Analys från DailyFX
Silver Price Buckles on USD Bounce from Support; Targeting Long-term Trend-line
What’s inside:
- Silver price put in key reversal last week, followed through on Friday’s solid U.S. jobs report
- US dollar bouncing from long-term support, putting pressure on precious metals
- Still targeting the 2003 long-term trend-line as objective before possibly turning bullish
Find out in the Q3 Forecast what’s driving Gold Silver this quarter.
In last week’s post, at the time of writing silver prices were putting in a key reversal bar on the daily time-frame but still needed to finish the day with the same look before considering it to be a valid bearish bar formation (We discussed the importance of waiting for the close of candlesticks in this webinar.) The reversal-bar formed at an important cross-road of resistance by way of the April trend-line and around the peak of a bounce back in June.
Silver: Daily
Friday’s overall positive U.S. jobs report sparked buying in the US dollar at a critical long-term area of support, and subsequently led to heavy selling in precious metals. This is what we had to say Wednesday regarding the relationship: “The inverse correlation between precious metals and the dollar has been strong, and on that a big turn in the buck, as long as the relationship stays intact, could spur selling in precious metals.” The one-month correlation between silver and the US Dollar Index (DXY) is at -91%, about as negative as it can get. The strength of this relationship oscillates, but for now USD is in charge here as it bounces from major support.
US Dollar Index (DXY): Weekly
Where is silver headed from here? For starters, as long as it doesn’t trade above last week’s high at 16.96 then we look for the downturn to continue to follow through. Trade back above the Wednesday high would put our bearish bias on hold. The target continues to be the 2003 trend-line which arrives around 15. Should silver melt to that juncture then depending on how price action plays out we might look for a sustainable low to develop.
Join Paul live every Tuesday at 9 GMT for his technical outlook for indices and commodities.
—Written by Paul Robinson, Market Analyst
You can receive Paul’s analysis directly via email by signing up here.
You can follow Paul on Twitter at @PaulRobinonFX.
Analys från DailyFX
EURUSD Weekly Technical Analysis: New Month, More Weakness
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.
Analys från 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
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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