Has the short sell-off begun? Yesterday we monitored price as it was falling down towards the monthly 1.4000 key level. We did anticipate a break or bounce scenario after a short bounce price pressured to the downside and broke the support. Since yesterday price has fallen over 70+ pips to the downside as we currently trade at 1.39250. On a shorter time frame, we can also see price using our MA’s as a resistance pushing price further down. Later today we have US consumer confidence that could push further movement into this pair.
Our first resistance target has been achieved as we hit and broke the 1.28000 monthly barriers. Price has been on an extremely bullish run since we broke out of consolidation as shown on the chart, within 3 days we have jumped up 130+ pips to current levels. Our next upside target if the buying pressure continues could target the 1.29800 area, the, however, the price would have to remain above 1.28000 support. We stay clear of CAD news with USD releases today as mentioned above.
EURUSD: Slowly but surely the pair is heading to the projected target zone. Right now there is absolutely nothing to suggest EUR longs as momentum is in the continuation phase from last friday's closure. I see the pair sinking to 1.2150 and beyond (1.2050). These levels may be respected early this week.
GBPAUD: Yesterday there was much indecisive price action around the weekly support: 1.8250. "If we see a Daily Closure above the moving averages then the pair may go long over the next few days"... Which the price action did complete! A Daily break & close above the moving average after support holding firmly. The marked resistance: 1.8370 is extremely important even on an intraday level. A break of this area will lead the price much higher, maybe even back into 1.8500 Monthly resistance. A rejection on the other hand may allow the pair to form a new bearish leg to break weekly support and beyond.
GBPJPY: Yesterday I stated: "Again, just remember that with it being monday.. there is a possible chance for a false move to the upside before the pair continues last weeks bearish momo!" In which has followed through thus far! 152.00 Resistance is a level in which we should watch price action around as my bias is still bearish and we could expect a strong reaction after the early week pullback.
AUDUSD:- After a strong decline in the final few days of last week the pair closed extremely bearish on a weekly timeframe having rejected the 3rd touch of the descending trendline. With multiple confluences now aligning, it is possible that the pair may break lower than the previous support 0.76500. This level will be the determining factor in a break or bounce scenario as we can clearly see highlighted the discrete High lows that have been formed.
EURJPY:- A successful day as suggested in the member's zone on Friday as price pulled back towards the 132.00 level after multiple wick retests of the high resistance zone 133.600. However in the grand scheme of things price has been relatively slow last week with no real indication of bullish or bearish signals in play. We currently look to be responding off the 3rd touch of an ascending trendline, however, a strong daily closure whether we break or bounce will help provide us with a trading bias for the week ahead.
AUDJPY:- A dump on price took us back to the support level of 82.600. A break of this region we see price tumble back towards 82.000 weekly level of support.
USDJPY:- has gapped slightly higher on market open, seeing price start the week at 107.76 having closed last week at 107.62. Through the opening Asian session we have retested last Friday's highs as we flirt with the weekly resistance level of 108.00 and get closer and closer. I believe this level will be met and from here we will see whether we can break this level to push higher to 108.50 or if bears take control and push this pair lower. A break of the counter trend line would be needed to confirm the bears have control and we are not testing the MA's and trend line once again for support before a move higher.
NZDUSD:- Very bearish week last week showing a bearish engulfing candlestick on the weekly chart and we had four consecutive bearish days on the daily chart, signalling a lot of downward momentum. Weekly and Daily chart also now show price having broken my MA's and closed below showing even more weakness on this pair but, and an important but this is, we have reached 0.7200 which we have continuously failed to break for more than two months. We may find some support around this level and pull back, perhaps before making another leg down. This level is key to watch for today and I will be waiting for confirmation of a break on the 4H chart as we may see price push lower to only pull back. Bears are in control on this pair but can they continue is the question, the market has just opened so we need to let the new week settle and watch price action for clues.