Analys från DailyFX

DAX Turns Lower Off Confluence of Resistance

Published

8 år ago

3 mars, 2017

DailyFX

What’s inside:

DAX presses up against eyed confluence of resistance, turns lower
Has support not far below by way of the December trend-line, recent swing low
Rising wedge scenario could come into play with more time

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Following Wednesday’s surge, yesterday was a relatively nothing day for the DAX with its paltry range of about 40 points. The German index found itself the past two days pressed up against several levels/lines of resistance we’ve been eyeing.

From Wednesday’s piece, “In the immediate future, the 2/22 high of 12031, April ’16 trend-line, 12079 (level from 2015), and then just a shade higher the August ’16 trend-line are our biggest concerns. All of these technical events lie within closely proximity to one another.”

We’re seeing some early selling on a gap-down open after the U.S. sagged during its afternoon session yesterday and weakness in sentiment continuing into Asia (Nikkei off by 49 bps).

Even with moderate selling in the near-term, the trend will remain point higher as long as the DAX can maintain the December trend-line (which gained further importance over the course of three days of testing it, 2/24-2/28), and not decline below the most recent swing low of 11722 created on 2/24. As long as support holds, the trend holds and downside momentum will be contained.

With further upside pressure and a break above the trio of resistance levels, the DAX will have room to run towards another top-side trend-line running up off the 1/3 swing high, then to the 2015 record high of 12391, which depending on timing may coincide with the Jan trend-line.

If the DAX continues to bobble around, though, between the pair of 2016 top-side trend-lines and the December trend-line, then the rising wedge scenario we briefly touched on the other day could come into focus. The outcome of such a formation could resolve itself into a strong squeeze higher or result in a sell-off; that’s the nature of the pattern, it often portends a big move, but doesn’t necessarily provide signaling as to the direction until it breaks (although rising wedges tend to be bearish). More on that later…

All-in-all, the tone for global equities remains bullish, and so it is expected to be the case for the DAX until we see price action indicate otherwise.

DAX: 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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