GBP/USD Intraday Technical Analysis and Trading Recommendations for January 31, 2012

 

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After break of the long-term bearish channel marked in blue, the pair is trending up inside the narrow bullish channel marked in brown.

Yesterday we expected formation of a Head & Shoulders reversal pattern which became confirmed on closure below 1.5650 and the lower limit of the channel which didn't happen, so we are out of the market.

On the other side, the pair managed to make a higher high today closing above 1.5740 which opened the way for the pair to test 1.5775, which is the nearest resistance level for the pair.

This resistance 1.5775 is a key-level for GBP/USD movement today and this week as its break will extend the bullish journey towards 1.5870.

Bearish Price action towards it, brings the pair back to retest the lower limit of the channel at 1.5730 which would be liable to be broken this time.

SL for any mentioned scenario should be break of the high/low we are couning on.

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EUR/JPY Weekly Technical Levels - January 30 - February 3, 2012.

Weekly Technical Levels:

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Tip (s):

R3 and S3 are good indication of the maximum range for extremely volatile days but can be exceeded occasionally.
Pivot lines work well in sideways markets as prices will most likely range between the R1 and S1 line.
In a strong trend, price will lower through a pivot point line and keep going.
If there is significant news to influence on the market, price may go straight through R1 or S1 and reach even R2 & R3 or S2 & S3.

Time Frame: H1.

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Drag your Fibonacci retracement levels from the lower to the higher levels of the last week (It has 120 candles, as you know each candle is formed in 1 hour on H1 chart, then: (120 candles * 1 hour) / 24 hours = 5 days from the 23^rd of January to the 27^h of January, 2012.) in order to determine low and high price.
Average = (Higher - Lower) / 2
Average = 100.65

• Range was: 309 pips.
• The value of 50% Fibonacci retracement levels is: 100.65.
• 104.00 a strong resistance will be formed.
• 98.15 a strong support will be formed.
• Volatility is 3110.23. 
• It should be noted that the price is still trapped between 101.70 and 99.10, as well as that the weekly pivot point is between 61.8% of Fibonacci retracement levels and 50%.

Observation (s):

• If the strength of the trend for the pair is an uptrend, then the strength of the currency is as follows: EUR is an uptrend and JPY is a downtrend.
• Most of traders use the Fibonacci retracement to determine accurate psychology level of support and resistance.
• Volatility Formulas: Variation = Average * (Higher - Lower).
  

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GBP/USD: Intraday Technical Analysis for January 27, 2012.

Pivot Point: 1.5695.

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GBP/USD:

• Resistance: 1.575. (Sell below this level).
• Support: 1.55. (Buy above this level).
  

Trading Recommendations:

According to the previous events, the price is still located between levels1.5750 and 1.55.

• BUY-deals are to be made higher than the 1.55 level with targets at levels 1.5525 and 1.5675.
• The descending movement will probably take place lower than the 1.575 level with the first targets at levels 1.5653, 1.559 and 1.5465.

Overview:

It should be noted that the market revealed the signs of instability and the trend movement was controversial as it took place in a narrow sideways channel. Concerning the previous events, the price is still between the levels 1.5750 and 1.5400, so it is recommended to be careful in this area. Therefore, it is necessary to wait till the sideways channel is passed through. Then, the market will probably show the signs of a bullish trend. In other words, BUY-deals are recommended higher than the 1.5400 level (Support 3: 1.5469) with its first target at level 1.55. From this point the pair is likely to begin the ascending movement to the point 1.56 and later to 1.5675. However, if the pair is not to pass through the level 1.5750, the market will indicate a bearish opportunity lower than the strong resistance level 1.5750. In this regard, it is recommended to make SELL-deals lower than the 1.5750 level with the first target of 1.56. It is possible that the pair will turn to downward movement continuing the development of the bearish trend to the level 1.555.
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Intraday Technical levels (the 27^th of January, 2012):

R3:1.5804
R2:1.5769
R1:1.5730
PP:1.5695
S1:1.5656
S2:1.5621
S3:1.5582

Definition (s):

Range I – A long-term mean reversion strategy that looks to go against strong divergence from the pair’s average value. It will typically hold trades for an extended period of time and is one of the slower moving trading strategies.
Range II– Like Breakout 2, uses sentiment as a filter for its trades. It will use a simple oscillator range trading strategy but only take the trading signals if SSI is not at extremes. It is fairly short-term in nature and will tend to trade very little during times of strong trending moves. It is likewise one of the most volatility-sensitive trading systems and will tend to do poorly during times of sharp currency moves.

Observation (s):

Please check out the market volatility before investing, because the sight price may have already been reached and scenarios become invalidate.
Stop Loss should NEVER exceed your maximum exposure amounts.

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USD/CAD Technical Analysis and Trading Recommendations for January 26, 2012.

Pivot Point: 1.0073.

