2011 12 13 migbank daily technical analysis report

8/3/2019 2011 12 13 Migbank Daily Technical Analysis Report

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MIG BANK / Forex Broker 14, rte des Gouttes d’Or CH-2008 Neuchâtel 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 SHORT 3 1.3280 1.3140/1.2990/1.2870 (Entered 12/12/2012) 1.3460

GBP/USD Await fresh signal.

USD/JPY Await New Buy Trade Setup above 80.00.

USD/CHF Buy limit 3 0.9335 0.9460/0.9630/0.9776 0.9250

USD/CAD Awaiting New Buy Trade setup.

AUD/USD Sell Stop 3 1.0050 0.9950/0.9660/0.9380 1.0210

GBP/JPY Sell limit 3 123.00 122.00/121.00/120.00 124.00

EUR/JPY Await fresh signal.

EUR/GBP Sell at 0.8700 removed. Look to sell higher.

EUR/CHF Sell limit 3 1.2480 1.2380/1.2226/1.1973 1.2580

GOLD SHORT 3 1705 1605/1530/1300 (Entered 12/12/2012) 1750

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 REPORT13 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

DAILY TECHNICAL REPORT 13 December, 2011

www.migbank.com

Bears push into 1.3146 after rating warning fromMoody’s.

EUR/USD bears have continued to push lower, after a recent warning from

Moody’s which cited that it would review ratings for all European Union

countries. In price terms, bears need to break near-term support at 1.3146

(Oct swing low).

We have opened short position favouring extended downside scope. Our

cycle analysis suggests increased volatility over the next two weeks across

“risk” proxies, including the equity and commodity markets.

A close beneath 1.3146 will re-establish the larger downtrend from April and

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

Meanwhile, resistance can be found at 1.3550 (02 Dec high), then 1.3610

and 1.3730. Any rebound into these levels is likely to be short-lived.

Inversely, the USD Index is maintaining its recovery higher and still targets

its 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 USD’s 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

SHORT 3: 1.3280, Obj: 1.3140/1.2990/1.2870, Stop: 1.3460

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 and COT Liquidity, Bloomberg Finance LP

200-DMA (1.4074)

BERMUDATRIANGLE FAILED

BREAKOUTS

UPTREND2 YEARS

EUR/USD (Daily)

BREAKOUT

ZONE (1.4000)

1.3000 (PSYCHOLOGICAL) 1.2870 (2011 MAJOR LOW)

+

-

USD INDEX(4 YEARS)

DEMARK™ BUY SIGNAL

+27% +19%

TRIGGER(15000)

COT LIQUIDITY

+10%SO FAR

EXTREME NETUS $ SHORTPOSITIONS

9 KEY SUPPORT (73.50-73.00)

13

USD INDEX

200-DMA(75.84)

DEMARK™ BUY SIGNALS

BREAKOUT ZONE

EUR 57.6%, JPY 13.6%, GBP 11.9%CAD 9.1%, SEK 4.2%, CHF 3.6%

9 MONTHHIGH

http://www.migbank.com/research/howard/2011-06-17_migbank_daily-technical-analysis-report_special-focus-EURUSD.pdf





http://www.youtube.com/watch?v=8JxLscMBUHY&feature=player_embedded


http://www.fxstreet.com/webinars/sessions/session.aspx?id=8e1265eb-a0b4-4b43-87d3-e5be91699f54




http://www.bloomberg.com/video/75644864/

mailto:[email protected]










3


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Range formed by a sequence of false breaks.

GBP/USD has formed a sequence of false breaks on the hourly chart. We

now await to see if the most recent push lower, to 1.5538, will see any follow

through. This sequence of lower lows and higher highs has formed a rangebound market for the majority of December.

Demand for sterling is likely to be affected by the movement in selected core

Euro-Zone sovereign markets. In particular we note that Italian 10 year

yields are trading close to 7.00%. Daily structure is also suggestive of a

return to test 7.00% and higher. A continuation of higher yields may see

Sterling being adopted as a safe haven again. This reasoning would likely

help to keep cable within its year long range.

With the above in mind, the region near 1.5400 may offer attractive levels toenter into medium-term long positions. Taking this approach will need to

see levels closer to 1.5400 for a well placed stop. The range bound trade of

the last few days is best avoided.


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







4


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Weakening beneath 78.24 (DeMark™ Level).

USD/JPY is still weak beneath 78.24 (DeMark™ Level). There is an ever

growing probability of unfolding a third price retracement back to pre-

intervention levels (PIR III) and potentially even a new post world war recordlow 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 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/JPY’s Long-Term Structural Change

Media Reports: CNBC Bloomberg


Awaiting Renewed Buy Trade Setup above 80.00.


