== $ == Banks Orders Book == $ ==

Will Triangle Send The EURO to 1.45/1.5 levels !

As shown on the daily chart below the pair breached above the triangle last week , this scenario is likely to add pressure on the 1.3415 levels,a break will expose 1.3710 levels , If seen , the way will be paved to 1.4200/1.4500 levels.

Note that according to triangle on the daily/weekly chart, the assumed target is 1000 pips from the breakout point , so it's around 1.4300 levels..

On the weekly chart, we have the same triangle , but we also have a second bullish pattern according to weekly MACD, neckline is at 1.3485, so a break above the triangle followed by a break above 1.3485 levels on weekly is likely to advance the pair further higher towards the 1.5000 levels.

However, support on daily is at 13265, on weekly is at 1.3230, so as long as both levels hold, 1.3415 will be breached, sooner or later, just a matter of time ! Losing both levels would delay /invalid the bullish view ?!!!

Next Week's Trading Ranges & Bias For EUR/USD, USD/JPY, & Other FX Spots - Commerzbank

In the table below, Commerzbank outlines its expectations for next week's trading ranges and bias for EUR/USD, and a selection of other currency pairs.

GBPUSD – Weekly Forecast 12-16 Aug 2013

The GBPUSD maintained a strong bullish momentum last week , and reached as high as 1.5573 , closed at 1.5505 levels, recent development leaves the pair targeting the 1.5530 levels , a halt is suggested as seen last week , but a breach will have large bullish implication towards 1.5750 levels.

On the downside, support is at 1.5434 levels, main support comes at 1.5204, so as long as this level holds on a daily closing basis , the pair will remain biased to the upside towards 1.5530 ahead of 1.5750 levels, losing 1.5204 would delay/weaken the last bullish run , last support comes at 1.5078, below this level will bring a free fall towards the 1.4813 levels.

Support : 1.5435, 1.5355 , 1.5240 , 1.5204 , 1.5078 , 1.4813

Resistance : 1.5530 ,15675 , 1.5750

Trend Status - daily chart :

Bullish : above 1.5435

Sideways (bullish): above 1.5204

Sideways (bearish) :above 1.5078

Bearish : below : 1.5078

Bank of America Merrill Global Economic, Monetary Policy, & FX Forecasts

The following tables provide Bank of America Merrill Lynch's latest global economic, monetary policy, and FX forecasts.

Barclays - Stay Patient & Stick With The USD

Despite our data surprise index (DSI) moving sharply in favor of the USD, summer market trading, an absence of major catalysts and the associated selling of volatility helped drag the DXY close to its June lows, says Barclays Capital.

"Risk assets, and the associated commodity currencies, recovered some of their losses after stronger-than-expected trade data in China. EM FX has also recovered as portfolio outflows from the asset class slow and an improved global risk environment. The improvements in the cyclical outlook in the UK also suggests to us GBP should now trade between the USD and EUR since the recovery, while uncertainty remains ahead of that in the euro area," Barclays clarifies.
Given that, how should investors position in the USD going forward?
"We remain constructive on the USD and maintain our broadly bullish medium-term view as the cyclical outlook in the US improves into H2 13. However, we acknowledge the risks to our views in the near term, particularly versus the lower yielding currencies, as the Fed stresses that tapering does not mean hiking," Barclays advises.

EU Stops tripped early Greece WEIGHS

Stops under 1.3330 tripped early - brief 1.3313 low -back @ 1.3335 open
Der Spiegal - Greece will need extra aid in early 2014 weighs [ID:nL6N0GC06G]
Inside day Friday - five days of higher lows ended this morning
Momentum studies are cresting - potential 1.3400 double top
1.3250 20 dma is pivotal uptrend support - vulnerable

European Market Report

EUR/USD
•Bids at 1.33, 1.3270 and larger at 1.3250
•Sell stops sub-1.33 and beneath the mid figure through 1.3240
•Offers lined up at 1.3350 and in better size from 1.34 up to 1.3420
•Buy stops sizeable above 1.34

