Analys från DailyFX

A EUR/JPY Set-up That Flew onto the Radar

Published

11 år ago

25 februari, 2014

DailyFX

Talking Points:

Pullback within Overall EUR/JPY Uptrend
Key Support Zone for Initiating New Longs
The Ideal Time Frame for Taking This Trade

Today’s trade developed quite suddenly, as EURUSD began a fall that is also being reflected in other EUR cross pairs, including EURJPY. Whenever there is a sudden drop, traders hurriedly look to news in order to explain the price action, and sometimes, that’s perfectly valid. However, the more important question is how to benefit from changing price action, and today’s EURJPY trade is an example of this.

The bigger picture from the below weekly chart provides a clear uptrend as a backdrop for this trade. Admittedly, the larger trend has been losing momentum, but even a week’s worth of rising price action would easily help facilitate a trade on the lower time frames.

Guest Commentary: Clear Weekly Uptrend in EUR/JPY

The daily chart below presents some more confusing price action by way of the recent downward move. However, as shown, the declining line of resistance has been both broken and retested. This suggests that the best response to the current decline is to assume that the rising trend line will hold and there could be some kind of reaction off of it.

Guest Commentary: Daily Trend Line Break in EUR/JPY

The four-hour chart below gives a clearer idea of where support might reside, as there is a confluence of several previous horizontal resistance levels and the rising trend line in play.

Guest Commentary: Key Support Zone for EUR/JPY

The actual zone of support is 139.72-140.17, or 45 pips deep. This is reasonable risk given that there are more than 100 pips even to the most recent high on the four-hour chart. Nonetheless, more accurate entries would be much preferred, and thus, the hourly chart is a better place to look for a potential trigger.

On the hourly chart below, the bearish momentum may initially appear alarming, but it is also encouraging to note that a relatively wide declining parallel channel coincides with the projected zone of support, suggesting that prices may at least put in a bounce.

Guest Commentary: Ideal Time Frame for Buying EUR/JPY

Acceptable triggers would include pin bars, bullish engulfing patterns, and/or bullish reversal divergence on the hourly chart. There, the news should digest itself within one or two candlesticks, and there may then be an ample opportunity for the bulls to show their hand.

As always, anything can happen in trading, so two or three tries may be required in order to trade this successfully, but given that most stop losses on the hourly chart for EURJPY require less than 30 pips, this is an entry opportunity that is well worth considering.

By Kaye Lee, private fund trader and head trader consultant, StraightTalkTrading.com

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

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

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

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