2011 12 06 migbank daily technical analysis report

8/3/2019 2011 12 06 Migbank Daily Technical Analysis Report

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MIG BANK / Forex Broker14, rte des Gouttes dOr CH-2008 Neuchtel Switzerland

Tel +41 32 722 81 00 Fax +41 32 722 81 01 [email protected] www.migbank.com

Please note: None of the strategies below represent trading advice or trading recommendations of any kind. Please refer to our full disclaimer.

WINNER BEST SPECIALIST RESEARCH

MA

S-TERMMULTI-DAY

L-TERMMULTI-WEEK

STRATEGY/POSITION

ENTRYLEVEL

OBJECTIVES/COMMENTS STOP

EUR/USD Await fresh signal.GBP/USD Await fresh signal.USD/JPY Await new buy trade setup above 80.00.USD/CHF Await fresh signal.USD/CAD Awaiting new buy trade setup.AUD/USD Awaiting new buy trade setup.GBP/JPY Missed sell at 123.00. Await fresh signal.EUR/JPY Await fresh signal.EUR/GBP Sell limit 3 0.8700 0.8565/0.8485/0.8285 0.8835EUR/CHF Sell stop 3 1.2130 1.2030/1.1526/1.1002 1.2230GOLD Awaiting new sell trade setup.SILVER SHORT 3 34.1300 29.9700/26.0700/23.3400 (Entered 01/11/2011) 34.1300

DISCLAIMER &DISCLOSURESPlease read the disclaimer and thedisclosures which can be found atthe end of this report

DAILY TECHNICAL REPORT6 December, 2011

Ron William, CMT, MSTA

Bijoy Kar, CFA

Notes: Entries are in 3 units and objectives are at 3 separate levels where 1 unit will be exited. When the first objective (PT 1) has been hit the stop will be moved to the entry

point for a near risk-free trade. When the second objective (PT 2) has been hit the stop will be moved to PT 1 locking in more profit. All orders are valid until the next report is

published, or a trading strategy alert is sent between reports.


2/15

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Sharp recovery following positive news.

EUR/USD extended sharply higher, as six central banks, reduced their USD

funding costs to ease the debt crisis. The impact was very positive for

investors around the world and has encouraged traditional risk appetite

markets, such as EUR/USD, AUD/USD and S&P500 to turn back higher.

Expect the recovery to be limited into 1.3610, then 1.3730 and perhaps

even 1.3850-90. Probability still favours a bearish reversal at these levels.

Meantime, support can be found at 1.3380 and 1.3146. A sustained close

beneath 1.3146 (Oct swing low) will re-establish the larger downtrend from

April and target 1.3000 (psychological level), then 1.2870 (2011 major low).

Inversely, the USD Index is maintaining its recovery higher and still targetsits recent 9-month highs near 80, (a move worth almost 10%).

Speculative (net long) liquidity flows have unwound from recent spike highs

(3 standard deviations from the yearly average). This will likely remain

strong and help resume the USDs major bull-run from its historic oversold

extremes (momentum, sentiment and liquidity).

Special Report:EUR/USD A Fall From Grace ? Decline Targets 1.3770/1.3410. VIDEO

MIG Bank Webinar: Why the US dollar is likely to gain up to 30% in 6-12 months.US Dollar Interview on Bloomberg

S-T TREND L-T TREND STRATEGY

Await fresh signal.

EUR/USD

Ron William, Technical Strategist, E-mail:[email protected], Phone: +41 32 7228 454

