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Greece Referendum Result Adds Little Clarity to EURUSD Direction

Technical Analysis

The “No” Vote Victory after Sunday‚Äôs Greek Referendum has only had muted impact on the EURUSD exchange rate.

Whilst a gap lower has dented a more positive tone, EURUSD remains very much defined by a range environment and we still look for a mere decisive breakout from key levels define below for a more significant directional bias to surface

  • Only a breakout from above 1.1436 or below 1.0819 sets a more significant base or bearish continuation threat, respectively.
  • Below 1.0819 opens bear risks down to 1.0520 and the 1.0459 cycle low for 2015.
  • Above 1.1436 aims higher, through 1.1467 for 1.1534 and 1.1660 targets.

Daily EURUSD Chart

EURUSD

Yen “Flight to Quality” Bid, but Still an Underlying Bull Tone for USDJPY

The Japanese Yen is historically viewed as a “safe haven” currency and usually attracts buying during uncertain times. The current situation in Europe with the Greek Debt Crisis, alongside the freefall in Chinese equity markets has seen a bid for the Yen over the past 1-2 weeks.

However, whilst above 121.53, we see the May-June bullish breakout rally from the previous 2015 range intact and still see upside risk into July.

  • Short-term risk is for a correction towards 121.53 (which we would look to try to hold to maintain an underlying bull theme).
  • The July threat remain for a retest of key barriers up at 125.81/85.

Daily USDJPY Chart

USDJPY

GBPUSD remains solid during Broader US Dollar Rally

The Cable (GBPUSD) spot FX rate has dipped lower over the past 1-2 weeks, but maintains an underlying bull tone. This is particularly impressive given the strength being demonstrated by the US currency across G10 currencies (notably versus AUD, NZD, CAD and to a lesser extent EUR). This favours a resumption of a more bullish GBPUSD tone into July.

  • Modest support at 1.5500 is holding.
  • Whilst minimally above here and better support at 1.5189 we see upside into July.
  • The bias is back to the recent 1.5930 peak and for psychological/ option target at 1.6000.
  • Above aims for 1.6182/88.

Daily GBPUSD Chart

GBPUSD

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