Analys från DailyFX
Snapback Levels for Trading Gold and Australian Dollar in Focus
Gold
Weekly
Chart Prepared by Jamie Saettele, CMT using Marketscope 2.0
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FOREXAnalysis: Everyone wants to know about gold! I’m looking for a ‘tradeable low’ between 1220 and 1265. 1265 is the June 2010 high. 1250 is the extension from 1523 of the 1523-1796 range. 1220 is the 161.8% extension from 1322 of the 1322-1488 range. 1227 is the November 2009 high. There are clusters of levels at 1155 and 1045/80 as well. It’s been gold’s tendency since September 2012 to ‘crash’ for 2-4 weeks and consolidate for at least a month. Next week would be week 2 of this ‘crash’.
FOREX Trading Strategy: Looking for a low next week between 1220 and 1250. Given current market conditions, a turn would probably occur with the SP 500 (watch 1550), and the AUDUSD (see below). I’m looking for ‘tradeable lows’. These are lows that lead to sharp advances (‘snapback’ rallies) but not the end of trends.
AUDUSD
Daily
Chart Prepared by Jamie Saettele, CMT using Marketscope 2.0
Are you new to FX or curious about your trading IQ?
FOREXAnalysis: Extensions of the recent AUDUSD range project .9114 (161.8%) and .8984 (200%). .8984 is of particular interest due to participants’ obsession with big round figures. If/when the market approaches .9000, expect many to proclaim terrible things for AUDUSD if it breaks .9000. The level is also home to a steep downward sloping trendline. Near term, a 4th wave rally may carry to .9277-.9313 before the final lows are registered (see 2 charts down).
Part of last week’s argument for a USDJPY low was extreme 4 week rate of change figures. We can make the same argument based on 13 week rate of change for the AUDUSD this week. 13 week ROC is at levels consistent with near term reversals. The red dots on the chart below represent 13 week ROC less than or equal to -11%. The week that ended 5/14/04 was -12.27%. The 2008 decline was interrupted by a bounce in September after 13 week ROC had reached -15.25% (go back and look at the September 2008 bounce…it was NOT immaterial). This week’s reading is -11.52%. It’s in the ballpark.
FOREX Trading Strategy: Looking for a low next week….watch the SP 500 if it gets to 1550, especially if on Monday. This setup was discussed in detail during Friday’s DailyFX PLUS webinar.
AUDUSD
Weekly
Chart Prepared by Jamie Saettele, CMT using Marketscope 2.0
Are you new to FX or curious about your trading IQ?
AUDUSD
Hourly
Chart Prepared by Jamie Saettele, CMT using Marketscope 2.0
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NZDUSD
Daily
Chart Prepared by Jamie Saettele, CMT using Marketscope 2.0
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FOREXAnalysis: The intersection of 2 long term trendlines intersects just below .7650 next week. .7649 is the 78.6% retracement of the rally from the November 2011 low and .7634 is the 2009 high.
FOREX Trading Strategy: Looking for a low near .7650.
USDCHF
Weekly
Chart Prepared by Jamie Saettele, CMT using Marketscope 2.0
Are you new to FX or curious about your trading IQ?
FOREXAnalysis: The USDCHF rallied for 22 weeks off of the 2011 low (8/12/11 to 1/13/12) and has traded sideways for the last 73 weeks. Consolidation has lasted 3.3 times (73/22) longer than the previous trend. The low last week was registered at the trendline that extends off of the October 2011 and 2013 lows and just 8 pips below the open for the year. The USDCHF has made important lows since 2012 in a fashion similar to what is happening now. That is, price has dropped sharply into the lows and made an inside week the next week.
FOREXTrading Strategy: Long while above .9170
GBPUSD
Daily
Chart Prepared by Jamie Saettele, CMT using Marketscope 2.0
Are you new to FX or curious about your trading IQ?
FOREXAnalysis: Don’t lose sight of the big picture. A 4 year triangle (see next chart) was broken to the downside in February and price has returned to the breakout point. The GBPUSD completed an outside week. This is the first reversal from a 13 week price extreme since the week that ended 3/15 (low of the year so far). The GBPUSD is ahead of the EURUSD at this point. The GBPUSD topped in January…the EURUSD in February. The GBPUSD bottomed in March…the EURUSD in April. The GBPUSD made a high on 6/17 and the EURUSD made its high on 6/19. So it makes sense that the GBPUSD would fall apart before the EURUSD does. 5 waves down are visible from the high but when the GBPUSD turns, it tends to go quickly so beware of looking for a deep 2nd wave rally that never materializes. 1.5490-1.5529 is resistance.
FOREXTrading Strategy: If not already short, would wait for 1.5490-1.5529. Stop above pre-FOMC high of 1.5680.
GBPUSD
Weekly
Chart Prepared by Jamie Saettele, CMT using Marketscope 2.0
Are you new to FX or curious about your trading IQ?
— Written by Jamie Saettele, CMT, Senior Technical Strategist for DailyFX.com
To contact Jamie e-mail jsaettele@dailyfx.com. Follow him on Twitter @JamieSaettele
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Jamie is the author of Sentiment in the Forex Market.
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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