MNI Asia FX Morning Analysis - DXY Caps Strongest Week in Six

DXY Caps Strongest Week in Six

EUR/GBP closed in on the lowest levels for nearly two months, with the cross narrowing the gap with the 200-dma at 0.8906 into the Friday close. Signs of further progress made between EU and UK negotiators are making the prospects for a deal before November 15th more likely, and helping GBP find support on dips.

USD demand into the October month-end fix put most major pairs under pressure into the close, but this swiftly dissipated once the orders were absorbed.

This was less evident in the EUR, however, which shrugged off strong French, Italian, German and Spanish GDP data, taking heed of Lagarde's communications at the ECB press conference Thursday that the bank are likely to 'recalibrate' policy in December. This helped the greenback secure the best weekly performance in six.

It's difficult to play down the importance of numerous risk events in the coming week, with the Presidential election, FOMC rate decision and Nonfarm Payrolls report all to contend with. Rate decisions from the RBA, BoE and Norges Bank are also due.

​EUR/USD TECHS: Bearish Following Trendline Break

• RES 4: 1.1881 High Oct 21 and the bull trigger
• RES 3: 1.1839 High Oct 27
• RES 2: 1.1798 High Oct 28
• RES 1: 1.1759 High Oct 29
• PRICE: 1.1671 @ 17:11 GMT Oct 30
• SUP 1: 1.1642 Low Oct 30
• SUP 2: 1.1612 Low Sep 25 and the bear trigger
• SUP 3: 1.1576 0.764 proj of Sep 1 - 25 sell-off from Oct 21 high
• SUP 4: 1.1541 Low Jul 23

EURUSD maintains a bearish tone following the sell-off in the second half of the week that confirmed a clear breach of short-term trendline support drawn off the Sep 28 low. The clear break, confirmed by a move below Wednesday's low of 1.1718 as well as key support at 1.1689, Oct 15 low strengthens the bearish case. This opens 1.1612, Sep 25 low and the primary bear trigger. Initial resistance is at 1.1759, Thursday's intraday high.

GBP/USD TECHS: Support Exposed

• RES 4: 1.3266 2.0% 10-dma envelope
• RES 3: 1.3177 High Oct 21 and the bull trigger
• RES 2: 1.3080 High Oct 27 and key near-term resistance
• RES 1: 1.3026 High Oct 29
• PRICE: 1.2948 @ 17:13 GMT Oct 30
• SUP 1: 1.2881 Low Oct 29
• SUP 2: 1.2863 Low Oct 14 and key near-term support
• SUP 3: 1.2806 Low Sep 30
• SUP 4: 1.2794 76.4% retracement of the Sep 23 - Oct 21 rally

The GBPUSD outlook remains bearish following this week's move lower. The breach of 1.2940, Oct 21 low suggests scope for a deeper corrective pullback with attention on 1.2863, Oct 14 low and a key short-term support. Clearance of this level would open 1.2794, a Fibonacci retracement. Price action has defined initial firm resistance at 1.3080, Oct 27 high. A move back above this hurdle would ease bearish pressure and open 1.3177.

EUR/GBP TECHS: Eyeing Key Support

• RES 4: 0.9220 High Sep 22
• RES 3: 0.9154/62 1.0% 10-dma envelope / High Oct 7
• RES 2: 0.9149 Oct 20 high
• RES 1: 0.9107 High Oct 23
• PRICE: 0.8994 @ 17:21 GMT Oct 30
• SUP 1: 0.8986 Low Oct 14 / 29 and bear trigger
• SUP 2: 0.8967 76.4% retracement of the Sep 3 - 11 rally
• SUP 3: 0.8925 Low Sep 7
• SUP 4: 0.8900 Low Sep 4

EURGBP is trading closer to recent lows and remains largely unchanged. The outlook is bearish following the sharp sell-off on Oct 21. Attention is on 0.9007, Oct 14 and 29 low, the near-term bear trigger. A break of 0.9007 would confirm a resumption of the downtrend that started Sep 11 and expose 0.8967, a retracement. Key S/T resistance has been defined at 0.9149, Oct 20 high. Clearance of this level would undermine bearish conditions.