GBP/USD
•Bids at 1.5480 and in solid size around 1.5430
•Sell stops sub-1.5480 looking vulnerable and likely to be cleared soon
•Offers lined up at 1.5520, 1.5550 and larger from 1.5580 up to 1.56
•Buy stops clustered around 1.5560 and in better size above 1.56

USD/JPY
•Bids resting at 96.00 and good size around 95.80
•Sell stops accumulating sub-95.80 and beneath the mid figure through 95.40
•Offers at 96.80 up to 97.00, better size at 97.50
•Buy stops sizeable around 97.20

AUD/USD
•Bids at 0.9170 and 0.9130
•Sell stops building sub-0.9150 and larger below 0.91
•Offers at 0.9250 and heavy around 0.93
•Buy stops at 0.9260 and in size through 0.9310/20

EUR/JPY
•Bids at 128.00 and 127.50
•Sell stops in decent size sub-128.00 and still looking vulnerable
•Offers at 129.00 and 129.50
•Buy stops around 129.10 and 129.60/70

UBS FX Technical

EUR/USD – Critical resistance at 1.3417, the June high, as expected held the rally since July 9, inducing a setback. The pair is retracting, to unwind the overextended upside conditions, with support at 1.3270, the 62% retracement of the advance from Aug 2. That said, with the MACD above its zero line, any close above 1.3420 would trigger further extension with no major resistance until 1.3711, the February 1 rejection high.

USD/JPY – Focus for now is on the critical support offered by the June low at 93.79, which links with the 38% retracement of the September 2012 to May 2013 bull trade at 93.57. Currently we are not convinced this will be broken so maintain a watching brief, but this area is significant moving forward. The immediate risk appears for a recovery with resistance at 97.88, the midpoint of the latest sell-off.

GBP/USD – We see the pair consolidating just below the key resistance at critical 1.5598, the midpoint of the January/July trade. Support is at 1.5394, the 38% retracement of the advance from Aug 2. Having said that, with the MACD above its zero line, a closing break above 1.5598 would trigger further upside towards the June high at 1.5750, which links with the higher 62% retracement at 1.5782.

USD/CHF – Upside should be limited and is viewed as corrective to unwind downside extremes. Resistance at 0.9283, the midpoint if the latest sell-off, should hold for now. With the MACD below its zero line, reflecting bearish conditions, potential remains for downside, with initial support at 0.9175 ahead of the significant 0.9130, the June extreme.

AUD/USD – Since last week the pair remains under a recovery phase, unwinding the overextended downside conditions. There is strong resistance at 0.9320, the last correction high, which coincides with the midpoint of the June/August sell-off, which is expect to hold and reverse the current move, as the bear trend remains intact. Support is at 0.9087 ahead of 0.8973, Thursday’s low.

USD/CAD – Focus for now is on the significant support at 1.0241, the 62% retracement of the longer May/July advance, which held the July sell-off, inducing a recovery. We will be watching how well this level is defended on a closing basis. Resistance is at 1.0353 ahead of 1.0445, last week’s high. Only a closing break below 1.0241 would be a bearish development, triggering further downside.

DXY INDEX – Immediate risk is for a short-term recovery to unwind the overextended downside conditions. Resistance is at 81.489, the 38% retracement of the latest sell-off. Having said that, with the bear trend intact broader potential remains for the resumption of downside with initial support at 80.868, last week’s low. A move below this would trigger further downside towards the key support area at 80.498/ 80.147, the June low and the 38% retracement of the May 2011 to July 2013 advance.

EUR/CHF – As the bearish trending conditions persists, reflected by the MACD below its zero line, scope remains for further downside. Support is at 1.2268, last week’s low ahead of the significant level provided by the June low at 1.2219. Upside should be limited and is viewed as corrective to unwind overextended downside conditions. Resistance is at 1.2333, the midpoint of the latest sell-off.

