DAILY TECHNICAL REPORT

27 October, 2011
Please note: None of the strategies below represent trading advice or trading recommendations of any kind. Please refer to our full disclaimer.

MA RK ET
EUR/USD GBP/USD USD/JPY USD/CHF
Ron William, CMT, MSTA

S-TERM
MULTI-DAY

L-TERM
MULTI-WEEK

STRATEGY/ POSITION

ENTRY LEVEL

OBJECTIVES/COMMENTS

STOP

Sell limit 3 Sell limit 3 Sell limit 3 123.15 107.90 0.8870 Buy limit 3 Buy Stop 3 0.8600 1.0275

Awaiting Directional Confirmation. Await fresh signal. Awaiting New Buy Trade Setup. 0.9000/0.9200/0.9316 1.0660/1.0850/1.1110 Exited Short at 1.0510. 121.60/118.50/116.50 106.90/104.00/100.00 0.8750/0.8580/0.8400 Await fresh signal. Awaiting New Sell Trade Setup. Awaiting New Sell Trade Setup. 124.40 109.00 0.8970 0.8500 1.0150

USD/CAD AUD/USD GBP/JPY EUR/JPY EUR/GBP

Bijoy Kar, CFA

EUR/CHF GOLD SILVER

WINNER BEST SPECIALIST RESEARCH

DISCLAIMER & DISCLOSURES

Please read the disclaimer and the disclosures which can be found at the end of this report

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. CH-2008 Neuchtel Switzerland info@migbank.com www.migbank.com

MIG BANK / Forex Broker14, rte des Gouttes dOr Tel +41 32 722 81 00 Fax +41 32 722 81 01

EUR/USD EUR/USD
EUR/USD (Daily)
BERMUDA TRIANGLE FAILED
BREAKOUTS

DAILY TECHNICAL REPORT

27 October, 2011

Bullish recovery pushes above 1.4000 on positive EU News.

EUR/USDs short-term bullish recovery has pushed above that all-important psychological level at 1.4000 (previous breakout zone). The move was triggered following todays positive EU news to boost their bailout fund.

BIG LEVEL (1.4000)

All-eyes are now watching probes into the long-term 200-day MA at 1.4097. Only a sustained confirmation above here will neutralise the larger bearish downtrend and offer further gains into 1.4220. Failure to hold above the 200-day MA will warn of an emotionally charged

200-DMA (1.4092) TREND 2 YEARS

bull-trap and ultimately a sharp downside reversal through 1.3799 (26th Oct low) and 1.3653 (18 Oct low), with scope into 1.3146 (Oct swing low). Watch intermarket relationships across broad risk-related proxies such as
th

EUR/USD daily chart, Bloomberg Finance LP

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

the developed equity markets. The euro currently shares a high correlation of 0.85% with the S&P500 which has just climbed to an 8-week high. Inversely, the USD Index is continuing to retrace (from its recent 6-month highs) and is testing initial support at 75.80-55.
+27% +19%
+10%
SO FAR

USD INDEX (4 YEARS)

Speculative (net long) liquidity flows are temporarily unwinding from their recent spike highs (3 standard deviations from the yearly average). This will 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.

BREAKOUT ZONE

DEMARK BUY SIGNAL

200-DMA (75.93)

3 STD ABOVE ONE YEAR AVERAGE

VIDEO

TRIGGER (15000)
DEMARK BUY SIGNALS

MIG Bank Webinar: Why the US dollar is likely to gain up to 30% in 6-12 months.
EXTREME NET US $ SHORT POSITIONS

13

KEY SUPPORT (73.50-73.00)

MIG Bank US Dollar Interview on Bloomberg S-T TREND L-T TREND STRATEGY
Awaiting Directional Confirmation.

COT LIQUIDITY

USD Index daily, weekly chart and COT Liquidity, Bloomberg Finance LP
www.migbank.com

Ron William, Technical Strategist, E-mail: r.william@migbank.com, Phone: +41 32 7228 454 2

GBP/USD

DAILY TECHNICAL REPORT

27 October, 2011

Under 1.5632 would turn bias bearish.

