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EUR Technical Analysis
An "Audacious" Long Set-up in EUR/GBP
Talking Points:
- Possible End of a Six-Month Elliott Structure
- The Case for an Impulsive EUR/GBP Upside Move
- Step-by-Step Parameters for Taking This Trade
While EURGBP isn’t a pair we typically enjoy trading, sometimes a structure is presented that’s just too hard to ignore. Today, we see a potential trade that’s based on analysis from both the daily and hourly time frames. Together, they provide an opportunity to try to buy a “bottom,” which is, admittedly, a perennially dangerous task in itself.
The below daily chart of EURGBP shows our Elliott wave count starting in August 2013 and extending into late January. It’s an Elliott Wave diagonal, a five-wave structure where all five legs comprise three waves each. By definition, it makes progress in an overlapping manner. Here, the fourth leg must move back into the area of the second leg. This makes it different from the more common motive structure called an impulse, whose fourth wave cannot (in theory) intrude into the area of the second wave.
Guest Commentary: Diagonal Pattern on EUR/GBP Daily Chart
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While the overlapping requirement makes it different from an impulse, there’s an important attribute that both types of motive waves share: the third wave must never be the shortest of waves one, three, and five. By itself, that’s a key component that makes the structure very tradable.
In this case, the first wave was 437 pips and the third wave was 333 pips. This rule means that the fifth wave cannot be 333 pips or larger because that would make the third wave the shortest of waves one, three, and five. With that, the fifth leg needed to stay above 0.8130.
Though many traders will trade in the opposite direction to the fifth leg as it approaches a level like 0.8130 (in this case, EURGBP reached a low of 0.8167) and place their stop a little behind 0.8130. We chose to wait, however.
There are two other attributes of Elliott wave diagonals that give us greater confidence that we’ve labelled this structure correctly:
- In many cases, the fourth wave pulls back 61.8% of the third wave, and this occurred (see 4 vs. 3 Fibonacci ratio).
- Another common trait among diagonals is that they change direction quite sharply. While this hasn’t happened yet, we may see a sharp move higher and away from the 0.82 level over the next few weeks.
Therefore, factoring these traits in as well, we’re keen to try to buy a possible bottom while price is still in this area.
As mentioned, we chose to wait instead of buying EURGBP as it approached 0.8130 because we wanted to see if there was any evidence of an impulsive move to the upside. And, to that point, the hourly chart below shows a sharp, five-wave impulsive move higher (see blue wave (i)) followed by what seems to be a comparatively prolonged WXY zig-zag correction (see blue wave (ii)).
Price recently tested the 78.6% retracement of the impulsive move higher (sometimes called “the last line in the sand”). The low of the correction was near the WXY equality level (see Fib Y vs. W: 100%) and also perfectly aligned the smaller-degree ABC zig-zag equality level. In light of this, the decision to wait and analyze more price action now gives greater confidence when placing a trade.
Guest Commentary: The Case for a Bottom in EUR/GBP
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While we could have traded late in the blue wave (ii) pullback, we waited once more for an impulsive rise. That occurred in the form of yellow wave i, and we’re now going to buy the pair during the yellow wave ii pullback.
Therefore, the trade is to buy EURGBP at 0.8265 (or lower), placing a stop at the low of blue wave ii (0.8185). For this 80-pip stop, we’re not setting a target at this time, but we’re potentially looking at hundreds of pips, and as a result, this trade will take many weeks to complete.
The risk profile is very good, but there is real risk in this trade. EURGBP has fallen 600 pips over the last six months, and it takes some audacity to try to call a bottom. If price continues higher, though, we will look to add to this in time.
Long Set-up for EUR/GBP
- Trade: Buy EURGBP at 0.8265 (or lower)
- Stop Loss: Place stop at 0.8185
- Target: Open (for reasons discussed above)
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EURJPY Technical Analysis
EURJPY Technical Analysis
Talking Points:
- EUR/JPY Technical Strategy: Flat
- Support: 138.06 (23.6% Fib ret.), 136.68 (50% Fib ret.)
- Resistance: 140.29 (Feb 11 high)
The Euro may be readying to turn lower against the Japanese Yen, with prices showing a Bearish Engulfing candle setup and hinting at weakness ahead. Near-term support is at 138.06, the 23.6% Fibonacci expansion, with a break below that targeting the 38.2% level at 136.68. Resistance is at 140.29, the February 11 high.
A short position targeting 138.06 with a stop on a daily close above 140.29 is acceptable from a risk/reward perspective. We will opt to pass on the setup however. EUR/JPY is displaying a strong correlation with the S&P 500 (0.77 on 20-day percent change studies), pointing to a strong sensitivity to risk appetite trends. The benchmark stock index is in the midst of its strongest push higher in seven months and fighting that momentum seems ill-advised.
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--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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EURCAD Technical Analysis
A Textbook Buying Opportunity in EUR/CAD
Talking Points:
- Prolonged Weekly Uptrend in EUR/CAD
- Consolidation Before a New Push Higher
- Key Support Zone for Buying EUR/CAD
This week is starting out with a potential opportunity to hop onto the uptrend in EURCAD, which has been going on for a quite a long time.
Of course, the question always exists as to whether or not a trend is coming to an end, but ultimately, no one can be absolutely certain until it has happened. As a result, continuing to buy dips in an uptrend is the most prudent move.
