Talking Points
- Price & Time covers key technical themes daily and can be delivered to your inbox each morning by joining the distribution list: Price & Time
- EUR/USD holding above key support
- USD/JPY fails at key Fibonacci retracement
Get real time volume on your charts for free. Click HERE
Foreign Exchange Price & Time at a Glance:
Price & Time Analysis: USD/JPY
ChartPrepared by Kristian Kerr
- USD/JPY traded to its highest level in two months last week before reversing sharply at the 88.6% retracement of the June - July decline near 125.20
- Our near-term trend bias is higher in the exchange rate while above 124.00 (closing basis)
- A move through 124.70 is needed to alleviate some of the immediate downside pressure and re-instill upside momentum in the pair
- A minor turn window is eyed tomorrow
- A daily close under 124.00 would turn us negative on USD/JPY
USD/JPY Strategy: Like the long side while over 124.00 (closing basis).
| Instrument | Support 2 | Support 1 | Spot | Resistance 1 | Resistance 2 |
|---|---|---|---|---|---|
| USD/JPY | 123.55 | *124.00 | 124.35 | *124.70 | *125.20 |
Price & Time Analysis: NZD/USD
ChartPrepared by Kristian Kerr
- NZD/USD continues to have difficulty with the 1x2 Gann angle line of the May high (currently near .6570)
- While below .6570 our near-term trend bias is lower in the exchange rate
- A daily close below .6500 is needed to set off a new leg lower towards a long-term Fibonacci attraction around .6400
- A minor turn window is seen tomorrow
- A daily close over .6570 would turn us positive on the kiwi
NZD/USD Strategy: Like the short side while below .6570
| Instrument | Support 2 | Support 1 | Spot | Resistance 1 | Resistance 2 |
|---|---|---|---|---|---|
| NZD/USD | *.6390 | *.6500 | .6570 | *.6570 | .6650 |
Focus Chart of the Day: EUR/USD
I’ll state the obvious. Developed market FX is range bound. Some traders love these type of markets, others hate them. I definitely fall in the latter camp, but this is largely a function of my reliance on time cycles. When the markets get stuck in these ranges time analysis becomes a bit more muddled. EUR/USD is a good case in point. The low a couple of weeks ago fell right on a nice turn window related to the June high while last week’s high came right on a turn window related to the July low. Which is more important? I can’t say that I know and that is always a big problem for practitioners of cycle analysis in range bound markets. The plus side is that when we do finally overcome one of these swing points it should prove significant and set up a decent trend move. I suppose the pain trade is higher on a move through 1.1215, but probably only marginally so. Under 1.1000 would begin to turn the chart structure negative, but only a clear break of 1.0845 invalidates the positive cycle at work over the past couple of weeks.
To receive Kristian’s analysis directly via email, please SIGN UP HERE.
--- Written by Kristian Kerr, Senior Currency Strategist for DailyFX.com
This publication attempts to further explore the concept that mass movements of human psychology, as represented by the financial markets, are subject to the mathematical laws of nature and through the use of various geometric, arithmetic, statistical and cyclical techniques a better understanding of markets and their corresponding movements can be achieved.
To contact Kristian, e-mail instructor@dailyfx.com. Follow me on Twitter @KKerrFX
