Indices, Oil and Forex Analysis – JPY Turns Red Again

Major Markets Technical Analysis

Indices continue the bearish correction but in a very limited manner. It seems like buyers are in a full control of the situation.

The SP500 is very close to the resistance level on the 23.6% Fibonacci, a breakout of that resistance will be a great confirmation of a buy signal.

NASDAQ is doing pretty much the same but below the 38,2% Fibonacci.

Brent Oil slightly dropped after touching March highs. The sentiment remains positive.

The USDJPY continues the upswing after the pair escaped from the symmetric triangle pattern.

The EURUSD is trying to create a nice Head and Shoulders pattern on a crucial horizontal resistance.

The EURGBP is locked inside of a rectangle. We have to wait for the breakout.

The USDCAD continues sliding aiming for the lower line of the ascending triangle.

The GBPCAD dropped after the price broke the lower line of the flag.

The GBPAUD also dropped but after leaving a small pennant formation.

The GBPJPY is aiming for the 164 resistance after a successful escape from the symmetric triangle pattern.

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Indices and Pairs with JPY Start a New Week with an Upswing

Indices continue the reversal initiated in the last week.

SP500 broke a crucial horizontal support on the 4150 points.

Nasdaq bounced off of the 50% Fibonacci and is aiming the 38,2%.

DAX escaped from the symmetric triangle pattern and is aiming crucial resistance on the 14850 points.

USDJPY tries to escape from the symmetric triangle as well.

USDCAD continues the drop influenced by the giant Head and Shoulders pattern.

GBPCAD tries to break the lower line of the flag in order to start a new sell signal.

GBPAUD is doing pretty much the same thing but breaking the horizontal support.

AUDCHF comes back inside of the rectangle. A false bearish breakout can be a good buy signal.

GBPJPY tries to end the correction and is putting heavy pressure on resistances.

Traders Edge: Market Briefing for 30.05.22

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Correction on USD and Indices Accelerates

Major Financial Markets Technical Analysis

SP500 started the new week with a possible double bottom formation and a promising movement to the upside.

Nasdaq is defending the 50% Fibonacci and is also creating a double bottom formation.

The DAX in a better situation with an inverse head and shoulders pattern. We are inches from breaking the neckline and creating a buy signal.

The EURUSD is climbing higher, after the price broke the neckline of the inverted Head and Shoulders pattern and the long-term down trendline (red).

The AUDUSD is in a very similar pattern and is also aiming higher.

The USDCAD dropped after the price created a false bullish breakout.

The GBPCAD joined the EURUSD and AUDUSD in an upward movement triggered by the inverted Head and Shoulders formation.

The GBPAUD tested the lower line of the pennant. The end of the sideways trend is near, and a breakout to the downside is currently on the table.

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For a look at all of today’s economic events, check out our economic calendar.

Forex, Gold and Indices – Usual Friday Correction

Major Financial Markets Technical Analysis

USDJPY overnight corrects the 50% of the most recent downswing.

GBPJPY also slightly corrects the recent slide and tests the major horizontal resistance.

It’s also correction day for the SP500 and Nasdaq.

DAX, German Index is doing much better than its American peers. The weak Euro is to blame, which is helping German exporters.

EURUSD joins the correction party as well. 1.05 on the horizon.

Gold breaks a major, long-term up trendline.

AUDUSD breaks the long-term, horizontal support on the 0.7. That’s pretty negative.

EURCHF drops to test a combination of three crucial supports, the down trendline, a horizontal one and the upper line of the symmetric triangle.

GBPAUD with a massive double bottom formation. The price is close to a neckline, so a breakout here would be a major buy signal.

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Weekly Waves: Bitcoin Bearish Reversal Plus EUR/USD & GBP/AUD Daily Charts

The Bitcoin (BTC/USD) weekly chart is showing a potential bearish reversal. The uptrend could be completed after 5 bullish waves up.

We also review the EUR/USD downtrend and GBP/AUD triangle pattern on the daily charts.