Guest Commentary: Accelerating Weekly Uptrend in EUR/CAD
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The daily chart below is exhibiting a set-up that not all traders would consider taking, but it constitutes what might be a slight hesitation before an upward move. Of course, this could just as easily be the beginning of a deeper pullback, which is why lower time frames are used in order to obtain a more precise entry and counteract this risk.
Guest Commentary: Key Decision Point for EUR/CAD
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As this is a mere hesitation, it is not surprising that there are no rising lines of support on the below four-hour chart. However, there is plenty of evidence that price may be approaching a zone of support. Previous horizontal turning points indicate rigorous interaction between bulls and bears in the blue shaded zone. Ideally, price should bounce off this level to continue its upward journey.
Guest Commentary: Key Support Zone for Buying EUR/CAD
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The key support zone has been identified as 1.5150-1.5196. This zone is a mere 46 pips in depth, as compared with the potential for a move of 140 pips or more just to retest the recent high. Thus, the risk profile is adequate, but the hourly chart (not shown) should be used as the trigger time frame for this trade.
On the hourly time frame, acceptable triggers would consist of bullish reversal divergence, bullish engulfing patterns, and/or pin bars.
Two or three tries may be needed to get onto this move, however, it is also worth noting that price may completely disregard support and form a deeper pullback, heading back towards the rising line of support instead. In that case, it is necessary to limit losses as much as possible, so no more than three tries should be made, as there will always be another support zone to consider.
By Kaye Lee, private fund trader and head trader consultant, StraightTalkTrading.com
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Forex: EUR/JPY Technical Analysis
Talking Points:
- EUR/JPY Technical Strategy: Flat
- Support: 139.97 (23.6% Fib exp.), 139.24 (horizontal pivot)
- Resistance: 140.71 (38.2% Fib exp.), 141.30 (50% Fib exp.)
The Euro is on pace to erase yesterday’s would-be breakdown against the Japanese Yen. Prices are aiming to challenge the 38.2% Fibonacci expansion at 140.71, with a break above that exposing the 50% level at 141.30. Alternatively, a turn back below the 23.6% Fib at 139.97 opens the door for another test of horizontal shelf support at 139.24.
Prices are too close to relevant resistance to justify a long position on risk/reward grounds. On the other hand, a short trade assuming resistance will hold is premature absent a defined reversal signal. We will continue to stand aside for now.
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--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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1 Attachment(s)
I see the EURJPY pair in a retracement back to a weak support level @138.939. I will watch the price action at this level to determine if there will be a continuation of my long position. If price breaks through 143.375 I look to go long to 144.708.
Attachment 5959
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An Ultra-Nimble EUR/CAD Scalp Trade
Talking Points:
- Established Uptrend on EUR/CAD Weekly Chart
- A One-Candle Daily Pullback That Poses Problems
- The Ideal Time Frame for Buying EUR/CAD
EURCAD is currently in one of those situations where a long trade would be perfectly justified, but yet for certain reasons, it may be premature as well.
As shown below, the weekly chart is in a clear uptrend. In fact, it has been accelerating upwards to boot. Some traders may argue that the current week's candle is threatening to become a pin, but it is far too early in the week to tell that for certain. As a result, it is best to proceed on the assumption that the established uptrend will continue.
Guest Commentary: EUR/CAD in Strong Weekly Uptrend
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The daily chart below is actually where the main worry for this long trade lies. Thus far, the pullback has only been one day long, and while this can certainly happen in a strong uptrend (there are prior examples of this even on the chart itself), a pullback of three or four candles is very much preferred.
Guest Commentary: Possible One-Candle Pullback in EUR/CAD
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Because of the one-candle nature of the pullback on the daily chart, a nimbler trade might be required in order to manage this set-up more efficiently, and for this reason, we drop down to the four-hour chart below. Here, we readily see previous levels of support and resistance from which we can determine a zone where price would be expected to bounce.
Guest Commentary: Nearby Support Zone for Buying EUR/CAD
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Again, though, because of the doubts that arise on the daily chart, a trade initiated on the smaller time frames is preferred, both in order to obtain greater precision, and to provide ample opportunity to scalp part of the position out, if necessary.
As such, the hourly chart below shows a pullback scenario that is much clearer, and as a result, is much preferred as well. The final support zone is 1.5244-1.5377, which represents a risk of only 33 pips. That is extremely small when considering the prospects for a trend continuation on the daily chart.
Guest Commentary: Narrow Risk Zone on EUR/CAD Hourly Chart
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Nonetheless, in the interest of nimbleness and risk, the trigger is best taken on the 15-minute chart (not shown), where traders can keep their eyes out for pin bars, bullish engulfing patterns, and/or bullish reversal divergence as potential long-entry signals.
As always, two or three attempts may be required before price formally turns up. Traders would also be advised to enter using multiple positions so that they will have the option of scaling out should price action turn hostile following the entry.
