Weekly technical analysis for 30.12 – 3.01

IMPORTANT ECONOMIC DATA DURING THE WEEK

EURUSD:

Gap: 9 Pips (bullish)

On H4 we could notice that the price has done three important bullish breaks in three important levels during the last week. First, we noticed that the price is forming a bearish trend (green) which brought the idea that the price might break the blue bullish trend (D1). Suddenly, the price broke through the green trend, then through the already broken red bullish trend and then after the 2-years high, creating a new top at 1.3891. Finally the price found resistance in a level (turquoise), which connects the highest point of the pair (2008) (MN) and the top from 2011 (D1). The price then rebounded and foud support in 61.8% Retracement of Fibonacci. Now the price is still testing this level. In an eventual bounce, the price would probably return to the turquoise resistance, where it would test. If the price breaks through 61.8%, we would probably see it on the blue bullish trend line.

USDJPY:

Gap: 6 Pips (bullish)

After the price broke through its previous top (5-years high) marked with a thick red line, it started following a small bullish trend line (blue), which it tested 4 times. This has distracted the price from the basic 2-months bullish trend (white). The Momentum Indicator is showing that the bullish move is exhausting, so we will probably see an interaction with the white bullish trend. We should not forget that the basic trend is the white line, so since the price has not interacted with it lately, we might see a break in the blue trend and a test on the white line.

GBPUSD:

Gap: 5 Pips (bearish)

This is the third pair, which has broken its top lately. The price is following a bullish trend line (white) for the last 6 months. This trend line twice brought the price to new highs. The last one was during the last Friday, when with breaking its last top, the price created a 28-months high. This confirms the future bullish movement, and the intentions of the price to go long. However, we should not forget that for the past 6 months the price is following the white bullish trend line and we could see a correction to the line at any time.

USDCHF:

Gap: 10 Pips (bearish)

On H4 graph we see that during the last week the price has formed a Double Top Formation and it completed it with giving even more than the expected. Then it came a rebound to SMA 50, which is the current location of the price. If the price breaks SMA50 it will reach the white bearish trend line, where it would test again, or the price could follow SMA50 until they reach the white bearish trend line, which would give additional resistive force. Anyway, since we have these two resistances, the chances to see a bearish move during the current week is big.

AUDUSD:

Gap: 4 pips (bullish)

Last week we set a target on this pair, which was about to be accomplished, when suddenly the price changed its direction and even broke throuh 61.8% Retracement of Fibonacci. Then it did another bearish move with the same size, forming a bearish trend line (light blue). The last bottom the price formed is higher than the previous one (H1), which is a potential signal for a possible break in the trend. If the price breaks the light blue trend line, it could close a Double Bottom Formation (H1), which could change the mood by this pair. The Momentum Indicator is about to cross the 100-level line in bullish direction. Maybe the price would meet the upper level of its bearish corridor (red) after all.

Weekly technical analysis for 23 – 27.12

Important Economic Data during the Week:

EURUSD:

Gap: 1 Pip (bullish)

On D1 chart we notice that after reaching the area of the previous top (purple) around 1.3820, the price has returned for a test to the 45-days bullish trend (blue). Despite of the break the price did, it could not be said that the blue bullish trend is broken yet, although the break is a little bit bigger than the previous ones. We have one signal which supports the bearish thesis: We notice that the Momentum Indicator has done a little bearish cross of the 100-level line. At the same time, we also have one other signal, which supports the bullis thesis: On H4 chart we notce that SMA150 has supported the price, where the price has bounced and has returned in the frames of the blue bullish trend. We would like to say again that despite we are discussing this break, that does not mean that the level is broken. It means that the Forex Market is volatile and such deviations are pretty frequent. The good move here is to wait for the price to take a direction and then to enter.

USDJPY:

Gap: 1 Pip (bearish)

On D1 chart we notice that the price is still following the white 2-months bullish trend and last week the price reached a new high, which is 62-and-a-half-months high. Since the price has shaped a top and has started a bearish movement, we would probably first see an interaction with the white trend before any bullish activity. If you feel experienced and confident enough, you could try trading the rest of the correction, which might end at the interaction point of the white bullish trend and the red line, which indicates the previous top. That could be so, because such scenario will satisfy both of the levels. If right, the correction and the new bullish force would probably happen until the end of the trading week.

