Daily Technical Outlook

[ajpipsmaker]

GBPUSD left me annoyed today with an unexpected move lower.
This was due to a possible leak of the inflation data.
The pair has finally found support at around the 1.6350, which is a crucial support zone.
Tomorrow's inflation data for the UK may play a key role for the pair in the short to medium term.
I will be looking to buy dips in the pair.
I am still learning these moves in the market.

 

[katetrades]

GBP/AUD Pullback Play (January 14, 2014)

After its strong selloff in the past few days, GBP/AUD seems ready to make a retracement to an area of interest. On the 1-hour time frame, it can be seen that the broken support level is right in between the 38.2% and 50% Fibonacci retracement levels, making it a good sell area.

Stochastic is still climbing though, which means that the pair has momentum to climb before resuming its selloff. Setting a short order at 1.8250 with a stop above the 61.8% Fib level and a target at the previous lows near 1.8000 could yield a good return on risk.

By Kate Curtis from Trader's Way

 

[katetrades]

AUD/JPY Showing Momenutm (January 16, 2014)

Thanks to Australia’s weaker than expected jobs data, AUD/JPY finally broke below that short-term consolidation on the top of the falling channel on its 4-hour time frame. At the same time, the yen could continue to gain ground as risk aversion has been driving currency movements.

Stochastic is in the oversold region though, indicating a potential bounce, but this might only last until the top of the channel or the bottom of the box pattern.

Shorting at market with a stop above the channel or 100 pips and aiming for the bottom of the channel around 90.50 could yield a good return on risk.

By Kate Curtis from Trader's Way

 

[katetrades]

AUD/JPY Falling Channel (January 17, 2014)

AUD/JPY is on its way towards the bottom of the falling channel on the 4-hour time frame. A bounce might be in the cards since stochastic is indicating deeply oversold conditions.

The pair could find support at the 91.00 major psychological level, which is in line with the bottom of the channel. If you plan to go long at this area, set your stop below the bottom of the channel or below the previous lows.

Aiming for the middle of the channel could give at least a 1:1 return on risk while aiming for the channel resistance around 93.00 could mean a 2:1 return on risk.

By Kate Curtis from Trader's Way

 

[katetrades]

Trend Line Break and Retest on USD/JPY (January 20, 2014)

USD/JPY has confirmed the potential downtrend, after it made a retest of the broken trend line support last week. This could mean that further losses are in the cards for the pair.

Take note though that stochastic already reached the oversold zone, indicating that a bounce is still possible in the near term. If you’re looking to ride the downtrend, you can sell at market with a stop above the retest of the trend line. Aiming for the previous lows can still offer a 1:1 return on risk, good enough for a short-term trade.

If you’re bullish on this pair though, a bounce could take place once the pair tests the previous lows around the 103.00 major psychological support level.

By Kate Curtis from Trader's Way

 

[katetrades]

NZD/USD Countertrend Play (January 21, 2014)

NZD/USD is forming a rising channel on its 1-hour time frame, after having bounced off the bottom near the .8200 major psychological support. The pair has moved past the middle of the channel after the New Zealand CPI release and is on its way to test the top around the .8400 mark.

Shorting at the channel resistance or at .8400 with a stop above the previous highs and a target at the bottom of the channel could yield a high return on risk for a medium-term play. Stochastic is already in the overbought zone, indicating that bears are ready to sell this pair again soon.

To protect profits and minimize exposure, you can adjust your stop to entry once price hits the middle of the channel around .8300.

By Kate Curtis from Trader's Way

 

[katetrades]

EUR/USD Reversal Pattern (January 22, 2014)

EUR/USD’s recent selloff might soon be over, as the pair formed a double bottom on its 1-hour time frame. This is a classic reversal pattern and the uptrend could be confirmed once the pair breaks above the neckline of the formation.

Right now, the pair is still testing the neckline resistance around the 1.3600 major psychological level while stochastic has reached the overbought zone. Take note though that the oscillator hasn’t crossed down yet though, which suggests that there’s still enough buying momentum left.

A long order above the neckline around 1.3600 could be a good entry area. Setting the stop below the 1.3550 mark with a target of 100 pips, which is roughly the same size as the chart pattern, could yield a 2:1 return on risk.