By Kaye Lee, private fund trader and head trader consultant, StraightTalkTrading.com
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EUR Technical Analysis
6 Veritable Short Signals for EUR/AUD
Talking Points:
- A Preferred Lineup of Indicators
- Strong Case for Upcoming EUR/AUD Weakness
- 6 Technical and Fundamental Factors to Consider
I’m often asked by retail traders how I go about setting up my chart and which indicators I use. Obviously, there are a seemingly infinite number of choices and variations there, and in the end, there is no one “right” way to do it, however, I prefer to trade using:
- A very short-term moving average (Hull)
- 20-day moving average (MA)
- 100-day MA
- Bollinger bands
- Commodity Channel Index (CCI)
- Moving Average Convergence Divergence (MACD)
- Support, resistance, and trend lines
- Parabolic SAR (sometimes), which is used to ascertain stop losses
Using these indicators to facilitate analysis, it appears that EURAUD represents a great short opportunity right now. The underlying fundamentals, as well as several technical signals on the daily chart below, all indicate the potential start of a new downtrend.
Guest Commentary: Technical Case for a New Downtrend in EUR/AUD
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The following are all factors that support the case for upcoming EURAUD weakness:
- MACD has recently shown declining upward momentum and is now suggests increasing downward momentum. The histogram is showing a new move into bearish territory
- CCI has confirmed price falling into sell territory and has done so with conviction
- Bollinger band is tight with a new break downwards. Constricting bands indicate a possible spike in either direction
- The end of head and shoulders pattern is evident on the chart
- The 20-day MA is starting to fall with price moving below the line, potentially indicating the start of a long-term downtrend
- The Australian dollar (AUD) has benefited from capital flight from China and comparatively higher interest rates. Risk appetite for more diverse currencies is increasing as well
By Josh Brown, Director and Fund Manager, The Alpha Generator
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A EUR/GBP Set-up with Confluent Long Signals
Talking Points:
- Potential False Breakout for EUR/GBP
- Gartley Pattern Completing on Daily Chart
- Structuring a Trade with "Exceptionally" Low Risk
As many major currencies continue to fluctuate within consolidating patterns, EURGBP seems to be presenting quite an interesting technical trade set-up.
The daily chart below shows a triangle breakout within a consolidation zone. At this daily level of analysis, however, the trend direction is not at all clear, and it might be fairest to call it sideways. However, interested traders may look to the weekly chart (not shown) to discover that generally bullish momentum holds true for EURGBP.
Guest Commentary: Daily Triangle Breakout in EUR/GBP
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In a sideways market, prices are always more prone to being whipsawed, but the presence of a secondary price pattern makes this particular set-up even more interesting. Here, that comes in the form of the Gartley pattern that is now beginning to complete on the below daily chart. The first pullback respected the 61.8% retracement of the original move, and should the next leg react at the 78.6% retracement, as a standard Gartley pattern would anticipate, the resulting move would be bullish.
Guest Commentary: Gartley Pattern Completing in EUR/GBP
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A decent move upwards to test the Gartley high could contain 180 pips or more, which is quite significant for this slow-moving pair, and that makes it all the more possible for traders of all risk appetites to structure trades with appropriate risk profile.
The four-hour chart below readily provides a zone of support around the anticipated 78.6% Gartley reaction level, as indicated. The zone turns out to be 0.8205-0.8228, which is an exceptionally small 23 pips. More aggressive traders could simply initiate a long trade with a stop past the support zone and a stop loss of 30 pips, but it would be most preferable to wait for a trade trigger to occur on the hourly chart (not shown).
Guest Commentary: Key Support Zone for Buying EUR/GBP
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Viable trade triggers would consist of pin bars, bullish reversal divergence, and/or bullish engulfing patterns on the hourly chart. Even though two or three attempts may be required to hop on to this move, the very favorable risk profile makes this trade highly worthwhile.
The slow-moving nature of EURGBP can often test a trader's patience, but nonetheless, it is quite nice to see a confluence of a trend line breakout and a Gartley pattern. Afterall, the most rewarding trades often occur on the heels of such false breakouts when traders are properly positioned to trade the long side, in this case.
By Kaye Lee, private fund trader and head trader consultant, StraightTalkTrading.com
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EUR/GBP Technical Analysis
Talking Points:
- EUR/GBP Technical Strategy: Flat
- Support: 0.8127 (falling trend line)
- Resistance:0.8190 (23.6% Fib ret.), 0.8200, 0.8230 (38.2% Fib ret.)
The Euro launched a recovery against the British Pound after finding support at a falling trend line connecting major swing lows since late January. Near-term resistance is in the 0.8190-0.8200 area, marked by the 23.6% Fibonacci retracement and reinforced by the formerly broken range floor. A break above that on daily closing basis exposes the 38.2% level at 0.8230. Trend line support is now at 0.8127.
Prices are too close to relevant resistance to justify a long position from a risk/reward perspective. On the other hand, the absence of a defined bearish reversal signal warns against taking up the short side. With that in mind, we will continue to wait on the sidelines for the time being.
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--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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EUR/GBP Technical Analysis
Talking Points:
- EUR/GBP Technical Strategy: Flat
- Support: 0.8125 (falling trend line), 0.8109 (channel floor)
- Resistance:0.8166 (channel top), 0.8190-0.8200 (23.6% Fib ret., range floor)
A brief Euro recovery has been overturned, with the British Pound securing its strongest close in 16 months against the single currency. Support lines up 0.8125, marked by a falling trend line set from late January, with a break below that exposing the bottom of a falling channel at 0.8109. Alternatively, reversing a daily close above the channel top at 0.8166 clears the way for a challenge of the 0.8190-0.8200 area, marked by the 23.6% Fibonacci retracement and a recently broken range floor.
