Technical Analysis by Admiral Markets

[Admiral Markets]

Gold and Silver Technical Update

Although Gold and Silver recovered from a multi-month lows on Thursday, both the precious metals resumed their losing streak on Friday in wake of continuous strengthening of the US Dollar. Both the precious metals now seems to be heading for a third consecutive weekly loss.

Given the backdrop, here is a technical update for Gold and Silver.

Gold

Following a decisive break on the downside of a short-term descending channel support near $1250-45 zone, the yellow metal now seems to be aiming towards $1200 psychological mark support. Further, failure to hold this psychological support has the potential to further drag the prices lower initially towards 2013 lows of $1180 and subsequently towards $1150 support area. Meanwhile on the upside, $1240-45 zone has now emerged as immediate resistance for the metal. Although it seems unlikely that the metal could surpass this immediate resistance; however, should it manage to strengthen above this immediate resistance area, it could possibly headed back towards another horizontal resistance area near $1275-80 region.

Silver

The white metal has weakened below an important horizontal support near $18.70 region, clearly suggesting a break-down. Moreover, formation of a descending trend-channel on daily chart further reassure continuation of the recent weakening trend. Hence, from current levels the metal seems to continue weakening initially towards 2013 lows of $18.20, also coinciding with the lower trend-line support of the descending trend-channel. However, considering the recent price action, which suggests continuation of the weakening trend, the metal could easily break below 2013 lows and continue weakening in the near-term towards $16.20-30 support area with intermediate support near $17.20-30 zone. On the upside, previous important support near $18.70 region, now seems to act as immediate resistance, which is closely followed by another important resistance near $18.90, marking the upper trend-line resistance of the descending channel. Only a decisively move and close above this important resistance levels could possibly negate the bearish outlook for the white metal.

“Original analysis is provided by Admiral Markets”

 

[Admiral Markets]

Technical Outlook: Important GBP Pairs

Having witnessed considerable volatility into the GBP pairs, mainly caused by Scottish referendum and UK employment numbers, current week witnesses dearth of important economics; however, this doesn’t signal the absence of volatility into the pairs connected to GBP. Meanwhile, the following is a brief technical overview of the EURGBP, GBPJPY and GBPAUD.

EURGBP

EURGBP continued maintaining its downtrend by observing the descending trend channel, stretched from August 2013. The pair recently tested the lowest level since August 2012 and jumped back during the early hours of Tuesday; however psychological resistance near 0.7900 is likely to provide immediate cap to the pair’s up-move, breaking which 0.7970 and 0.8030 can become consecutive resistance levels to observe. Should the pair sustain a break of 0.8030, the resistance line of the descending trend channel coupled with the 200-day EMA, near 0.8120 – 0.8125 region, can cap the medium-term up-move of the pair. Alternatively, the support line of the channel, near 0.7780, becomes crucial for the pair, breaking which the 61.8% FE level of its March – July 2014 downturn, near 0.7740 level, can provide strong support to the pair before it plunges to the 100% FE level of 0.7550. Considering the lower level of RSI and reversal from the support line of the channel, a mild pull-back into the pair price is more acceptable as against the continuation of downtrend.

GBPJPY

With the overbought levels of RSI and the inability to break the 100% FE level of its February – July up-move, the GBPJPY is witnessing a pullback towards 61.8% FE level near 176, breaking which the July high, near 175.30, and the 174.30 can provide consecutive supports to the pair. If the pair closes below 174.30, it is more likely to re-test 23.6% Fibonacci Retracement of the same move, near 172.70. On the upside, 178.30 becomes immediate resistance for the pair, breaking which the pair can rally towards 180.50, coinciding 100% FE. Given the pair’s ability to close above 180.50, it can surpass the 182 level.