USD/JPY

USD/JPY daily, weekly chart, Bloomberg Finance LP

82.00

83.30

USD/JPY

QUAKESHOCK!

POST INTERVENTIONRETRACEMENT (PIR I)

POSTG7

MOVE (I)HIGH

PIR II

80.24

POSTBOJ

MOVE (II)HIGH

DEMARK™ BUY SIGNAL AHEADOF NEW POST WWII LOW (75.35)

POSTBOJ

MOVE (III)HIGH

PIR III

MONTHLYDEMARK™

USD/JPY Weekly(2007 – 2011)

ENDINGDIAGONAL

PATTERNANTICIPATES

BREAKOUT(85-79)

http://www.migbank.com/research/howard/USDJPY_Verging_on_a_Major_40_Year_Cycle_Reversal.pdf

http://www.fxstreet.com/webinars/sessions/session.aspx?id=d77a35a0-4a11-44fa-a883-c95e01661d21




http://www.cnbc.com/id/45301945



http://www.bloomberg.com/news/2011-11-24/dollar-may-rise-20-to-94-yen-on-elliot-wave-rebound-technical-analysis.html









http://www.migbank.com/research/howard/USDJPY_Verging_on_a_Major_40_Year_Cycle_Reversal.pdf



5


www.migbank.com

Over 0.9331 opens up a return to 0.9776.

USD/CHF saw a break over 0.9331 yesterday. This warns of a larger swing

higher, back towards 0.9776. We now look to see if the region just above

0.9331 has the capacity to act as support for a further extension higher.

This pair is currently ignoring the early warning signs exhibited by the

continued rise in some core Euro-Zone government bond markets. If the

yield on 10 year Italian government bonds continues to rise towards 7.000%

and higher, there is scope for a degree of downside pressure to return to

USD/CHF. In the meantime, the above mentioned extension higher is

favoured.

Referencing Spanish and Italian government bonds back to their respective

levels prior to the six party central bank agreement, we note that most of thepositive after effects have worn off, with yields trading at 5.881% and

6.684% versus 6.478% and 7.355%, before the agreement. (These yields

were trading at 5.897% and 6.521% respectively at the same time

yesterday.)


Buy limit 3 at 0.9335, Objs: 0.9460/0.9630/0.9776, Stop: 0.9250

USD/CHF hourly chart, Bloomberg Finance LP


USD/CHF

USD/CHF daily chart, Bloomberg Finance LP







6


www.migbank.com

Bulls rebound above 1.0200.

USD/CAD is maintaining its sharp bullish rebound above 1.0200. We are

watching for further sustained price activity to open a buy trade setup.

A directional confirmation above 1.0680 is still needed to unlock the

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

rate’s ending triangle pattern, which was part of a major Elliott wave cycle.

Only a sustained close beneath 1.0080 and parity unlocks bearish setbacks

into the long-term 200-day MA at 0.9870 and 0.9726 (31st

Aug low).

EUR/CAD is unwinding mildly ahead of the base of an important multi-

month distribution pattern. A break beneath 1.3393-79 (19th

Sept low/61.8%

Fib), signals an important breakdown into 1.3140 and would providesubstantial correlation pressure onto EUR/USD.

CHF/CAD, which serves as a proxy for “risk appetite”, remains weak

beneath its 200-day MA (which had provided support for most of the uptrend

since mid-2010). Key support now holds at 1.0893 (61.8% Fib retrace). A

break here would extend the sharp decline into 1.0332 (01st

March low) and

help confirm further unwinding of global risk appetite.


Awaiting New Buy Trade Setup.


USD/CAD

USD/CAD daily, weekly charts, Bloomberg Finance LP

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

USD/CAD (Weekly)

CONFIRMATIONABOVE 1.0680

OPENSLARGER

RECOVERY

DEMARK™ BUY SIGNAL

USD/CAD (Daily)

200-DMA(0.9870)

MAJOR RESISTANCE

50% (1.3570)

61.8% (1.3379)

200-DMA(1.3876)

REVERSALPATTERN

CHF/CAD (Daily)

50% (1.1488)

61.8% (1.0893)







7


www.migbank.com

Sharp setbacks beneath 200-day MA at 1.0414.

AUD/USD has resumed its sharp setbacks beneath its 200-day MA which is

currently holding at 1.0414. This key level is likely to encourage further

downside scope over the multi-day-week horizon.

The bears must sustain below 1.0000 to further compound downside

pressure on the rate’s 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/week horizon.

