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Technical Cross
Written by article default Monday, 11 July 2011 09:16
Weekly Report 11/07 – 15/ 07/ 2011
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One more negative weekly closing was achieved below 100% Fibonacci retracement of CD leg for our caught bearish harmonic butterfly pattern at 130.05. This is another negative technical factor that confirms our previous 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 is still showing bearish signs; whilst Vortex reflects the strength of the bearish trend that started from D point of the aforesaid harmonic formation. Furthermore, the descending channel provides the bearish trend with the protection it needs. Breaching 128.40 zones will accelerate the bearishness anticipated for this week.
The trading range for this week is among key support at 123.95 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 | 128.40 | 127.60 | 126.70 | 125.50 | 123.95 |
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| Resistance | 130.00 | 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 around 129.40 targeting 125.50 and stop loss above 132.00 might be appropriate. | ||||
Euro vs. Japanese Yen (EUR / JPY)
Weekly Report 11/07 – 15/ 07/ 2011
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The second technical objective of 61.8% Fibonacci retracement of the CD leg for our efficient bearish harmonic butterfly pattern at 115.25 was reached easily -check the previous report-. Not only that, but the pair succeeded in reaching the first extended technical target of the pattern at 76.4% as seen on the provided four hour graph. Now, we believe that the technical trip of achieving more extended technical targets will continue during this week but not before relaxing RSI 14. Henceforth, the pair may retest the previous broken 61.8% Fibonacci level before moving to the downside, noting that a clear breakout below the harmonic trend line which connects A, C points and their extensions will cancel out the aforesaid retest process sending the pair directly towards 100% of CD leg followed by 127.2% projection level. There is a technical obstacle at 114.25 which represents a potential support where 88.6% Fibonacci level of CD leg exists.
The trading range for this week is among key support at 110.50 and key resistance now at 118.65.
The general trend over short term basis is to the downside targeting 97.90 as far as areas of 132.50 remain intact.
| Support | 113.90 | 113.50 | 112.80 | 112.40 | 111.60 |
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| Resistance | 115.25 | 115.75 | 116.20 | 116.95 | 117.30 |
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| Recommendation | Based on the charts and explanations above our opinion is, selling the pair around 115.20 targeting 112.80 and stop loss above 116.80 might be appropriate. | ||||
Euro vs. Great British Pound (EUR / GBP)
Weekly Report 11/07 – 15/ 07/ 2011
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It seems that the previous expected bullishness of our caught harmonic 5-0 pattern has been limited around 127.2% of CD leg for this pattern at 0.9080. Now, a new harmonic probability of forming a bearish harmonic AB=CD pattern becomes in favor due to the following negative technical factors:
- The bearish stick sandwich candlestick pattern formed after Friday's closing.
- The negative closing below SMA 20.
- The overbought sign appearing on RVI indicator.
- The obvious bearish sign appearing on AROON.
Despite those factors but we should witness a sustained breakout below 0.8860-0.8850 zones to make sure that the bearishness will continue since those aforesaid levels represent the second technical objective of the entire harmonic formation. Conversely, breaching through 0.8965 will clarify that the bearishness is limited around 61.8% of CD leg.
The trading range for this week is among the key support at 0.8680 and key resistance now at 0.9110.
The general trend over short term basis is to the upside, targeting 1.0000 as far as areas of 0.8420 remain intact.
| Support | 0.8820 | 0.8790 | 0.8760 | 0.8730 | 0.8715 |
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| Resistance | 0.8900 | 0.8925 | 0.8965 | 0.9000 | 0.9030 |
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| Recommendation | Based on the charts and explanations above our opinion is, selling the pair below 0.8850 targeting 0.8720 and stop loss above 0.8930 might be appropriate. | ||||
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