Indecisive positioning argues against taking a trade on either the long or the short side for the time being. We will remain on the sidelines, waiting for a more actionable opportunity to present itself.
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--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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EUR/GBP Technical Analysis
Talking Points:
- EUR/GBP Technical Strategy: Flat
- Support: 0.8124 (falling trend line), 0.8096 (channel floor)
- Resistance:0.8153 (channel top), 0.8190-0.8200 (23.6% Fib ret., range floor)
A brief Euro recovery has been overturned, with the British Pound securing its strongest close in 16 months against the single currency. Support lines up 0.8124, marked by a falling trend line set from late January, with a break below that exposing the bottom of a falling channel at 0.8096. Alternatively, a daily close above the channel top at 0.8153 clears the way for a challenge of the 0.8190-0.8200 area, marked by the 23.6% Fibonacci retracement and a recently broken range floor.
Indecisive positioning argues against taking a trade on either the long or the short side for the time being. We will remain on the sidelines, waiting for a more actionable opportunity to present itself.
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--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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EUR/GBP Technical Analysis
Talking Points:
- EUR/GBP Technical Strategy: Flat
- Support: 0.8087 (channel floor), 8056 (100% Fib exp.)
- Resistance:0.8104 (76.4% Fib exp.), 0.8124-33 (trend line, 61.8% Fib exp.)
The Euro renewed its push downward against the British Pound, with prices sinking to the lowest level since January 2013. Support is seen at the bottom of a falling channel set from late April, now at 0.8087, with a break below that exposing the 100% Fibonacci expansion at 0.8056. Alternatively, a move back above the 76.4% level at 0.8104 aims for the 0.8124-33 area, marked by a falling trend line established from January and the 61.8% Fib.
Risk/reward considerations argue against taking a trade at present withprices wedged too closely between near-term up- and down-side technical barriers. We will continue to wait on the sidelines for the time being.
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--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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EUR/GBP Technical Analysis
Talking Points:
- EUR/GBP Technical Strategy: Flat
- Support: 0.7955 (61.8% Fib exp.), 0.7908 (76.4% Fib exp.)
- Resistance:0.7992 (50% Fib exp.), 0.8030 (38.2% Fib exp.)
The British Pound continues its aggressive attack against the Euro, with prices sinking below the 0.80 figure. Near-term support is marked by the 61.8% Fibonacci expansionat 0.7955, with a break below that on a daily closing basis exposing the 76.4% level at 0.7908. Alternatively, a move back above the 50% Fib at 0.8030 clears the way for a challenge of the 38.2% expansion 0.8030.
Current positioning does not offer an actionable trade setup. We will opt to remain on the sidelines for the time being, waiting for a more attractive opportunity to present itself.
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--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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EUR/GBP Technical Analysis
Talking Points:
- EUR/GBP Technical Strategy: Flat
- Support: 0.7958 (Jun 16 low)
- Resistance:0.0.8023 (14.6% Fib ret.), 0.8062 (23.6% Fib ret.)
The Euro has found tentative support below the 0.80 figure against the British Pound, with a bullish Piercing Line candlestick hinting a rebound is ahead. Resistance is at 0.8023, the 14.6% Fibonacci retracement, with a daily close below that targeting the 23.6% level at 0.8062. Near-term support is at 0.7958, the June 16 low.
The ECB looks to be the most dovish of the leading central banks, putting the Euro at an inherent disadvantage against its G10 counterparts. As such, we will opt not pursue buying opportunities, looking to any corrective gains for an opening to enter short as discussed in our weekly outlook.
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--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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EUR/GBP Technical Analysis
Talking Points:
- EUR/GBP Technical Strategy: Flat
- Support: 0.7978, 0.7950, 0.7927
- Resistance:0.8023, 0.8062, 0.8081
The Euro may be on track to launch a rebound against the British Pound after prices put in a bullish Piercing Line candlestick pattern. Initial resistance comes in at 0.8023, the 14.6% Fibonacci retracement, with a break above that on a daily closing basis exposing the 23.6% level at 0.8062. Alternatively, a drop through the 23.6% Fib expansion at 0.7978 targets the June 16 low at 0.7958, followed by the 38.2% level at 0.7950.
The ECB looks to be the most dovish of the leading central banks, putting the Euro at an inherent disadvantage against its G10 counterparts. As such, we will opt not pursue buying opportunities, looking to any corrective gains for an opening to enter short (as discussed in our weekly outlook).
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--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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EUR/GBP Technical Analysis
Talking Points:
- EUR/GBP Technical Strategy: Flat
- Support: 0.7929, 0.7864, 0.7812
- Resistance:0.7968, 0.8081, 0.8134
The Euro looks set to renew its declined against the British Pound after a period consolidation around the 0.80 figure. A break of support at 0.7968, the 14.6% Fibonacci expansion, has exposed the 23.6% level at 0.7929. A daily close below this barrier targets the 38.2% Fib at 0.7864. Alternatively, a reversal back above 0.7968 clears the way for a test of the June 25 high at 0.8033.