GBPAUD

A break of descending trend line resistance, near 1.8080, during last week, provided considerable strength to GBPAUD as the pair rallied till 1.8474 on weekend. The pair currently trades near 1.8380 level and is likely to witness a pullback towards 1.8210, encompassing 38.2% Fibonacci Retracement of its October 2013 to January 2014 up-move. A break of 1.8210 can cause the pair to test resistance turned support line near 1.8060, breaking which 200-day EMA and the 50% Fibo. level near 1.7910 becomes critical support for the pair. On the upside, 1.8590 – 1.8600, including 23.6% Fibo. level, is likely to provide immediate resistance to the pair, breaking which 1.8740 and 1.8840-50 can restrict the pair’s up-move before it rallies toward new high which surpassed 1.9200 level.

“Original analysis is provided by Admiral Markets”

 

[Admiral Markets]

Important Major Currency Pairs Technical Update

Following the release of lower-than-expected existing home sales data for the month of August, the US Dollar gave up some of its early gains against EUR, GBP and JPY, but remained firm against the Australian counterpart (AUD). Apart from the PMI data released on Tuesday, investors would now focus on data pertaining to US durable goods orders and the final print of US GDP data for the second quarter of 2014, scheduled for release on Thursday and Friday respectively. Meanwhile, here is a technical update on some important major currency pairs - EURUSD, GBPUSD, AUDUSD and USDJPY

EURUSD

The pair seems to have found support near 1.2820-1.2800 area, representing 61.8% Fib. retracement level of July 2012 to May 2014 strong rally, and is now headed to test an important resistance near 1.2915-30 area, marking a descending trend-line on 4-hourly chart. Decisive strength above this immediate resistance could extend the pull-back towards another strong resistance near 1.3000-1.3020 zone, coinciding with 50% Fib. retracement level, which seems to limit any further upward momentum. However, a drop back below 1.2850 immediate horizontal support and a subsequent drop below 1.2800-1.2790 support zone, seems to exert additional pressure on the pair. The pair then could be vulnerable to drop further towards 1.2660 intermediate horizontal support area.

GBPUSD

The pair continues finding strong support near 1.6300 round figure mark, also comprising of the lower trend-line support of a short-term ascending channel formation on 4-hourly chart and 23.6% Fib. retracement level of July-Sept. 2014 corrective move. The pair now seems to find some minor resistance near 1.6400 mark, which if conquered is likely to trigger some accelerated moves towards 1.6480-1.6500 strong resistance zone, coinciding with highs touched after Scottish referendum and also with 38.2% Fib. retracement level. 1.6440 could possibly provide some intermediate minor resistance for the pair. Meanwhile, on the downside, 1.6300 remains an important support, which if broken decisively is likely to trigger some accelerated downfall for the pair, initially towards 1.6150 horizontal support area and eventually towards 1.6000 psychological mark support.

AUDUSD

Following the release of strong-than-expected Chinese manufacturing PMI data, the pair recovered from short-term oversold conditions and from an important support near 0.8840-50 area, also marking the lower trend-line support of a short-term descending trend-channel formation on 4-hourly chart, to move back above 0.8900 round figure mark. Considering the recent highly oversold conditions, the pull-back seems to get extended towards 0.8950-60 resistance area, marked by the upper trend-line resistance of the descending channel. Meanwhile, should the pair now decisively drop back below 0.8900-0.8890 round figure mark support, it seems more likely to accelerate the downfall to retest the lower trend-line support of the descending channel, near 0.8820-30 area. Moreover, a decisive weakness below 0.8840-20 support area has the potential to drag the pair further, even below 0.8800 mark, towards 0.8750 support area.

USDJPY

After testing 6-year high, the pair now seems to witness some profit taking move. However, on 4-hourly chart, the pair has manage to hold an ascending trend-line support near 108.30 level. Should the pair now break below this immediate support, it is likely to continue with its corrective move towards 107.50-40 horizontal support area. The 107.00 area represents a break-out above a medium-term ascending trend-line resistance extending from May 2013 highs through highs tested in Jan. 2014 and hence, becomes an important resistance turned support area on the downside. The broader picture suggests possible continuation of the recent upward trajectory towards 110.00 mark in the near-term. Only a move back below this important support would possibly negate the possibilities of any further up-move for the pair.