GBPUSD:

Gap: 9 Pips (bullish)

On D1 graphe we notice that the price has already tested the white bullish trend line and then it has bounced in bullish direction. Since the price has not reached any significant level, or created some crucial top, we would probably witness a bullish movement until the end of the week. The other scenario is to see another test of the white bullish trend line and then a bullish move again. Furthermore, on D1, H4 and H1, the Momentum Indicator shows clear intentions to break the 100-level line.

USDCHF:

Gap: 3 Pips (bearish)

The completed Double Top Fromation has brought the price back to the white bearish trend. The test point of the trend line maches with 38.2% Retracement of Fibonacci, which is another bearish signal. Furthermore, on H4 and H1 we noticed a Rising Wedge Formation, which was the third signal to go short, and we hope you did it. After these signals, the price bounced and started a new bearish movement. Since the previonus bearish move made the price break the old low, we might now see this scenario repeat. On the other hand, we have the Momentum Indicator, which has just crossed the 100-level line in bullish direction, so we should not lose sight of it.

AUDUSD:

Gap: 6 Pips (bullish)

On D1 chart we notice our completed Head and Shoulders Formation and the bearish corridor, where the price is still located in. Although the Head and Shoulders Formation is fully completed, the price is still located in the bearish corridor. Now the price is in a correction phase and it is moving toward the upper level of the bearish corridor. If you feel confident and experienced enough, you could try trading the rest of the correction. Otherwise, the good move here is to wait for the interaction of the price with the upper level of the corridor. That would probably happen in the next day or two. An eventual bounce would be a great premise to go short again.

Technical Analysis for 16-20.12

IMPORTANT ECONOMIC DATA DURING THE WEEK:

EURUSD:

On the D1 chart we notice that the price has broken the already broken 4-months bullish trend and has reached the 1.3820 area, which indicates the last clearly stated D1 top. After an interaction with the area of the top, the price has returned to the already broken bullish trend line and has bounced from it. The blue trend line and the purple resistance are closing something like a triangle, where the purple resistance is an upper level and the blue trend line is a lower level. This formation would probably determine the further movement of the price. If we see a break through the purple resistance we would probably witness a new top during the current week. On the other hand, if the resistance stands the pressure of the price and we see a break through the already broken blue bullish trend line, this might be a nice premise for the beginning of a beautiful downtrend, which could later evolve in a double top formation.

USDJPY:

The situation by this pair is similar to the one on the EURUSD. A resistance, which indicates the last clearly stated top, and a trend line close a triangle formation. The price is now on the bullish trend line (white). If the price bounces, we would probably see an interaction with the red resistance again, which could evolve in a bullish break and the reach of new highs. On the other hand, we might see a bearish break in the white trend followed by continuous bearish activity. As you see, we have an open short position, which is already on 35 pips profit. The Momentum Indicator shows a slowdown of the bullish activity and it might cross the 100-level line. This gives some weight to the bearish theory, which is the reason not to close the position. Since the price is on the white trend line, we have adjusted our stop loss tight in order to avoid losing our profit in an eventual bounce from the white trend. At the same time, with not closing the position we keep our chances to catch an eventual drop.

GBPUSD:

On D1 chart we see that the price has given the three signals, which indicate a potential change in the bullish trend:
1. A break in the bullish trend and the formation of a bottom outside the trend.ris
2. Turning the trend line from a support into a resistance after the break
3. A bounce and a break in the level which indicates the bottom outside the trend.
These three signals give us a sufficient reason to believe that the price would eventually move in a bearish direction during the week. The Momentum Indicator has just crossed the 100-level line, which supports the bearish thesis.

USDCHF:

On D1 chart we notice that the price has broken through the purple support, which is an indicator of a 2-years bottom. Then we see a return to the purple level and a test as a resistance, where it looks like the level resisted the price. The break and the fact that the level resisted the price gives us a strong reason to believe that the bearish drop would most likely continue. The Momentum Indicator is in the middle between the 100-level line and the lowest possible position, which means that the price could drop even more.