EUR/USD

EUR/USD weekly chart, Bloomberg Finance LP

USD Index daily chart, Bloomberg Finance LP
http://www.migbank.com/research/howard/2011-06-17_migbank_daily-technical-analysis-report_special-focus-EURUSD.pdfhttp://www.migbank.com/research/howard/2011-06-17_migbank_daily-technical-analysis-report_special-focus-EURUSD.pdfhttp://www.migbank.com/research/howard/2011-06-17_migbank_daily-technical-analysis-report_special-focus-EURUSD.pdfhttp://www.migbank.com/research/howard/2011-06-17_migbank_daily-technical-analysis-report_special-focus-EURUSD.pdfhttp://www.migbank.com/research/howard/2011-06-17_migbank_daily-technical-analysis-report_special-focus-EURUSD.pdfhttp://www.youtube.com/watch?v=8JxLscMBUHY&feature=player_embeddedhttp://www.youtube.com/watch?v=8JxLscMBUHY&feature=player_embeddedhttp://www.fxstreet.com/webinars/sessions/session.aspx?id=8e1265eb-a0b4-4b43-87d3-e5be91699f54http://www.fxstreet.com/webinars/sessions/session.aspx?id=8e1265eb-a0b4-4b43-87d3-e5be91699f54http://www.fxstreet.com/webinars/sessions/session.aspx?id=8e1265eb-a0b4-4b43-87d3-e5be91699f54http://www.fxstreet.com/webinars/sessions/session.aspx?id=8e1265eb-a0b4-4b43-87d3-e5be91699f54http://www.bloomberg.com/video/75644864/mailto:[email protected]:[email protected]:[email protected]:[email protected]://www.bloomberg.com/video/75644864/http://www.fxstreet.com/webinars/sessions/session.aspx?id=8e1265eb-a0b4-4b43-87d3-e5be91699f54http://www.youtube.com/watch?v=8JxLscMBUHY&feature=player_embeddedhttp://www.migbank.com/research/howard/2011-06-17_migbank_daily-technical-analysis-report_special-focus-EURUSD.pdf


3/15

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Break out from short-term range required.

GBP/USD has met initial resistance close to the 50% retrace of the 1.6167

1.5423 fall. We now seek a break out of the 1.5577 1.5726 short-term

range. A further push under 1.5577 in the hourly timeframe will continue toweaken the near-term structure, warning of an increased likelihood of

continuation back towards 1.5423. Alternatively, a push back over 1.5726

will warn of a fresh leg higher in the recovery from 1.5423.

The actions of the six central banks to cut rates last week is likely to act as a

short term relief to the European debt markets. However, a return to

stresses in the Euro-Zone is anticipated and thus Sterling has the capacity

to be deemed as a safe haven.

With the above in mind it may be advantageous to sell into a break underthe recent 1.5577 low, for a near-term return to 1.5423.

Alternatively buying at lower levels for a return to range bound trading is a

medium-term option.


Await fresh signal.

GBP/USD

Bijoy Kar, Technical Strategist, E-mail:[email protected], Phone: +41 32 7228 424

GBP/USD hourly chart, Bloomberg Finance LP

GBP/USD daily chart, Bloomberg Finance LP
mailto:[email protected]:[email protected]:[email protected]:[email protected]


4/15

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Minor rebound capped at 78.24 (DeMark Level).

USD/JPYs minor rebound is still being capped at 78.24 (DeMark Level) .

Moreover, downside risks remain, with the growing probability of a third

price retracement back to pre-intervention levels (PIR III) and potentiallyeven a new post world war record low beneath 75.35 (PINL).

Sentiment in the option markets continues to suggest that USD/JPY buying

pressure remains overcrowded as everyone continues to try and be the first

to call the market bottom.

This may inspire a temporary, but dramatic, price spike through

psychological levels at 75.00 and perhaps even sub-74.00. Such a move

would help flush out a number of downside barriers and stop-loss orders,

which would create healthy price vacuum for a potential major reversal.

The medium/long-term view remains bullish, as USD/JPY verges toward a

major long-term 40-year cycle upside reversal. Expect key cycle inflection

points to trigger into November-December this year, offering a sustained

move above our upside trigger level at 80.00/60, then 82.00 and 83.30.

Please select the link below to review our special coverage on USD/JPY.

Special Report: USDJPY Verging on a major 40 year cycle reversal

Webinar: USD/JPYs Long-Term Structural Change

Media Reports: CNBC Bloomberg


Awaiting renewed buy trade setup.