Bitcoin Bearish Momentum vs Uptrend

The BTC/USD chart remains in an uptrend but the bearish pressure is placing it under severe pressure. The higher high was quickly followed by a fast decline:

04.01.22 waves BTCUSD
  1. A 5 wave (pink) pattern seems to be completed. There is also a clear 5 wave pattern (blue) in the final 5th wave (pink).
  2. Price made a higher high but the bulls were unable to hold ground. The quick bearish decline showed a lot of bearish momentum. The bearish drop could be a wave A (blue).
  3. A new lower low is expected (orange arrow) to test the support zone (green) first. A bullish bounce (green arrow) could test the resistance zone (orange).
  4. A bearish bounce at the resistance would confirm that the uptrend is indeed over.
  5. A larger, complex bearish correction could take place via a WXY (pink) pattern. In case, the uptrend continues, then it is likely that a triangle pattern will emerge first.

EUR/USD Downtrend Continuation

The EUR/USD downtrend is strong. The resistance trend line (orange) indicates how long the bears have been in control:

04.01.22 waves EURUSD
  1. The current decline is a bearish impulsive wave. There seem to be 5 waves (grey) developing at the moment.
  2. The current pullback is probably a bear flag (purple lines) within the wave 4 (blue). This is invalid if the retracement breaks above the 78.6% Fibonacci level. A break below (orange arrow) the flag confirms the downtrend continuation.
  3. The main target for the downtrend is the round level of 1.10.
  4. The downtrend could be part of a wave 5 (blue) of wave 3 (pink) of wave 5 (grey).

GBP/AUD In Consolidation

The GBP/AUD chart is showing an uptrend with support trend lines (purple) below the current price:

04.01.22 waves GBPAUD
  1. After 5 waves up (pink), price is making a consolidation. The correction could be an ABCDE (pink) pattern.
  2. The current outlook remains valid if price action stays above the bottoms.
  3. A break above the resistance trend line could spark a bullish breakout and rally.

Good trading,

Chris Svorcik

The analysis has been done with the indicators and template from the SWAT method (simple wave analysis and trading). For more daily technical and wave analysis and updates, sign-up to our newsletter

 

GBP/AUD Bears Are There To Win

GBP/AUD Technical Analysis

  • Move down below M L3
  • New bearish move
  • Q L3 is the first support
  • M L4 possible

  1. Order block
  2. Swing high
  3. Entry zone
  4. Target

GBP/AUD has another bearish momentum. We can see the strength of Asian Pacific currencies both AUD and NZD. The order block is showing a rejection of the GBP/AUD and it’s mostly due to AUD strength. The swing high is at the Q H3 and the natural move should be to the camarilla pivot Q L3. The break of the Q L3 pivot should move the market further down to M L4 pivot. 1.8288 is the target. However, it will depend a lot on the continuation of the trend and the AUD strength which is gaining momentum.

Cheers and safe trading,

Nenad

 

GBP/AUD Bullish On All Fronts

GBP/AUD Technical Analysis

  • Double top spotted
  • Move up is expected
  • Breakout is possible
  • M H3 is the target

  1. Double top point 1
  2. Double top point 2
  3. Entry
  4. Target

The GBP/AUD is bullish. We can spot marubozu candles which are obvious is the Daily timeframe. As long as marubozu candles keep the momentum up, we can expect further continuation to the upside. Double top is there, if it breaks we go for the M H3 as the target. The overnight entry is doing good, almost 100 pips in profit. GBP/AUD is both European and Asian-Pacific cross so it has huge ATR and great momentum. This is all bullish and the breakout might be expected soon especially due to this obvious emerging inverted SHS pattern.

For a look at all of today’s economic events, check out our economic calendar.

Cheers and safe trading,

Nenad

 

GBP/AUD Rooftop Pattern Spotted in Daily TF

GBP/AUD Technical Analysis

  • Rooftop pattern on daily
  • The price should move down
  • Targets are M H3 and M L3
  • 1-2-3 Breakout

  1. Double top support
  2. High of the move
  3. New Support
  4. Retest of the swing entry zone
  5. Target

GBP/AUD has formed a rooftop pattern on the daily TF. The pattern has a horizontal or near horizontal bottom with up sloping trend in the first part of the pattern followed by a down-sloping trend in the last part of the pattern. 1-2-3 resembles the roof. The entry zone is around 1.8520. The first target is is M H3 camarilla 1.8375 followed by 1.8250. If the market continues with the trend the final target is M L3 camarilla pivot – 1.8050.