While entering short is very tempting from a purely technical perspective, we will tactically opt to stand aside as the ECB rate decision looms ahead. We will continue to stand aside, waiting for event risk to pass before committing to a directional bias.
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--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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EUR/GBP Technical Analysis: 3-Week Trend Support in Focus
Talking Points:
- EUR/GBP Technical Strategy: Flat
- Support: 0.7937, 0.7920, 0.7872
- Resistance:0.7997, 0.8074, 0.8136
The Euro moved higher against the British Pound as expected after prices produced in a bullish Morning Star candlestick pattern. A daily close above resistance at 0.7997, the 23.6% Fibonacci retracement, exposes the 38.2% level at 0.8074. Alternatively, a push below trend line support at 0.7937 clears the way for a challenge of the 14.6% Fib expansion at 0.7920.
We are tactically opting not to pursue a long position, choosing not be long the Euro considering the ECB is shaping up to be the most dovish of the major central banks over the coming months. Rather, we will continue to monitor the upswing for opportunities to enter short.
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--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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EUR/GBP Technical Analysis: Key Trend Line Support at Risk
Talking Points:
- EUR/GBP Technical Strategy: Flat
- Support: 0.7973, 0.7954, 0.7935
- Resistance:0.8007, 0.8031, 0.8050
The Euro began edging higher against the British Pound as expected after prices produced in a bullish Morning Star candlestick pattern. A pullback now sees prices testing support at 0.7973, the intersection of the 38.2% Fibonacci retracement and a rising trend line set from July’s low. Breaching this barrier on a daily closing basis exposes the 50% level at 0.7954. Alternatively, a turn above the 23.6% Fib expansion at 0.8007 clears the way for a challenge of the 38.2% threshold at 0.8031.
We are tactically opting not to pursue a long position, choosing not be long the Euro considering the ECB is shaping up to be the most dovish of the major central banks over the coming months. Rather, we will continue to monitor the upswing for opportunities to enter short.
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--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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EUR/GBP Technical Analysis: Rebound Rejected Above 0.80
Talking Points:
- EUR/GBP Technical Strategy: Flat
- Support: 0.7873, 0.7777, 0.7728
- Resistance: 0.7953, 0.8055, 0.8082
The Euro moved lower against the British Pound as expected after showing a bearish Dark Cloud Cover candlestick pattern. A daily close below 0.7873-96 area marked by the July 23 low and the 23.6% Fibonacci expansion exposes the 0.7777-0.7803 zone (July 2012 bottom, 38.2% level). Alternatively, a reversal above the 14.6% Fib at 0.7953 clears the way for a test of the 0.8030-55 zone (September 9 close, channel top).
Risk/reward considerations argue against entering short with prices in close proximity to support. On the other hand, the absence of a defined bullish reversal signal suggests taking up the long side is premature. We will remain flat for now, waiting for a more actionable opportunity to present itself.
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--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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EUR/GBP Technical Analysis: Waiting to Re-Enter Short
Talking Points:
- EUR/GBP Technical Strategy: Flat
- Support: 0.7873, 0.7777, 0.7728
- Resistance: 0.7953, 0.8051, 0.8082
The Euro moved lower against the British Pound as expected after showing a bearish Dark Cloud Cover candlestick pattern. A daily close below 0.7873-96 area marked by the July 23 low and the 23.6% Fibonacci expansion exposes the 0.7777-0.7803 zone (July 2012 bottom, 38.2% level). Alternatively, a reversal above the 14.6% Fib at 0.7953 clears the way for a test of the 0.8030-51 zone (September 9 close, channel top).
Risk/reward considerations argue against entering short with prices in close proximity to support. On the other hand, the absence of a defined bullish reversal signal suggests taking up the long side is premature. We will remain flat for now, waiting for a more actionable opportunity to present itself.
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--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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EUR/GBP Technical Analysis: Treading Water Above 0.78
Talking Points:
- EUR/GBP Technical Strategy: Flat
- Support: 0.7803, 0.7728, 0.7654
- Resistance: 0.7896, 0.7953, 0.8030
The Euro declined as expected against the British Pound after prices produced a bearish Dark Cloud Cover candlestick pattern. Near-term support is at 0.7803, the 38.2% Fibonacci expansion, with break below that on a daily closing basis exposing the 0.7728-51 area marked by the July 2012 low and the 50% level. Alternatively, a turn above the 0.7873-96 zone (July 23 low, 23.6% Fib) opens the door for a challenge of the 14.6% expansion at 0.7953.
While we are tempted to re-enter short after the second half of our EURGBP short position was closed last week, we will tactically opt remain flat for now.The upcoming publication of the Bank of England Quarterly Inflation Report may mark a pivotal moment for monetary policy bets, throwing off chart-based direction cues. With that in mind, we will stand aside for now.
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--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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EUR/GBP Technical Analysis: Range Top Under Pressure
Talking Points:
- EUR/GBP Technical Strategy: Flat
- Support: 0.7917, 0.7887, 0.7849
- Resistance: 0.7947, 0.7985, 0.8030
The Euro has launched a brisk recovery against the British Pound, rising to the highest level in a month. Near-term resistance is at 0.7947, the 61.8% Fibonacci retracement, with a break above that on a daily closing basis exposing the 76.4% level at 0.7985. Alternatively, a turn back below the 50% Fib at 0.7917 opens the door for a challenge of the 38.2% retracement at 0.7887.
