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Price & Time: Trend Resumption in the Precious Metals?

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This publication attempts to further explore the concept that mass movements of human psychology, as represented by the financial markets, are subject to the mathematical laws of nature and through the use of various geometric, arithmetic, statistical and cyclical techniques a better understanding of markets and their corresponding movements can be achieved.

Foreign Exchange Price Time at a Glance:

USD/CHF:

PT_pms_body_Picture_4.png, Price amp; Time: Trend Resumption in the Precious Metals?

Charts Created using Marketscope – Prepared by Kristian Kerr

USD/CHF has rebounded strongly over the past few days since finding support from just under the 3rd square root progression of the year-to-date high in the .9275area

Our bias remains higher in the exchange rate with immediate focus on the 3×1 Gann angle line from the year-to-date high near .9415

-Traction over the 1st square root progression of the year’s high at .9470 is really needed to signal the a resumption of the broader uptrend

-A minor cyclical turn window is seen over the next couple of days

-The 1×1 Gann angle line from the year-to-date low at .9360 is immediate support, but only weakness under .9275 level turns us negative

Strategy: Favor the long side while over .9270.

USD/CAD:

PT_pms_body_Picture_3.png, Price amp; Time: Trend Resumption in the Precious Metals?

Charts Created using Marketscope – Prepared by Kristian Kerr

USD/CAD has come under steady downside pressure over the past few days and touched its lowest level since mind-February on Tuesday

-Our bias is lower, but the exchange rate is approaching a key support zone in the 1.0015/35 area as this marks a convergence of the 3rd square root progression from the year’s high and several key retracements

-Weakness below this key zone is needed to maintain the downside tack

-Near-term time cycle analysis suggests the end of the week is a medium-term turn window

-The 1×1 Gann angle line from the year-to-date high in the 1.0100 area is now resistance and only strength above this level undermines the immediate negative technical tone

Strategy: Short positions favored while under 1.0100. Caution required, however, as we apporach potentially pivotal support in the 1.0015/35 area.

GBP/USD:

PT_pms_body_Picture_2.png, Price amp; Time: Trend Resumption in the Precious Metals?

Charts Created using Marketscope – Prepared by Kristian Kerr

GBP/USD has found formidable resistance over the past week at the 50% retracement of the year-to-date range in the 1.5585 area

We remain positive on Cable, but a close over 1.5585 is needed to trigger another push higher towards 1.5650 and above

-Near-term focused time cycles are a bit muddled, but a turn window is seen around the first half of next week

-The 38% retracement of the April advance in the 1.5450 area is immediate support

-However, weakness below the 50% retracement of the same move near 1.5405 is needed to signal a broader downside resumption

Strategy: Looks to be nearing an important juncture. A break of 1.5585 is needed soon if this counter-trend move is going to continue.

Focus Chart of the Day: Silver

PT_pms_body_Picture_1.png, Price amp; Time: Trend Resumption in the Precious Metals?

Several cycle counts we follow suggest the next couple of days will be important for spot Silver and a turn could materialize. Given the metal is in the midst of a minor counter-trend move higher this turn window should lead to a resumption of the broader downtrend. The 38% and 50% retracements of the late April decline at 24.40 and 25.10 look like key resistance as does the 6th square root progression of the year-to-date low at 24.80. On the downside the 50% retracement of the 3-week long advance near 23.45 looks like immediate support with weakness below there needed to signal the start of a downside resumption.

Written by Kristian Kerr, Senior Currency Strategist for DailyFX.com

To contact Kristian, e-mail kkerr@fxcm.com. Follow me on Twitter @KKerrFX

Are you looking for other ways to pinpoint support and resistance levels? Take our free tutorial on using Fibonacci retracements.

Need guidance managing risk on trades? Download the free Risk Management Indicator.

To receive other reports from this author via e-mail, sign up to Kristian’s e-mail distribution list via this link.

Analys från DailyFX

EURUSD Weekly Technical Analysis: New Month, More Weakness

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What’s inside:

  • EURUSD broke the ‘neckline’ of a bearish ‘head-and-shoulders’ pattern, April trend-line
  • Resistance in vicinity of 11825/80 likely to keep a lid on further strength
  • Targeting the low to mid-11600s with more selling

Confidence is essential to successful trading, see this new guide – ’Building Confidence in Trading’.

Coming into last week we pointed out the likelihood of finally seeing a resolution of the range EURUSD had been stuck in for the past few weeks, and one of the outcomes we made note of as a possibility was for the triggering of a ’head-and-shoulders’ pattern. Indeed, we saw a break of the ’neckline’ along with a drop below the April trend-line. This led to decent selling before a minor bounce took shape during the latter part of last week.

Looking ahead to next week the euro is set up for further losses as the path of least resistance has turned lower. Looking to a capper on any further strength there is resistance in the 11825-11880 area (old support becomes new resistance). As long as the euro stays below this area a downward bias will remain firmly intact.

Looking lower towards support eyes will be on the August low at 11662 and the 2016 high of 11616, of which the latter just happens to align almost precisely with the measured move target of the ‘head-and-shoulders’ pattern (determined by subtracting the height of the pattern from the neckline).

Bottom line: Shorts look set to have the upperhand as a fresh month gets underway as long as the euro remains capped by resistance. On weakness, we’ll be watching how the euro responds to a drop into support levels.

For a longer-term outlook on EURUSD, check out the just released Q4 Forecast.

EURUSD: Daily

EURUSD Weekly Technical Analysis: New Month, More Weakness

—Written by Paul Robinson, Market Analyst

You can receive Paul’s analysis directly via email bysigning up here.

You can follow Paul on Twitter at@PaulRobinonFX.

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Analys från DailyFX

Euro Bias Mixed Heading into October, Q4’17

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Euro Bias Mixed Heading into October, Q4'17

Why and how do we use IG Client Sentiment in trading? See our guide and real-time data.

EURUSD: Retail trader data shows 37.3% of traders are net-long with the ratio of traders short to long at 1.68 to 1. In fact, traders have remained net-short since Apr 18 when EURUSD traded near 1.07831; price has moved 9.6% higher since then. The number of traders net-long is 15.4% lower than yesterday and 16.4% higher from last week, while the number of traders net-short is 0.4% higher than yesterday and 10.5% lower from last week.

We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests EURUSD prices may continue to rise. Positioning is more net-short than yesterday but less net-short from last week. The combination of current sentiment and recent changes gives us a further mixed EURUSD trading bias.

— Written by Christopher Vecchio, CFA, Senior Currency Strategist

To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com

Follow him on Twitter at @CVecchioFX

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British Pound Reversal Potential Persists Heading into New Quarter

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British Pound Reversal Potential Persists Heading into New Quarter

Why and how do we use IG Client Sentiment in trading? See our guide and real-time data.

GBPUSD: Retail trader data shows 38.2% of traders are net-long with the ratio of traders short to long at 1.62 to 1. In fact, traders have remained net-short since Sep 05 when GBPUSD traded near 1.29615; price has moved 3.4% higher since then. The number of traders net-long is 0.1% higher than yesterday and 13.4% higher from last week, while the number of traders net-short is 10.6% lower than yesterday and 18.3% lower from last week.

We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests GBPUSD prices may continue to rise. Yet traders are less net-short than yesterday and compared with last week. Recent changes in sentiment warn that the current GBPUSD price trend may soon reverse lower despite the fact traders remain net-short.

— Written by Christopher Vecchio, CFA, Senior Currency Strategist

To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com

Follow him on Twitter at @CVecchioFX

To be added to Christopher’s e-mail distribution list, please fill out this form

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