“Original analysis is provided by Admiral Markets”

 

[Admiral Markets]

Technical Outlook: USDCAD, USDCHF, GBPCAD and CADCHF

Canadian Core Inflation, published during last weekend, provided considerable weakness to the Loonie which carried over its fall against majority of its counterparts during the current week as the Canadian Retail Sales, published yesterday, unexpectedly fell after witnessing consecutive six monthly gains. On the other hand, the CHF also weakened across the board as the Swiss National Bank President, in his speech yesterday, said that they are ready for introducing harsh monetary measures immediately, if needed.

Given the backdrop, the following is a brief technical overview of USDCAD, USDCHF, GBPCAD and CADCHF.

USDCAD

USDCAD kept following the ascending trend channel on Daily chart and is currently heading towards the 1.1110, 23.6% Fibonacci Retracement of its December 2013 to March 2014 up-move, immediately followed by the resistance line of the channel near 1.1125. Should the CAD fails to re-gain its strength and surpasses the channel resistance, it can rally to 1.1220; however, 1.1150 can become intermediate resistance for the pair. On the downside, the 38.2% Fibo. level near the psychological support level of 1.1000 becomes important for the pair, breaking which the pair can rest near 1.0960 before plunging to the crucial support zone of 1.0915 – 1.0900, coinciding 200-day SMA, 50% Fibo. level and support line of the channel.

USDCHF

Even after rallying considerably, the USDCHF remained weak enough not to close above the psychological resistance level of 0.9400, also coinciding 61.8% Fibonacci Retracement of its May 2013 to March 2014 downturn. The pair is currently making the lower high lower low pattern on smaller timeframes and together with the intervening MACD line it is signaling a pullback towards 0.9320 before plunging to 0.9260, the 50% Fibo. level. On the sustained close below 0.9260, the pair becomes vulnerable to head towards ascending trend line support near 0.9130, also encompassing 38.2% Fibo. level. Should the pair closes above 0.9400, the horizontal resistance line near 0.9460 can cap the near-term up-move of the pair before its rallies to 0.9560 – 0.9570 resistance zone.

GBPCAD

Failure to sustain the break of 1.7800, fuelled the GBPCAD to head towards a re-test of 200-day SMA near 1.8220, breaking which 1.8320 can become consecutive resistance for the pair before it rallies to 1.8475 – 1.8480 multiple resistance zone. On the downside, 1.8030 and the 23.6% Fibonacci Retracement of its August – 2008 to February – 2014 up-move, near 1.7930 levle, can provide immediate support to the pair. If the GBP weakens further against the CAD after closing below 1.7930, the pair can test 1.7800 level which marks the near-term bottom for the pair.

CADCHF

CADCHF again failed to surpass the 0.8590 – 0.8600 horizontal resistance zone and is now re-testing the 0.8465 – 0.8460 support zone, coinciding ascending trend line support and the 38.2% Fibonacci Retracement of its May – 2013 to March – 2014 downturn. Should the pair closes below 0.8460, which becomes more likely considering the CAD weakness and the intervening MACD lines, the pair becomes vulnerable to test 0.8400 and 0.8280 before plunging to the 0.8215 – 0.8210 support zone, including 200-day SMA and 23.6% Fibo. level. On the upside, a break of 0.8550 can cause the pair to re-test 0.8590 – 0.8600 horizontal resistance zone. Moreover, a sustained break of 0.8600 can cause the pair to rally towards 0.8700 levels in a quick manner.

“Original analysis is provided by Admiral Markets”

 

[Admiral Markets]

Technical Update - Important EUR Pairs

Following the release of Euro-zone PMI figures on Tuesday, the Euro-zone common currency, EUR, recovered from day's low against AUD, JPY and CAD, but traded in a tight range against CHF. On Wednesday, however, the retreated after the release of German Ifo Business Climate index, which dropped to its lowest level since April-2013.

Given the backdrop, here is a technical update for important Euro cross currency pairs - EURAUD, EURJPY, EURCAD and EURCHF.