The Aussie dollar pairing back its mild recovery against the Japanese yen,

while holding 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 global risk appetite.


Sell stop 3: 1.0050, Obj: 0.9950/0.9660/0.9380, Stop: 1.0210.

AUD/USD


AUD/USD daily, weekly charts, Bloomberg Finance LP

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

AUD/USD (Weekly)

38.2% (0.9144)

50% (0.8546)

61.8% (0.7947)

3 YEARUPTRENDIS UNDER

PRESSURE

STRUCTURALLEVEL

KEYZONE

AUD/USD(1 YEAR)

DEMARK™ SELL

SIGNALS

200-DMA1.0405

REVERSINGINTO

200-DMA

AUD/NZD(Daily)

KEY SUPPORT1.2319 / 1.2100

200-DMA

(82.47)

13

38.2% (76.70)

61.8% (68.47)

50% (72.58)

AUD/JPY(Daily)

DEMARK™ SELL SIGNAL

RESUMPTION OFBREAKDOWN

ADDS TORISK AVERSION







8


www.migbank.com

Fails to maintain break lower in the hourly timeframe.

GBP/JPY continues to trade in a similar manner to GBP/USD. Yesterday’s

downside test of the month long range failed, returning to trade within the

range. However, the rise seen since 116.84 is deemed corrective in nature

suggesting scope for a return to 119.38 and then 116.84 in the near-term,

before a more lasting recovery.

As noted in prior reports, should this pair reach the 123.00 level, a degree of

resistance would be anticipated. In the meantime, we remain wary of the

short-term range bound environment but are re-instating the sell strategy at

123.00.

If the recent range bound trade is resolved to the downside, then the 120.00

level should provide a degree of support, from where a short-term leg higher

would be favoured to develop.


Sell limit 3 at 123.00, Objs: 122.00/121.00/120.00, Stop: 124.00

GBP/JPY

GBP/JPY daily chart, Bloomberg Finance LP


GBP/JPY hourly chart, Bloomberg Finance LP







9


www.migbank.com

Trend channel contains hourly weakness.

EUR/JPY is likely to see a period of volatile trade due to its clear association

with EUR/USD which is now approaching the key 1.3146 level. We are also

wary of the possibility of coordinated intervention to maintain the stability of

the Euro as a currency. This acts as a manipulation of the market, making

technical analytics harder.

The clash in structure that we have noted in previous reports remains

present, with the recent rise from 102.49 being deemed as corrective.

However, the larger 100.76 – 111.60 rise is suggestive of a further leg

higher back towards 111.60. Thus the directional clash in two timeframes is

ever present.

As mentioned above, if EUR/USD breaks under 1.3146 this will end the

rising phase seen since 2010 and would likely be associated with a fall back

down to 100.76 in EUR/JPY and potentially lower.

It is preferred to see if a sustained break can be achieved under 1.3146 in

EUR/USD, before committing to any directional bias.


Await fresh signal.

EUR/JPY hourly chart, Bloomberg Finance LP


EUR/JPY daily chart, Bloomberg Finance LP

EUR/JPY







10


www.migbank.com

Possible exhaustion pattern after break of trend-line support.

Sell strategy at 0.8700 removed. Negative bias remains.

EUR/GBP broke under 0.8486 yesterday. In doing so, a break under long-

term trend-line support from 0.8068 has been achieved. However, we notethat in the hourly and 5 minute timeframes, there are initial signs of

exhaustion. It is anticipated that these patterns may lead to a repeat

behaviour of this currency pair to exhibit a false break lower. Thus, although

we have removed the prior sell strategy, we still await a recovery higher

before participating in this market.

The message that we take away from the recent six party central bank

coordination is that there is a demand for US Dollars amongst European

banks. This fact is a warning sign and a clear weakness, suggesting scope

for a credit contractionary phase. We continue to expect a continuation of

rising yields in the Euro-Zone and it is within this environment that we see

the potential for Sterling to be perceived as a safe haven.

Another trigger for participation in this possible break lower would be a

lasting break under 1.3146 in EUR/USD, as this would likely have a knock

on effect in all EUR crosses. We also note the continued trade under the 50

week and 200 day moving averages.


Sell at 0.8700 removed. Look to sell higher.

EUR/GBP hourly chart, Bloomberg Finance LP

EUR/GBP daily chart, Bloomberg Finance LP

EUR/GBP








11


www.migbank.com

Continues to trade within a tight range.

