Daily Technical Analysis for Majors by Dukascopy

[KristinaDC]

XAU/USD moves in accordance with pattern

The bullion’s price continues to move in accordance with the discovered patterns. On Thursday morning the commodity price decline to trade below the resistance of the 55-hour SMA, which was located at the 1,240 mark. The metal was making attempts to regain lost ground during the morning hours of the session. However, in accordance with the ascending channel pattern, in which the metal trades, the bullion is set to decline down to the support line of the mentioned pattern. Before that occurs the commodity price might face the support of the 100-hour SMA, which on Thursday was located near the 1,235 mark. Meanwhile, down to the just mentioned simple moving average there are no other support levels, which creates a free range of almost 500 base points.

 

[KristinaDC]

EUR/USD trades above 1.1650

Yesterday, as Mario Draghi spoke, the common European currency skyrocketed against the rest of the markets. After the ECB press conference the EUR/USD currency exchange rate stopped at the upper trend line of the long term descending channel patter near the 1.1560 mark. Immediately afterwards the markets were watching, will or will not the pair break out of the pattern. The result is that the pattern was broken. The breakout resulted in a 100 base point surge. Moreover, it indicates that the Euro is set to continue to score gains against other currencies in the long term. Meanwhile, it has to be noted that the next target for the pair is the combined resistance of a large scale ascending pattern and the 2015 high level near the 1.1710 mark.

 

[KristinaDC]

GBP/USD fluctuates around weekly PP

Thursday’s trading session the currency pair started in a sluggish horizontal movement, being squeezed between the 55- and 100-hour SMAs from the top and the weekly PP at 1.3008 from the bottom. In anticipation of a release of the UK Retail Sales at 8:30 GMT the Pound fell below the above support level towards the 200-hour SMA. But since the data appeared to be better than analysts expected, the pair made a u-turn and started a steady recovery. Accordingly, the second half of the day the rate is expected to spend in attempts to break through the above resistance level, which will be supplemented also by the 20-hour SMA. This scenario is supported by a number of technical indicators, which point out that the pair is oversold.

 

[KristinaDC]

USD/JPY breaks from falling wedge

In line with expectations, the currency pair bounced off from a lower support line near the 111.596 mark and left a falling wedge in an upward direction, bypassing on the way the 20-, 55- and 100-hour SMAs. Such outcome should establish a new uptrend, which will guide movement of the pair at least in next two days. However, for this theory to be true, the currency exchange rate has to bypass two combined resistance levels. The first is formed by the 200-hour SMA and the weekly PP at 113.098, while the second is set up by the weekly and monthly R1 at 113.940. Most probably, one of them will manage to turn around the currency rate, provided that this will not happen even earlier.

 

[KristinaDC]

XAU/USD near 1,250 mark

The yellow metal continues to surprise the bulls. The commodity price was reaching for the 1,250 mark on Friday morning. It was initially expected on Thursday that the metal will decline down to the lower trend line of a medium ascending channel pattern. However, as the metal fluctuated between the 100 and 55-hour SMAs, a fundamental event took place, which influenced the price of gold. As the ECB press conference took place, the massive buying of the Euro and simultaneous selling of the US Dollar caused a spill over. That resulted into the metal breaking the resistance of the 55-hour SMA. Due to that it can be observed on Friday morning that the bullion is most likely going to reach above the 1,250 levels on Friday, as there are no notable strong resistance levels, which might stop it.

 

[KristinaDC]

EUR/USD breaches patterns

Following the massive plunge mid-Friday, EUR/USD breached two patterns simultaneously, namely, an ascending wedge and a longer-term channel up. The pair halted near the 200-hour SMA circa 1.1770— a level which has managed to provide support this morning, as well. It seems that the rate is starting to recover losses, thus approaching a resistance cluster formed by the 55– and 100-hour SMAs. In general, the pair is expected to make a retracement from the bottom channel boundary in the 1.1840/60 area that should be realised within the upcoming 24 hours. Technical indicators suggest that the Euro may remain relatively stable against the Greenback, thus entering a consolidation period between the aforementioned resistance cluster and the 200-hour SMA.

 

[KristinaDC]

GBP/USD calm after fundamentals

The GBP/USD currency pair started Friday’s session rather calmly, being supported by the 200-hour SMA near 1.32. This lack of movement, however, changed at 1230GMT when solid fundamentals from the US altered market sentiment in favour of Dollar bulls. Thus, the Pound ended the previous trading week slightly above the 1.3020 mark and remained in the same range this morning, as well. The aforementioned plunge set the pair in the strongly bearish territory; thus, it is expected that the Pound tries to recover some losses and approach the monthly PP or a resistance cluster formed by the 55– and 200-hour SMAs circa 1.3150. Meanwhile, the lack of market shakers today may likewise keep the pair relatively still, thus resulting in the Pound fluctuating around the 20-hour SMA.