EURAUD

After testing 1.4560-80 resistance zone, comprising of 38.2% Fib. retracement level of Jan. to Sept. 2014 downfall and the upper trend-line resistance of an ascending channel formation on 4-hourly chart, the pair is dropping back towards an important Pivot Point near 1.4440-20 zone, marking 100-day SMA region. Drop below 100-day SMA could possibly drag the pair towards testing the lower trend-line support of the ascending channel, near 1.4360-50 area. A decisive break below the trend-channel support might negate the possibilities of any further up-move for the pair and the pair could drop back below 1.4300 round figure mark, representing 23.6% Fib. retracement level. However, until the pair continues holding above 100-day SMA the pair seems more likely to test 1.4560-80 strong resistance area, which if conquered seems to trigger a fresh leg of up-move for the pair towards 1.4800 resistance level, representing 50% Fib. retracement level.

EURJPY

Following a spike to the highest level since early May, the pair has declined sharply to move back towards 200-day SMA region. The pair is currently hovering around 200-day SMA and has just managed to keep its head above a short-term ascending trend-line support near 139.40 level. A drop below the trend-line support seems to accelerate the fall and immediately force the pair to test 139.00 support area, also coinciding with 38.2% Fib. retracement level of Sept. 5-19 up-swing. Moreover, a decisive break below the trend-line support is more likely to confirm further depreciating move towards an important resistance turned support area near 138.00 round figure mark, also representing 61.8% Fib. retracement level. Meanwhile on the upside, 140.00 psychological mark continues to remain important hurdle to conquer, which if cleared could further lift the pair towards 142.00 resistance area.

EURCAD

Although the pair seems to be trading in a well established descending trend-channel, but it now seems to have found a very good support at 1.4000 psychological mark. From current levels the pair seems more likely to continue with the recent recovery towards 1.4300-20 resistance area, marking the upper trend-line support of the descending channel, which is followed by another strong resistance at 50-day SMA, currently near 1.4400 mark. On the downside, 1.4200 now seems to protect immediate downside for the pair, which if broken might lead to a further fall towards 1.4100 round figure mark support. Further, a decisive break below 1.4100 mark support seems to drag the pair, even below 1.4000 psychological mark support towards, testing the lower trend-line support of the descending channel, currently near 1.3870-60 zone.

EURCHF

The pair has been consolidating in narrow range, forming a short-term ascending channel on 4-hourly chart. Taking into consideration the recent sharp fall and the consolidation, the pair seems to form a bearish flag chart-pattern, possibly suggesting continuation of the fall that the pair has been witnessing since the beginning of 2014. Hence, a break below the lower trend-line support near 1.2060 level has the potential to drag the pair immediately towards testing 1.2000 psychological mark. On the upside, 1.2080-1.2100, also coinciding with 50-day SMA, remain a major resistance area for the pair. Even if the pair manages to clear this immediate resistance, further upside seems to be capped at 1.2180 strong resistance area, marked by an important moving average, 200-day SMA.

“Original analysis is provided by Admiral Markets”

 

[Admiral Markets]

US Equity Indices - Technical Update

On Thursday, all the three major US equity indices registered heavy losses on worries over the Russia-Ukraine conflict and sharper-than-expected fall in durable goods orders in August. Investors now await for the release of final US GDP data for the second quarter of 2014, scheduled later on Friday.

Given the backdrop, here is a technical update on the major US benchmark indices - Dow Jones Industrial Average, S&P 500 and Nasdaq 100.

Dow Jones [DJI30]

The index managed to find some minor support near last week's closing lows to return back above 17,000 psychological mark. However, considering that the index has reversed from an important resistance near 17,350-60 zone, marking 61.8% Fib. expansion level and an ascending trend-line resistance, a drop back below 17,00 mark indicates continuation of the near-term corrective move for the index initially towards 16,900-880 zone, comprising of 23.6% Fib. retracement level of Feb. to Sept. 2014 up-swing and 100-day SMA. Further, a decisive weakness below 100-day SMA is likely to trigger some accelerated downfall towards 38.2% Fib. retracement level support near 16,600 region. Meanwhile on the upside, 17,050-100 area now seems to provide immediate resistance for the index, which if conquered would provide the required momentum for the index to move past recent highs and test 17,400 level.

