Previous Articles

Written by Sam Shenker Currency Analyst

EUR/USD - Euro bulls held their ground against the greenback and managed to push the pair higher as the price action is becoming reminiscent of a showing match. Euro longs maintained their defensive positions with a minor support at 1.2797, an Apr 5 daily low, followed by an intermediate support at 1.2757, Nov 5 spike low, which combine to protect the major support at 1.2729, a 2005 low and the gatekeeper to the 1.2490 level, a 61.8 Fib of the 1.1760-1.3667 euro rally.

A break down of the 1.2490 may see the pair retest the 1.2000 figure, which marks the 2004 summer range lows. Dollar bulls fortified their defenses in the wake of the euro's countermove with the minor resistance at 1.2890, a 78.6 Fib of the 1.2730-1.3482 euro rally, which is further reinforced by a 5-day SMA at 1.2897. An intermediate resistance at 1.2918, a 10-day SMA currently defends the major resistance at 1.2971,a Mar 25-31 consolidation range high. Oscillators are mixed, with Stochastic continuing to be extremely oversold at 8.98 on the daily chart and is traveling toward the overbought line at 57.8 on the dealer (4HR) chart. RSI at 30.83 continues to skim the oversold level on the daily and is neutral at 48.44 on the 4-hour chart. MACD remains below the zero line on the daily chart and followed through with a bullish crossover below the zero line on the dealer (4HR) chart.

Key levels

USD/JPY - Yen bounced of the channel's upper boundary and is currently pushing the dollar longs toward the lower channel's boundary in the latest countermove against the greenback. As yen longs continue to advance against the greenback they will encounter a minor support established by the dollar bulls at 107.73, a 5-day SMA. An intermediate support is seen at 107.50, channels lower boundary, which defends the major support at 107.25, a 10-day SMA. If dollar longs manage to stage a countermove, they will encounter a minor resistance at 108.85, channel's upper boundary, which protects an intermediate resistance at 109.14 an Oct 11 daily low. A breakout above the lesser resistance levels will encounter the major resistance at 109.92, a 61.8 Fib of the May-Jan yen rally. The 109.92 remains a tempting target for the dollar longs as it defends the 111.48, a start of the Nov-Dec yen rally. Indicators are mixed. Stochastic remains extremely overbought on daily chart at 93.42 and is neutral at 48.80 on the dealer (4HR) chart. RSI remains above the overbought line on the daily at 76.53 and is dipping below the overbought line at 55.87 on the 4-hour chart. MACD continues to travel above the zero line on daily chart and made a bearish crossover above the zero line on the dealer (4HR) chart. 
 
Key levels


GBP/USD - Sterling continues to lead the charge against the greenback in the latest counter move by majors against the greenback. Advancing pound bulls will encounter a minor resistance at 1.8863, a Jan 7 spike high, with an intermediate resistance at 1.8915, a 50.0 Fib of the 1.8505-1.9328 sterling rally establishing the next round of defenses, which is being further reinforced by the 20-day SMA at 1.8934. A further push by the sterling longs into the dollar held territory will encounter a major resistance at 1.8983, established by the Apr 1 spike high. Currently a bullish crossover of the 5-day and the 10-day SMA's is lending a further support to the advancing cable bulls. With their latest advance, the pound longs tightened their defenses, with a minor support established at 1.8754, a 10-day SMA. An intermediate support at 1.8704, an Apr 4 low, currently defends the major support at 1.8611, a key 78.6 Fib of the 1.8505-1.9328 cable rally. Indicators are mixed with Stochastic about to leave the oversold territory on the daily chart at 28.17 and is extremely oversold the dealer (4HR) chart at 84.49. RSI remains neutral on both daily chart at 43.06 and the 4-hour chart at 56.4. MACD is getting ready for a bullish crossover below the zero line on the daily chart and is treading along the zero line on the dealer chart.        

Key levels


USD/CHF - Swissie bulls launched a counter move against the dollar positions and managed to recapture some of the territory previously lost to the greenback. Battle lines are being redrawn with Swissie longs pushing toward the dollar defenses at 1.2016, a minor support created by the 10-day SMA. An intermediate support at 1.1961, a 61.8 Fib of the 1.2262-1.1474 Swissie rally, protects the major support at 1.1900, a Mar31-Apr 1 double spike low. In case of the counter move, the dollar longs will encounter a minor resistance at 1.2094, a 78.6 Fib of the 1.2262-1.1474 CHF rally, which is also marked by a reversal signal, a Doji star candlestick pattern. Further resistance can be seen at 1.2146, an intermediate resistance established by the Apr 4 high. Major resistance at 1.2209, Jun 12 daily spike low, remains intact, as dollar bulls continuously failed to retest the 1.2262, a 2005 high and a gateway to the 1.2519, a 78.6 Fib of the 1.2849-1.1288 CHF rally. Oscillators are mixed with Stochastic remaining extremely overbought at 87.3 on the daily chart; with a dealer (4HR) chart Stochastic oversold at 22.76. RSI continues to tread below the overbought line on the daily chart at 64.16 and is treading sideways at 47.95 on the 4-hour chart. MACD is above the zero line on the daily chart and made a bearish crossover above the zero line on the dealer chart.          

Key level




Technical Overview



Chart of the Day - EUR/JPY

4/06
EURJPY continues to swing within a large channel and is also consolidating within a large triangle. The latest swing toward the channel's upper boundary is beginning to fail and the subsequent channel's breakdown (currently favored) will see the cross retest the major support at 137.30, a 50.0 Fib and a triple bottom. The subsequent breakdown will seethe EuroYen test the next major support at 136.30, a 38.2 Fib and the triangles lower boundary. Indicators are mixed, punctuating the low volatility conditions, a pre-breakout setup. Stochastic is neutral at 46.77. ATR is extremely low, indicating a contracting range. ADX(DMI) is at 16.43, far below the 25, pointing to a lack of trend.  

03/14
EURJPY came back and retested the offers around the 140.00 level, failing to reach the upper boundary of the channel, creating a failure swing reversal setup. The breaking of the lower channel boundary may carry the aggressive bears to the 138.32, a key 61.8 Fib of the 141.61-133.00 yen rally.  Aggressive Bulls may be bidding the cross at 139.40, the channels lower boundary as the EURJPY still remains in an upward momentum. Aggressive Bears may try to short the pair at 140.50, a resistance created by the Dec 14 spike high, breaking the resistance may see the cross retest its all time high of 141.61, which may give the bears another shorting opportunity. Any further upward momentum may carry the EURJPY into an uncharted territory of multiple all time highs. Oscillators are telling an interesting story as Stochastic is overbought at 79.46 and showing a bearish divergence with a lower high, while price is making a new short term high, which aggressive bears may interpret as a shoring opportunity. A bearish divergence will be confirmed if the cross breaks the lower channel boundary and penetrates the support at 139.00. ADX is climbing at 23.6, approaching 25 indicating a trending market. ATR is low, as volatility fell indicating a shrinking range, which in most cases precedes a breakout and indicates a trending market.

Technical Levels - London/New York