GBP/USD is settling above the 38.2% retrace of the 1.6747-1.5272 fall. A sustained break under 1.5632 is now required to increase the probability of a lasting lower high. Strategy is still hampered by a lack of reliable structure, largely due to the
200-day MA

range bound nature of the market in the medium-term time frame. Should this continue then a larger recovery phase, back towards the 200 day moving average would come back into focus. Remaining neutral is deemed best for now. GBP/USD has already experienced a large devaluation versus the US Dollar, therefore any further strengthening in the US Dollar may not see the

GBP/USD daily chart, Bloomberg Finance LP

full participation of GBP/USD. stronger then most.

Instead GBP/USD is favoured to remain

GBP/USD hourly chart, Bloomberg Finance LP

S-T TREND

L-T TREND

STRATEGY
Await signal.

www.migbank.com

Bijoy Kar, Technical Strategist, E-mail: b.kar@migbank.com, Phone: +41 32 7228 424 3

USD/JPY
USD/JPY (Daily 1 YEAR)

DAILY TECHNICAL REPORT

27 October, 2011
POST INTERVENTION RETRACEMENT (PIR I)

USD/JPY still basing around its NEW all-time low.

USD/JPY maintains a confluence of DeMark exhaustion bullish signals, after yet another new post WWII record low which was carved out at 75.82.

QUAKE SHOCK! 83.30

POST G7 MOVE HIGH

These reversal signals are also following the second post intervention retracement in 2011, which is holding around a multi-week base pattern. It is also worth noting that our volatility measures remain very low and continue to favour a major breakout over the short-term horizon.
82.00

The medium/long-term view remains bullish, watching for a sustained move

POST BOJ MOVE HIGH

above our initial upside trigger level at 77.68. This would offer a resumption of the preferred new structural bull-cycle into the all-important psychological level at 80.00, near 80.24 (post BOJ intervention II high).
80.24

Keep in mind that such a scenario would help reactivate the longer-term technical bias, including prior monthly DeMark exhaustion signals, within
USD/JPY Weekly (2007 2011)

ENDING DIAGONAL PATTERN BREAKOUT TARGET (88-85)

PIR II

the ending diagonal pattern, which was part of a major Elliott Wave cycle. Only a sustained weekly close below 76.25 will lead to a reassessment of
DEMARK BUY SIGNAL AFTER NEW POST WWII LOW (75.82)

the view and extend temporary weakness into 74.55.

Please select the link below to sign up for our MIG Bank webinar on USD/JPY. This will feature an update to our previous Special Report USD/JPYs Long-Term Structural Change (Wednesday, November 02nd 15:00-15:45 GMT). - What do long-term cycles tell us about the future of USD-JPY? - How do event shocks and Central Bank Interventions impact the market? - Safe-Haven Flows: A wave of change. - High-Probability Trading Strategies.

MONTHLY DEMARK BUY SIGNAL

S-T TREND

L-T TREND

STRATEGY
Awaiting New Buy Trade Setup.

USD/JPY daily, weekly chart, Bloomberg Finance LP

www.migbank.com

Ron William, Technical Strategist, E-mail: r.william@migbank.com, Phone: +41 32 7228 426 4

USD/CHF

DAILY TECHNICAL REPORT

27 October, 2011

Testing its long-term 200 day MA (0.8741).

USD/CHF is now testing its 200-day moving average which is currently at 0.8741, having recently printed a lower high at 0.9083, following the recent
200-day MA

break under 0.8881. While under 0.9123 a continuation of this weakness is favoured. It is also noted that the current trading region is close to the location of the 50-week moving average, at 0.8927. Thus, a continuation of weakness would also warn of a breakdown of the recent recovery structure. However, back under 0.7712 is required to change the long-term bullish bias. The recent break lower also opens up the potential for a further extension towards 0.8600, where a return to a bullish bias would become attractive

USD/CHF daily chart, Bloomberg Finance LP

again.

S-T TREND

L-T TREND

STRATEGY
Buy limit 3 at 0.8600, Objs: 0.9000/0.9200/0.9316, Stop: 0.8500

USD/CHF hourly chart, Bloomberg Finance LP

www.migbank.com

Bijoy Kar, Technical Strategist, E-mail: b.kar@migbank.com, Phone: +41 32 7228 424 5

USD/CAD
USD/CAD (Daily)
August High (1.0673)

DAILY TECHNICAL REPORT

27 October, 2011
USD/CAD (Weekly)

Bears push back into the psychological 1.0000 level.