S&P 500 [SP500]

The index has repeatedly failed to decisively move above the upper trend-line resistance of an ascending trend-channel formation on daily chart, currently near 2025 area. The index now has dropped to its lowest level since Aug. 18 and is now trading very close to 100-day SMA important support, currently near 1960 region. A decisive drop below 100-day SMA support now seems to magnify the losses immediately towards 1940-45 support region and could subsequently drag the index towards a very important psychological support of 1900 round figure mark, also coinciding with the lower trend-line support of the ascending channel. On the upside, 1980-85 horizontal zone now seems to restrict any immediate upside for the index. This is closely followed by a very important resistance near 2000 psychological mark. A decisive strength above 1985 resistance, leading to a subsequent strength above 2000 mark, has the potential to further lift the index towards testing the upper trend-line resistance of the ascending channel, currently near 2035 levels.

Nasdaq 100 [NQ100]

The index held an important support near 4000-10 zone, comprising of 50-day SMA and the lower trend-line support an ascending trend-channel formation on daily chart. Should the index drop below this important support, breaking below the trend-channel, it seems vulnerable to drop immediately towards 3960 support area, representing 23.6% Fib. retracement level of its up-move from April to Sept. 2014. However, should the index continue holding above this immediate support, it seems more likely to witness a bounce back towards 4050-60 horizontal resistance zone, which if conquered has the potential to further lift the index to surpass 4200 mark and test the upper trend-line resistance of the ascending trend-channel formation, currently near 4230 level.

“Original analysis is provided by Admiral Markets”

 

[Admiral Markets]

Important Major Currency Pairs Technical Update

On Monday, the US Dollar remained range-bound against most major currencies, registering gains against AUD and JPY while witnessing a minor weakness against EUR and GBP. On Tuesday, the US Dollar resumed its upward trajectory against most major currencies, as investors gear up for a slew top-tier economic releases, including the closely watched US NFP data and ECB monetary policy decision later during the week.

Given the backdrop, here is a technical update on some important major currency pairs - EURUSD, GBPUSD, AUDUSD and USDJPY

EURUSD

Following the release of Euro-zone flash CPI reading the pair dropped sharply, breaking below 1.2600 mark, to hit a fresh 2-year low. The pair, however, seems to find some support near 1.2600-1.2580 area, also coinciding with the lower trend-line support of a descending trend-channel formation on 4-hourly chart. Moreover, RSI reading below 30 is also suggesting short-term oversold conditions. Hence, the pair could possibly witness some pull-back from current level towards 1.2660 horizontal resistance zone. Beyond 1.2660 area, major resistance on the upside is pegged near 1.2710-20 zone, which if conquered seems to extend the near-term recovery for the pair towards 1.2800 mark, marking the upper trend-line resistance of the descending channel. Meanwhile on the downside, 1.2600-1.2580 region seems to protect immediate downside for the pair. Failure to hold this immediate support area seems to accelerate the downfall immediately towards 1.2550 horizontal support zone, which could possibly get extended till 1.2500 round figure mark support.

GBPUSD

After rising above 1.6500 level, following the Scottish referendum, the pair reversed and on Tuesday dropped back below 1.6200 mark, confirming the emergence of a strong resistance near 1.6270-80 area representing 38.2% Fib. retracement level of July 2013 to July 2014 big up-move. From current levels, the pair seems to find immediate support near 1.6160-50 horizontal area, which if broken seems to eventually lead the pair towards 1.6000 psychological mark support area. On the upside, 1.6230 level now seems to provide immediate resistance, which is closely followed by a strong resistance near 1.6270-80 area. This 1.6270-80 region now seems to act as a short-term cap for the pair and only a decisive move above this strong resistance area could possibly negate the short-term bearish outlook for the pair.