 

[KristinaDC]

USD/JPY reaches 111.00 in wake of fundamentals

Friday morning was characterised by a lack of distinctive movement for the USD/JPY pair, as the rate remained in a relatively small range. Nevertheless, strong US employment data mid-session put an upward pressure on the Dollar that resulted in a 65-pip jump against the Yen. The rate halted at the 200-hour SMA and remained stranded below the given line on Monday morning, as well. Technical indicators suggest that the rate should trade lower within the next 24 hours. This prediction is in line with a channel down pattern which has bounded the US Dollar since early July. No market shakers are expected in this session; thus, the most likely trading range for the given pair is between the 200-, 55– and 100-hour SMAs in the 110.80/40 area.

 

[KristinaDC]

XAU/USD goes below 200-hour SMA

XAU/USD was not an exception for the strong appreciation of the US Dollar in the wake of solid employment data. As a result, the yellow metal fell below the 200-hour SMA into the bearish territory. Subsequently, the pair entered a consolidation period on Monday morning, thus fluctuating near the 1,257.80 mark. The given move has pushed the rate outside a minor channel down which was formed as a wave south in a senior ascending channel. Technical indicators signal to a potential near-term recovery that should push Gold back in the junior channel. Likewise, it is likely that it edges as high as the weekly PP at 1,262.80 and stops near the 200– and 55-hour SMAs. From the downside, the pair is supported by the weekly S1 at 1,251.28.

 

[KristinaDC]

EUR/USD reveals descending pattern

On Tuesday morning a classic pattern was spotted on the hourly chart for the EUR/USD currency exchange rate. Namely, a junior descending channel pattern was spotted in the borders of the dominant ascending channel. In accordance with both of the patterns, various scenarios can occur during the next two trading sessions. Moreover, the close proximity of the simple moving averages of the hourly chart makes the situation more complex. However, in general the currency pair is most likely going to surge up to the upper trend line of the junior pattern, and it will be propelled higher by the 200-hour simple moving average. Afterwards the rate should decline down to the support line of the dominant channel.

 

[KristinaDC]

GBP/USD flat on Tuesday

In line with expectations, GBP/USD was relatively still on Tuesday, as no major fundamental events that could shake the market were scheduled for the given session. As a result, the Pound formed a flat short-term channel down and tested its upper boundary this morning. Meanwhile, the rate remains stranded between the bounds of the 55-hour SMA and the weekly and monthly S1s at 1.3065 and 1.2950, respectively. The Pound may appreciate against the Greenback in this session, testing a resistance set by the aforementioned 55-hour SMA and the monthly PP at 1.3085. Nevertheless, it is likely that yesterday’s lack of momentum may likewise repeat today, thus making no significant changes to the overall price level by Wednesday morning.

 

[KristinaDC]

USD/JPY moves along channel line

On Monday, the US Dollar was driven by neither bears nor bulls, thus resulting in a movement sideways. This stillness was broken this morning when the rate fell down to the 110.60 mark and crossed the 200-hour SMA from above. Thus, it remained stranded in a very narrow range between the 200-, 100– and 55-hour SMAs and the monthly PP in the 110.65/55 area. The previously drawn channel down was shifted to the upside, demonstrating that the Greenback has been quite sticky to the upper channel boundary. This implies that the given currency may eventually breach to the upside. However, it is not yet clear if this move will occur today. For now, the rate is likely to either move sideways near the weekly PP or trade lower along the upper channel line.

 

[KristinaDC]

XAU/USD reaches long term support

On Tuesday morning the yellow metal’s price was trading just above the lower trend line of the long term ascending channel pattern. However, the commodity price was about to face various levels of resistance. First of all the 55, 100 and 200-hour simple moving averages will attempt to keep the bullion lower. The resistance levels are located, respectively, at 1,260.83, 1,263.25 and 1,264.01 levels. Moreover, there is a weekly pivot level located near the 1,260 mark. Due to these reasons market participants should watch, whether the metal’s price breaks through the combined strong resistance or not. As the result of the face off will show the future medium term direction of the commodity price.

