.2130 level in EUR/CHF, below

which should increase the likelihood of selling towards the 1.2000 level.

Fresh highs are still anticipated in 10 year Italian sovereign yields, with

scope then for a minor pullback, maintaining downside pressure on

USD/CHF.

• 10 year yields in Spain and Italy are currently trading at 5.691% and

7.137% versus 6.478% and 7.355%, before the US Dollar based swap

agreement. In both case we can see that the effects of the swap

agreement appear to be wearing off. This reminds us that the

agreement was likely put in place due to a need for US Dollars by

European financial institutions. This is a clear warning sign. These

same yields were trading at 5.531% and 6.991% respectively yesterday.


Sell limit 3 at 0.9610, Objs: 0.9500/0.9306/0.9176, Stop: 0.9700

USD/CHF hourly chart, Bloomberg Finance LP


USD/CHF

USD/CHF daily chart, Bloomberg Finance LP







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Unwinding from resistance at 1.0425.

• USD/CAD is unwinding sharply from intraday resistance at 1.0425, which

coincided with a short-term DeMark™ exhaustion signal.

• We prefer to wait for a strong directional confirmation higher before

initiating a buy trade setup.

• A sustained break under 1.0220 now suggests further downside into

1.0000.

• Meanwhile, the bulls need to push back above 1.0425 and 1.0524 (25

Nov swing high), in order to trigger a larger breakout from the rate’s multi-

month triangle pattern.

• In terms of the big picture, a directional confirmation above 1.0680 is still

needed to unlock the recovery into 1.0850 plus. This would extend the

upside breakout from the rate’s ending triangle pattern, which was part of

a major Elliott wave cycle.

• EUR/CAD has breached the base of an important multi-month distribution

pattern. Sustained beneath 1.3393-79 (19th

Sept low/61.8% Fib), now

signals an important breakdown and provides substantial correlation

pressure on to EUR/USD.


Awaiting new buy trade setup above 1.0425.


USD/CAD

USD/CAD daily chart, Bloomberg Finance LP

USD/CAD hourly chart, Bloomberg Finance LP







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Breaks higher out of triangular consolidation.

• AUD/USD has seen a clear break higher out of the triangular

consolidation that we highlighted last week. This now opens up a return

to 1.0753 over coming sessions.

• Elsewhere, the Aussie has weakened against the New Zealand dollar.

Near-term price activity has mean reverted back over the 200-day MA

and we watch for further setbacks over the multi-day/week horizon.

• The Aussie dollar is also pairing back its mild recovery against the

Japanese yen, while holding above the neck-line of its two-year

distribution pattern.


Await fresh signal.

AUD/USD


AUD/USD daily chart, Bloomberg Finance LP

AUD/USD hourly chart, Bloomberg Finance LP







8


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Scope still seen for a return to 122.00.

• GBP/JPY has found initial support just ahead of 119.00. However, a

higher low still needs to be registered to realise our favoured scenario of

a return to the 122.00 region. We view the recent failure to remain

under 119.38 as building the basis for a minor false break lower, which

will also benefit our near-term scenario.

• Failure to hold over 119.00 will suggest a re-test of the region close to

116.84. Strong support is anticipated close to this level, should

weakness persist.

• This is in line with our longer-term view, where it is perceived that there

is potential for a much larger recovery to develop with scope for a return

to 163.09 and then potentially on to 192.65. However, signs of basing

are still not evident in the medium-term timeframe.


Long 3 at 119.40, Objs: 120.50/121.50/122.00, Stop 118.90.

GBP/JPY

GBP/JPY daily chart, Bloomberg Finance LP


GBP/JPY hourly chart, Bloomberg Finance LP







9


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Break under 98.66 negates falling wedge scenario.

• EUR/JPY has now broken under the recent hourly low at 98.66 negating

the prior potential for a false break lower in the daily timeframe.

•

This failure to recover to the 101.50 region instead targets 96.84, themid December low from 2000.

