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Price & Time: Cable Bucking the Correction
DailyFX.com -
Talking Points
EUR/USD cracks post FOMC high
US DOLLAR testing key support zone
GBP/USD flirts with important Fibonacci pivot
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Foreign Exchange Price & Time at a Glance:
Price & Time Analysis: EUR/USD
Charts Created using Marketscope – Prepared by Kristian Kerr
EUR/USD broke above last week’s highs to trade at its highest level in three weeks this morning
Our near-term trend bias is positive on the euro while above 1.0760
A move through a Gann level related to the year’s low at 1.1070 is needed to set off a more serious advance
A very minor turn window is seen today
Only weakness below 1.0760 would turn us negative again on the euro.
EUR/USD Strategy: Like buying the euro on dips while 1.0760 holds.
Instrument | Support 2 | Support 1 | Spot | Resistance 1 | Resistance 2 |
EUR/USD | *1.0760 | 1.0920 | 1.1030 | *1.1040 | *1.1070 |
Price & Time Analysis: FXCM US DOLLAR INDEX
Charts Created using Marketscope – Prepared by Kristian Kerr
US DOLLAR has come under steady pressure since failing earlier in the month at 12,150
Our near-term trend bias is lower in the index while below 12,015
A key attraction/reaction zone is seen between 11,885 and 11,830 with weakness below needed to set off a more serious decline
A very minor turn window is eyed today
A close back over 12,015 would turn us positive again on the dollar
US DOLLAR Strategy: Like the short side while below 12,015.
Instrument | Support 2 | Support 1 | Spot | Resistance 1 | Resistance 2 |
US DOLLAR | *11,830 | 11,885 | 11,905 | 11,966 | *12,015 |
Focus Chart of the Day: GBP/USD
Despite all the correction carnage going on around it, GBP/USD has held within a remarkably steady range this week between 1.4830 and 1.4990. The top end of the range marks the 38% retracement of the February to March decline and is a natural near-term pivot. Interestingly last week after the FOMC, Cable ended up settling the day below this key level even after being above it by almost two big figures at one point. If EUR/USD and the rest of the European FX complex can gain traction above their post-FOMC highs (which it looks like they might) will the pound be able to continue to buck these broader corrective forces? It would seem unlikely. A close over 1.4990 over the next coming sessions would be a clear warning sign that the pound is trying to join “the party”. If recent history is any guide it could do so rather swiftly. Weakness back under 1.4830 is needed to keep these corrective forces at bay.
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--- 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 kkerr@fxcm.com. Follow me on Twitter @KKerrFX
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.
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