USD/CAD bears have pushed back into the all-important psychological 1.0000 level (prior trading range). Only a sustained close beneath here will extend bearish setbacks into the

200-DMA (0.9811)

CONFIRMATION ABOVE 1.0680 OPENS LARGER RECOVERY

long-term 200-day MA at 0.9813. Meanwhile, positive momentum needs to push above 1.0264 and 1.0400 to extend the recovery higher above the old resistance level at 1.0673 (August high & Congestion zone). A strong directional confirmation above here will open a much larger

DEMARK BUY SIGNAL

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.

USD/CAD daily, weekly chart, Bloomberg Finance LP

MAJOR RESISTANCE CHF/CAD (Daily) REVERSAL PATTERN

Elsewhere, EUR/CAD is extending above its 200-day MA, within a large multi-month trading range. Key resistance continues to hold at 1.4379 (June swing high), which has for some time marked a strong distribution pattern. CHF/CAD is retesting its support nearby the 200-day MA at 1.1265, following the dramatic price slide lower (triggered by the SNB intervention). The cross-rate has now retraced more than half of its 2011 gains.

50%

(1.3570)
61.8% 50%

(1.3379)

200-DMA (1.3826)

(1.1488)

61.8%

(1.0893)
200-DMA (1.1265)

EUR/CAD (Daily)

S-T TREND

L-T TREND

STRATEGY
Buy Stop 3: 1.0275, Objs:1.0660/1.0850/1.1110, Stop: 1.0150

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

www.migbank.com

Ron William, Technical Strategist, E-mail: r.william@migbank.com, Phone: +41 32 7228 454 6

AUD/USD
AUD/USD
(1 YEAR) DEMARK SELL SIGNALS TD RISK (1.1102) (1.0935)

DAILY TECHNICAL REPORT

27 October, 2011
AUD/USD
(Weekly)

Bulls reverse higher above 200-day MA and target 1.0765.

Exited Short at 1.0510. AUD/USD bulls reversed back higher above its 200STRUCTURAL LEVEL

day MA and is now targeting next resistance at 1.0765 (01st Sept high). In terms of the big picture, failure to hold above the 200-day MA will resume
3 YEAR UPTREND IS UNDER PRESSURE

38.2%

(0.9144)
50%

downside pressure on the rates multi-year uptrend. The bears need to confirm beneath 1.0322 (26 Oct low) and 1.0188 (18 Oct low). A break here will unlock sharp setbacks into 1.0000. Elsewhere, the Aussie dollar remains stable against the New Zealand dollar. The pair is still locked within its new bear cycle structure while it holds beneath its 200-day MA. Key support can be found at 1.2320 and 1.2100. The Aussie dollar is also gaining against the Japanese yen, after pushing
th th

(0.8546)
200-DMA (1.0389)
61.8%

(0.7947) KEY ZONE

AUD/USD daily, weekly chart, Bloomberg Finance LP

AUD/NZD (Daily) AUD/JPY (Daily)
DEMARK SELL SIGNAL

back above resistance at 80.00. Near-term support continues to hold at

13

77.6350 (18 76.7000.

th

Oct low). A break here will resume downside scope into

200-DMA CAPS BEAR MKT 38.2%

(76.70)
50%

200DMA (83.15)

(72.58)
61.8%

(68.47)

BREAKDOWN ADDS TO RISK AVERSION

KEY SUPPORT 1.2319 / 1.2100

S-T TREND

L-T TREND

STRATEGY
Exited at 1.0510.

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

www.migbank.com

Ron William, Technical Strategist, E-mail: r.william@migbank.com, Phone: +41 32 7228 454 7

GBP/JPY

DAILY TECHNICAL REPORT

27 October, 2011

Range bound short-term, favouring a return to 122.65.