AUDUSD

The pair has fallen relentlessly in the month of September and has dropped to its lowest level since Feb. 2014. However, in the short-term the pair might find some support near 0.8650-40 area, marking the lower trend-line support of a descending trend-channel formation on 4-hourly chart. However, a closing below 0.8750 area on Tuesday, marking the lowest monthly closing in 2014, would indicate continuation of the weakening trend towards 0.8500 mark in the near-future. On the upside, 0.8770-80 zone, representing the upper trend-line resistance of the short-term descending channel, seems to provide immediate resistance for the pair. Moreover, a decisive move above this immediate resistance might provide some relief rally for the pair, even beyond 0.8800 mark, towards 0.8830-40 strong resistance zone.

USDJPY

The pair has been consistently forming fresh 6-year high and now seems to be aiming for 110.00 psychological mark resistance, representing 61.8% Fib. expansion level. Considering the pair's strong momentum, it seems more likely to break pass the 110.00 resistance and continue appreciating towards 111.00 mark, also coinciding with 100% Fib. expansion level. On the downside, 109.00 mark now becomes an important level to watch for, which if broken might trigger some profit taking move initially towards 108.40-30 horizontal support and then towards 107.40-30 important support area. Further, only a decisive move back below the 107.40-30 important support area might hinder the continuation of the up-move for the pair.

“Original analysis is provided by Admiral Markets”

 

[Admiral Markets]

Technical Outlook: USDCAD, USDCHF and CADCHF

US Dollar trimmed some of its gains on the first day of the week even after the Core PCE and Personal Spending-Income increased as market players remained afraid of the consistent higher levels of the greenback However, it gained considerably on Tuesday as weaker economic numbers from the rest of the globe kept fueling the greenback’s demand.

Read fundamentals of the current week: A Week Full of Market Moving Economic Events

USDCAD

Even after the USDCAD managed to close below ascending trend channel support on H4 chart yesterday, it failed to sustain the break and reversed back towards the test of important psychological resistance level of 1.1200. Should the pair closes above 1.1200, the 1.1225 can become intermediate resistance for the pair, breaking which it is less likely to stop at March high and can rally towards 1.1330 level. On the downside, a close below 1.1130 can cause the pair to re-test 23.6% Fibonacci Retracement of its December 2013 to March 2014 up-move on Daily Chart near the psychological support of 1.1100, breaking which 1.1030 can become next support for the pair before it plunges to 1.0930 support level. A sustained close below 1.0930 negates the chances of near-term up-move by the pair.

USDCHF

USDCHF is knocking the resistance line of ascending trend channel, on H4 chart, near the psychological resistance level of 0.9600 which gives rise to expectations of a small pull-back of pair towards sub-0.9500 levels; however, the daily chart supports the otherwise case as the pair has already breached the 23.6% Fibonacci Retracement of its May 2013 to March 2014 downturn. Hence, today’s close becomes crucial for the pair. Should it close above 0.9600, it becomes vulnerable to rally till 0.9670 and 0.9750 level before targeting the 2013 high of 0.9838. However, a close below 0.9500 level can cause the pair to test 0.9450 and the support line of ascending trend channel near 0.9420, breaking which 61.8% Fibo. level on Daily Chart near the psychological support level of 0.9400 becomes crucial to determine near-term moves of USDCHF. A sustained break of 0.9400 can call for additional downside of the pair till the 0.9260 level.

CADCHF

CADCHF continues to observe the ascending trend line support and is re-testing the 0.8590 – 0.8600 critical resistance zone. Should the pair break this strong resistance, it is likely to march till 0.8670, including 50% Fibonacci Retracement of its May – 2013 to March – 2014 downturn. A sustained trading above 0.8670 can cause the pair to rally till 0.8770 levels before testing 61.8% Fibo. level near 0.8880. However, a failure to break the resistance can cause the pair re-test ascending trend line support near the psychological support level of 0.8500, breaking which 38.2% Fibo. level support near 0.8470 can limit the pair’s downside before it plunges to 0.8320 level.