• The fate of this pair is still tightly bound to the movement in EUR/USD,

particularly given the rangebound nature of USD/JPY over recent weeks

and months. As with any pair that includes the EUR, we will continue to

monitor Italian yields, anticipating a test of the 7.5% level in the 10 year

maturity.

• In the absence of further stresses out of the core Euro-Zone it would be

expected that a degree of support would be found close to current levels

for a longer-term recovery. Thus event risk is high in relation to bond

market movement, particularly in Italy.


Possibly looking to buy short term.

EUR/JPY hourly chart, Bloomberg Finance LP


EUR/JPY daily chart, Bloomberg Finance LP

EUR/JPY







10


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Short-term pullback sought to enter short positions.

• EUR/GBP has entered into a phase where it appears to be trading more

fluidly without being subject to countless false breaks in either direction,

which had become the hallmark of the pair over recent months.

Medium-term we continue to seek a return towards 0.8068 and

potentially lower. To facilitate better trade location a push higher is

sought ahead of trade formulation.

• The change in characteristics of EUR/GBP is partly attributed to the

breakdown in EUR/USD under 1.3146, which has assisted short

positioning in other EUR crosses too.

• As with all EUR crosses we need to keep a close eye on the core Euro-

Zone sovereign bond markets. Within this environment Sterling may

well be judged as a short-term safe haven, further adding to the

potential for downside pressure ahead. Focus remains on the Italian

bond market where yields are once again trading over 7.000%, with a

host of rollover auctions scheduled for the first half of the year.


Missed sell at 0.8425. Look to sell higher.

EUR/GBP hourly chart, Bloomberg Finance LP

EUR/GBP daily chart, Bloomberg Finance LP

EUR/GBP








11


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Under 1.2133 to trigger an extension lower.

• This strategy will be negated on a push back over the lower high at

1.2242.

•

EUR/CHF is consolidating just above the key low at 1.2133. A return toand break under this level is anticipated, with scope then for a fresh

attempt at 1.2000. If a break under 1.2000 were to occur, the 1.1800

level would then become the main focus.

• Our trading bias is also affected by the failure over the last three months

to break over the 50 week moving average, warning that the longer-term

down-trend is still dominant. This suggests that a return to weakness

cannot be ruled out.

• Italian 10 year yields are once again trading above 7.000% warning of a

period of stress within the Italian sovereign market. Demand for Swiss

Francs is likely to be linked to yields in core Euro-Zone nations. Given

the longer-term structure, it is doubtful that 7.500% will cap this rate.

• In an environment where 10 year Italian yields are trading at, or near,

7.000% it is likely that the Swiss Franc will see a degree of demand

despite the low deposit rates available.

S-T TREND L-T TREND

Sell stop 3 at 1.2130, Objs: 1.2010/1.1526/1.1002, Stop: 1.2250.

EUR/CHF daily and weekly charts, Bloomberg Finance LP

EUR/CHF

EUR/CHF hourly chart, Bloomberg Finance LP








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Short-term recovery back towards the 200 day moving average.

• Stopped for profit at 1605, having met two objectives.

• Gold has re-tested its 200-day average, which was recently broken for the

first time in 3 years. The move was triggered by a multi-month trianglepattern breakout (see both daily and intraday charts).

• There is still heightened risk for a much larger decline if we confirm a weekly

close beneath $1600 and $1530 (swing low).

• A number of “bargain hunting” trend-followers will be watching this

benchmark “line in the sand” for repeat support or a potential big squeeze

lower into $1300 and perhaps even $1040-1000 (12-year channel–floor/see

top chart insert).

• Speculative (net long) flows also support this view having recently breached

a key downside level which may threaten over 2 years of sizeable long gold

positions. This will trigger a temporary, but dramatic setback that would

ultimately offer a unique buying opportunity into summer 2012.

Please select links for in-depth Gold coverage:

Special Report “Gold’s mountainous peak at risk…beneath $1600” VIDEO

Bloomberg Countdown CNBC Squawk Box MIG Bank Gold Webinar video(BLOOMBERG & CNBC REPORTS)


Short stopped for profit at 1605. Initial two objectives met.

