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Technical Cross
Written by article default Monday, 04 July 2011 08:09
Weekly Report 04/07 – 08/ 07/ 2011
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Friday's closing below 100 Fibonacci retracement of CD leg for our caught bearish harmonic butterfly pattern at 130.05 is another negative technical factor which confirms our suggested bearish scenario. Our bearish predications are based on harmonic rules where the technical journey of reaching the extended objectives of the pattern is still in progress towards 127.2% followed by 161.8% projections of CD leg. In the interim, Stochastic started to show some kind of exhaustion entering overbought areas; whilst Vortex still reflects the strength of the bearish trend started at D point of the aforesaid harmonic formation. Breaching 129.40 is needed to confirm the scenario suggested for this week.
The trading range for this week is among key support at 125.50 and key resistance at 134.20.
The general trend over short term basis is to the downside, targeting 118.80 as far as areas of 150.75 areas remain intact.
| Support | 129.40 | 128.40 | 127.60 | 126.70 | 125.50 |
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| Resistance | 130.50 | 131.60 | 132.50 | 133.15 | 133.65 |
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| Recommendation | Based on the charts and explanations above our opinion is, selling the pair with a breakout below 129.40 targeting 124.80 and stop loss above 132.50 might be appropriate. | ||||
Euro vs. Japanese Yen (EUR / JPY)
Weekly Report 04/07 – 08/ 07/ 2011
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Breaching 38.2% Fibonacci of the previous suggested Bat pattern-check the previous report- has delayed the resumption of the daily harmonic structure, but studying the four hour time scale has offered a new probability for drawing a potential bearish harmonic pattern connected by the Fibonacci rhythmic seen on the provided graph. Additionally, we can see a negative divergence appearing on RSI 14; whilst AROON started to show signs of trend weakness. Therefore, we believe that the first potential reversal zones at 117.55 may send the pair lower over upcoming sessions; otherwise D2 at 118.60 will be visited before reversing. Consequently, we need to witness a sustained breakout below the pivotal support of 116.90 to make sure that D 1 is efficient enough to pressure the pair negatively.
The trading range for this week is among key support at 113.50 and key resistance now at 121.05.
The general trend over short term basis is to the downside, targeting 97.90 as far as areas of 132.50 remain intact.
| Support | 117.30 | 116.90 | 116.35 | 115.75 | 115.25 |
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| Resistance | 118.00 | 118.35 | 119.10 | 119.85 | 120.50 |
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| Recommendation | Based on the charts and explanations above our opinion is, selling the pair with a breakout below 116.90 targeting 113.60 and stop loss above 118.85 might be appropriate. | ||||
Euro vs. Great British Pound (EUR / GBP)
Weekly Report 04/07 – 08/ 07/ 2011
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The royal pair has closed comfortably over weekly basis above the full correctional of CD leg if our successful bullish harmonic "5-0" pattern as seen on the provided graph. This positive closing has confirmed the technical effect of the pattern which always achieves extended target beyond 100% of the length of CD leg. Now, Stochastic has the ability to force the pair to achieve some kind of correction which will be considered as a preparation process to resume the bullish trip towards the next Fibonacci projection level at 161.8% of CD leg valued at 0.9135 after it succeeded in touching 127.2% which was our first detected technical objective. Note that, areas between the psychological level of 0.9000 and 0.9010 could be the floor where Stochastic will be relieved as well to start the upside wave expected for this week.
The trading range for this week is among the key support at 0.8820 and key resistance now at 0.9280.
The general trend over short term basis is to the upside, targeting 1.0000 as far as areas of 0.8420 remain intact.
| Support | 0.9030 | 0.9000 | 0.8965 | 0.8930 | 0.8900 |
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| Resistance | 0.9070 | 0.9110 | 0.9140 | 0.9175 | 0.9215 |
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| Recommendation | Based on the charts and explanations above our opinion is, buying the pair around 0.9010 targeting 0.9135 and stop loss below 0.8915 might be appropriate. | ||||
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