For a look at all of today’s economic events, check out our economic calendar.

Cheers and safe trading,

Nenad

 

Pound Hits Three-Week Low vs Dollar on Weak Risk Appetite

Global stock markets were in the red for a second day running as an unexpectedly weak set of Chinese economic data along with unrest in Afghanistan and other factors weighed on appetite for riskier assets.

The pound hit its weakest level since July 26 at 14:42 GMT, falling as much as 0.7% on the day to $1.3744. The 0.7% drop was its biggest daily loss since June 18. Against the euro it hit a two-week low of 85.35 pence.

The market mostly overlooked positive jobs data. As Britain’s economy extended its recovery, payrolls rose by 182,000 in July to 28.9 million, data showed – 201,000 shy of the level seen before the COVID-19 pandemic hit in March 2020.

The Office for National Statistics also said the headline unemployment rate fell to 4.7% in the three months to June, its lowest since the three months to August 2020.

Economists polled by Reuters had mostly expected the unemployment rate to hold at 4.8%.

“The pound continues to struggle despite the overall better than expected labour market data out of the UK: the unemployment rate came in a tad lower and the weekly earnings were stronger than expected, while the employment gains continued at a healthy clip in June,” said Valentin Marinov, head of G10 FX research at Credit Agricole.

“The slightly less good news was the fact that the claimant count continued to grow in July with the drop in total jobless claims that we saw in June stagnating in July. The data has offered the pound relatively little support likely because the labour market conditions in the UK are expected to soon start deteriorating again after the expiry of the government’s furlough scheme next month.”

On Wednesday, investors will look to UK inflation figures, with the market consensus expecting inflation to ease.

That will reduce pressure on the Bank of England to normalize monetary policy any time soon, Marinov said.

“All this, coupled with the heightened pound sensitivity to risk sentiment, makes us keep our cautious outlook on the pound in the near term. Indeed, FX investors could continue to look for hedges against further escalation in risk aversion and may found the pound an attractive short, given current valuation and market positioning.”

Sterling has traded in line with risk sentiment in recent weeks, and has been among the top-performing currencies in the ‘G10′ group.

Speculators’ positioning on the pound turned net long in the week to Aug. 10, according to weekly CFTC positioning data. This means that the speculative market generally expects the pound to strengthen.

“Sterling has slipped into subdued trading after failing to hold onto gains last week,” ING said in a note to clients.

“Today’s June employment data understandably has delivered little fresh news with the market instead waiting for this autumn to see the end of furlough schemes and how much unemployment rises then.”

ING said 84.50-85.50 pence per euro may now be the broad boundaries of a euro-sterling range, with low volatility potentially extending into September.

For a look at all of today’s economic events, check out our economic calendar.

(Reporting by Ritvik Carvalho; Editing by Susan Fenton)

Gold Is Ready for a Reversal

 

Gold is in a proper V-shape reversal bouncing from the 38,2% Fibonacci. That can be the end of the bear market.

Silver is in a slightly worse situation but still it bounced from an important horizontal support.

Platinum is respecting the Fibonacci levels. For the buy signal, we need to see a breakout of the 38,2% level.

Palladium is inside a mid-term symmetric triangle. A breakout will show us a direction.

Crude Oil is defending a crucial horizontal support at the 66,5 USD/bbl but for how long?

The Dow Jones is in a pessimistic candlestick pattern on the daily chart but there’s still time to deny it.

The EURUSD is in a false bearish breakout below the neckline of the Head and Shoulders pattern. This can be a positive signal.

The GBPAUD is escaping from the pennant to the upside.

The GBPCHF is testing the neckline and the upper line of the wedge but this time, from the upside. As long as the price is above, the sentiment is positive.

For a look at all of today’s economic events, check out our economic calendar.