GOLD

Gold daily and weekly charts, Bloomberg Finance LP


Gold hourly chart, Bloomberg Finance LP

http://www.migbank.com/research/howard/2011-09-13_Gold_Special_Report_(RW).pdf


http://www.youtube.com/watch?v=haKdlGKWyjQ&feature=player_embedded&list=PL953E96C7BE48D2FA


http://www.bloomberg.com/video/78409176/


http://video.cnbc.com/gallery/?video=3000042202

http://www.fxstreet.com/webinars/sessions/session.aspx?id=8f81a2e3-e29b-4031-b370-a85149271145

http://www.bloomberg.com/news/2011-09-11/gold-may-fall-below-1-700-before-extending-bull-rally-technical-analysis.html












http://www.fxstreet.com/webinars/sessions/session.aspx?id=8f81a2e3-e29b-4031-b370-a85149271145

http://video.cnbc.com/gallery/?video=3000042202






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Returns again towards the $30.0000 level.

• Silver’s weak recovery from oversold conditions has tested key support

turned resistance at $30.0000. A sustained close below here now triggers

a test of the previous swing low at $26.0700, reaching 26.1600 so far.

• Macro price structure continues to focus on the downside risks, following

the major sell-off in September. Such a dramatic move traditionally

produces volatile trading ranges. This allows the market to have enough

time to recover and accumulate renewed buying interest.

• Expect a large trading range to hold between $37.0000 - 26.0700 over the

multi-week / month horizon, with downside macro risk into $21.5165

(61.8% Fib-1999 bull market) and $20.0000. This would still maintain

silver’s long-term uptrend and help offer a potential buying opportunity for

the eventual resumption higher.

• Continue to watch the gold-silver “mint” ratio (see top chart insert) which

has now accelerated higher by 70%, suggesting further risk aversion over

the next few weeks. This also helps explain recent divergences between

gold and silver.


SHORT 2: 34.1300, Objs: 26.0700/23.3400, Stop: 34.1300

SILVER

Spot Silver hourly chart, Bloomberg Finance LP


Spot Silver daily chart, Bloomberg Finance LP







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Limitation of liability

MIG BANK disclaims, without limitation, all liability for any loss or damage of any kind,

including any direct, indirect or consequential damages.

Material Interests

MIG BANK and/or its board of directors, executive management and employees may have or

have had interests or positions on, relevant securities.

Copyright

All material produced is copyright to MIG BANK and may not be copied, e-mailed, faxed or

distributed without the express permission of MIG BANK.

Notes: Entries are in 3 units and objectives are at 3 separate levels where 1

unit will be exited. When the first objective (PT 1) has been hit the stop will be

moved to the entry point for a near risk-free trade. When the second objective

(PT 2) has been hit the stop will be moved to PT 1 locking in more profit. All

orders are valid until the next report is published, or a trading strategy alert is

sent between reports.

DISCLAIMER

No information published constitutes a solicitation or offer, or recommendation, or advice, to

buy or sell any investment instrument, to effect any transactions, or to conclude any legal act

of any kind whatsoever.

The information published and opinions expressed are provided by MIG BANK for personal

use and for informational purposes only and are subject to change without notice. MIG BANK

makes no representations (either expressed or implied) that the information and opinions

expressed are accurate, complete or up to date. In particular, nothing contained constitutes

financial, legal, tax or other advice, nor should any investment or any other decisions be

made solely based on the content. You should obtain advice from a qualified expert before

making any investment decision.

All opinion is based upon sources that MIG BANK believes to be reliable but they have no

guarantees that this is the case. Therefore, whilst every effort is made to ensure that the

content is accurate and complete, MIG BANK makes no such claim.

LEGALTERMS



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www.migbank.comRon WilliamTechnical [email protected]

MIG [email protected]

14, rte des Gouttes d’OrCH-2008 NeuchâtelTel.+41 32 722 81 00

Bjioy KarTechnical [email protected]

CONTACT

Howard FriendChief Market [email protected]











Documents

2012 01 06 Migbank Daily Technical Analysis Report