EUR/GBP – There is a critical support offered by the July 22 low at 0.8571, which held on closing basis last week. With the bull trend intact as reflected by the MACD above its zero line, we anticipate a fresh recovery to materialise soon from here. Initial resistance is at 0.8623 ahead of the midpoint of the sell-off since Aug 1 at 0.8674. However, only a closing break below 0.8571 will extend the correction to 0.8541, the 62% retracement of the April/August advance.

EUR/JPY – The cross this morning initially extended its weakness, but faces strong support at 127.94, the 62% retracement of the June/July advance. Although, the MACD has moved below its zero line, we are not convinced of the bearish picture and maintain a neutral stance, as long as 127.94 support holds. Initial resistance is offered by Friday’s high at 129.71 ahead of 131.98, the Aug 2 high.

*NOTE: The trend for each currency pair as defined above is determined by UBS proprietary model and is independent of its discretionary interpretation of price action.

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Goldman Sachs FX Desk Report

EUR: Expect today’s trading range to be tight – 1.3280-50 probably containing us before we enter the more data heavy end of the week

JPY: We have bought USDJPY around these levels, with room to add towards 96.20-00 level to the trade, with a tight stop at 95.45

GBP: I am inclined to wait until we see more guidance from the US side of the ledger and stay away from the summer chop

AUD: We are sidelined at current levels and will wait to sell into a larger rally towards 0.9280 risking 0.9360

EUR
The Euro refrains from testing the last of the stops through the 1.3418 level that has capped us since the June FOMC meet and retreats sub 1.3330/40 support. Few headlines to attribute to the move, but the Spiegel article citing a Bundesbank document which suggests that Greece will need additional rescue loans – rekindling the debate over Merkel downplaying ideas ahead of the election – brings back into focus the frictions around the subject. Although the calendar is light today, tomorrows ZEW and Wednesdays Euro-zone GDP numbers should help ignite the fuse – the German print already looking to be closer to 0.75% vs. the 0.6% expected (Bloomberg reporting the German Econ Ministry). From here 1.3270 and then 1.3190 will offer support, but expect today’s trading range to be tight – 1.3280-50 probably containing us before we enter the more data heavy end of the week.

JPY
A delicate cross roads approaching for Abe and his master plan for the Japanese economy, as a number of tricky issues will begin to appear on the horizon into the Autumn period. These issues will have to be tackled without the comfort of a roaring domestic stock market or the backdrop of a currency trade lacking any immediate catalyst to take us firmly back above the 100.00 level and into fresh cycle highs. Last night’s GDP figure did little to help these issues, coming in well below market expectations at +2.6% - with the caveat that inventories had muddied the waters - taking over 1% off the headline figure. Although ultimately a strong figure was needed overnight, this weak data may well give Abe slightly more room to manoeuvre when it comes to the pressing issue of the consumption tax and possibly opt for a gradual introduction as advised by Hamada – arguing the fragility of the recovery. Although Abe’s resolve will be tested over the coming months, on a short term basis and even taking into account the seasonality effects of the JPY in Aug, we can not help but feel some value in USDJPY at these levels – with some well defined stop loss levels below, guiding our limits. We have bought USDJPY around these levels, with room to add towards 96.20-00 level to the trade, with a tight stop at 95.45. A break of 97.50 on the topside should see further momentum.

GBP
Hard to know whether to be long or short, my inclination tells me the reaction function of the BOE has changed with sterling not anywhere near as much of a focus as it was under King, and as such with the inflation report / forward guidance in the price we go back to data watching. This weeks minutes and UE report take renewed focus in light of the forward guidance. The weekend press already speculating a potential rise in the jobless rate this week given the volatility of the monthly numbers. David Smith in the Sunday Times points out nearly 1m more people are in jobs since 2009 yet the UE rate has only edged down from 7.9% to 7.8% (older workers staying in jobs and inward migration meaning 7% UE rate further than 3% away) and as we know that's only a threshold. So we can make a case for sterling lower or higher depending on how you look at it and to be honest until the market can settle I am inclined to wait until we see more guidance from the US side of the ledger and stay away from the summer chop. Intra-day for those that just can't help themselves the broader washout in longer dollar positioning feels to have more or less run its course but we still have a market that universally wants to own dollars so perhaps at these levels selling cable anywhere on a 1.55 handle risking last weeks 1.5580 highs is the right risk-reward trade but I must admit I don't have huge conviction. 1.5440/60 initial support and then back towards 1.5400 while in the cross 0.8560 / 0.8640 continues to define the range with little to get excited about.

