Analys från DailyFX
Technical Weekly: Is USD/CHF the Tell?
- EUR/USD smallest non-holiday range since September 2014
- Tough spot for commodity currencies
- USD/CHF old highs = new lows
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EUR/USD
Weekly
Chart Prepared by Jamie Saettele, CMT
SeeREAL TIME trader positioning
This was the smallest weekly range for EUR/USD since Christmas week 2014. It’s the smallest non-holiday weekly range since September 2012. 1.0820 wasn’t reached although that’s still a level that I would pay attention to for near term resistance…then around 1.0900. If EUR/USD low is in place and everything since Thanksgiving is a bottoming pattern then 1.0462-1.0539 (2015 lows) should provide support. Remember the weely RSI comment – “the fact that the indicator has turned up from above 30 is a positive but pay attention to the 60 value for resistance.”
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GBP/USD
Weekly
Chart Prepared by Jamie Saettele, CMT
SeeREAL TIME trader positioning
Cable has followed through on the weekly reversal and closed above the 13 week average. Yes, the high this week is at the November high and a long term parallel so it could take some time to work out the kinks before an extension higher. Recent comments remain valid. “Did the96 month (8 year) cycle low countjust nail a major GBP/USD low (cycle is in February but give this some wiggle room)? This week’s bullish outside week is a good start. The former floor in the 1.3500-1.3700 zone could come into play at some point although the first test would be 1.2800.”
AUD/USD
Weekly
Chart Prepared by Jamie Saettele, CMT
SeeREAL TIME trader positioning
Aussie was dead this week which isn’t much of a surprise given the hairy area that the cross has entered. The first half of 2015 floor is up here and the big wicks from 2016 start near .7650. In other words, we’ve entered a resistance area. Previously, “AUD/USD sports good looking symmetry with respect to the time between major lows. It’s one reason that I like the idea of the 2016 low at .6847 holding. The other reason to get bullish in the event of constructive price action on the daily or weekly charts is the relationship between the 2011 high and 2016 low. The .618 absolute retracement of the 2011 high at 1.1080 is .6847 (1.1080 x .618). The 2016 low is .6827.”
NZD/USD
Weekly
Chart Prepared by Jamie Saettele, CMT
SeeREAL TIME trader positioning
“At this point, the head and shoulders pattern is considered failed but pay attention to the underside of the 2016 trendline for resistance. The line is just above the December high of .7239.” Kiwi is finishing the week better than the level noted last week. Price channels since the August 2015 (China) in a bullish manner although there is a good deal of horizontal consideration for supply between .7316 and .7403. In other words, the situation is similar to Aussie in that the big move is probably up but we’re at levels that won’t be easy to penetrate.
USD/JPY
Weekly
Chart Prepared by Jamie Saettele, CMT
SeeREAL TIME trader positioning
The last USD/JPY note remarked that “USD/JPY has indeed turned lower but could stabilize now that the 13 week average has held. Even so, the strength of the prior trend probably necessitates a more drawn out corrective process. In the event of a break, 109 would be in play.” I’m sticking with the ‘drawn out process’, meaning that USD/JPY is neither overly bullish nor bearish but rather range. The trendline / horizontal level above price and 13 week average / December low below price make for solid range barriers.
USD/CAD
Weekly
Chart Prepared by Jamie Saettele, CMT
SeeREAL TIME trader positioning
No change as USD/CAD continues to hold up the ‘new’ channel. “Connect the May and November highs and extend a parallel off of the May low to work with the new channel. The overlapping (corrective) nature of the advance from May keeps me from turning bullish on the outside week. Best to wait for clarity regarding Loonie.”
USD/CHF
Weekly (LOG)
Chart Prepared by Jamie Saettele, CMT
SeeREAL TIME trader positioning
“Since trading to a 6+ year high, USD/CHF has slowly declined. Broad upside potential is possible as long as price is above the 2011-2014 trendline. The trendline is near .9850 on log scale and just above .9700 on arithmetic. The topside of the wedge is worth knowing near 1.0450 (line off of 2012 and 2015 highs). Essentially, the wedge barriers are all I care about…all else is noise.” I care about where this week’s low was because it’s at former resistance from the 2012 high and June 2016 high. Former resistance providing support is bullish…so I’m bullish.
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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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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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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