Sive Morten
Special Consultant to the FPA
- Messages
- 18,659
Morning everybody,
So, bulls are getting help from nobody expects. Foreign investors are leaving China. On the stock market we see big sell-off, yuan near the all time lows, so PBoC was have to peg it to USD. Few weeks earlier the US has initiated the legislative act that US citizens who works in micro electronic sphere in Chinese companies have to leave the country, or they could lose US citizenship. After Xi victory, it has become clear that US has lost all chances to change political and economical vector of China. Chinese economy is becoming more close, fewer and fewer statistics is available.
As Japan and China as to sell foreign reserves and supply USD to open market - this brings some relief for liquidity problems and markets come back to life across the board. EUR is not an exception as well, especially on a background of coming 0.75 rate change by ECB as well.
So, on daily chart price is breaking K-resistance area, our COP is completed yesterday. With this new background, EUR has not bad chances to reach 1.01 OP target as well. Overbought level stands higher and should not become a problem:
4H chart shows clear acceleration to OP with almost no downside reaction. This brings good chances for upside continuation to XOP target and completing of the butterfly. BTW, as XOP as butterfly extension also stands at 1.01 - agree with daily OP target:
1H chart shows that we correctly suggested just minor 3/8 pullback before upside continuation. Now once again - we suggest to consider only two nearest levels. K-support is also suitable to stop placement. Also it agrees with major 3/8 support level. If any pullback happens at all of course... No shorts by far.
Indeed, everything looks nice, etc. But the major problem with such a rallies - you never know when it will be over as it is driven by specific technical factor.
So, bulls are getting help from nobody expects. Foreign investors are leaving China. On the stock market we see big sell-off, yuan near the all time lows, so PBoC was have to peg it to USD. Few weeks earlier the US has initiated the legislative act that US citizens who works in micro electronic sphere in Chinese companies have to leave the country, or they could lose US citizenship. After Xi victory, it has become clear that US has lost all chances to change political and economical vector of China. Chinese economy is becoming more close, fewer and fewer statistics is available.
As Japan and China as to sell foreign reserves and supply USD to open market - this brings some relief for liquidity problems and markets come back to life across the board. EUR is not an exception as well, especially on a background of coming 0.75 rate change by ECB as well.
So, on daily chart price is breaking K-resistance area, our COP is completed yesterday. With this new background, EUR has not bad chances to reach 1.01 OP target as well. Overbought level stands higher and should not become a problem:
4H chart shows clear acceleration to OP with almost no downside reaction. This brings good chances for upside continuation to XOP target and completing of the butterfly. BTW, as XOP as butterfly extension also stands at 1.01 - agree with daily OP target:
1H chart shows that we correctly suggested just minor 3/8 pullback before upside continuation. Now once again - we suggest to consider only two nearest levels. K-support is also suitable to stop placement. Also it agrees with major 3/8 support level. If any pullback happens at all of course... No shorts by far.
Indeed, everything looks nice, etc. But the major problem with such a rallies - you never know when it will be over as it is driven by specific technical factor.