By Kate Curtis from Trader's Way

 

[katetrades]

CAD/JPY Rising Channel Break (January 23, 2014)

CAD/JPY might be in for more losses, as the pair just broke below the support of the rising channel on its 4-hour time frame. Stochastic is already in the oversold zone but hasn’t crossed upwards, indicating that sellers have enough momentum to push the pair even lower.

Shorting at market with a stop above the channel support and a target of the previous lows around the 92.00 major psychological level could yield a high return on risk for a quick day trade.

Bear in mind that the BOC just hinted that they are ready to cut interest rates if inflation remains weak and the Loonie remains strong.

By Kate Curtis from Trader's Way

 

[katetrades]

Resistance Turned Support on GBP/JPY (January 24, 2014)

GBP/JPY has made a stellar rally in the past few trading days, thanks to improved fundamentals in the UK. However, yesterday’s yen strength triggered a sharp selloff, which could simply be a retracement for this pair.

Right now, the pair is finding support at a former resistance level around the 171.50 minor psychological level. Stochastic has reached the oversold zone and climbed out, indicating that buying pressure is back.

Going long at market with a stop below the latest bounce or 171.50 and a target of the previous highs around 173.50 could yield a good return on risk for a short-term trade.

By Kate Curtis from Trader's Way

 

[katetrades]

AUD/USD Retracement Setup (January 27, 2014)

AUD/USD suffered a sharp selloff towards the end of last week, when the world economic leaders in Davos confirmed that a slowdown is in the cards for the emerging nations. It didn’t help that China also printed a weaker than expected HSBC manufacturing PMI reading.

AUD/USD broke below the .8800 major psychological level but might pull back to this area before heading any lower. The 50% Fibonacci retracement level lines up with the former support area around .8775. If this area holds as resistance, the pair might make its way back to the previous lows around .8700.

Shorting at .8775 with a stop above the 61.8% Fib level and a target of .8700 could yield a decent return on risk for a day trade.

By Kate Curtis from Trader's Way

 

[katetrades]

AUD/JPY Potential Pullback (January 28, 2014)

AUD/JPY recently made a sharp selloff on global growth concerns and risk aversion but the pair seems ready to make a quick retracement. On the 4-hour time frame, the 61.8% Fibonacci retracement level of the latest swing high and low lines up with the former support area above the 91.00 major psychological level.

Shorting at this level with a stop above the previous support and a target at the recent lows around 88.50 could yield a high return on risk. Stochastic is still moving out of the oversold region, indicating that bulls are in control at the moment. Waiting for the oscillator to cross down before entering a short trade could be a conservative trade decision.

By Kate Curtis from Trader's Way

 

[katetrades]

USD/CHF Rising Channel Forming (January 29, 2014)

USD/CHF seems to be on the start of an uptrend on its 1-hour time frame, as a rising channel is beginning to form. The pair just found support at the bottom near the .8950 minor psychological level and might be on its way to test the top.

Stochastic is pointing up, indicating that bulls are in control at the moment. However, the oscillator is close to reaching the overbought zone, which suggests that bears might take over soon. If that’s the case, USD/CHF might encounter resistance around the middle of the channel near .9050.

Going long at market with a stop below the previous low and a target of the top of the channel around .9200 could yield a good return on risk. To protect profits or minimize exposure ahead of the FOMC statement, one could adjust the stop loss to entry later on.

By Kate Curtis from Trader's Way

 

[katetrades]

NZD/USD Approaching Range Support (January 30, 2014)

The RBNZ decided to keep interest rates unchanged at 2.50%, much to the disappointment of Kiwi bulls expecting to see policy tightening. The pair sold off after the event but might be due to find support at the bottom of its 4-hour range.

Stochastic is still pointing down, indicating that bears are in control, but a bounce might take place around the .8100 to .8150 levels. Going long at this area with a stop below .8100 and a target of the middle of the range around .8300 could yield a 2:1 return on risk.

By Kate Curtis from Trader's Way

 

[katetrades]

GBP/USD Potential Bounce (January 31, 2014)

GBP/USD is still on an uptrend on the 4-hour time frame, as can be seen on the rising channel on the chart. The pair is selling off but might be ready to find support at the bottom of the channel.

Stochastic is already moving out of the oversold region though, which indicates that pound bulls are ready to push the pair back up. Going long at the bottom of the channel around the 1.6400 major psychological level with a tight stop below the channel and a target at the top of the channel could yield a high return on risk.