GBP/JPY saw a minor break under 120.34 which failed to hold, reaching
200-day MA

120.00. This is suggestive of the potential for a further recovery leg higher to test the region near 123.00. The structure present since 116.84 is deemed corrective, with scope for a final swing higher to complete this corrective phase. However, a sustained push under the recent low at 120.00 will warn of resumption of weakness back towards the floor near 117.00. However, an eventual return to 116.84/98 is expected, below which would open up an extension towards 115.00 immediately. A sustained break over 123.31 is required to change the current bearish

GBP/JPY daily chart, Bloomberg Finance LP

bias. Should this take place a larger corrective phase higher would then be anticipated.

GBP/JPY hourly chart, Bloomberg Finance LP

S-T TREND

L-T TREND

STRATEGY
Sell limit 3 at 123.15, Objs: 121.60/118.50/116.50, Stop: 124.40

www.migbank.com

Bijoy Kar, Technical Strategist, E-mail: b.kar@migbank.com, Phone: +41 32 7228 424 8

EUR/JPY

DAILY TECHNICAL REPORT

27 October, 2011

Consolidates above the 104.75/104.99 floor.

EUR/JPY continues to range just above the 104.75/99 floor, following initial support over the last few sessions. Provided this floor is not breached,
200-day MA

scope is seen for a fresh swing higher to re-test the 107.68 level. However, the larger structure present since 114.18 favours the formation of a lower high close to 108.03, for a return to re-test 100.76. Failure to hold under 108.03 will warn of a larger recovery structure, negating our medium-term bearish bias. Also, if a push over 108.03 can be sustained this will bring into focus a potential false break lower out of a falling channel in the daily timeframe. A move under the annual low would open up an extension to 97.50, ahead

EUR/JPY daily chart, Bloomberg Finance LP

of 92.80, levels not seen since 2000.

S-T TREND

L-T TREND

STRATEGY
Sell limit 3 at 107.90, Objs: 106.90/104.00/100.00, Stop: 109.00

EUR/JPY hourly chart, Bloomberg Finance LP

www.migbank.com

Bijoy Kar, Technical Strategist, E-mail: b.kar@migbank.com, Phone: +41 32 7228 424 9

EUR/GBP

DAILY TECHNICAL REPORT

27 October, 2011

Further swing higher anticipated towards 0.8886/85.

EUR/GBP has broken above its 200-day moving average, which is currently at 0.8727.
200-day MA

The rise from 0.8530 is viewed as being a corrective structure with scope for a lower high to form closer to the old 0.8886/85 double top. So, although further short-term strength may follow, supply is favoured to manifest near 0.8885. Should this move be realised, it would also take us close to the upper end of the recent trading range. There is an increased probability of general range bound trade, thus short entry at higher levels is also supported by the potential of a return to a period similar to that between 2003 and 2007 (not

EUR/GBP daily chart, Bloomberg Finance LP

shown). A move back over 0.8960 is required to neutralise our mild bearish bias, in a generally rangebound environment.

EUR/GBP hourly chart, Bloomberg Finance LP

S-T TREND

L-T TREND

STRATEGY
Sell limit 3 at 0.8870, Objs: 0.8750/0.8580/0.8400, Stop: 0.8970

www.migbank.com

Bijoy Kar, Technical Strategist, E-mail: b.kar@migbank.com, Phone: +41 32 7228 424 10

EUR/CHF

DAILY TECHNICAL REPORT

27 October, 2011

Fails to garner momentum close to channel resistance.

EUR/CHF failed to garner momentum after meeting supply close to the
200-day MA

resistance of an hourly rising channel. The subsequent weakness is currently testing the support of this same structure. A failure to find support here would warn of a larger fall back down to the 1.2000 level. Although bullish for the time being, it is expected that the 1.2500-1.3000 zone may limit the current recovery phase from 1.0075. It is anticipated that the markets willingness to trade with the bias of the SNB may exhaust should this trading region be met, as further gains in this cross are likely to become more dependent on economic releases. A sustained move under 1.2024 will alter our near-term bullish bias.

EUR/CHF daily chart, Bloomberg Finance LP

EUR/CHF hourly chart, Bloomberg Finance LP

S-T TREND

L-T TREND

Await fresh trading signal.

www.migbank.com

Bijoy Kar, Technical Strategist, E-mail: b.kar@migbank.com, Phone: +41 32 7228 424 11

GOLD
GOLD KEY TRIGGER LEVELS
DOWNSIDE: $1600 / $1530 UPSIDE: $1704 / $1844

DAILY TECHNICAL REPORT

27 October, 2011

RISK ZONE III

DOUBLE TOP

Risk of a larger decline beneath $1530.