Prices are too close to resistance to justify entering long from a risk/reward perspective. On the other hand, the absence of a defined bearish reversal signal suggests that taking up the short side is premature. With that in mind we will remain flat for now.
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--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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EUR/GBP Technical Analysis: Euro Bounce in the Cards?
Talking Points:
- EUR/GBP Technical Strategy: Flat
- Support: 0.7809, 0.7751, 0.7662
- Resistance: 0.7899, 0.7954, 0.8033
The Euro may rise against the British Pound following the appearance of a bullish Piercing Line candlestick pattern. A daily close above the 14.6% Fibonacci expansionat 0.7899 exposes support-turned-resistance at 0.7954. Alternatively, a turn below the 23.6% level at 0.7809 opens the door for a challenge of the 0.7751-65 area marked by the July 23 2012 and September 30 2014 lows.
Risk/reward considerations argue against entering long with prices in close proximity to resistance. On the other hand, the absence of a defined bearish reversal signal suggests taking up the short side is premature. We will remain flat for now, waiting for a more actionable opportunity to present itself.
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--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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EUR/GBP Technical Analysis: Waiting for Short to Trigger
Talking Points:
- EUR/GBP Technical Strategy: Pending Short at 0.7839
- Support: 0.7804, 0.7761, 0.7727
- Resistance: 0.7869, 0.7891, 0.7926
The Euro appears to be resuming its long-term down trend against the British Pound following the appearance of a bearish Three Inside Down candle pattern. Near-term support is at 0.7804, 23.6% Fibonacci expansion, with a break below that on a daily closing basis exposing the 0.7761-65 area marked by the 38.2% and the September 30 low. Alternatively, a reversal above 0.7856-69 area (Triangle floor, 38.2% Fib retracement) clears the way for a test of the 50% threshold at 0.7891.
Prices are too close to support to justify entering short from a risk/reward perspective and we have established a pending order to sell the pair at 0.7839. If triggered, the position will initially target 0.7804 with a stop-loss activated on a daily close above 0.7873.
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--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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EUR/GBP Technical Analysis: Sideways Trade Continues
Talking Points:
- EUR/GBP Technical Strategy: Short at 0.7311
- Support: 0.7149, 0.7005, 0.6887
- Resistance: 0.7239, 0.7392, 0.7509
The Euro turned lower against the British Pound as expected after producing a Shooting Star candlestick below the 0.74 figure. A daily close below the 23.6% Fibonacci expansionat 0.7149 exposes 38.2% level at 0.7005. Alternatively, a move above the 14.6% Fib at 0.7239 opens the door for a test of the 0.7384-92 area (38.2% Fib retracement, March 25 high).
We entered short EURGBP at 0.7311 and have since booked profit on half of the trade. The rest of the position will remain in play with a stop-loss at the breakeven level (0.7311) to capture any further downside momentum.
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--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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1 Attachment(s)
EUR/JPY Technical Analysis: Oscillating in Familiar Range
Talking Points:
- EUR/JPY Technical Strategy: Flat
- Support: 137.51, 135.33, 133.56
- Resistance:140.15, 141.50, 142.69
The Euro continues to wait for directional guidance against the Japanese Yen as prices tread water above the 137.00 figure. Near-term support is at 137.51, the 23.6% Fibonacci retracement, with a break below that on a daily closing basis exposing the 38.2% level at 135.33. Alternatively, a move above the 14.6% Fib at 140.15 opens the door for a challenge of the 23.6% expansion at 141.50.
Risk/reward considerations argue against entering long with prices in close proximity to resistance. On the other hand, the absence of a defined bearish reversal signal suggests taking up the short side is premature. We will remain flat for now, waiting for an actionable opportunity to present itself.
Attachment 14256
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EUR/GBP Technical Analysis: Waiting for Selling Opportunity
Talking Points:
- EUR/GBP Technical Strategy: Flat
- Euro Aims at Resistance Above 0.74 Figure Against British Pound
- Gains Seen as Corrective, Waiting to Sell Into Six-Year Down Trend
The Euro is attempting to rebuild upside momentum against the British Pound after prices found support below the 0.73 figure. The single currency drifted downward having failed to hold up above the 0.74 mark but the return of risk aversion has proven supportive amid the unwinding of carry trades funded in terms of the low-yielding unit.
Looking ahead, near-term resistance comes in at 0.7432, the 38.2% Fibonacci expansion. A break above this barrier on a daily closing basis exposes the 0.7482-90 area, marked by the June 5 high and the 50% level. Alternatively, a reversal back below the 23.6% Fib at 0.7361 clears the way for a retest of the 14.6% expansion at 0.7317.
The long-term EURGBP trend has favored weakness since prices topped in December 2008. With that in mind, any near-term gains appear corrective and our preference is to stand aside while those moves play out, waiting for an actionable selling opportunity to emerge.
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EUR/JPY Technical Analysis: Four-Month Support Under Fire
Talking Points:
- EUR/JPY Technical Strategy: Flat
- Euro Drops to Lowest Level in 4 Months, Threatens Key Support
- Opting to Wait for Confirmation of Break Before Entering Short
The Euro came under renewed selling pressure against the Japanese Yen, dropping to the lowest level in over four months. The pair now finds itself at a pivotal juncture, with prices testing below support that has capped losses since early May.