Moving the stop to entry once price reaches the middle of the channel around 1.6550 can help reduce exposure and protect profits in case price reverses.

By Kate Curtis from Trader's Way

 

[katetrades]

USD/CHF Channel Holding (February 3, 2014)

The bottom of USD/CHF’s channel held last week, as risk aversion was still present in the trading markets. The pair is currently moving towards the middle of the channel, which might act as medium-term resistance.

Take note that stochastic is already in the overbought zone, which means that price might be ready to dip later on. If that’s the case, it could fall back to the bottom of the channel and find support around the .9000 major psychological level.

On the other hand, if the risk-off environment carries on for the next few days, USD/CHF might still make its way to the top of the channel around the .9200 major psychological level.

By Kate Curtis from Trader's Way

 

[katetrades]

USD/JPY Potential Retracement (February 4, 2014)

USD/JPY recently broke below the 102.00 major psychological support level and dipped below the 101.00 mark this week. However, with stochastic reaching the oversold region and crossing upwards, dollar bulls may be back in action for the near term.

If that happens, the pair could retrace to the former support zone, which is around the 61.8% Fibonacci retracement level. Cautious traders can wait for reversal candlesticks or for stochastic to reach the overbought zone before shorting around 102.00.

A short order at 102.00 with a 50-pip stop and a 100-pip target would yield a 2:1 reward to risk.

By Kate Curtis from Trader's Way

 

[katetrades]

NZD/USD Divergence Play (February 5, 2014)

Thanks to strong New Zealand jobs figures, NZD/USD made a stellar rally in the past trading session and climbed back above the .8200 handle. However, the pair might be encountering resistance right at that area, which has acted as a support level in the past.

At the same time, price has made lower highs while stochastic drew higher highs, forming a bearish divergence. Stochastic is already moving out of the overbought zone, hinting at a potential short-term selloff.

If that happens, the pair might be on its way to test the former lows around the .8100 major psychological level. Shorting at market with a 100-pip stop and a target of .8100 would be a 1:1 return on risk.

By Kate Curtis from Trader's Way

 

[katetrades]

GBP/JPY Double Bottom (February 6, 2014)

A classic reversal chart pattern has formed on GBP/JPY’s 1-hour time frame, indicating that the recent selloff is almost over. However, the pair has yet to make a break above the neckline of the formation before a rally is confirmed.

Take note that stochastic is already in the overbought zone and looks ready to cross down, which means that a bit of consolidation or pullback might be in the cards before an actual upside break.

Going long above the 166.00 major psychological resistance with a stop around 165.00 or lower and a target of 200 pips could make close to a 2:1 return on risk. Bear in mind that the chart pattern is roughly 200 pips in height, which suggests that the potential breakout could be of the same size.

By Kate Curtis from Trader's Way

 

[katetrades]

USD/JPY NFP Setup (February 7, 2014)

USD/JPY might be in for a bit of consolidation in the trading hours leading up to the US non-farm payrolls release. Another weak figure is expected, as cold weather conditions could weigh on the employment change figure for January.

If that’s the case, the support turned resistance area around the 102.00 major psychological level might hold as a barrier for further rallies. Stochastic is already in the overbought zone, which suggests that dollar bears are ready to push the pair back down.

Shorting at market if the NFP figure comes in below consensus and aiming for the previous lows around 101.00 with a tight 50-pip stop could yield a 2:1 return on risk for a quick day trade.

By Kate Curtis from Trader's Way

 

[katetrades]

GBP/USD Trend Line Retest (February 10, 2014)

GBP/USD just broke below the long-term rising trend line on its 4-hour chart recently but appears ready to make a pullback before resuming its selloff.

The pair has bounced off support at the 1.6300 major psychological level earlier in the month and has pulled up to the 38.2% Fibonacci retracement level on the latest swing high and low. Stochastic is already indicating overbought conditions, which means that the downtrend might resume soon.

Shorting at the test of the trend line around the 1.6450 minor psychological resistance or at market around the 38.2% Fib level with a stop back above the trend line could yield a high return on risk if one aims for new lows. Moving the stop to entry once price tests the former lows around 1.6300 is a good way to reduce risk.

By Kate Curtis from Trader's Way