Analys från DailyFX

A "Make-or-Break" Scenario for USD/SEK

Published

10 år ago

7 januari, 2014

DailyFX

Talking Points:

”Massive” Rally and 61.8% Retracement
The ”Make-or-Break” Support Level
Upside and Downside Price Targets

The US dollar (USD) took a near-one-way ride against the Swedish krone (SEK), where USDSEK bottomed in the low 6.30’s in mid-October and peaked around the 6.70 level in November. This was a massive move with only small pullbacks that were few and far between. After this massive move, USDSEK failed to take out the highs around 6.70 after the Riksbank cut the repo rate by 25 basis points at its December monetary policy meeting. Furthermore, the Riksbank postponed the first repo rate hike into 2015 and announced that rates will remain low in Sweden. Normally, a repo rate cut and adjustment to the rate path would have weakened the currency even more, but this means that most of the expectations for a lower rate path and repo rate cut were already priced in. This was probably driven by Sweden’s soft inflation numbers from November. Guest Commentary: Technical Outlook for USD/SEK Support: 6.45, 6.37-6.30, 6.30 Resistance: 6.55, 6.60, 6.70 Since the lows in October around 6.30 to the peak around 6.70 in November, USDSEK has retraced 61.8% (to around 6.45) of the move, but has failed to establish a higher high after a weak bounce from this support level. The result is a lower low from the peak in November, and to boot, the support level around 6.45 is again under pressure. A close below this level might result in deeper pullback, and in that case, earlier lows around 6.30 might provide support. Furthermore, the positive trend is also under attack. We might see some choppy price action at current levels, but an establishment below the current trend line might give us a new trend with lower highs and lower lows in the weeks to come. For now, the critical area will be the support area around 6.45. A bullish reversal pattern from these levels might give us a new entry opportunity ahead of a potential move up to the November highs around 6.70. On the downside, however, a close below support will give a new sell signal, and the earlier lows around 6.30 might then act as support. Trade Idea for USD/SEK Await price action at the current support level around 6.45. If we see a bullish reversal pattern, we might see another test of the November highs around 6.70 and a potential push higher in 2014. On the downside, however, a close below support would be critical and could give way to a re-test of the lows around 6.30. With visibility on the charts rather low and risk still quite high at this point, it remains to be seen whether USDSEK will manage to defend the uptrend from the lows in October, or if a new trend with lower highs and lows will prevail. Until a signal does emerge, patience is a virtue! By Rafiul Hossain, Guest Analyst, DailyFX.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

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

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

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

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