A daily close below the 133.07-30 area marked by the aforementioned horizontal pivot and the 76.4% Fibonacci expansion initially opens the door for a test of the 100% level at 131.24.
Attachment 15738
134.20 clears the way for a test of resistance-turned-support at 135.11, the 50% expansion.
Risk/reward considerations argue against trying to chase the pair lower. A break below support remains inconclusive absent confirmation on a daily closing basis, with a swift reversal higher a discrete possibility if risk trends firm on the back of the upcoming US jobs report. With that in mind, we will continue to stand aside and wait for a more compelling opportunity to present itself.
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EUR/GBP Technical Analysis: Euro Threatens 5-Month Resistance
Talking Points:
- EUR/GBP Technical Strategy: Flat
- Euro Resumes Recovery vs. British Pound, Probes Highest Level in 8 Months
- Waiting for Upswing to Yield Sell Signal in Line with Long-Term Down Trend
The Euro resumed its recovery against the British Pound, rising to probe the highest level in eight months. Prices are now challenging resistance below the 0.75 figure that has kept the single currency capped against Sterling since early May.
Near-term resistance is at 0.7482, the May 7 high, with a break above that on a daily closing basis opens the door for a challenge the 38.2% Fibonacci expansion at 0.7529. Alternatively, a move back below double-top resistance-turned-support at 0.7421clears the way for a test of 0.7333, the intersection of rising trend line support and the October 7 low.
Prices are too close to justify entering long from a risk/reward perspective. Furthermore, the long-term trend continues to favor the downside, suggesting the upswing since July is corrective. With that in mind, we will continue to stand aside and wait for a confirmed bearish reversal signal to trigger a short position.
Attachment 16259
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https://charts.mql5.com/9/173/eurgbp...apital-ltd.png
Intraday bias in EUR/GBP is back on the downside with the current fall. Focus is now on 0.7195 support. Decisive break there will confirm that whole rebound from 0.6935 has completed at 0.7492 already after failing to sustain above 0.7482 resistance. In that case, deeper fall should be seen back to 0.6935 low.
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The EUR/JPY pair fell significantly during the course of the session on Thursday, breaking through the 135 handle. With that being the case, the market has broken through significant support and should now be looked at as very soft. The European Central Bank suggested that perhaps more quantitative easing could be coming and as a result the Euro fell rather drastically around the world.
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EUR/GBP Technical Analysis: Selloff Pauses at 2-Month Low
The Euro corrected modestly higher after swiftly sinking to the lowest level in over two months against the British Pound. Prices reversed downward as expected after putting in a bearish Dark Cloud Cover candlestick pattern at resistance below the 0.75 figure.
Near-term support is now at 0.7145, the 61.8% Fibonacci retracement, with a break below that on a daily closing basis opening the door for a test of the 76.4% level at 0.7063. Alternatively, a move back above support-turned-resistance at 0.7211, the 50% Fib, sees the next upside barrier at 0.7278 marked by the 38.2% retracement.
We sold EUR/GBP at 0.7325 and have since taken profit on half of the trade. The rest of the position continues to be in play to take advantage of further weakness ahead. The stop-loss has been adjusted downward to the breakeven level.
Attachment 16374
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EUR/GBP Technical Analysis: Down Trend Seeks Momentum
Talking Points:
- EUR/GBP Technical Strategy: Short at 0.7325
- Euro Declines for Third Consecutive Day After Failing to Break Trend Line Resistance
- Short Trade Still Active with Stop at Breakeven, Looking for Down Trend Continuation
The Euro finds itself under pressure once again after a surge against the British Pound following the BOE policy announcement failed to break trend line resistance. Prices have now declined for three consecutive days, making for the longest losing streak in a month, though momentum is far from convincing as ATR-based volatility drops to the lowest since April.
Attachment 16574
Near-term support is at 0.70941, the 23.6% Fibonacci expansion, with a break below that opening the door for a test of the 0.7025-42 area marked by the November 5 low and the 38.2% level. Alternatively, breaking above the 14.6% level at 0.7131 – a move that would likewise clear trend line resistance set from mid-October highs – clears the way for a challenge of the 38.2% Fib retracement at 0.7214.
We sold EUR/GBP at 0.7325 and then booked profit on half of the trade. The remainder of the position remains in play to capture continued downside momentum. The stop-loss has been revised to the breakeven level.
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Price & Time: EUR/JPY - Flirting With Cyclical Breakdown
Talking Points
- EUR/JPY meandering around key Fibo
- Last week’s low in the cross a key pivot
EUR/JPY: Flirting With Cyclical Breakdown
Attachment 16605
Last week’s 131.47 low is critical. If that was some sort of important medium-term cyclical low then it needs to hold and in fact it has. Yesterday there was a downside retest in EUR/JPY, but it couldn’t break under 131.47. This is clearly a positive. What I don’t like about the price action is the tepid nature of advance attempts this week. If the cross is indeed recovering from some sort of price/time square out then I would expect advances to be a little more dynamic than they have been. A move through this week’s high is desperately needed to instill some sort of upside momentum into the rate as it would it would also trigger a minor double bottom. The flipside is we get a break of 131.47. This would invalidate the positive timing aspect from last week and signal a likely resumption of the downtrend in place since June.