GBP/AUD M Pattern Suggesting Breakout

The ATR low is 1.8196. At this point the pair is bearish. Further move below the support suggest further weakness in the pair. The target is W L5 1.8040-60. We should see a bounce off that level if the price gets there. Shorts on rallies might come around 1.8323 on a pullback.

For a look at all of today’s economic events, check out our economic calendar.

Cheers and safe trading,

Nenad

 

Australian Dollar On The Rise

Gold traders are fighting to keep the bullish dream alive and they’re trying to create the right shoulder of the Inverse head and shoulders pattern. A breakout of the neckline can possibly bring serious bullish sentiment.

Silver bounced from a crucial support on the 24.8 USD/oz.

Brent oil broke the mid-term down trendline and is aiming higher.

The Dow Jones is in the third wedge pattern in a row. The previous two ended in an upswing.

The EURUSD climbed back above the 23.6% Fibonacci.

The GBPUSD wasted a great chance for an upswing and failed to break the neckline of the inversed head and shoulders pattern.

The AUDUSD on the other hand, is very close to activating the buy signal from its own inversed head and shoulders formation.

The USDCAD is locked in a tight rectangle below major down trendlines.

The GBPAUD is in a sweet long-term sell signal, after the price created a head and shoulders pattern at the end of the wedge. A breakout of the lower line of the wedge opens a way towards new mid-term lows.

For a look at all of today’s economic events, check out our economic calendar.

Gold Extends the Drop

Gold extends the bearish correction giving chance to bulls, who missed the initial buying opportunity from the beginning of the month.

Silver bounces from a crucial mid-term horizontal support.

Brent Oil breaks the upper line of the triangle but the breakout itself is not very convincing.

Indices are ready to make another all-time highs.

The GBPUSD testing the neckline of the mid-term inverse head and shoulders pattern.

The AUDUSD with a flag just below the neckline of the H&S pattern.

The NZDUSD with a very similar situation.

The USDCAD consolidates below crucial long-term down trendlines.

The GBPAUD breaks two major short-term resistances but the main sentiment still looks rather negative.

The EURRUB stays bullish despite two dangerously looking shooting stars on an important horizontal resistance.

For a look at all of today’s economic events, check out our economic calendar.

Traders Take Profits on Precious Metals

After a sweet bounce, gold finally reached a crucial horizontal resistance and started a small correction.

Silver broke the lower line of the wedge and is aiming for an important horizontal support.

Brent oil is in a sideways trend waiting for a breakout to give us a proper direction.

The DAX is inside a correction pattern, getting closer to another strong buy signal.

The Dow Jones is already done with waiting and has started aiming higher.

The GBPUSD is on its way to test the long-term up trendline.

The GBPAUD tested the neckline of a bog head and shoulders pattern and created a shooting star which is a rather bearish sign.

The EURRUB is aiming lower after the price escaped from a flag and broke the neckline of the inverted head and shoulders pattern.

GBP/JPY Vs GBP/USD and USD/JPY – March 6th, 2021

GBP/USD last week fell 236 pips from 1.4015 to 1.3776 while overbought GBP/JPY rose 257 pips from 148.14 to 150.71.

Known since the 1930’s, the Japanese pegged GBP/JPY to UK Gold for not only economic viability but the first incursion to the western world of finance. The standard to hold GBP/JPY to the UK held throughout Bretton Woods. Upon the 1972 free float, GBP/JPY became attached permanently with high +90% correlations to GBP/USD.

All JPY cross pairs followed with high and positive correlations as AUD/USD and AUD/JPY, NZD/USD and NZD/JPY, EUR/USD and EUR/JPY while USD/CAD and CAD/JPY became polar opposites as both permanently correlate negatively. USD/CHF and CHF/JPY traditionally also hold opposite correlations.

The Japanese offered not only a double trade but GBP/JPY and GBP/USD as the same exact currency pairs. The same principle holds true for EUR/JPY and EUR/USD, AUD/USD and AUD/JPY and NZD/USD and NZD/JPY. The double trade is permanent for USD/CAD and CAD/JPY.

