Analys från DailyFX
FTSE 100 Technical Outlook: Looking for Turn Off Slope Support
What’s inside:
- The FTSE 100 is backing its way into slope support going back to July
- Should turn higher soon, but if not needs to hold 6722 at the worst to maintain trend
- Top-side targets at August peak and near record high made in 2015
On Monday, we said the big 2%+ breakout out of the bull-flag in the FTSE 100 (FXCM: UK100) to end last week (with the help of weak US Jobs data) clearly put the path of least resistance in the longs’ favor. Since then we are seeing some backing and filling of that shot higher, which isn’t yet cause for alarm. In fact, the decline has brought the FTSE into a solid sloping level of support. The lower parallel extending back to early July is a good spot to see the current decline come to a halt and for buyers to show up.
The general trend structure remains bullish, with the markings of higher lows and higher highs. Global risk sentiment remains buoyed from Asia to the rest of Europe to the U.S., as well, which helps support the case for higher prices in London.
In the short-run, we would like to see the FTSE hold the lower parallel and turn higher, but if it should sink below the lower parallel not all is lost; it will require a break below the 9/1 low at 6722 to put the trend in jeopardy of breaking. As long as the lower parallel holds, and it should do so today/tomorrow, then we will look to a minor top-side trend-line off the 8/15 high as potential resistance in the near-term. A break above that line and the Friday high at 6929 will quickly expose the August high at 6956 and increase potential for a larger breakout, creating another significant higher high. A new high opens up the path towards the upper parallel currently in the vicinity of 7100 (upward moving target), which is also near the April 2015 record high at 7127.
Track trader sentiment in real-time with FXCM’s ‘Speculative Sentiment Index’.
—Written by Paul Robinson, Market Analyst
You can follow Paul on Twitter at @PaulRobinsonFX.
He can be emailed at probinson@fxcm.com with any questions or comments.
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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