AUDUSD:

The price did a drop last week, following the head and shoulders formation, but it has not reached the lower level of the corridor yet. Since the price has around 40-50 pips more to take until it fully complete the formation, we might see the price on the lower level of the corridor. Probably it is a good idea to pursue the head and shoulders formation to its end with adjusting our stop loss in order to keep the minimal possible risk.

Weekly technical analysis for 2 – 6.12

EURUSD:
Gap: 11 Pips (bullish)

On the D1 chart we see that the price is now located on a level which indicates the last clear top before the one on 1.38365. It is obvious that the uptrend shows a slowdown during the interaction with this level, but that does not mean that the level would resist for sure. We might also see a break in this level, which would give better chances for the price to increase. The Momentum Indicator is also showing an uptrend slowdown, which supports the bearish thesis but on the other hand, with the test on the pink resistance, we see a little bullish break in our bullish turquoise corridor. It could be said that the movement of the price for the current week could be better determined by waiting the next move of the price.

 

USDJPY:

Gap: 13 Pips (bullish)

On the D1 chart we notice that the price has returned for a second test in the area of the red resistance, which indicates the biggest top for the last 5 years. That appears to happen after one of the biggest corrections of the bullish trend lately. If the red resistance stands the pressure of the price, we might see a break in the green trend and a confirmation of a double top formation. Having in mind that three of the most important supports in this case cross in a certain area (the green target), it is possible to see the price there for a test, because together the three supports indicate an area with high importance. Such area could support the price, but could also got broken at once with one single drop. The whole situation by this pair could evolve in a very beautiful trend-changing formation. That could be noticed during the current week if the price finds resistance in the red level.

 

GBPUSD:

Gap: 1 Pip (bearish)

Having in mind that the price found resistance in 23.6% Retracement of Fibonacci (D1) in the area of the already broken purple resistance, which indicates a top with the same high, it could be said that the price is probably temporary testing the purple level as a support. On the other hand the Momentum Indicator warns for a bullish trend slowdown. Maybe we would have clearer bullish picture if the Momentum Indicator makes a small bullish jump in order to confirm any upcoming bullish activity. In general, for now the facts indicate for a bullish activity during the week.

 

USDCHF:

Gap: 1 Pip (bearish)

Om the D1 chart we notice that the price has made a bearish break in our bearish corridor, which supports the idea for a bearish activity, stronger than the expected. After the break the price tries to return with two bullish candles, but we see no effect for now. Another scenario is that the price would test the lower level of the corridor as a resistance and it would increase its bearish intentions even more. On the other hand this could be just a roughness in our bearish corridor and the price could return back in its frames, following the bearish scenario under this angle. With this bearish break the price has reached its previous bottom. Another scenario could be the price to create a big double bottom formation on W1 and to completely change its direction.

AUDUSD:

Gap: 16 Pips (bullish)

On D1 we notice that the price is still moving toward the confirmed head and shoulders formation.  The figure is not absolutely completed yet. The expected target is to the lower purple line. No matter that the price shows bullish activity lately, the head and shoulders formation looks a stronger and more reliable source for a price direction. We still could look for going out around the lower purple line at 0.8884. That might happen during the current week. The long-term bearish activity is a fact as soon as the price is located in the bearish corridor.

Weekly technical analysis for 2 – 6.12

EURUSD:

Gap: 11 Pips (bullish)

On the D1 chart we see that the price is now located on a level which indicates the last clear top before the one on 1.38365. It is obvious that the uptrend shows a slowdown during the interaction with this level, but that does not mean that the level would resist for sure. We might also see a break in this level, which would give better chances for the price to increase. The Momentum Indicator is also showing an uptrend slowdown, which supports the bearish thesis but on the other hand, with the test on the pink resistance, we see a little bullish break in our bullish turquoise corridor. It could be said that the movement of the price for the current week could be better determined by waiting the next move of the price.