“Original analysis is provided by Admiral Markets”

 

[Admiral Markets]

Major Currency Pairs Technical Update

Following its recent strong up-move, USD retreated for second consecutive day against EUR, GBP, AUD and CHF but managed to hold with marginal gains against CAD. With very little in terms of any major economic releases from the US that could trigger further up-move, except for the FOMC meeting minutes, the US Dollar could possibly witness some corrective move or move in a narrow trading range for the rest of the week.

Given the backdrop, here is a technical update for important major currency pairs - EURUSD, GBPUSD, AUDUSD, USDCHF and USDCAD

EURUSD

After dropping to a two-year low level of 1.2500, the pair has been witnessing some buying interest and is now moving closer to its immediate strong resistance near 1.2700 marked by the upper trend-line resistance of a short-term descending trend-channel formation on 4-hourly chart. A decisive strength above this immediate resistance might trigger a another leg of up-move initially towards 1.2760 horizontal resistance area and further towards another strong resistance near 1.2830-50 zone, represented by 23.6% Fib. retracement level of May to Oct. 2014 sharp fall. However, reversal from the trend-line resistance and a subsequent drop back below 1.2600 round figure mark immediate support seems to indicate resumption of the descending trend, even below 1.2500 mark, towards 1.2450 support area, marked by the lower trend-line support of the descending channel.

GBPUSD

The pair after dropping to 1.5950, the lowest level since Nov. 2011, has managed to quickly recover but is now finding difficult in holding its strength above 1.6100 round figure mark. Sustained strength above 1.6100 mark has the potential to immediately lift the pair back above 1.6200 horizontal mark resistance area. Alternatively, a drop back below 1.6040-20 immediate horizontal resistance would possibly negate the chances of any further recovery. The pair then could easily drop back below 1.6000 psychological mark and continue depreciating, even below 1.5950, towards 1.5900 strong horizontal support area, held since Sept. 2013. Furthermore, a decisive break below 1.5900 important support area would suggest the upcoming near-term weakness for the pair towards 1.5700-20 support area, marked by 61.8% Fib. retracement level of July 2013 to July 2014 big up-swing.

AUDUSD

The pair has failed to register any meaningful recovery from a four-year low levels touched in the previous week and is facing strong resistance in decisively conquering 0.8800-20 resistance zone, representing 23.6% Fib. retracement level of its downfall witnessed in Sept. and Oct. 2014. Considering that the pair is reversing from its immediate resistance zone, a follow-up weakness back below 0.8760-50 immediate horizontal support area might confirm continuation of the descending trend towards 0.8500-20 support area in the near-term. Meanwhile, a decisive move above 23.6% Fib. retracement level might suggest continuation of the pull-back towards 38.2% Fib. retracement level resistance near 0.8930 area. with 0.8870 horizontal zone acting as intermediate resistance on the upside.

USDCHF

As could be seen on 4-hourly chart, the pair failed to sustain the break-out above a short-term ascending trend-channel formation and reversed from 0.9680 resistance area, roughly coinciding with 23.6% Fib. retracement level of its multi-year down-trend witnessed from 2001 to 2011. The pair, however, is finding some immediate support at 0.9550 area. Failure to hold this immediate support seems to accelerate the downfall immediately towards 0.9500 support area, representing the lower trend-line of the ascending channel, which if broken could further drag the pair towards 0.9450 support area, marked by 23.6% Fib. retracement level of lows touch in May to highs tested in Oct. 2014. Meanwhile on the upside, 0.9600 round figure mark now seems to act as immediate resistance, which if conquered could further boost the pair towards 0.9840 resistance, marked by May 2013 highs.

