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Price & Time: Next Couple of Days Are Important For AUD

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This publication attempts to further explore the concept that mass movements of human psychology, as represented by the financial markets, are subject to the mathematical laws of nature and through the use of various geometric, arithmetic, statistical and cyclical techniques a better understanding of markets and their corresponding movements can be achieved.

Foreign Exchange Price Time at a Glance:

USD/JPY:

PT_AUD_continuation_body_Picture_4.png, Price amp; Time: Next Couple of Days Are Important For AUD

Charts Created using Marketscope – Prepared by Kristian Kerr

USD/JPY gapped higher on the open to trade at its highest level since May of 2009 on Monday

Our bias remains higher in the exchange rate with immediate focus now on the 1×3 Gann angle line from the September low and the 161.8% extension of the March decline in the 99.00/30 area

-Strength above this key resistance zone needed to setup the next push higher

-A Pi cycle relationship over the next couple of days with the 2011 low warrants some caution with the pair near key resistance levels as the market is susceptible to a turn of some sort during this time

-A convergence of Gann and Fibonacci levels in the 97.25/50 area is key support and only a clear break below these levels undermines the positive technical tone in the pair

Strategy: Still long half a unit from 94.15. Raising our stop from 95.30 to just under 97.20.

NZD/USD:

PT_AUD_continuation_body_Picture_3.png, Price amp; Time: Next Couple of Days Are Important For AUD

Charts Created using Marketscope – Prepared by Kristian Kerr

NZD/USD pushed through key Gann resistance near .8435 on Monday to trade to its highest level since late February

-We remain positive on the Kiwi, but strength over a convergence of Gann and Andrews lines in the .8480 area needed to trigger a more important move higher

-Time cycle analysis suggests the next couple of days are a medium-term turn window where a change in trend could occur

-The .8435 area is now immediate support

-However, only weakness under the 61.8% retracement of the year-to-date range in the .8400 area turns us negative on the Bird

Strategy: Frustrating trading in the Kiwi. Missed getting long last week by a few pips. Want to wait and see if weakness materializes during this cycle turn window before starting our next operation.

USD/CHF:

PT_AUD_continuation_body_Picture_2.png, Price amp; Time: Next Couple of Days Are Important For AUD

Charts Created using Marketscope – Prepared by Kristian Kerr

USD/CHF has come under steady pressure over the past few days and broken several key support levels including the .9370 2nd square root progression of the year-to-date high

Our bias is now lower in the exchange rate with focus on the 50% retracement of the year’s range at .9295

-Traction below this level needed to signal that a more important decline is indeed underway

-Near-term focused time cycle analysis indicates Tuesday and Friday could see a minor turn

-The .9370 Gann level is now resistance, but strength over the 9440 50% retracement of the most recent decline needed to turn us positive

Strategy: Took a 40 pip loss on our long from 9440. Now looking to get short at .9405 with a stop just over .9445.

Focus Chart of the Day: AUD/USD

PT_AUD_continuation_body_Picture_1.png, Price amp; Time: Next Couple of Days Are Important For AUD

We noted last week that April 3rd had a Fibonacci time relationship with the January high and the March low and that a change in trend was more probable at this time. After testing the 78.6% retracement of the year-to-date range near 1.0500 the Aussie did turn and has come under pressure over the past few days. So just how important is this price/time harmonic? The quick answer is we are not sure yet. A problem with Fibonacci related turn windows is they do a good job at pinpointing turns in the market, but are lousy at determining duration. The next couple of days look significant from a time perspective as weakness below 1.0350 into the second half of the week would be further evidence of a more important down cycle materializing. On the other hand, more strength over a confluence of several key Gann and Fibonacci levels near 1.0445 would signal the decline was likely just a minor correction before renewed gains.

Written by Kristian Kerr, Senior Currency Strategist for DailyFX.com

To contact Kristian, e-mail kkerr@fxcm.com. Follow me on Twitter @KKerrFX

Are you looking for other ways to pinpoint support and resistance levels? Take our free tutorial on using Fibonacci retracements.

Need guidance managing risk on trades? Download the free Risk Management Indicator.

To receive other reports from this author via e-mail, sign up to Kristian’s e-mail distribution list via this link.

Analys från DailyFX

EURUSD Weekly Technical Analysis: New Month, More Weakness

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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

EURUSD Weekly Technical Analysis: New Month, More Weakness

—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.

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Analys från DailyFX

Euro Bias Mixed Heading into October, Q4’17

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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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British Pound Reversal Potential Persists Heading into New Quarter

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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

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