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Overview:

The market will continue showing strength by following to the level of 0.9960 (11% of Fibonacci retracement levels). Therefore, the USD/CAD resistance was broken and turned into support a month ago (on the 30th of October, 2011), the pair has already formed a strong support at the level of 0.9960. So the market indicates a bullish opportunity at level of 0.9960 with the first objective of 1.0130 and continues towards 1.02. However, if the trend does not manage to break through and close above the level of 1.02, then it will be a downside momentum, that is rather convincing and the structure of the downfall looks non-corrective, for that the market will indicate a bearish opportunity at 1.0200, hence it will be a good sign to sell at this level in order to continue downward pace towards 1.0010 on H4.

Trading Recommendations:

According to previous events, the price is still trapped between 1.0020 and 1.0270.

• Buy above 0.9960 with target at 1.0133 then 1.0200.
• Below 1.0200, look for further downside pace with a target of 1.0010.

Technical Levels:

R3:1.0238
R2:1.0193
R1:1.0118
PP:1.0073
S1:0.9998
S2:0.9953
S3:0.9878

Observation (s):

Please check out the market volatility before investing, because the sight price may have already been reached and scenarios become invalidate.

Key level at 0.9960.

History will probably repeat itself at this level again.

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GBP/USD Wave Analysis for January 25, 2012

Wave marking analysis:
The breakdown of the level 1.5600 by the GBP/USD pair confirmed yesterday the formation of the 5-wave structure on ascending part of the trend initiated on January 13. Therefore, the current uprising correction is expected to be complicated and continuous. The first targets for the whole ascending part of the trend of the supposed wave A are located near the level 1.5675. If that is true, then having reached the mentioned target level and considering the MACD decisive divergence it will be possible to expect the decline in prices within the prospective wave B.
 

Targets for the variant with the uprising wave A:
1,5619 – 88.6% according to Fibonacci
1,5675 – 161.8% according to Fibonacci

Targets for the variant with the wave B:
1,5566 – 76.4% according to Fibonacci
1,5503 – 61.8% according to Fibonacci

General conclusions and trading recommendations:
With GBP deals we observed the formation of the ascending corrective part of the trend, probably within the wave A, inside of which the 5-wave structure was formed. The MACD divergence points at possible small decrease in prices and can coincide right with the completion of the wave A. If that proves to be true, then the wave B is likely to form and we can expect the decrease in prices to the levels 1.5566 and 1.5503. It is possible that the developing wave A will raise the pair to the level 1.5619 which is equal to 88.6% according to Fibonacci and further to the level 1.5675 corresponding to 161. 8% of Fibonacci.

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AUD/USD Wave Analysis for January 24, 2012

The AUD/USD pair is forming the impulse wave C of the 5th order from 1. 0231-level. It includes the sub-wave C of the 4th order from 1. 0231, which in turn has its own sub-wave C of the 3rd order coming from 1. 0370. From the level of 1. 0573 the corrective 4th sub-wave is forming. The targets of this wave are defined according to the correction grid 1.0370-1.0573. The correction grid also provides the support levels 1.0145-1.0573.

Support levels:
- 1.0471 = 50%
- 1.0448 = 61.8%
- 1.0410 = 38.2%
If the pair continues the upward movement with the breakdown at level 1.0573 then the nearest resistance levels will provide expansion grids 1.0145-1.0377-1.0231, 1.0231-1.0449-1.0354, 1.0354-1.0436-1.0370.

Resistance levels:
- 1.0572 = 100% expansion
- 1.0585 = 261.8% expansion
- 1.0606 = 161.8% expansion

The direction of deals: BUY-deals are recommended as long as the pair keeps the position higher than 1.0458.
 

The wave levels (marking):
1st order (the lowest) – dotted line
2nd, 3rd order and higher - line weight 1, 2 etc.
The same is for Fibonacci grids.

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EUR/USD Intraday Technical Analysis & Trading Recommendations January 23, 2012

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On the daily chart, the bullish breakout of the mid-term bearish channel is obvious with quite a long bullish candlestick.
Now the pair is testing 61.8% Fibonacci level after bearish rejection, which appeared at 1.2970 with gap to the downside at the opening this week.
Stabilization below 61.8% Fibonacci level gives the confirmation to resume the downside movement. However, if the pair fails to do so, this may push the pair up again to retest 1.2970.
Thus we can say that EUR/USD is moving in the mid-term bearish direction and short-term bullish direction after breakout of the mentioned channel.

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Last Thursday, EUR/USD managed to break and close above the consolidation range upper limit at 1.2880.
EUR/USD managed to break and close above the upper limit of the long-term bearish channel established in last October. However, this isn't considered a valid bullish entry as the pair has a considerable resistance area at 1.2890-1.2970, which is a 61.8% Fibonacci level, and also the previous broken daily low.
Last Friday, the pair was testing the upper limit of the SUPPLY zone at 1.2970 which held the price below acting as intraday resistance.
Also Bearish price action towards this resistance area 1.2970 is fairly strong manifested in the daily bearish engulfing candlestick.
However, its break will open the way directly to 1.3075 which, if broken too, will go up to 1.3190, these moves, if happen, can be profitable for intraday traders.
The current midterm bearish direction and trend of the pair, besides the bearish WEEKLY closure last week, enhances the bearish side of the market more than the bullish one.
It's important to mention that the pair has a good support around 1.2600-1.2585, which is a significant previous weekly low.

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