Analys från DailyFX

GBP/USD Technical Analysis: Bullishly Adhering to Fibonacci Structure

Published

9 år ago

14 september, 2016

DailyFX

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Talking Points:

GBP/USD Technical Strategy: Longer-term price action remains subdued below historically low levels; near-term bullish structure.
The Cable continues to show support/resistance inflections using the Fibonacci retracement around the post-Brexit move in the pair.
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In our last article, we looked at the bullish price action structure in GBP/USD as a pivotal resistance structure around the major psychological level at 1.3500 neared. As we noted, traders looking to get long would likely want to wait for a deeper retracement in the effort of buying ‘higher-low’ support. We had discussed the reasons behind such a move two weeks ago in the article, Carney’s Lament, and should inflationary pressure continue to be a concern for the U.K. after the ‘sharp repricing’ in the British Pound in the wake of the Brexit referendum, this could lead to continued bullishness in the Sterling.

The post-Brexit range in the Cable continues to show support and resistance with a Fibonacci retracement drawn over the range; taking the high of 1.3523 that came in on 6/29 to the 1.2788 low that showed up a few days later. This was just after Mark Carney warned of impending rate cuts in response to Brexit, and helped to ramp up rate-cut bets in anticipation of a proactive response to Brexit. That swing-low has yet to give way, even after the BOE delivered considerably more than what markets were looking for at their August meeting; and when price action doesn’t make a lower-low after an extremely bearish driver, that could be telling us something (extremely oversold).

As prices in GBP/USD began sliding lower last week after approaching the confluent batch of resistance around 1.3500, price action found resistance off of the 76.4% retracement, support at the 61.8% retracement, and now support at the 50% level; and each of these instances are not the first iteration of these levels coming in as support or resistance. The prior swing-low of the move showed up at the 38.2% retracement, so traders could continue to build approaches utilizing this Fibonacci structure.

Traders looking to get long ahead of tomorrow’s BOE meeting would likely want to investigate stops based on this structure of support/resistance; with aggressive approaches looking to place risk levels below today’s low of 1.3137, and more conservative approaches looking to place stops below the prior swing around 1.3050. On the upside, traders could target levels at 1.3357 (76.4% retracement of the post-Brexit move), followed by 1.3430 (most recent swing-high), followed by 1.3500 (the Financial Collapse low).

Created with Marketscope/Trading Station II; prepared by James Stanley

— Written by James Stanley, Analyst for DailyFX.com

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Analys från DailyFX

EURUSD Weekly Technical Analysis: New Month, More Weakness

Published

8 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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You can follow Paul on Twitter at@PaulRobinonFX.

Analys från DailyFX

Euro Bias Mixed Heading into October, Q4’17

Published

8 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

8 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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