USD/JPY

USD/JPY daily, weekly chart, Bloomberg Finance LP
http://www.migbank.com/research/howard/USDJPY_Verging_on_a_Major_40_Year_Cycle_Reversal.pdfhttp://www.fxstreet.com/webinars/sessions/session.aspx?id=d77a35a0-4a11-44fa-a883-c95e01661d21http://www.fxstreet.com/webinars/sessions/session.aspx?id=d77a35a0-4a11-44fa-a883-c95e01661d21http://www.fxstreet.com/webinars/sessions/session.aspx?id=d77a35a0-4a11-44fa-a883-c95e01661d21http://www.fxstreet.com/webinars/sessions/session.aspx?id=d77a35a0-4a11-44fa-a883-c95e01661d21http://www.cnbc.com/id/45301945http://www.cnbc.com/id/45301945http://www.cnbc.com/id/45301945http://www.bloomberg.com/news/2011-11-24/dollar-may-rise-20-to-94-yen-on-elliot-wave-rebound-technical-analysis.htmlhttp://www.bloomberg.com/news/2011-11-24/dollar-may-rise-20-to-94-yen-on-elliot-wave-rebound-technical-analysis.htmlmailto:[email protected]:[email protected]:[email protected]:[email protected]://www.bloomberg.com/news/2011-11-24/dollar-may-rise-20-to-94-yen-on-elliot-wave-rebound-technical-analysis.htmlhttp://www.cnbc.com/id/45301945http://www.fxstreet.com/webinars/sessions/session.aspx?id=d77a35a0-4a11-44fa-a883-c95e01661d21http://www.migbank.com/research/howard/USDJPY_Verging_on_a_Major_40_Year_Cycle_Reversal.pdf


5/15

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Break back over 0.9252 suggests a return to strength.

USD/CHF has broken back over 0.9252 in todays trade. This now

increases the probability that the correction from 0.9331 is complete, with a

return to strength possible.

The respite that was offered to 10 year Italian government bond yields

following the USD based swap rate cut is likely nearing completion. The

6.00% level is seen as offering support with the potential of a return back

towards 7.00% over coming sessions. If upside pressure were to return to

Italian and Spanish yields then USD/CHF will likely experience a degree of

downside pressure too.

Spanish and Italian government bonds remain elevated, currently trading at

5.140% and 5.950% versus 6.478% and 7.355%, before the six partycentral bank agreement.

Looking at the German sovereign yield curve in particular we note that

yields are lower across all maturities when compared with a week ago (with

the exception of 6 months). Assuming German yields are not pressured to

the upside, this should also act to ease downside pressure in USD/CHF.


Await fresh signal.

USD/CHF hourly chart, Bloomberg Finance LP


USD/CHF

USD/CHF daily chart, Bloomberg Finance LP


6/15

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Sharp Setbacks hold steady.

USD/CADs sharp setbacks are holding steady, following the recent short-

term DeMark exhaustion sell signal.

A directional confirmation above 1.0658 is still needed to unlock the

recovery into 1.0850 plus. This would extend the upside breakout from the

rates ending triangle pattern, which was part of a major Elliott wave cycle.

Only a sustained close beneath 1.0120 and parity unlocks bearish setbacks

into the long-term 200-day MA at 0.9852 and 0.9726 (31st

Aug low).

EUR/CAD remains beneath its 200-day MA, still within a large multi-month

trading range. The strong multi-month distribution pattern is likely to

breakdown further into support levels at 1.3570 and 1.3380.

CHF/CAD has also broken back beneath its 200-day MA at 1.1375, while

breaching a multi-week trading range. This follows the dramatic price slide

lower (which was triggered by the SNB intervention). The cross-rate has

retraced more than half of its 2011 gains.


Awaiting new buy setup.Ron William, Technical Strategist, E-mail:[email protected], Phone: +41 32 7228 454

USD/CAD

USD/CAD daily, weekly charts, Bloomberg Finance LP

EUR/CAD and CHF/CAD daily charts, Bloomberg Finance LP


7/15

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Extended recovery beneath 200-day MA.

