Technical Forecasts In Currency Markets

Daily Trading Forecasts (December 5, 2012)

The currency instruments have continued their upward journeys, in spite of disturbing figures that are being released from some countries. Though a few pairs and crosses remain in consolidating modes (like the USDCHF and the EURJPY). The developments in the markets remain intriguing; new opportunities are forming on the charts.

EURUSD: The EURUSD had some moderate bullish journey on Tuesday – in spite of the gloomy forecasts by some. The indicators on the chart still support a clean northward bias, though one would need to pay closer attention to the RSI period 14, which is now in the overbought region, i.e., above 70. This might lead to some bearish pullback in the market before the continuation of the upward journey. Since the resistance line at 1.3100 is being battered, the next target would be the line at 1.3150.

USDCHF: The USDCHF is having a very difficult time in finding the next sustained move in the price. The level at 0.9250 has succeeded in halting any further bearish move, at least temporarily. The resistance level at 0.9300 should also prevent any break above itself as well. The EMAs and the RSI period 14 are still giving a strong indication of a bearish bias – unless otherwise indicated. So it is still expected that the price would break the support level at 0.9250 to the downside.

GBPUSD: On this market, there has not been any significant pullback in spite of the fact that the Williams’ % Range is in the overbought level – particularly recently. The EMAs still support the strength of buyers. The prize zone at 1.6100 has already been attacked, and the distribution zone at 1.6150 would be reached when the price goes further upwards.

USDJPY: Yes, there is a brand-new signal on the USDJPY. That signal is: SELL. This has been indicated by the RSI 14 period since the beginning of this week, before it was indicated at the situation happening to the EMA 56. The price is now below the aforementioned EMA (as it goes down lower). The demand territory at 81.50 stands being tested .

EURJPY: The consolidating phase of the EURJPY remains as it is. One big reason for this being that both the EUR and the JPY are strong, and their individual strength is almost not more than the other rival. The price continues to vacillate between the zones at 107.00 and 107.50, while the Williams % Range is trying to head downwards from the overbought region. A strong break outside either of these zones would determine the next movement in the market. Any sign of weakness in the EUR would definitely give the JPY an upper hand.

 

Daily Trading Forecasts (December 6, 2012)

Serious fundamental figures are secluded to be released today. Some have already been released, while others are being awaited. Some of the awaited fundamental figures are: Minimum Bid Rate and ECB Press Conference, affecting the EUR and Unemployment Claims, affecting the USD, including many others. These figures might push some prices out of their ranges today.

EURUSD: The bullish bias on the EURUSD is still intact. The price is currently consolidating to the downside, but it might not go below the support line at 1.3050. When the buying pressure does resume, it would touch the resistance line at 1.3100.

USDCHF: The price has found it difficult to break the support level at 0.9250 to the downside, neither is there any bullish thrust that could even take the price towards the resistance level at 0.9300. The price has been moving sideways since the beginning of this week, and there would be a break above or below any of the aforementioned levels before any sustained movement can occur. However, the bearish outlook remains.

GBPUSD: There is still some northward pressure in this market, which means that the upward bias is still intact. The Williams’ % Range is still moving around the overbought territory perpetually. The price has broken the distribution zone at 1.6100 to the upside. The next target could be the zone at 1.6150.

USDJPY: The bearish signal that was indicated on the chart below has proven invalid as the RSI 14 period moves above the level 50, and the price itself reverts back above the EMA 56. This occurred because of the protracted weakness in the Yen, not because the Greenback is particularly strong. The next target in the upper region could be 82.50 that would be breached eventually, to the upside.

EURJPY: This remains a bull market. All the indicators on the chart back this assumption. The Williams’ % Range is showing continuous abundance of energy on the part of buyers. The price is going upwards steadily, and it could reach the zone at supply 108.00.

 

Daily Trading Forecasts (December 6, 2012)

As expected, fundamental figures that came out on Thursday pushed some prices out of their ranges. Are these mere significant pullbacks and rallies in the context of current biases? Or do they portend the beginning of new trends? One thing is certain: should the corrections that started yesterday continue for just a few days, they would render the current biases useless.

EURUSD: There was a serious bearish breakout on this pair, and it was something that took away all the bullish gains in the market. The price plummeted by over 120 pips, staying below the line at 1.3000. Currently, the RSI 14 period is below the level 50. Only further bearish plunge of a few more days would render the present bullish scenario totally useless.