AUD
0.9221 highs overnight as the USD selloff shows no real signs of abating. A strong session for Asian stocks help AUD start the week on the front foot and flows continue to be skewed towards position reduction. Despite the rate cut along with a seemingly dovish SOMP last week the AUD couldn’t sell off and there’s a growing consensus that we might have seen the cycle lows given how much is priced into the curve. Technically the Friday close above the 21dma also confirms a break of the downside momentum. In general I think the market has switched from wanting to sell AUD on rallies and not feeling short enough to fairly apathetic until we see the September top tier data events. We are sidelined at current levels and will wait to sell into a larger rally towards 0.9280 risking 0.9360 (a strategy that worked a few weeks back). Downside supports at 0.9170 followed by 0.9120.

SEB - Intraday Outlooks For EUR/USD, USD/JPY, AUD/USD, & SP500

The following are the intraday outlooks for EUR/USD, USD/JPY, AUD/USD and S&P500 as provided by the technical strategy team at SEB Group.

EUR/USD: Looks tired – focus on 1.3295/70. The backdrop short-term move higher has been looking wedgy for quite some time now and has reached a point where sellers could become interested again. Fri’s candle is potentially bearish and underlines a price/momentum divergence which soon could be confirmed. Today’s focus therefore is with the 8day "Conversion line" at 1.3295 and a tentative ascending line of support at 1.3270. Below those on a bearish looking close would likely also bring ~1.32/31.

USD/JPY: Buyers respond near support. As on Thu, buyers have this morning responded to the JulAug decline. And so not far from the ~95.40 level thought to be the lower end of a larger (bullish) contracting range. Over 97.00 would turn the immediate focus back on short-term refs of interest in the 97.60\98.85-zone.

AUD/USD: Positions have become a threat. All short- & medium-term tools are in bearish gears, but in the latter conditions remain stretched even with last week’s move higher included (which also confirmed the price/momentum divergence). This weekly print is clearly bullish and should lead to (massive) Specs raking some chips off the table thus fueling the move higher for some time yet. For the days ahead 0.9235\0.9320 is of great interest while local support is likely building around 0.9085/35.

S&P 500: Looks increasingly top heavy. The price/momentum divergence of late is seemingly taking its toll now. Last week closed on a negative note, possibly with a short-term bearish "Head & shoulders" top in the making. A bearishly looking session close below 1,680 would put the flood lights on prior lows at 1,670 & 1,666 –with an upped possibility of losses beyond those.

NAB - AUD/USD: Risk Of Bigger Squeeze Higher S/T Before Collapse

Focus of the day:

"We last revised our AUD forecasts in June, lowering our end- 2013 estimate for the AUD/USD rate to 0.88 and to 0.83 for end 2014. While still in essence a US dollar call, back then our view was that the RBA easing cycle was likely to be complete with a move down in the Cash Rate to 2.5% and with a tightening cycle potentially commencing late in 2014. We now envisage at least one further rate cut in this cycle (to 2.25%) with risk skewed to an even lower cycle end-point – a view supported by the economic projections contained in the new RBA Statement of Monetary Policy - and with no tightening expected before 2015 at the earliest. This is part of the justification for now forecasting a somewhat deeper and faster AUD depreciation path. We now envisage an end-2013 rate at 0.86, and a move down to the 80 cent level by the end of 2014.