AUD/USD has extended its recovery into key resistance at 1.0340 (61.8%

Fib-Oct 28th

decline) and 200-day MA which is currently holding at 1.0412.

The bears must sustain below 1.0000 to further compound downside

pressure on the rates multi-year uptrend and push back towards 0.9611.

Elsewhere, the Aussie dollar remains strong against the New Zealand

dollar. However, near-term price activity is mean reverting back into the 200-

day MA. Expect a sharp setback to ensue over the multi-day horizon.

The Aussie dollar has triggered a mild recovery against the Japanese yen

and is now trading back above the neck-line of its two-year distribution

pattern. Watch for further downside scope into support at 72.00 which would

signal further unwinding of risk appetite.


Awaiting new sell trade setup.

AUD/USD


AUD/USD daily, weekly chart, Bloomberg Finance LP

AUD/NZD and AUD/JPY daily chart, Bloomberg Finance LP


8/15

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Rising wedge begins to break down.

Sell strategy at 123.00 removed. Short-term negative bias remains.

GBP/JPY continues to exhibit price action warning of a loss of momentum.

The rising wedge that we had noted in recent reports has seen its supportbroken in trade today. This now warns of a possible topping formation, with

scope now for a return to the 120.00 region in the short-term.

If 120.00 is met, a degree of support would be anticipated there. An earlier

push back over 122.64 would be expected to meet resistance at 123.00.

A failure to hold over 119.38 will warn of a return to 116.84.

Over a longer period of time a substantial recovery higher is favoured,

initially towards 163.09.


Missed sell at 123.00. Await fresh signal.

GBP/JPY

GBP/JPY daily chart, Bloomberg Finance LP


GBP/JPY hourly chart, Bloomberg Finance LP


9/15

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Short-term correction possibly complete at 105.70.

EUR/JPY has potentially completed a corrective phase higher after peaking

at 105.70. A break back under 103.36 is now sought.

Despite this short-term weakness, we view the fall that has taken placesince 111.60 as being corrective in nature, suggesting potential for a return

to this same level. Thus we have a directional clash in two timeframes.

The EUR component of this pair is clearly affected by the movement in

EUR/USD. A break under 1.3146 in EUR/USD will end the rising phase

seen since 2010. This would likely be associated with a fall back down to

100.76 and potentially lower.

Given the above clash between the structure and events in the Euro-Zone,

we prefer to wait on the side lines.

A sustained hold over the 200 day moving average will turn the medium-

term outlook more bullish.


Await fresh signal.

EUR/JPY hourly chart, Bloomberg Finance LP


EUR/JPY daily chart, Bloomberg Finance LP

EUR/JPY


10/15

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Failed downside break warns of a larger corrective phase higher.

EUR/GBP failed to gain momentum again, this time in the hourly timeframe,

after breaking under 0.8546, reaching 0.8525. This now warns of a larger

rise higher, back towards the 0.8700 region. As has already been seen,

following the recent push under 0.8530/31, this failure to garner momentum

is a hallmark of this currency pair in recent trade. Thus the strategy remains

to sell, but at higher levels.

Given the precarious situation in the Euro-Zone, it is anticipated that if yield

curve deterioration continues then Sterling could be viewed as a safe haven.

Italian and Spanish government bond yields have eased back somewhat

after the coordinated cut in USD based swap lines amongst selected central

banks. However, a lasting solution still appears a long way off with the

recent intervention simply easing a dire situation.

Our bias remains mildly bearish with trade continuing under both the 200

day and 50 week moving averages. We keep an eye on the 1.3146 level in

EUR/USD. A push under this level will mark a clear breakdown of

confidence in the EUR, which would then likely have a knock on effect in all

EUR crosses.


Sell limit 3 at 0.8700, Objs: 0.8565/0.8485/0.8285, Stop: 0.8835.

