Vantage FX Chart of the Day

[Vantage FX]

Chart of the Day:
But what about the ASX index futures market, or the SPI200 on your Vantage FX MT4 platform? Well the locals didn’t escape lightly, ending with the worst start to a year ON RECORD. Today’s open should be interesting for the SPI, with the US lead pointing to further pain.

SPI200 Daily:

Click on chart to see a larger view.

Taking a look at the daily chart, you can see just how brutal last week’s price action was! Price fell very nicely off a zone that had previously reacted in both directions and now is sitting at the bottom of a little consolidation range.

SPI200 Weekly:

Click on chart to see a larger view.

I’ve included the weekly chart for context, showing that the major bullish trend line is in jeopardy. On these major weekly trend lines that I talk about being subjective, I wouldn’t be looking to sell any sort of break too soon. It’s a long term bullish trend and there will definitely be buyers lurking to snap up any latecomers to the short term bearish party.

Don’t be that guy…

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On the Calendar Monday:
JPY Bank Holiday:
Japanese banks will be closed in observance of Coming-of-Age Day.

“Coming of Age Day is a Japanese holiday held annually on the second Monday of January. It is held in order to congratulate and encourage all those who have reached the age of majority (20 years old over the past year, and to help them realize that they have become adults.”

AUD ANZ Job Advertisements m/m:
While today’s job advertisements data is actually only a third tier release, I have included it here as we have Australian employment data to be released on Thursday. As we head toward the end of the week, traders will be looking for clues in today’s number on which way to best position themselves.

Do you see opportunity trading Indices?

 

[Vantage FX]

Chart of the Day:
To be quite honest, I’m sick about talking about healthy stock market pull-backs as catastrophes, and want to get back to some bread and butter Forex charts sitting at quality levels to manage your risk around.

GBP/USD Daily:

Click on chart to see a larger view.

Flicking through the Forex majors and the Cable daily chart was the one to catch my eye. Price tested and chopped through its previous swing lows from back in April 2015, now sitting just below the level.

I’m inclined to lean to playing this chart from the long side, treating the choppy break of support as confirmation that the level isn’t black and white and actually more of a weekly support zone which we are only just heading into. The fact that price hasn’t cleanly broken the level makes me think that the weak stops below the level were cleaned out and now we’ll get a chance to use it as place to buy on any re-test.

Are you trading Cable? Share a chart and idea with @VantageFX on Twitter.

 

[Vantage FX]

Chart of the Day:
The Loonie continued its parabolic, upward trajectory as it reached its highest level since 2003.

USD/CAD Weekly:

Click on chart to see a larger view.

So with all this clear blue sky, where do we look for technical levels? Turn off auto-scroll on your MT4 platform and scroll back in time on the weekly chart.

Look at the zone that price happens to be sitting inside right now.

USD/CAD Daily:

Click on chart to see a larger view.

But hey, as RBS says…

“Sell everything except high quality bonds. This is about return of capital, not return on capital. In a crowded hall, exit doors are small.”

Could you have gotten a bigger contrarian signal?

 

[Vantage FX]

Chart of the Day:
Leading into the Aussie employment data, we have to take a look at the AUD/USD chart. Just keep in mind the big picture with our old friend the weekly trend line support is still in play.

AUD/USD Hourly:

Click on chart to see a larger view.

But it’s the hourly that I wanted to focus on today, with price forming a short term bullish channel following the pair’s solid beat down that it has experienced all of January.

With price teetering on the brink at support, we’re set up nicely for the 11.30am Sydney time employment data release. Are you trading the AUD/USD channel into the release or waiting for the dust to settle?

 

[Vantage FX]

Chart of the Day:
And there it is. The very first note that passes across my desk this morning runs the headline ‘Oil bears retreat’.

OIL Daily:

Click on chart to see a larger view.

Just look at that daily candle. Put the bear tanks away, the bulls are in control now!

No.

Other than the non-existent cheap petrol at the pump, the storyline you need to be following here is that low oil prices are heaping pressure on the Fed’s 2% inflation target. Overnight saw known Hawk, Fed Bank of St Louis president James Bullard, answering questions on inflation with not so excitable answers.

“With renewed declines in crude oil prices in recent weeks, the associated decline in market-based inflation expectations measures is becoming worrisome.”

Find more Oil technical analysis on the Vantage FX News Centre.

 

[Vantage FX]

Chart of the Day:
The Kiwi is in the same boat as its big brother across the ditch, sitting even closer to hourly trend line resistance

NZD/USD Hourly:

Click on chart to see a larger view.

Heading into major data releases, the charts always tell the story of where the greater risk lies if the release misses expectations. As a trader, your number 1 job is to manage this risk.

I’ve made it pretty clear that I see the biggest risk being a miss to the downside, with a lack of support to halt any technical drops in both the Aussie and Kiwi.

See more NZD/USD analysis at Vantage FX.