Analys från DailyFX

GBP/USD Technical Analysis: Bullish but Nearing Resistance Barrier

Published

9 år ago

7 september, 2016

DailyFX

To receive James Stanley’s Analysis directly via email, please sign up here.

Talking Points:

GBP/USD Technical Strategy: Near-term price action continues moving higher in a bullish manner.
While price action remains below the longer-term support value of 1.3500, the pair could pose continued bullish price action as additional rate-cut bets for the U.K. unwind as inflationary pressure has begun to show.
SSI – If you’re looking for trading ideas, check out our Trading Guides. And if you want something more short-term in nature, check out our SSI indicator. If you’re looking at opening a trading account, FXCM has a contest at the beginning of next month for certain account holders. Click here for full details.

In our last article, we looked at the potential for the British Pound to pose an extended top-side run after the Bank of England’s post-Brexit maneuvering drove the Sterling lower; exposing the economy to inflationary pressure as import prices continue to tick higher. And while this may not necessarily amount to a rate hike for a bank that just unloaded an artillery of stimulus last month, it could soften additional rate-cut bets as higher levels of inflation force the BoE’s hand away from future dovish moves.

Since that article, GBP/USD broke out of the top-side of the symmetrical wedge formation that had built-in post-Brexit, and prices have continued to trounce higher with higher-highs and higher-lows printing throughout; furthering the bullish case for the Cable.

There is but one complication with bullish strategies on the pair at the moment, and that’s the outsized thicket of resistance sitting above current price action. At 1.3480 we have the July swing-high in the pair; at 1.3500 we have the ‘Financial Collapse low’ that set swing support on the pair for more than 7-years before giving way to Brexit-driven price action earlier this summer. And just a bit above that at 1.3532 we have the post-Brexit swing-high; and this was the peak level in the pair just ahead of Mark Carney’s impromptu press conference just days after the Brexit referendum, in which he assured markets that accommodation would be coming from the Bank of England, preemptively.

Traders would likely want to move forward with bullish approaches in one of two ways: A) wait for a deeper support inflection in order to get long or B) let the batch of top-side resistance give way to confirm the pair’s bullish potential before triggering long, at which point traders can look to buy ‘higher-low’ support. For the inside approach, traders would likely want to target the zone around 1.3250, as this has a key Fibonacci retracement level as well as being a psychological level and a prior form of resistance (outlined in purple on the below chart). For traders looking to wait for more information, let the pair break above the 1.3532 level before looking to catch that ‘higher-low,’ which given current technical structure can be attractive if showing up in the zone from 1.3480-1.3500.

Created with Marketscope/Trading Station II; prepared by James Stanley

— Written by James Stanley, Analyst for DailyFX.com

To receive James Stanley’s analysis directly via email, please SIGN UP HERE

Contact and follow James on Twitter: @JStanleyFX

Analys från DailyFX

EURUSD Weekly Technical Analysis: New Month, More Weakness

Published

8 år ago

30 september, 2017

DailyFX

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

—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.

Analys från DailyFX

Euro Bias Mixed Heading into October, Q4’17

Published

8 år ago

29 september, 2017

DailyFX

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

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

Analys från DailyFX

British Pound Reversal Potential Persists Heading into New Quarter

Published

8 år ago

29 september, 2017

DailyFX

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