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EUR/GBP Technical Analysis: Passing on Short Trade Setup
Talking Points:
- EUR/GBP Technical Strategy: Flat
- Bearish Evening Star Candlestick Pattern Hints at Euro Losses vs. British Pound
- Firming Inverse EUR/GBP vs. S&P 500 Correlation Warns Against Short Trade
The Euro put in a bearish Evening Star candlestick pattern, hinting that a turn lower against the British Pound may be looming ahead. Prices recovered as expected having found interim support below the 0.70last month but the dominant down trend set from August 2013 remains intact, painting the move as corrective.
Near-term support is at 0.7158, the 23.6% Fibonacci expansion, with a break below that on a daily closing basis paving the way for a test of the 38.2% level at 0.7084. Alternatively, a push above the December 9 high at 0.7278 opens the door for a challenge of falling trend line resistance at 0.7403.
Attachment 16961
Establishing a short position is a tempting proposition from a purely technical perspective. A firming inverse correlation between EUR/GBP and the S&P 500 sets off alarm bells however. Indeed, the trade may turn out to be disastrous in the plausible event of risk aversion following next week’s FOMC policy announcement. With that in mind, we will tactically opt to stand aside.
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Next Week Forecast: the most interesting pair you can make money with - EUR/CAD
EUR/CAD: bullish breakout. The pair is on bullish market condition since the beginning of Dec this year: price broke Ichimoku cloud from below to above together with Senkou Span line which is the virtual border between the primary bearish and the primary bullish trend on the chart. The price was stopped by 1.5125 resistance and 1.5200 resistance levels together with ascending triangle pattern to be formed for the price to be started with the ranging market condition near and below those resistance levels. The price is ranging within the following key reversal support/resistance levels:
- 1.5200 resistance level located above Ichimoku cloud in the primary bullish area of the chart, and
- 1.4618 support level located on the border between the bearish and bullish trend on the daily chart.
There are 3 simple scenarios for the price movement for the next week:
- bullish trend will be contining in case the price breaks 1.5200 resistance from below to above.
- bearish reversal to be started in case the price breaks 1.4618 support level,
- or the ranging within the levels.
Chinkou Span line is located above the price indicating the bullish breakout to be continuing by direction.
Attachment 17159
Resistance
|
Support |
1.5125 |
1.4618 |
1.5200 |
1.4023 |
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EUR/AUD Price Action Analysis - ranging within 100 day SMA and 200 day SMA for the waiting for direction
Daily price is located between 100 day SMA (100-SMA) and 200 day SMA (200-SMA) with the ranging market condition waiting for the direction for the possible breakout or breakdown. The key reversal support/resistance levels for this pair are the following:
- 1.5574 resistance level located above 100-SMA/200-SMA in the beginning of the bullish area of the chart, and
- 1.4952 support level located below 200-SMA in the beginning of the bearish area of the chart.
RSI indicator is estimating the ranging condition to be continuing.
- If the price will break 1.5574 resistance level so we may see the bullish trend to be started on this timeframe.
- If price will break 1.4952 support so the bearish trend will be continuing.
- If not so the price will be ranging within the levels.
Resistance
|
Support
|
1.5574 |
1.4952 |
1.6590 |
1.4345 |
Attachment 17275
- Recommendation to go short: watch the price to break 1.4952 support level for possible sell trade
- Recommendation to go long: watch the price to break 1.5574 resistance level for possible buy trade
- Trading Summary: ranging
SUMMARY : ranging
TREND : waiting for direction
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EUR/GBP Technical Analysis: R1 YR1 Pivot to be crossed for 0.79 target
Attachment 19038
- "The Euro resumed the push higher against the British Pound after two weeks of range-bound consolidation, with prices now aiming to challenge the monthly high. The dominant multi-year trend continues to favor the downside however, painting the upswing from mid-November 2015 lows as corrective."
- "A daily close above the 23.6% Fibonacci expansion at 0.7912 opens the door for a challenge of the 38.2% level at 0.8046. Alternatively, a turn below resistance-turned-support at 0.7830, the 14.6% Fib, paves the way for a test of the 0.7703-35 area (horizontal pivot, rising trend line)."
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EURJPY Pivot Points Analysis - ranging bearish with S1 Pivot to be broken for breakdown
W1 price is on primary bearish market condition to be located below yearly Central Pivot at 133.61: the price was bounced from S1 Pivot at 123.07 to above for the ranging within Yearly PP and S1 Pivot. Descending triangle pattern with 123.07 support level was formed by the price to be crossed for the bearish trend to be continuing.
Attachment 19571
Instrument
|
S1 Pivot |
Yearly PP |
R1 Pivot |
EUR/JPY |
123.07 |
133.61 |
141.13 |
Trend:
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EUR/CAD: End Of Week Technicals - correction to the bearish reversal
Weekly price is on primary bullish trend located above 100-period SMA and 200-period SMA for the secondary correction: the price was bounced from 1.4386 support level for the ranging within key bullish s/r levels.
Attachment 19772
If the price breaks 1.4386 support level so the bearish reversal will be started with the secondary ranging.
If the price breaks 1.6103 resistance level so the bullish trend will be continuing.
If not so the price will be ranging within the levels.