Analys från DailyFX
Price & Time: Gold Breaks 1400 So What Next?
Gold takes out key levels while AUD/USD remains pinned down by important Gann resistance. USD/JPY up move stalls.
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Foreign Exchange Price Time at a Glance:
Price Time Analysis: USD/JPY
Charts Created using Marketscope – Prepared by Kristian Kerr
- USD/JPY traded to its highest level in three weeks on Friday before encountering resistance near the 4th square root progression of the year-to-date high in the 99.25 area
- The near-term trend bias is positive and will remain so while above 96.90
- The 99.25 level is now a near-term upside pivot with traction above opening the way for a test of key resistance at 99.95
- The latter half of this week is a medium-term cycle turn window
- A confluence of Fibonacci retracements near 97.50 is intermediate support, but only weakness below last week’ low near 96.90 would alter the positive technical outlook in the rate
USD/JPY Strategy: like the long side whilst over 96.90.
Price Time Analysis: AUD/USD
Charts Created using Marketscope – Prepared by Kristian Kerr
- AUD/USD recovery off the 78.6% retracement of the month-to-date range at .8930 has been unimpressive
- While over .8930 our near-term trend bias will remain positive
- A move through Gann resistance at .9040 is deseperately needed to set up a more important move higher
- However, medium-term cycle studies turn negative around the middle of the week
- A close under .8930 will undermine the burgeoning postive structure and turn us negative on the Aussie
AUD/USD Strategy: Small longs favored while over .8930
Price Time Analysis: EUR/GBP
Charts Created using Marketscope – Prepared by Kristian Kerr
- EUR/GBP has moved slowly higher since finding support a couple of weeks ago at the 4×1 Gann angle line of the year’s high in the .8500 area
- While under the 4th square root progression of the year’s high near .8625 our near-term trend bias will remain lower in the cross
- The .8530 area is a near downside pivot, but weakness below major support at around .8485 is really needed to set off a more important decline in the rate
- Cycle studies suggest that the middle of the week is a likely turn window in the cross
- A close over Gann resistance at .8625 will alter the negative technical outlook and focus higher
EUR/GBP Strategy: Only very small short positions favored while below .8625.
Focus Chart of the Day: GOLD
XAU/USD overcame more important resistance last week. The latest key level to give way was the 6th square root progression of the year’s low in the 1385 area. The weekly close over this level is potentially important and is further evidence that a more significant uptrend is in the making. Looking further out, the June high near 1424 is the next resistance point of note ahead of the all-important 161.8% projection of the July advance in the 1440 area. We doubt the metal will be able to test this resistance without backfilling, however, as we see cyclical headwinds getting stronger around the second half of the week.
— Written by Kristian Kerr, Senior Currency Strategist for DailyFX.com
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.
Looking for a way to pinpoint sentiment extremes in Gold in real time? Try the Speculative Sentiment Index.
To contact Kristian, e-mail kkerr@fxcm.com. Follow me on Twitter @KKerrFX
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
You can receive Paul’s analysis directly via email bysigning up here.
You can follow Paul on Twitter at@PaulRobinonFX.
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
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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