Comment: Trading far more erratically since September with a big swing down and then up, something reflected in at-the-money implied volatility which has been trading over one standard deviation above the long term mean, levels last seen in March 2009. This month expect a slightly smaller trading band but still with sharp swings inside the very large rising weekly Ichimoku ‘cloud’. Only a monthly close above 1.4500 would put this year’s struggles behind it, something which looks unlikely between now and year-end.
A weekly close below 1.3300 will probably force a review.
Comment: Nasty price swings as October’s rally almost reverses September’s steep decline, Cable just holding inside a massive weekly Ichimoku ‘cloud’. Allow for more of the same this month, prices likely to hold between 1.5600 and 1.6200. Only weekly and monthly closes above 1.6500 will allow sterling to make significant gains, something that is unlikely before year-end.
A weekly close below 1.5500 would force us to adjust.
Comment: After weeks and weeks of unnaturally tiny daily ranges the Bank of Japan decided to intervene again after the pair set a new record low at 75.31. While destroying the very frayed ‘triangle’ pattern we had pencilled in, this week’s price action looks remarkably similar to that of early August, retracing a mere 38% of this year’s drift, semi-capped by the 26-week moving average. Therefore the ultra-long term trend is still lower, this latest move buying time only. We shall continue to expect a managed drop to 74.50 and 73.50. Obviously prices can also spiral out of control, but at the moment this looks unlikely.
A weekly close above 80.00 would hint at a long period of sideways price action above the record low.
Comment: Progress since July’s high at 0.9085 has been negligible, ‘channel’ support and the bottom of the weekly Ichimoku ‘cloud’ sort of limiting the downside for umpteen weeks. We still feel this should give way, pushed down by the moving averages that suggest a short position. While below 0.8900 (roughly) we shall continue to allow for a drift down to 0.8400 towards year-end.
A weekly close above 0.9000 forces us to review.
Comment:September’s scary downside probe ended just ahead of parity and ahead of November 2000’s record low at 88.93. October’s bounce, more than reversing the previous month’s decline, is welcome but only buys time because it is well within retracement parameters. Therefore another similar downside probe cannot be ruled out. Instead however we favour a few months of broadly sideways work roughly between 106.00 and 116.00.
A weekly close above 112.00 would hint that yet another interim low is in place and prices will limp slowly higher.
Comment: Trading more erratically in September and October down to a new record low at 116.80, under the previous one at 118.80 of January 2009. A ‘double bottom’ there allowed this pair to break above the neat ‘channel’ that has been in place since April, but it has struggled with Fibonacci retracement and the bottom of what had been the sideways band of May 2010/July 2011. Therefore we cannot rule out another cautious downside probe. However, because momentum is neutral the most likely course for the coming month is erratically sideways above last month’s low.
A weekly close above 128.00 would probably hint that another important interim low is in place.
Source http://www.fxstreet.com/technical/analysis-reports/monthly-technical-outlook/2011-11-01.html
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