EUR/CHF saw an initial push higher above the 50 week moving average

which again failed close to 1.2500, adding a further lower high to the

sequence seen since the middle of October. Since reaching the 50 week

moving average earlier in the year, it has acted as a decent region of

resistance, warning that the larger down-trend may not be over. We will

maintain our sell limit strategy at 1.2480 for now, as this represents a decent

trade location during thin Christmas markets. However, we look to see if a

break under 1.2226 can be achieved.

1.2226 will be used as a filter. Under 1.2226 we will swap our current sell

limit strategy to a sell stop strategy at 1.2130, with objectives at

1.2030/1.1526/1.1002 and a stop at 1.2230.

A rising sovereign yield environment may now be returning within the Euro-

Zone, as discussed in other parts of this report. We look to see if Italian 10

year sovereign yields can return to the 7.000% handle. It is these kinds of

pressures that may assist a return to and break of 1.2123/31. This

represents the real goal of a lasting breakdown in the recent range bound

structure.

The 1.2000 level is the only level that the SNB has suggested they will

defend. There is thus likely to be a large cluster of stops under this level,

which if triggered, could herald a return to the 1.0075 level.

S-T TREND L-T TREND

Sell limit 3 at 1.2480, Objs: 1.2380/1.2226/1.1973, Stop: 1.2580.

EUR/CHF weekly chart, Bloomberg Finance LP

EUR/CHF

EUR/CHF hourly chart, Bloomberg Finance LP








12


www.migbank.com

Bearish breakout from triangle pattern targets $1600.

Gold’s bearish breakout from a multi-month triangle pattern targets initial

support at $1600/17. This is likely to accelerate from inter-market weakness

across related risk proxies such as EUR/USD and equity markets.

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

confirm a weekly close beneath $1600/16 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 (12-year channel –floor).

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 into summer 2012.

Please select links for in-depth Gold coverage:

Special Report “Gold’s mountainous peak at risk…beneath $1600” VIDEO

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


SHORT 3: 1705, Obj: 1605, 1530, 1300, Stop: 1750

GOLD

Gold weekly, daily chart and COT Liquidity, Bloomberg Finance LP


TRENDCHANNEL (12 YEARS)

I

RISK ZONE III

CONFIRMATION BELOW $1530UNLOCKS LARGER DECLINE INTO $1300 & $1040-1000

26%

34%

20%SO FAR

25%

II

COT NET LONGSPECULATORPOSITIONS

OVER 2 YEARS OFSIZEABLE LONG

GOLD POSITIONSUNDER THREAT

IF KEY LEVEL BREAKS

200-DMANOT BROKENIN 3 YEARS!

DEMARK™ SIGNAL WARNED OFGOLD’S OVERBOUGHT

CONDITIONS

$1800

$1600

DOWNSIDE: $1600 / $1530

UPSIDE: 1760 / 1800

GOLD KEY LEVELS

$1532

DOUBLETOP

$1760

http://www.migbank.com/research/howard/2011-09-13_Gold_Special_Report_(RW).pdf





http://www.youtube.com/watch?v=haKdlGKWyjQ&feature=player_embedded&list=PL953E96C7BE48D2FA




http://video.cnbc.com/gallery/?video=3000042202

http://www.fxstreet.com/webinars/sessions/session.aspx?id=8f81a2e3-e29b-4031-b370-a85149271145

http://www.bloomberg.com/news/2011-09-11/gold-may-fall-below-1-700-before-extending-bull-rally-technical-analysis.html












http://www.fxstreet.com/webinars/sessions/session.aspx?id=8f81a2e3-e29b-4031-b370-a85149271145

http://video.cnbc.com/gallery/?video=3000042202






13


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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 silver’s 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


BULLMARKET

FROM1999

Silver Monthly (since 1980)

13

38.2% (32.3135)

50% (26.9150)

61.8%

(21.5165)

I

II

OVER 30 YEAR BASE PATTERN

Silver HITS 1980 Spike High! DEMARK™ SELL

13 YEAR LEVEL

UNWINDING 70% FROM

OVERSOLD TERRITORY

Gold/Silver "Mint" Ratio

KEYSUPPORT(26.0700)

DEMARK™ SELL SIGNALS

Silver (Daily)

200 DMA(36.9204)







14


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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.

DISCLAIMER

No 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

DAILY TECHNICAL REPORT

13 December, 2011

www.migbank.comRon WilliamTechnical [email protected]

MIG BANK

[email protected]

14, rte des Gouttes d’Or CH-2008 NeuchâtelTel.+41 32 722 81 00

Bjioy KarTechnical [email protected]

CONTACT

Howard FriendChief Market [email protected]



http://www.migbank.com/





http://www.migbank.com/



2011 12 13 migbank daily technical analysis report

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