Analys från DailyFX

FTSE 100: Treading Close to a Breakdown

Published

8 år ago

13 april, 2017

DailyFX

What’s inside:

FTSE 100 struggles again to overcome 2013 top-side trend-line
Threatening to fall out of bearish price sequence
Focus is on the June trend-line and recent lows

How will ‘Brexit’ impact the FTSE in Q2? Check out our equity markets forecast for details.

The other day when we last discussed the FTSE 100, we made not of choppy market conditions which are not only impacting the UK index but global indices as a whole. The June trend-line which held the FTSE up from day one of the month is coming under siege again, and given where the market is trading it could become especially important should it fail to keep a floor in place.

The long-term 2013 top-side trend-line we’ve discussed on several occasions in recent weeks is exerting a fair amount of pressure on the market (it connects the 2013 2015 highs). The footsie carved out two reversal days around this line this week, and marked the fourth time since it January it is has turned lower immediately upon touching the long-term barrier. It was only in the middle of March that the FTSE able to trade above for a brief period of time.

On Tuesday, we had this to say about recent price action: “The general shape of the chop-fest since the 3/17 high is that of a descending wedge, with the market starting to move higher from the consolidation pattern. However, we can’t yet fully rule out a possible head-and-shoulders pattern until the FTSE surpasses the 3/30 peak at 7385.”

While on Tuesday and Wednesday the market moved beyond the 3/30 peak, both days resulted in reversal bars and a failure to close above 7385. This keeps the possibility of a topping pattern in place, not necessarily a textbook ‘head-and-shoulders’, but whatever you want to label it price action is getting increasingly bearish. It could become a broader descending wedge, or perhaps no further pattern development at all.

In an attempt to keep things simple: We are centering our attention around the June trend-line and recent lows. A close below the June trend-line readies the market for a drop, with a close below 7263/55 expected to see increased selling pressure (neckline break). Because the market keeps failing to trade above the 2013 top-side trend-line, we will require a strong close above it (7400+) before we turn bullish again.

FTSE: Daily

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—Written by Paul Robinson, Market Analyst

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Analys från DailyFX

EURUSD Weekly Technical Analysis: New Month, More Weakness

Published

7 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

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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

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Analys från DailyFX

Euro Bias Mixed Heading into October, Q4’17

Published

7 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

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Analys från DailyFX

British Pound Reversal Potential Persists Heading into New Quarter

Published

7 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

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