 

[KristinaDC]

EUR/USD move into critical zone

The common European currency depreciated against the US Dollar earlier than expected. The currency exchange rate was about to approach the resistance of the 100-hour SMA just above the 1.1820 mark when it suddenly dropped. The reason for the sudden plummeting of the currency exchange rate was the release of the almost never financial markets impacting JOLTS Job Openings. The published data was so much higher than the initially forecasted that the US Dollar skyrocketed all across the boards. For the EUR/USD pair that resulted in the rate reaching the zone near the lower trend line of the long term ascending channel pattern near the 1.1750 mark. It still has to be seen, whether a surge reoccurs or a decline of the pair continues. Clues for that might be on the longer term charts.

 

[KristinaDC]

GBP/USD finds support near 1.2960

After breaching the senior channel down on Monday, the Pound managed to retrace from its upper boundary the following day. The rate found support at a support cluster formed by the weekly and monthly S1s circa 1.2950 and has since edged higher just to reach the 1.30 mark. The strong down-trend that guided the price last week has allayed, suggesting that the Pound may eventually appreciate against the US Dollar in this session. An immediate resistance is provided by the 55-hour SMA at 1.3025, while a more distant upside target for today is an intersection of the 100-hour SMA and the monthly PP circa 1.3000. In terms of a downside limit, the pair is not expected to go below the monthly and weekly S1s.

 

[KristinaDC]

USD/JPY pressured by bears

Despite being sticky to the upper boundary of the senior channel down, the USD/JPY exchange rate failed to move past this level (not taking into account the false breakout mid-session). The pair was located near the 55-, 100– and 200-hour SMAs for most of the session. However, the false breakout resulted in the price crossing all the SMAs and the weekly PP from above. The failed attempt to move above the latter pushed the Greenback even lower until its closing price at 110.33. On Wednesday morning, the rate resumed its fall even below the weekly S1, but managed to reverse near the 109.80 mark. It is likely that the rate tries to approach the upper channel boundary once again, thus remaining between the weekly S1 and PP for the whole session. The given level may be reached on Thursday morning.

 

[KristinaDC]

XAU/USD increases volatility

Fundamental changes form the US Dollar side have taken place in the financial markets. As a result, the price of the yellow metal has changed. In general, the JOLTS Job Openings data was released at 14:00 GMT on Tuesday and revealed such a high number, compared to the average market forecast, that the Greenback jumped. Due to that move the pair sort of reached the lower trend line of the recently adjusted descending channel pattern. Afterwards a rebound took place and the metal was already at the upper trend line of the channel down pattern on Wednesday morning. It still had to be seen whether the metal bounces off the resistance and a short term decline begins or the surge continues. The outcome will be possible to forecast as the bullion moves away from the trend line.

 

[KristinaDC]

EUR/USD bounces off previous support

The Euro traded near the previously active long term ascending channel pattern’s lower trend line on Wednesday against the US Dollar. However, that ended, as soon as the 55-hour simple moving average moved in from the upside to provide resistance. On Thursday morning it could be observed that every candle since then has been red. The Euro is continuing its decline against the Greenback.

In addition, it can be seen that the currency exchange rate made another confirmation of the lower trend line of the descending channel pattern. The pattern was discovered only yesterday. It can be assumed that it will guide the rate lower until a new long term pattern reveals itself.

 

[KristinaDC]

GBP/USD remains stable

No significant changes in GBP/USD was apparent on Wednesday, as the exchange rate remained at a relatively stable level. The Pound failed to surpass the 55-hour SMA on two occasions and therefore remained below the 1.3020 mark for the second consecutive day. Technical signals on Thursday morning suggest that the rate should not breach the weekly and monthly S1s in the 1.2940/60 area. Thus, it may fall down to the given territory and eventually reverse to the upside. Nevertheless, the economic calendar in this session is full of significant events that may shake the market in any direction. This may set today’s possible trading range quite wide—between the monthly PP and the weekly S2 at 1.3085 and 1.2867, respectively.

 

[KristinaDC]

USD/JPY returns near weekly S1

The US Dollar appreciated slightly against the Yen on Wednesday, thus returning near the 110 mark. The rate fluctuated around the given line, but failed to form a distinctive wave north. The expected move upwards may be realised in this session, as the Greenback should approach the upper boundary of either a senior or a junior channel down. Given the relatively stable move sideways, the former is likely to be breached this week. Along the way, the pair faces a resistance set by the 55-hour SMA and a cluster of the 100– and 200-hour SMAs circa 110.30 and 110.50, respectively. In case the 55-hour SMA is breached, the latter should halt the pair for the following 24 hours, leaving it in the 110.20/40 area. Traders should keep in mind that three sets of important data are released today.