USDCAD

Following its big fall on Monday, the pair recovered a bit on Tuesday, confirming a support near 1.1120-30 area marked by 23.6% Fib. retracement level of July to Oct. 2014 up-swing. However, on 1-hourly chart the pair seems to form a bearish Flag chart-pattern possibly suggesting the upcoming near-term downtrend for the pair. Hence, a drop below 1.1150 support area (the lower trend-line support of the ascending channel, forming part of the flag pattern) is likely to infuse some near-term weakness for the pair and the pair could immediately drop below 1.1100 mark with the near-term weakness expected to continue till 1.1020-1.1000 support area marked by 38.2% Fib. retracement level. Meanwhile on the upside, 1.1190-1.2000 area, coinciding with the upper trend-line resistance of the ascending channel, is now seen as important resistance to be conquered. Should the pair decisively strengthen above this resistance area, it could immediately aim towards retesting its recent high of 1.1270, also coinciding with highs tested in March 2014. Moreover, a move above 2014 highs would suggest continuation of the upward trajectory even beyond 1.1400 mark in the near-term.

“Original analysis is provided by Admiral Markets”

 

[Admiral Markets]

Technical Outlook: Important JPY Pairs

Recently, Bank of Japan downgraded its forecast of industrial production while the International Monetary Fund (IMF) cut Japanese growth forecast yesterday; however, with the global growth forecast also being downwardly revised by IMF, the safe haven demand of the Yen remained elevated and the currency continued maintaining the early-month strength against majority of its counterparts. With lesser Japanese economic events left for publishing during the week, market players are likely to concentrate more on the out of the Japan news in order to determine JPY moves.

Given the backdrop, the following is the brief technical overview of the USDJPY, EURJPY and GBPJPY that together constitute important JPY pairs.

USDJPY

Failure to break 100% FE level of October 2013 to January 2014 up-move, USDJPY plunged back to its 23.6% Fibonacci Retracement Level of Feb. 2014 lows to Recent highs, near 108 level. From the current level, the decline in RSI signals that the pair can test 107.30 level on the break of 108 and can stretch its fall towards 38.2% Fibo. level near 106.50 before plunging to 61.8% FE level and the 50-day EMA level near 106.20. Should the pair break the 106.20 level, it can rest near the January 2014 high near 105.30, also coinciding 50% Fibo. level before testing 100-day EMA near 104.70. Should the pair break 104.70 level, chances of near-term up-move can be negated and the pair becomes vulnerable to test sub-103 levels. On the upside, a bounce from the 23.6% Fibo. level can cause the pair to target 109 levels before rallying to 100% FE and recent highs of 110.00 – 110.10 region. Should the pair successfully encounters 110.10 region on a closing basis, it is more likely to test 111.50 level; however, 110.70 can become intermediate resistance for the pair.

EURJPY

EURJPY has been trading below 200-day EMA since the start of the month and is resting near 137 level, 61.8% Fibonacci Retracement of its November 2013 to December 2013 up-move. Should the pair breaks the psychological support of 137, it is likely to test 135.80 - 135.50 support zone which marks the near-term movement of the pair. The break of 135.50 support increases chances of near-term downturn and the pair becomes vulnerable to test 134.50, 76.4% Fibo. level, and the 133.50 levels. Should the pair reverses from the current level, 200-day EMA near 137.90 quickly followed by the psychological resistance level of 138 and the 50% Fibo. level of 138.50 become immediate resistances for the pair, breaking which it can rally till 139.30 and the 38.2% Fibo. level near 140.10 which marks the near-term top of the pair.

GBPJPY

Price uptick during mid-September couldn’t help the GBPJPY to break 100% FE level of February – July 2014 up-move and the pair fell back to 173.30 – 173.10 support zone, encompassing 100-day EMA and 38.2% Fibonacci Retracement connecting its February- September rally. Should the pair breaks 173.10 level and closes below the psychological support of 173, it can directly plunge to 171.80 level, breaking which 50% Fibo. level near 171.30 and the 200-day EMA near 170.80 can become near-term support for the pair. On the reverse side, 174.50 and the 23.6% Fibo. level, near 175.20, can cap the near-term rise of the pair before it rallies to 61.8% FE level of 176.30. A break of 176.30 can fuel the pair to extend its advance till 178.50 levels.

“Original analysis is provided by Admiral Markets”