Even though we are pulling forward our earlier 2013 year-end forecast of 0.88 to the end September, between now and then we see risk of a bigger squeeze higher, perhaps to the 93 cents area. For one, short positioning amongst the speculative trading community has recently become even more extended, at least as proxied by the CFTC (IMM) futures data. At the same time extended long USD positioning is proving vulnerable during the dog days of the Northern Hemisphere summer as risk positions are pared back. Alongside, the recent easing in US bond yields, a pickup in industrial metals prices off their recent lows and a fall-back in market volatility have all served to lift our short term ‘fair value’ estimates for the AUD. These currently stand in the 0.92-0.94 area under different iterations of our models, having been down near 90 cents (and falling) a month or so ago. So while we continue to expect that US bond yields and the USD will push back higher if the Fed does proceed to commence tapering its QE3 bond buying programme on September 19 and delivering our new 0.88 end September forecast, for the remainder of this month we see more upside than downside risk from current spot levels."

National Australia Bank (NAB)

Bank of America Merrill Sold EUR/USD Against A 'line In The Sand'Targeting 1.2821

Bank of America Merrill Lynch is making a very interesting bet in EUR/USD against the 1.3418 level which BofA sees as a 'line in the sand'.

"We have been EUR/USD bears. HOWEVER, a break of the 1.3418 June-19 high would FORCE US TO ABANDON OUR BEARISH VIEW AND TURN NEUTRAL. TO BE CLEAR, WE ARE STILL BEARISH, targeting 1.2821/1.2752, ahead of 1.2457 and eventually below," BofA clarifies.

Against this 1.3418 level, BofA now thinks that the recent break through 1.3345 is the first sign of topping, while a break of 1.3190 would confirm a return to trend.

"Given the proximity to our uncle point and our bearish outlook, we will initiate a short position at current levels (although we would recommend a smaller position size than usual)," BofA advises.

In line with this view, BofA enters into a technical tactical short EUR/USD position at market (1.3355), with a stop at 1.3420, and a target at 1.2821.

EUR/USD

EU Brief - London

[LONDON, Aug 12 11:40 GMT] EUR/USD opened the Asian session at 1.3340 and immediately went lower to trigger weak stops below 1.3330 down to 1.3313. The market then steadied and traded back to 1.3344 before model funds sold again. Into Europe and f good follow on from Friday’s 1.3391 to 1.3333 drop with losses to 1.3287. Not much weight behind the move with a smattering of speculative orders easily slicing through patchy European corporate bidding interest from 1.3320 down through the 1.3295 support point (200HMA, 50% Fibo 1.3188-1.3401) to the lows. Hearing fund offers now camped close to market at 1.3320-30 and stops above 1.3335. The bias is down and speculative accounts reportedly happy to sell all the way to 1.3400 with the larger stops now sat above the figure. Note the 2000 day moving average is at 1.3400. No EZ data today leaving the market to focus on the US Federal Budget numbers for July, -USD96 bln expected versus USD116.05 bln prev. PS. Copyright (c) 2013 Thomson Reuters

US Market Report

EUR/USD
•Bids at 1.3285 and then 1.3270, 1.3250
•Sell stops in good size seen beneath the mid figure through 1.3240
•Offers from leveraged funds at 1.3330, Asian offers at 1.3350 and larger supply from 1.3390 to 1.34
•Buy stops at 1.3335 and more accumulating above 1.3350

GBP/USD
•Bids at 1.5450 and larger at 1.5430
•Sell stops building around 1.5420
•Offers at 1.5520 and 1.5550
•Buy stops above 1.5520

USD/JPY
•Bids at 96.50 and larger from 96.20 to 96.00
•Sell stops again accumulating beneath the big figure
•Offers at 97.00 and ahead of 97.20
•Buy stops resting at 97.20

AUD/USD
•Bids at 0.9130 and the big figure
•Sell stops sub-0.9090
•Offers at 0.92 and 0.9220
•Buy stops building above 0.92 through 0.9210

EUR/JPY
•Bids from 128.10 down to 128.00 in good size
•Sell stops sizeable sub-128.00
•Offers clustered between 128.80 and 129.00
•Buy stops resting at 129.20