Analys från DailyFX
Price & Time: Gold Breaks Key Support Zone
- Gold falls below important near-term support
- USD/JPY struggles with Gann resistance
- GBP/USD nearing a critical resistance area
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Foreign Exchange Price Time at a Glance:
Price Time Analysis: USD/JPY
Charts Created using Marketscope – Prepared by Kristian Kerr
- USD/JPY failed earlier this week just shy of the 100.65 3rd square root progression of the year’s high
- Our near-term trend bias remains higher, however, while above the 50% retracement of the May to August decline at 98.75
- The 100.65 area is now a key upside pivot with traction above this zone needed to force a more serious move higher
- Early next week is a minor cycle turn window
- Weakness below 98.75 on a closing basis would undermine the immediate positive tone in the rate and turn us negative
USD/JPY Strategy: Like the long side while above 98.75.
Price Time Analysis: GBP/USD
Charts Created using Marketscope – Prepared by Kristian Kerr
- GBP/USD traded to a new 7-month high yesterday before encountering resistance at the 4th square root progression of the year-to-date high in the 1.5835 area
- While over 1.5710 our near-term trend bias will remain higher in Cable
- The 1.5835 area is a near-term upside pivot, but strength over 1.5885/95 is really needed to prompt the next important leg higher
- An medium-term cycle turn window is in effect over the next few days
- The 1×4 Gann angle line of the year’s low at 1.5755 is immediate support, but only weakness below 1.5710 would sour the positive near-term technical tone
GBP/USD Strategy: Like the long side while over 1.5710.
Price Time Analysis: SP 500
Charts Created using Marketscope – Prepared by Kristian Kerr
- SP 500 tested the 78.6% retracement of the August range near 1692 on Thursday, but so far has been unable to overcome the resistance
- While below this level on a closing basis our near-term trend bias will remain lower in the index
- The 50% retracement of the August range at 1667 is immediate downside support, but clear weakness under 1627 is required to signal the start of a more serious distribution phase
- A cycle turn window is currently in effect
- A close over 1692 in the days ahead is needed to improve the techncial outook and turn us positve on the SPX
SP 500 Strategy: Like holding small short positions against 1692.
Focus Chart of the Day: GOLD
XAU/USD smashed through an important zone at 1337/50 on Thursday. While over 1270 our broader bias is still positive on the yellow metal, but the sharp decline of the past couple of days raises the possibility of a more messy two-way corrective process. The next important cyclical turn window in the metal looks to be around late next week and the start of the week of September 23rd. Any weakness below 1270 over the next few days would undermine most of the positive technical developments of the past few months and turn us negative. A daily close back over 1350 is needed signal an early upside resumption.
— Written by Kristian Kerr, Senior Currency Strategist for DailyFX.com
Looking for a way to pinpoint sentiment extremes in Gold in real time? Try the Speculative Sentiment Index.
To contact Kristian, e-mail kkerr@fxcm.com. Follow me on Twitter @KKerrFX
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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