Major pairs: UOB's technical targets

EUR/USD: Neutral (since 29 May 17, 1.1180): In a 1.1150/1.1300 range.

The sharp rise above 1.1265/70 yesterday (high of 1.1295) has put paid to our expectation of a pull-back towards 1.1130. The outlook for EUR remains neutral for now but we expect this pair to trade sideways between 1.1150 and 1.1300. The undertone is still on the weak side but only a move below the rising trend-line support at 1.1150 would indicate the start of a sustained down-move.

GBP/USD: Bearish (since 13 Jun 17, 1.2670):

Further weakness seems likely but solid support expected at 1.2560, 1.2515. The stop-loss for our bearish view at 1.2820 was tested yesterday but held (exact high of 1.2820). The bearish phase that started on Tuesday, 13 Jun is still intact. As long as 1.2820 is not taken out, we continue to hold a bearish stance and expect GBP to move lower to 1.2560. However, the recent low near 1.2635 is expected to offer strong support and this level could hold for several days more.

AUD/USD: Bullish (since 07 Jun 17, 0.7515): To exit half of long position at 0.7670/75.

After trading in a muted manner for several days, AUD sprang to life and sliced through our bullish targets at 0.7575 and 0.7615 (high of 0.7636). The bullish phase that started one week ago  is still clearly intact even though the rally appears to be running ahead of itself. Those who are long should consider exiting half their position at 0.7670/75, just below the next major resistance at 0.7680.

NZD/USD: Bullish (since 23 May 17, 0.7000): Bullish outlook intact but likely consolidation first.

The ease of which the major 0.7245 resistance was taken out was unexpected as NZD surged to high a high of 0.7320. However, the rapid and sharp pull-back from the high has dented the upward momentum somewhat and this could lead to a few days of consolidation first. That said, as long as 0.7200 is intact, there is still room for a move towards the next major level at 0.7375 (even though the 0.7320 high is unlikely to yield so easily).

USD/JPY: Neutral (since 12 Jun 17, 110.35): Bearish only if NY closing below 108.80.

USD dropped sharply to hit a low of 108.81 but rebounded strongly from the low. While the immediate pressure has shifted to the downside, we are not convinced that the current movement is the start of a bearish phase We prefer to wait for a NY closing below 108.80 before turning bearish. In the meanwhile, further choppy swings are not ruled out but the downside pressure is expected to increase in the coming days unless USD can reclaim 110.35.