USD/JPY TECHS: All Eyes On 104.00

• RES 4: 105.75 High Oct 20
• RES 3: 105.51/53 50-dma / High Oct 21
• RES 2: 105.06 High Oct 26 and key near-term resistance
• RES 1: 104.73/74 High Oct 29/30
• PRICE: 104.60 @ 17:23 GMT Oct 30
• SUP 1: 104.00 Low Sep 21 and the bear trigger
• SUP 2: 103.67 76.4% retracement of the Mar 9 - 24 rally
• SUP 3: 103.09 Low Mar 12
• SUP 4: 102.02 Low Mar 10

USDJPY maintains a bearish outlook and traded inside the week's range Friday. Attention remains on the key 104.00 handle, Sep 21 low. Clearance of this support would suggest scope for a deeper USD sell-off within the bear channel drawn off the Mar 24 high. A break lower would also confirm a resumption of the current downtrend and maintain the bearish price sequence of lower lows and lower highs. Firm resistance is at 105.06.

EUR/JPY TECHS: Sharply Lower

• RES 4: 124.23 High Oct 23 and 26
• RES 3: 123.84 20-day EMA
• RES 2: 123.19 High Oct 28
• RES 1: 122.38 Low Sep 28 and recent breakout level
• PRICE: 121.81 @ 17:26 GMT Oct 30
• SUP 1: 121.50 0.764 proj of Sep 1 - 28 decline from Oct 9 high
• SUP 2: 120.70 Low Jul 13
• SUP 3: 120.39 1.000 proj of Sep 1 - 28 decline from Oct 9 high
• SUP 4: 120.27 Low Oct 10

EURJPY maintains a bearish tone and has extended this week's selloff well into the Friday close. The cross has cleared support at 123.03/02 and 122.38, Sep 28 low. This move lower confirms a resumption of the downleg that started Sep 1. Scope is seen for weakness towards 121.50 next, a Fibonacci projection. Further out, 120.39 is on the radar, also a Fibonacci projection. Initial resistance is at 122.38.

AUD/USD TECHS: Key Support Probed

• RES 4: 0.7243 High Oct 10 and a key resistance
• RES 3: 0.7218 High Oct 13
• RES 2: 0.7144/58 Trendline drawn off the Sep 1 high / High Oct 23
• RES 1: 0.7076 High Oct 29
• PRICE: 0.7022 @ 17:27 GMT Oct 30
• SUP 1: 0.7002 Low Oct 29
• SUP 2: 0.6965 23.6% retracement of the Mar - Sep Rally
• SUP 3: 0.6948 2.0% 10-dma envelope
• SUP 4: 0.6921 Low Jul 14

AUDUSD outlook is bearish. The pair has pulled further away from trendline resistance drawn off the Sep 1 high. The trendline resistance rests at 0.7144 and represents a key hurdle for bulls. This line was tested Wednesday and capped gains. While the trendline holds, a bearish theme dominates which was strengthened Thursday following the print below 0.7006, Sep 25 low. This has opened 0.6965 next. A trendline breach reverses the trend.

​USD/CAD TECHS: Rally Extends

• RES 4: 1.3545 200-dma
• RES 3: 1.3460 2.0% 10-dma envelope
• RES 2: 1.3421 High Sep 30 and primary resistance
• RES 1: 1.3390 High Oct 29
• PRICE: 1.3334 @ 17:28 GMT Oct 30
• SUP 1: 1.3259 High Oct 15 and recent breakout level
• SUP 2: 1.3180 Low Oct 28
• SUP 3: 1.3109/3081 Low Oct 23 / Low Oct 21 and the bear trigger
• SUP 4: 1.3047 Low Sep 7

USDCAD largely consolidated Friday. The bullish weekly close, however, cemented the break of key short-term resistance at 1.3259, Oct 15 high as well as the break of 1.3341, Oct 7 high. The move higher signals scope for a climb towards 1.3421 next, Sep 30 and primary resistance. Initial firm support is seen at Wednesday's low of 1.3180. A break of this level is required to undermine the developing bullish tone. First support however lies at 1.3259.

EUR/USD: MNI KEY LEVELS

• *$1.1793 55-dma
• *$1.1786/91 50-dma/Cloud top
• *$1.1769 21-dma
• *$1.1763 100-hma
• *$1.1757 Sep27-2018 high
• *$1.1736 Fibo 38.2% 1.3993-1.0341
• *$1.1704 Intraday high
• *$1.1691 Cloud base
• *$1.1661/65 Lower Boll Band (2%)/Lower 1.0% 10-dma env
• *$1.1651/54 Sep28-2018 high/100-dma
• *$1.1645 ***CURRENT MARKET PRICE 18:04GMT FRIDAY***
• *$1.1640 Intraday low
• *$1.1621 Oct16-2018 high
• *$1.1615/13 Down Trendline from Jul18-2008/161.8% swing $1.1497-1.1309
• *$1.1606 Lower Bollinger Band (3%)
• *$1.1570 Jan10-2019 high
• *$1.1547 Lower 2.0% 10-dma envelope
• *$1.1540 Jan11-2019 high
• *$1.1490 Jan15-2019 high
• *$1.1450/48 Jan29-2019 high/Mar20-2019 high
• *$1.1437 Mar21-2019 high

