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Technical Major Currencies
Written by article default Monday, 16 May 2011 09:01
EuroWeekly Report (May 16-20, 2011)
The pair moved to the downside to break through the critical 1.4150 support, the neckline for the bearish pattern shown above which resides with the 38.2% Fibonacci correction. The breach with a daily closing below it will extend the downside correctional move for the week targeting next 1.3910 which if breached moved the pair to the next correctional level at 1.3665. We will adopt the first target and observe the pair when reaching the target to confirm the next move.
The trading range for this week is among the major support at 1.3790 and the major resistance at 1.4395.
The short term trend is to the upside with steady daily closing above 1.2795 targeting 1.5135.
| Support | 1.4105 | 1.4050 | 1.3980 | 1.3910 | 1.3850 |
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| Resistance | 1.4150 | 1.4215 | 1.4250 | 1.4305 | 1.4395 |
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| Recommendation | Based on the charts and explanations above we recommend selling the pair around 1.4150 targeting 1.3910 and stop loss above 1.4250 might be appropriate this week | ||||
Great British Pound (GBP)
Weekly Report (May 16-20, 2011)
The pair breached the ascending channel’s support followed by breaching 38.2% correction shown above, signaling further downside movement for this week targeting 1.6045 then 1.5880 if the former was breached. Momentum indicators are positive that might push the pair to retest areas between 1.6210 and 1.6255 before reaching the targets. Breaching the latter and stability above it carries the pair to the upside once again.
The trading range for this week is among the major support at 1.5880 and the major resistance at 1.6415.
The short term trend is to the upside with steady daily closing above 1.5315 with targets at 1.7000.
| Support | 1.6160 | 1.6110 | 1.6045 | 1.6000 | 1.5955 |
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| Resistance | 1.6210 | 1.6255 | 1.6300 | 1.6355 | 1.6415 |
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| Recommendation | Based on the charts and explanations above we recommend selling the pair around 1.6255 targeting 1.6045 and stop loss above 1.6355 might be appropriate this week | ||||
Japanese Yen (JPY)
Weekly Report (May 16-20, 2011)
The pair is consolidating within a tight trading range above the breached descending channel’s resistance, which was previously considered a signal for resuming the upside correction. Stochastic is trading within overbought areas that might pressure the pair negatively and keep the volatility evident around the retest 80.60. In general, we see the likelihood for the pair to move to the upside this week which required breaching SMA 50 –currently around 81.75- and also stability with daily closing above 80.60.
The trading range for this week is among the major support at 79.00 and the major resistance at 83.50.
The short term trend is to the downside as far as 89.35 remains intact with targets at 77.70.
| Support | 80.60 | 80.05 | 79.80 | 79.00 | 78.40 |
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| Resistance | 81.75 | 82.50 | 83.00 | 83.50 | 83.90 |
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| Recommendation | Based on the charts and explanations above our opinion is buying the pair with hourly closing above 81.75 targeting 83.50 and stop loss below 80.60 might be appropriate this week | ||||
Swiss Franc (CHF)
Weekly Report (May 16-20, 2011)
The pair’s upside move stopped near the resistance for the descending channel, supported by the 50% Fibonacci correction and the negativity on momentum indicators. Therefore, we see the likelihood for a downside move this week to resume trading within the breached descending channel targeting 0.8740 and 0.8650. Breaching areas of 0.8965 with daily closing above it will extend the upside correction and carry the pair outside the bearish wave mentioned.
The trading range for this week is among the major support at 0.8650 and the major resistance at 0.9150.
The short term trend is to the downside with steady daily closing below 1.0330 targeting 0.8000.
| Support | 0.8850 | 0.8790 | 0.8740 | 0.8650 | 0.8600 |
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| Resistance | 0.8965 | 0.9040 | 0.9105 | 0.9150 | 0.9190 |
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| Recommendation | Based on the charts and explanations above our opinion is selling the pair with the breach of 0.8850 targeting 0.8650 and stop loss above 0.8965 might be appropriate this week | ||||
Canadian Dollar (CAD)
Weekly Report (May 16-20, 2011)
The pair attempted to breach the neckline mentioned in our previous reports at 0.9710 yet the daily closing remains below this level, and we still require stability above this level to activate the pattern’s effect shown above. We have two positive factors which are the stability with daily closing above the descending channel’s resistance, and the stability above the SMA 50 and accordingly we expect a general upside move this week targeting 0.9845 and might extend towards 0.9970. Nevertheless, breaching areas of 0.9600 with daily closing below it will revive the bearish move and negate the expected upside move.
The trading range for this week is among the major support at 0.9445 and the major resistance at 0.9970.
The short term trend is to the downside as far as 1.0665 remains intact targeting 0.9000.
| Support | 0.9645 | 0.9600 | 0.9525 | 0.9500 | 0.9445 |
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| Resistance | 0.9710 | 0.9770 | 0.9845 | 0.9915 | 0.9970 |
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| Recommendation | Based on the charts and explanations above our opinion is buying the pair with hourly closing above 0.9710 targeting 0.9845 and stop loss below 0.9600 might be appropriate this week | ||||