Why JPY cross pairs remain overbought into week 6 amd not falling with counterpart currencies is the USD/JPY problem to correlations. While GBP/USD correctly correlates to GBP/JPY at +94%, GBP/JPY also not correctly correlates to USD/JPY at +83%. A further problem exists as GBP/USD correlates to USD/JPY at +46 %. All correlations are not only running positive but this situation is the exact same for AUD/JPY, NZD/JPY, EUR/JPY, CAD/JPY and explains why prices remain high and overbought.

Positive correlations are the result of exchange rate prices and relationships to moving averages since correlations are found within the context of averages. USD/JPY trades above vital 105.70,  GBP/USD above 1.3697 and GBP/JPY above 144.80. Correlations are positive because prices trade above respective high / low averages.

Required to assist GBP/JPY to drop is GBP/USD breaks 1.3697 or USD/JPY trades below 105.70. GBP/JPY then decides to fully correlate to USD/JPY or GBP/USD. GBP/JPY in every instant follows GBP/USD as the 91 year correlation and order of currency markets.

Current GBP/JPY trades 1156 pips above GBP/USD and 2506 pips below GBP/CAD. GBP/JPY larger range from GBP/USD becomes 144.08 and 1.5564. GBP/JPY above is located the 14 year average at 155.38 and the 10 year at 148.36.

Prior to the 2016 interest rate changes by the central banks, the market order to currency pair arrangement existed as GBP/USD, GBP/JPY, GBP/CHF then GBP/CAD.

The new order is arranged as GBP/CHF, GBP/USD, GBP/JPY then GBP/CAD and seen as GBP/CHF 1.2855, GBP/USD 1.3820, GBP/JPY 149.86 or 1.4986 then GBP/CAD 1.7292. Much daylight exists for GBP/JPY to trade freely between GBP/USD and GBP/CAD yet 250 pips traded last week from a distance of 1100 and 2500 pips between exchange rates.

Why GBP/CHF and all currency  pairs arranged as Other Currency / CHF dropped from contention as support is due to the uniqueness to the SNB’s interest rate system. Libor is miles from actual interest rates as first comes Saron, Call Money rates and the most vital Debt Register Claims.

JPY cross pairs overall contain downside moves from GBP/JPY at 300 pips and 200 for AUD/JPY and NZD/JPY.

USD/JPY for the week is not only light years overbought but the 5 year average is located at 109.01. A good target is found at 106.65.

GBP/JPY big break lower is located at the 10 year average at 148.38. A break then GBP/JPY trades 146.00’s easily.

GBP/USD this week opens between 1.3768 and 1.3840. Below 1.3768 challenges most vital 1.3697, above 1.3840 then GBP/USD travels much higher.

GBP/CHF and GBP/CAD run good and positive correlations at +93% and +96 % for GBP/CAD. For GBP/NZD and GBP/AUD remain problems as correlations run negative at -43% and -64% for GBP/AUD.

GBP/JPY

Included are GBP/JPY moving averages from 5 day to 253 days. The averages are perfect and derived from the ECB. The first number is the day average followed by trading days then the average.

A 20 day average is actually 15 days, a 50 day average is actually 36 days. Trading day averages to factor perfectly start at the beginning of every year then the numbers increase as days trade. A 50 day average is most stable as it only trades 36 to 50 days.

A 5 day average begins Monday at 2 days, then 3 for Tuesday and Wednesday and 4 for Thursday. A full 5 day average only trades on Fridays.

5 Day     5             149.2391

10 Day  9             149.1325

20 Day  15           148.3808

50 Day  36           145.2691

100 Day               71           142.5398

200 Day               143       139.9417

253 Day               180       139.1231

As GBP/JPY trades lower then the averages drop.

Targets

Targets are not only known miles ahead but targets stack to watch trades unfold.

Current targets: 149.7549, 149.8496, 149.5086, 148.1852, 146.0887, 143.7901, 143.0356.

The ECB and most central banks factor exchange rates to 6 decimal places and 4 for USD/JPY and JPY cross pairs and I follow the ECB exactly.

GBP/AUD Resuming the Move Up as Long as POC Zone Holds

The GBP/AUD has completed the retracement and the price is currently holding above the D L3 level.