GBP/USD: MNI KEY LEVELS

• *$1.3080 May08-2019 high
• *$1.3041 May13-2019 high
• *$1.3024 200-hma
• *$1.3011 55-dma
• *$1.2997/98/99 Cloud top/50-dma/61.8% 1.3381-1.2382
• *$1.2988/89/91 Intraday high/100-hma/May10-2019 low
• *$1.2982 21-dma
• *$1.2970 May14-2019 high
• *$1.2960 Cloud base
• *$1.2950 200-wma, 50-mma
• *$1.2948 ***CURRENT MARKET PRICE 18:04GMT FRIDAY***
• *$1.2904/99 May14-2019 low/Intraday low
• *$1.2882/80 50% 1.3381-1.2382/Lower 1.0% 10-dma env
• *$1.2875 100-dma
• *$1.2852 May16-2019 high
• *$1.2845 Lower Bollinger Band (2%)
• *$1.2833/31 Feb12-2019 low/Jan21-2019 low
• *$1.2825 Jan16-2019 low
• *$1.2813/10 May21-2019 high/61.8% 1.1841-1.4377
• *$1.2784 Jun25-2019 high
• *$1.2776 Lower Bollinger Band (3%)

EUR/GBP: MNI KEY LEVELS

• *Gbp0.9108 Jan03-2019 high
• *Gbp0.9079 Cloud base
• *Gbp0.9068 50-dma
• *Gbp0.9062/64/65 Jan11-2019 high/55-dma/21-dma
• *Gbp0.9054 200-hma
• *Gbp0.9048/51/52 Jul16-2019 high/Jul17-2019 high/100-dma, Intraday high
• *Gbp0.9039/43 Jul18-2019 high/100-hma
• *Gbp0.9010 Jul10-2019 high
• *Gbp0.9000/05 Jul22-2019 high/Jul23-2019 high
• *Gbp0.8995 Lower Bollinger Band (2%)
• *Gbp0.8993 ***CURRENT MARKET PRICE 18:04GMT FRIDAY***
• *Gbp0.8985 Intraday low
• *Gbp0.8965/60 Lower 1.0% 10-dma env/Lower Boll Band (3%)
• *Gbp0.8953 Jul23-2019 low
• *Gbp0.8921 Jul02-2019 low
• *Gbp0.8905 200-dma
• *Gbp0.8874/73 Jun19-2019 low, Lower 2.0% 10-dma env/Jun20-2019 low
• *Gbp0.8872 Jun12-2019 low
• *Gbp0.8865 Fibo 61.8% 0.9108-0.8473
• *Gbp0.8830 Jun06-2019 low
• *Gbp0.8822 May31-2019 low, 100-wma

USD/JPY: MNI KEY LEVELS

• *Y105.77 Cloud top
• *Y105.51 55-dma
• *Y105.48 50-dma
• *Y105.28 Cloud base
• *Y105.19 21-dma
• *Y105.07 Cloud Kijun Sen
• *Y104.89 Cloud Tenkan Sen
• *Y104.87 Jan03-2019 low
• *Y104.74 Intraday high
• *Y104.67 200-hma
• *Y104.63 ***CURRENT MARKET PRICE 18:04GMT FRIDAY***
• *Y104.56 Mar26-2018 low
• *Y104.49 100-hma
• *Y104.14 Lower Bollinger Band (2%)
• *Y104.13 Intraday low
• *Y104.00 YTD low
• *Y103.94 200-mma
• *Y103.74 Lower 1.0% 10-dma envelope
• *Y103.62 Lower Bollinger Band (3%)
• *Y102.70 Lower 2.0% 10-dma envelope
• *Y101.65 Lower 3.0% 10-dma envelope

