GBP strengthens against CHF

Analisi Giornaliera - 11/01/2018

Technical movements in the currencies are creating good opportunities

Today’s FX markets are moving smartly today allowing for strong trends upon which we can capitalize. The USD shows strength against the Euro while the Japanese Yen is strengthening sharply against Sterling. We will take a close look at these movements and consolidations using the tools in our technical analysis bag. Commerzbank up very sharply on word that a possible merger with giant Deutsche Bank not in the cards.

Commerzbank up 6.66% in 2018

Commerzbank, the Germany investment bank which had been referred to by US buyout fund Cerebus as a potential merger candidate with the giant Deutsche Bank, is alas not likely to be engaging the proposition. Stating to the German Federal banking authorities recently that the buyout fund was not interested in such a merger, the talk of such a matchup is no longer on the table. The buyout fund has holdings in both banking institutions. Commerzbank UP.

GBPCHF pushing back up after MA crossover on the hourly chart

The pair fell sharply yesterday following price movement well above the 20 bar moving average slightly before 12:00 GMT. This fall which resulted in the crossover of the 50 bar MA by the 20 bar MA at about 13:00 GMT, as usual for this phenomenon, had prices fall precipitously from the 1.331 level stabilizing at the 1.321 level. Prices have since risen above the 20 bar MA , hovering around 1.322 level and showing signs of a renewed effort to push back up to retake some of the loss against the CHF. Price is moving on strong volume and a just slightly positive Force index pattern. We are looking for a sustained level above 1.32232 to indicate likely continuation of the upward movement in the pair showing solid gains by the GBP against the CHF.

EURUSD falling slightly within a longer term rise of the pair

The USD gained 1.13% on the Euro in the last six trading days on what we think is based largely on a very strong earnings season just getting underway in the US market. Price closed below BOTH 20 and 50 bar moving averages yesterday at 16:00 GMT. This is one of the surest of the technical indicators we use in our work bag of analytics. Price is still below both averages and therefore likely to persist. We will sell the pair as long as this trend stays in train. We look for a reversal if price breaks above the 20 bar MA on the hourly chart at 1.19512 USD to the EUR. An early warning of a reversal of this trend will be if the 50 bar MA crosses below the 20 MA from above. Not necessarily a reversal but a warning of one likely to occur. EURUSD UP.

GBPJPY falling

This is a pretty sharp decline even for a currency pair we are fond of and recommend often. Likely less to do with the GBP or anything Brexit oriented, the fall, we think, has to do with BOJ announcements that they are considering cutting back on their bond purchase, referred to these days as quantitative easing. As price falls sharply toward the all-important 15 barrier, which it stops just short of at press time, look for it to bounce around that level before returning upward. Currently it is just a tad below the 20 MA on the hourly chart and well below the 50 (which is 151.312).

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