A rejection off the 88.6 and the POC zone could make the price continue going further up. As long as the price is holding above 1.7815-40 it will be a bounce off the POC zone. Targets are 1.7850 followed by 1.7886 and 1.7950. However if we see a drop below 1.7790 then the price is going to become bearish and targets are 1.7761 and 1.7740.

For a look at all of today’s economic events, check out our economic calendar.

Cheers and safe trading,

Nenad

 

GBP/AUD W H3 Confluence For New Short Trades

The GBP/AUD might possibly complete the retracement soon and we should see a move down.

The POC zone 1.7599-1.7623 is additionally supported by the W H3 camarilla pivot. We can also see the D H5 resistance which adds to existing confluence. The pair should make a move down towards 1.7521 and 1.7480. If the targets are reached then it will be a decisive point for the pair. Either continuation down to 1.7459 or a move to the upside as a retracement again.

For a look at all of today’s economic events, check out our economic calendar.

Cheers and safe trading,

Nenad

GBP/AUD Bullish Momentum Patterns Aiming for 1.85 Target

The GBP/AUD bulls are breaking above the resistance trend line (dotted purple line). Price action seems to have completed a wave 4 (purple) pattern. Price is now preparing for a target at 1.85. How could traders profit from this expected price movement?

Price Charts and Technical Analysis

GBP/AUD 4 hour chart

The GBP/AUD will probably build a bull flag chart pattern on the 4 hour chart (orange arrows). The main candidate is the resistance zone around 1.8225-50 due to the long-term moving averages, previous tops, and Wizz 7 level.

A break above the flag could confirm the bullish continuation within wave 5 (purple). Whereas only a break below the 61.8% Fib invalidates (red x) this wave pattern and outlook.

On the 1 hour chart, the GBP/AUD is showing strong bullish momentum (green diamonds). Price action is probably completing a wave 3 and any potential pullback could be a wave 4 (orange).

This remains valid as long as price action stays above the 61.8% Fib (red x) at 1.8050. The support zone and the Fibonacci retracement levels are two main candidates for a bullish bounce.

GBP/AUD 1 hour chart

Good trading,

Chris Svorcik

The analysis has been done with the indicators and template from the SWAT method (simple wave analysis and trading). For more daily technical and wave analysis and updates, sign-up to our newsletter

For a look at all of today’s economic events, check out our economic calendar.

GBP/AUD Develops Strong Bearish Wave 3 Momentum

The GBP/AUD is showing a strong and impressive bearish momentum during the breakout. The downtrend is in full speed and expected to continue lower. Read this article for the main target.

1 hour chart

GBP/AUD 1 hour chart

The GBP/AUD bears remain in control as long as price stays below the resistance zones (orange boxes). A break above the wizz 4 level would invalidate (red x) the bearish outlook. But a bounce and breakout (green check marks) could confirm it. The current momentum, however, would first require a pullback like a bear flag (green arrows).

The GBP/AUD is expected to respect the 21 ema resistance zone too, if there is a pullback. The main target for the moment is aiming at 1.7750. The current push down could be part of a wave 3 (pink) of a larger wave 5 (purple). Recently price action seems to have completed an ABC (pink) within wave 4 (purple).

GBP/AUD 1 hour chart

Good trading,
Chris Svorcik

The analysis has been done with the indicators and template from the SWAT method (simple wave analysis and trading). For more daily technical and wave analysis and updates, sign-up to our newsletter

For a look at all of today’s economic events, check out our economic calendar.

 

GBP/AUD Might Start Dropping Soon

The GBP/AUD is not strong as the GBP/USD due to AUD strength and we might see the pair start dropping soon.

1.8030-50 is the POC zone. No close above the trendline should mark the start of the down-move in the GBP/AUD. The GBP is strong, but the AUD being a commodity currency is also strong so we might see a move down as the price is at the confluence and overall bearish. Targets are 1.8002, followed by 1.7965 and 1.7900. The move down in the GBP/USD will also reflect on the GBP/AUD but in a stronger way.

The Analysis has been done with the CAMMACD.Core and Sit Systems

For a look at all of today’s economic events, check out our economic calendar.