EUR/JPY: MNI KEY LEVELS

• *Y122.56 Jun13-2019 high
• *Y122.46 Intraday high
• *Y122.23 Jul12-2019 high
• *Y122.21 Lower 1.0% 10-dma envelope
• *Y122.13 Jun17-2019 high
• *Y122.09 Lower Bollinger Band (2%)
• *Y122.07 Fibo 61.8% 118.71-127.50
• *Y121.95 Fibo 50% 94.12-149.78
• *Y121.92 Jun20-2019 high
• *Y121.85 Jul15-2019 high
• *Y121.84 ***CURRENT MARKET PRICE 18:04GMT FRIDAY***
• *Y121.78 100-wma
• *Y121.62 Intraday low
• *Y121.42 Jul15-2019 low
• *Y121.24 Lower Bollinger Band (3%)
• *Y121.16 200-dma
• *Y120.98 Lower 2.0% 10-dma envelope
• *Y120.78 Jul18-2019 low, Jun03-2019 low
• *Y120.50 Jul23-2019 low
• *Y120.24 Fibo 61.8% 109.57-137.50
• *Y119.75 Lower 3.0% 10-dma envelope

AUD/USD: MNI KEY LEVELS

• *$0.7153/55 Apr17-2019 low/Upper 1.0% 10-dma env
• *$0.7140 Apr16-2019 low
• *$0.7116/21 Apr12-2019 low/21-dma
• *$0.7110/13 Apr10-2019 low/100-dma
• *$0.7094 200-hma
• *$0.7088 Apr08-2019 low
• *$0.7080 100-hma
• *$0.7069/72/73 Apr30-2019 high/Intraday high/Mar29-2019 low
• *$0.7053/57 Apr02-2019 low/Jul22-2019 high
• *$0.7044/48 Jul16-2019 high/May07-2019 high, Jul04-2019 high
• *$0.7019 ***CURRENT MARKET PRICE 18:04GMT FRIDAY***
• *$0.7013/12 Lower 1.0% 10-dma env/Intraday low
• *$0.7001 Lower Bollinger Band (2%)
• *$0.6985 Jan03-2019 low
• *$0.6971/67 Jul12-2019 low/Jun11-2019 high
• *$0.6942 Lower 2.0% 10-dma env, Lower Boll Band (3%)
• *$0.6909 Jun19-2019 high
• *$0.6893 100-wma
• *$0.6879 Jun20-2019 low
• *$0.6872 Lower 3.0% 10-dma envelope
• *$0.6855 Jun19-2019 low

USD/CAD: MNI KEY LEVELS

• *C$1.3546 200-dma
• *C$1.3475 Upper 2.0% 10-dma envelope
• *C$1.3452 Jun04-2019 high
• *C$1.3429/31/32 Upper Boll Band (3%)/Jun06-2019 high/Jun18-2019 high
• *C$1.3407 Fibo 61.8% 1.3565-1.3151
• *C$1.3383 Jun19-2019 high
• *C$1.3376/77 50% 1.4690-1.2062/100-wma
• *C$1.3354/58 Upper Boll Band (2%)/50% 1.3565-1.3151
• *C$1.3348 Intraday high
• *C$1.3343/45 Upper 1.0% 10-dma env/Jun12-2019 high
• *C$1.3337 ***CURRENT MARKET PRICE 18:04GMT FRIDAY***
• *C$1.3331/28 100-dma/38.2% 1.2783-1.3665
• *C$1.3309/07 38.2% 1.3565-1.3151/Cloud top
• *C$1.3300 Jun13-2019 low
• *C$1.3286 Jun20-2019 high
• *C$1.3280 Intraday low
• *C$1.3263 100-hma
• *C$1.3240 Cloud base
• *C$1.3226/24 Jun10-2019 low/50% 1.2783-1.3665
• *C$1.3208/07/06 21-dma/50-dma/55-dma
• *C$1.3202 200-hma

Expiries for Nov2 NY cut 1000ET (Source DTCC)

EUR/USD: $1.1570-85(E529mln), $1.1750(E574mln), $1.1795-00(E838mln), $1.1815-20($980mln)

USD/JPY: Y104.85-00($618mln)

GBP/USD: $1.3100(Gbp1.2bln), $1.3150(Gbp911mln)

EUR/GBP: Gbp0.8900(E2.2bln-EUR puts), Gbp0.9000(E1.5bln)

AUD/USD: $0.7140-45(A$1.9bln)

USD/CAD: C$1.3300($662mln)

USD/CNY: Cny6.65($770mln)

Larger Option Pipeline

EUR/USD: Nov03 $1.1900-05(E1.4bln); Nov06 $1.1600(E1.0bln)

USD/JPY: Nov03 Y105.45-49($1.3bln); Nov04 Y105.00($1.1bln); Nov05 Y106.06-09($1.6bln)

EUR/JPY: Nov05 Y124.50(E1.1bln)

USD/CNY: Nov03 Cny6.5334($1.2bln); Nov05 Cny6.75($1.0bln), Cny6.80($1.9bln), Cny6.85($1.3bln); Nov06 Cny6.70($1.2bln)