Gold remains bearish after its dramatic 20% price fall, which helped confirm the extreme overbought conditions (marked by DeMark indicators). This also timed a key cycle peak, ahead of that all-important $2000 glass-ceiling.

DEMARK SIGNAL WARNED OF GOLDS OVERBOUGHT CONDITIONS

20% SO FAR

$1704

Most concerning is that speculative (net long) flows have recently breached a key downside level which may threaten over 2 years of sizeable long gold
$1600

34%
$1532 BREAKOUT
200-DMA NOT BROKEN IN 3 YEARS!

positions. In price terms, Golds latest 20% bearish slide is still worth less than the largest average drawdown measured since the start of the yellow metals long-term bull market in 1999.

26%
CONFIRMATION BELOW $1530 UNLOCKS LARGER DECLINE INTO $1300 & $1040-1000 TREND CHANNEL
(12 YEARS)

There is heightened risk of a much larger decline if we confirm a weekly close beneath $1600 and $1554-30 (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

COT NET LONG SPECULATOR POSITIONS

lower into $1300 and perhaps even $1040-1000. Remember, this would still offer a unique buying opportunity in the near future.
Please select links for in-depth Gold coverage:

I
25%
OVER 2 YEARS OF SIZEABLE LONG GOLD POSITIONS UNDER THREAT IF KEY LEVEL BREAKS

Special Report Golds mountainous peak at riskbeneath $1600 MIG Bank Gold Interview on CNBC Squawk Box
(CNBC & BLOOMBERG REPORTS)

VIDEO

MIG Bank Gold Webinar video

II

S-T TREND

L-T TREND

STRATEGY
Awaiting New Sell Trade Setup.

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

www.migbank.com

Ron William, Technical Strategist, E-mail: r.william@migbank.com, Phone: +41 32 7228 454 12

SILVER
Silver HITS 1980 Spike High! Silver (Daily)
DEMARK SELL SIGNALS DEMARK SELL SIGNAL

DAILY TECHNICAL REPORT

27 October, 2011

13

Key support at $26.0700.

Silvers latest price capitulation is a painful reminder to the investment community that lightning can strike twice. Note, this marks the second time silver has crashed, following its 30% fall last April.

200 DMA (36.5125)

II

The move was triggered following a DeMark exhaustion sell signal and has now wiped out almost 50% of silvers prior gains (taken from Silvers alltime high at 49.7900) which was last seen in 1980.

KEY SUPPORT (26.0700)

38.2%

Such a dramatic move traditionally produces volatile trading ranges. This allows the market to have enough time to recover and accumulate renewed buying interest.

(32.3135)

Gold/Silver "Mint" Ratio

50%

(26.9150)

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-

61.8%

(21.5165) 13 YEAR LEVEL

UNWINDING 67% FROM OVERSOLD TERRITORY

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 67%, suggesting further risk aversion over the next few weeks.

OVER

30 YEAR BASE PATTERN

BULL MARKET FROM 1999

Silver Monthly (since 1980)

S-T TREND L-T TREND STRATEGY
Awaiting New Sell Trade Setup.

Spot Silver daily, weekly chart and Gold/Silver mint ratio, Bloomberg Finance LP
www.migbank.com

Ron William, Technical Strategist, E-mail: r.william@migbank.com, Phone: +41 32 7228 454 13

LEGAL TERMS

DAILY TECHNICAL REPORT

27 October, 2011

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.

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.

www.migbank.com

14

CONTACT

DAILY TECHNICAL REPORT

27 October, 2011

Howard Friend www.migbank.com Chief Market Strategist h.friend@migbank.com

Ron William Technical Strategist r.william@migbank.com

Bjioy Kar Technical Strategist b.kar@migbank.com

MIG BANK info@migbank.com www.migbank.com

14, rte des Gouttes dOr CH-2008 Neuchtel Tel.+41 32 722 81 00 15