EUR/GBP hourly chart, Bloomberg Finance LP

EUR/GBP daily chart, Bloomberg Finance LP

EUR/GBP



11/15

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Returns to re-test the 1.2400/2500 region.

EUR/CHF continues to trade in a tight range, failing to meet the 1.2500 level

thus far. However, a fresh attempt appears to have been initiated to re-test

the 1.2400/2500 region. This return to the upper end of the recent trading

range has been assisted somewhat by the six bank dollar swap rate

coordination. An eventual return to rising yields is anticipated and with this

downside pressure should return to EUR/CHF.

Our strategy is to trade opportunistically from a momentum perspective,

awaiting a return to the 1.2000 region. Should a re-test of the 1.2000 region

take place with a fall under 1.1973 also following, this would warn of the end

of the recovery seen since 1.0075, increasing the probability of a return to

this level. Alternatively if short-term structure supports, then a sell limit

order could be employed at or above the recent trading range ceiling,

between 1.2400 and 1.2500.

The failure of this pair to break over the 50 week moving average over

recent weeks is also an initial warning that the prior downtrend may not be

over. The large cluster of stops that is likely to be placed around the 1.2000

level is also anticipated to aid any short positioning, questioning the ability of

the SNB to hold back the possible flow of funds into Swiss Francs.

S-T TREND L-T TREND

Sell stop 3 at 1.2130, Objs: 1.2030/1.1526/1.1002, Stop: 1.2230.

EUR/CHF weekly chart, Bloomberg Finance LP

EUR/CHF

EUR/CHF hourly chart, Bloomberg Finance LP



12/15

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Remains negative beneath $1800.

Short-term price activity remains negative beneath resistance at $1800,

despite the recent push higher. Only a close above here would develop a

more sustained recovery into $1845.

Meanwhile, there is still heightened risk for a much larger decline if we

confirm a weekly close beneath $1600/04 and $1530 (200-day MA/swing

low), which has not been breached in 3 years!

A number of bargain hunting trend-followers will be watching this

benchmark line in the sand for repeat support or a potential big squeeze

lower into $1300 and perhaps even $1040 - 1000.

Speculative (net long) flows also support this view having recently breached

a key downside level which may threaten over 2 years of sizeable long gold

positions. This will trigger a temporary, but dramatic setback that would

ultimately offer a unique buying opportunity in the near future.

Please select links for in-depth Gold coverage:

Special ReportGolds mountainous peak at riskbeneath $1600 VIDEO

Bloomberg Countdown CNBC Squawk Box MIG Bank Gold Webinar video(BLOOMBERG&CNBCREPORTS)


Awaiting new sell trade setup.

GOLD

Gold weekly and daily charts, Bloomberg Finance LP

http://www.migbank.com/research/howard/2011-09-13_Gold_Special_Report_(RW).pdfhttp://www.migbank.com/research/howard/2011-09-13_Gold_Special_Report_(RW).pdfhttp://www.migbank.com/research/howard/2011-09-13_Gold_Special_Report_(RW).pdfhttp://www.youtube.com/watch?v=haKdlGKWyjQ&feature=player_embedded&list=PL953E96C7BE48D2FAhttp://www.youtube.com/watch?v=haKdlGKWyjQ&feature=player_embedded&list=PL953E96C7BE48D2FAhttp://www.bloomberg.com/video/78409176/http://www.bloomberg.com/video/78409176/http://video.cnbc.com/gallery/?video=3000042202http://www.fxstreet.com/webinars/sessions/session.aspx?id=8f81a2e3-e29b-4031-b370-a85149271145http://www.bloomberg.com/news/2011-09-11/gold-may-fall-below-1-700-before-extending-bull-rally-technical-analysis.htmlhttp://www.bloomberg.com/news/2011-09-11/gold-may-fall-below-1-700-before-extending-bull-rally-technical-analysis.htmlhttp://www.bloomberg.com/news/2011-09-11/gold-may-fall-below-1-700-before-extending-bull-rally-technical-analysis.htmlhttp://www.cnbc.com/id/44310840http://www.cnbc.com/id/44310840http://www.cnbc.com/id/44310840mailto:[email protected]:[email protected]:[email protected]:[email protected]://www.cnbc.com/id/44310840http://www.bloomberg.com/news/2011-09-11/gold-may-fall-below-1-700-before-extending-bull-rally-technical-analysis.htmlhttp://www.fxstreet.com/webinars/sessions/session.aspx?id=8f81a2e3-e29b-4031-b370-a85149271145http://video.cnbc.com/gallery/?video=3000042202http://www.bloomberg.com/video/78409176/http://www.youtube.com/watch?v=haKdlGKWyjQ&feature=player_embedded&list=PL953E96C7BE48D2FAhttp://www.migbank.com/research/howard/2011-09-13_Gold_Special_Report_(RW).pdf


