Majors & Exotics [EUR / GBP / JPY / CAD / AUD]

I've been watching USDJPY and GBPJPY, USDJPY H4 QQE is about to cross downward and there's a suspicious up move before friday close on GBPJPY, AUDJPY is in the overbought level, and the longer term for the three is bullish.

here's a chart of gbpjpy .. when zooming in to lower timeframes you'll notice that very few up bar closed on the highs, the rest has closed in the middle or on the lows, thats often viewed as weakness in an uptrend (even if going up slowly).

congratulations for those who shorted GBPJPY in tokyo session ... GBPJPY was met by buyers (once again) on 147.28, watch out for low activity (low volume) as it "approaches" that level as it will indicate that there's no interest in lower prices, stabilization just above that level however will indicates further weakness as there's no interest in higher prices.

trend map:

Premeur,

I was wanting to get your take on the DOW. I know a while back you were giving your thoughts about it (saying; look out if it breaks 7000, etc....) but have not heard you say much since this rally. Do you think that this is just a rally due to the time of season in the USA? (summer time, a little more work due to better weather, so better numbers coming out, etc...) and that the DOW has not really made a good bottom yet? or do you think that it could have actually made a bottom?

Thanks,
fxst

Hello fxst,

I am currently working on couple of projects, hence do not regularly update.

I agree to the points that we have not seen the bottom in DOW. For your consideration:

http://www.chartoftheday.com/20090515.gif

And current DOW's rally, compared to previous deep recessions/depression:

http://www.leap2020.eu/photo/grande-...25174.jpg?ibox

Update on EUR/USD:

The move above 1.38 mark has opened possibility to test the runaway rally happened in December '08, which brought the pair to 1.48. That region currently stands as highs, marked both in mid-September and mid-December.

I highly doubt that EUR/USD will be able to move above 1.50, to test 1.60s again; as long as DOW struggles around 8500-9000 mark.

The real economic developments do NOT support fundamentals for such a rally. On the contrary, the rally could still extend, even though economies do not pick up; as long as FED continues to print money, buy treasury bonds and keep interest rates low.

In the latter scenario, we could face the ugly side of both worlds, as the economies still stuck in recession, and inflation picking up.

Result: NO job creation, high prices (inflationary environment). You've got less money to pay higher gas prices.

Market Sentiment - May 25 '09

Going into a week with some weighing news, USD remains heavily under pressure.

Moving above the 1.38-1.39 region at the end of last week opened very high possibility to move towards 1.46-1.47 area. This level should be seen in the next few months, before September.

From there on, if we don't see a sustainable recovery, i expect another fall in equities.

Strong bull move for EURUSD above 1.4030s

With huge bounce back towards 1.40, we are set for another strong bull move above 1.4030s.

The weak bullish sentiment will be in power until a move below 1.3850, which seems very unlikely now. With all the cheer going around.

GBPUSD pending strong bullish sentiment

Likewise EURUSD, GBPUSD stayed bullish, even contracting to weak bullish yesterday.

A move above 1.5990s/1.60 will bring the pair back to strong bullish, pushing it higher.

It will not turn to bearish sentiment unless below 1.5730/40s

GBPUSD

The bullish trend that began 3-4 weeks ago is still in tact, and has turned to strong bullish after moving above 1.60 today in the Asia/EU session. The pair was weak bull,sh yesterday following USD gain before the US session.

EURCAD
Sentiment: Strong Bearish

The strong bearish sentiment that took over the pair in late US session proved to be correct.

The pair has declined more than 100 pips in 2 sessions, less than 12 hours.

EURAUD
Sentiment: Weak Bullish

The selloff brought the pair to weak bullish, but the bull sentiment is still on.

Moving below 1.7700 will get the pair to strong bearish sentiment.

AUDJPY
Sentiment: Weak Bullish

The V shaped day yesterday also got some bulls out of their positions, but the bullish trend is still intact.

Moving above 75.30/40 will get them back in for higher quotes.

Strong bearish will only come into play below 73.00

EURUSD
Sentiment: Strong Bearish

The strong bearish sentiment in play with the break of 1.3860s yesterday, late US session, is still in play.

Quotes above 1.4030s & 1.4060s are needed to talk of any bullish sentiment.

Tomorrow's GDP numbers are important.

USDJPY
Sentiment: Strong Bullish

With huge rally against JPY across the board, the pair jumped towards a possible target area of 99-100.

GBPUSD
Sentiment: Weak Bullish

Being under pressure of early USD strength, the pair is now weak bullish.

Probable large stops below 1.5830s, to push the sentiment to Strong Bearish.

USDCHF
Sentiment: Strong Bullish

With early moves above 1.0900s, the pair turned to strong bullish.

Huge stops expected around/below 1.0770-1.0990s. Below those values, USD will be vulnerable to turn the pair to strong bearish outlook.

AUDUSD
Sentiment: Weak Bullish

The whipsaw swings seen since the beginning of this weak is also showing presence on this pair.

The sentiment is slightly supporting the bullish outlook, however be on tap as large stops are lining up below 0.7830s.

The pair will probably see more buyers with a decisive break of 0.7900s level, turning the pair to strong bullish outlook.

Market Sentiment - May 29 '09