13/15

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Key support at $30.0000.

Silver is holding around key support at 30.0000. Only a sustained close

below here would trigger a test of the previous swing low at 26.0700.

Macro price structure continues to focus on the downside risks, following the

major sell-off in September. Such a dramatic move traditionally produces

volatile trading ranges. This allows the market to have enough time to

recover and accumulate renewed buying interest.

Expect a large trading range to hold between $37.0000-26.0700 over the

multi-week/month horizon, with downside macro risk into $21.5165 (61.8%

Fib-1999 bull market) and $20.0000. This would still maintain silvers long-

term uptrend and help offer a potential buying opportunity for the eventual

resumption higher.

Continue to watch the gold-silver mint ratio which has now accelerated

higher by 70%, suggesting further risk aversion over the next few weeks.

This also helps explain recent divergences between gold and silver.


SHORT 3: 34.1300, Obj: 29.9700/26.0700/23.3400, Stop: 34.1300

SILVER

Spot Silver daily and weekly charts, Bloomberg Finance LP



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Limitation of liability

MIG BANK disclaims, without limitation, all liability for any loss or damage of any kind,

including any direct, indirect or consequential damages.

Material Interests

MIG BANK and/or its board of directors, executive management and employees may have or

have had interests or positions on, relevant securities.

Copyright

All material produced is copyright to MIG BANK and may not be copied, e-mailed, faxed or

distributed without the express permission of MIG BANK.

Notes: Entries are in 3 units and objectives are at 3 separate levels where 1

unit will be exited. When the first objective (PT 1) has been hit the stop will be

moved to the entry point for a near risk-free trade. When the second objective

(PT 2) has been hit the stop will be moved to PT 1 locking in more profit. All

orders are valid until the next report is published, or a trading strategy alert is

sent between reports.

DISCLAIMERNo information published constitutes a solicitation or offer, or recommendation, or advice, to

buy or sell any investment instrument, to effect any transactions, or to conclude any legal act

of any kind whatsoever.

The information published and opinions expressed are provided by MIG BANK for personal

use and for informational purposes only and are subject to change without notice. MIG BANK

makes no representations (either expressed or implied) that the information and opinions

expressed are accurate, complete or up to date. In particular, nothing contained constitutes

financial, legal, tax or other advice, nor should any investment or any other decisions be

made solely based on the content. You should obtain advice from a qualified expert before

making any investment decision.

All opinion is based upon sources that MIG BANK believes to be reliable but they have no

guarantees that this is the case. Therefore, whilst every effort is made to ensure that the

content is accurate and complete, MIG BANK makes no such claim.

LEGALTERMS


15/15

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www.migbank.comRon WilliamTechnical [email protected]

MIG [email protected]

14, rte des Gouttes dOrCH-2008 NeuchtelTel.+41 32 722 81 00

Bjioy KarTechnical [email protected]

CONTACT

Howard FriendChief Market [email protected]
mailto:[email protected]:[email protected]://www.migbank.com/mailto:[email protected]:[email protected]:[email protected]:[email protected]://www.migbank.com/mailto:[email protected]:[email protected]

2011 12 06 migbank daily technical analysis report

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