USDCHF: Finally and ultimately, the ranging USDCHF broke out of its range. We can see that from Monday to Thursday (this week), the price had refused to go below the supply level at 0.9250 (that was a unique bottom), even when the EURUSD was going up. The price rose by 80 pips on Thursday, causing the RSI 14 period to go far above the level 50. Should this upward thrust continue today, I would be willing to open a long trade on November 9, 2012.

GBPUSD: The Cable dropped on the USD sudden gain of stamina, by over 70 pips. This forced the Williams’ % Range to fall back from the overbought region to the oversold region in a single day! Should the price succeed in staying below the distribution zone of 1.6050, it would eventually go to the accumulation zone of 1.6000, and this can cause the trend to form a bearish confirmation pattern.

USDJPY: The USDJPY was not that affected by the corrections that happened on Thursday. What could have caused a noteworthy pullback would be an exponential weakness in the USD. But both the USD and the JPY are strong right now. As revealed in the last Daily Trading Forecast, the indicators on the chart support a bullish scenario: this is still valid.

EURJPY: The EURJPY cross yielded to gravity and plunged by over 110 pips. This was very much supported by the Williams’ % Range that dropped from its overbought region to the oversold region (just as it was done on the GBPUSD). The price is now trading below the supply zone at 107.00, and should it continue trading lower and lower, the present bullish scenario would be rendered invalid.

 

Daily Trading Forecasts (December 10, 2012)

In most cases, the markets closed on Friday (December 7, 2012) with bearish tone, and opened with gaps in this week. The gaps are worthy of notice, because they portend the possibility of serious and volatile movements in the markets. The bearish tone has been expected, and it is still valid.

EURUSD: There is a bearish signal on the EURUSD – something that is expected to continue this week. The EMA 11 has crossed the EMA 56 to the downside, while the RSI 14 period has crossed the level 50 to the downside. The price could reach the support level at 1.2850 this week.

USDCHF: There has been an indication to go long in the market. The pair is now above both the EMA 11 and 56, as the RSI stays above the level 50. The price is projected to reach the resistance level at 0.9400 this week.

GBPUSD: Following a period of consolidation last week, this pair broke downwards with panic selling, and given the continuation of the selling pressure, the long-term bullish scenario has been rendered invalid. Since it is expected that the bearish pressure would continue, a bearish confirmation pattern is awaited; after which a short trade would be opened.

USDJPY: The USDJPY keeps on going in a range – though the upward scenario is still something valid. As long as the price stays above the EMA 56, and the RSI period remains above the level 50, the bullish possibility holds. If the price falls below the EMA 56, it would be a bearish signal.

EURJPY: The EURJPY is also going downwards as the bullish outlook is being threatened. The Williams’ Percentage Range is in the oversold condition. Should this continue, a ‘sell’ signal would be in place.

 

Daily Trading Forecasts (December 11, 2012)

Gaps are a phenomenal price action, often followed by continuation or reversal movements in the markets. The gaps that occurred at the open of the markets this week proffer unique possibilities (especially as they appeared on hourly and 30-minute charts). Firstly, significant movements would happen this week. Secondly, what happened on Monday shows that the markets could reverse, i.e. in favor of the EUR and GBP.

EURUSD: Contrary to the signal that was generated last week (which was bearish), this market traded upwards on Monday. Given the conditions on the indicators on the 4-hour chart, the bearish outlook is still valid, though precariously. Whatever happens today will determine what would probably happen for the rest of this week. Should the market move significantly upwards. It would mean the end of the current bullish scenario.

USDCHF: Whatever happens today on the USDCHF would be valid for the rest of this week. There is still a bullish signal; as it started appearing last week, but the price action of yesterday poses a serious threat to bullish continuation. The bullish conditions on the indicators are still vivid, but they would be rendered useless, should there be some southward plunge.

GBPUSD: Here, there is a ‘buy’ signal – something that is still valid. The EMA 11 is still above the EMA 56, though the Williams’ % Range gives something of a mediocrity in value. When the EUR becomes strong, the GBP would follow suit. This means that the price should not find it difficult to reach the distribution zone at 1.6100.

USDJPY: This pair still ranges – with some traces of bullish determination. This means that should there be a breakout, it would be more probably to the upside. The define ranges are currently the upper and lower territories at 82.50 and 82.00. When there is a break out of either of this, the next price movement would be determined.

EURJPY: The situation on this market remains tricky; requiring some tact. The bearish signal that was generated yesterday was quickly challenged (and could be potentially rendered useless). Yesterday, the price attempted to rally, and as the rally continues, the present bearish situation becomes useless, especially if the price goes above the EMAs.

 

Daily Trading Forecasts (December 12, 2012)

As it was forecasted, the price actions that were brought about by the gaps that occurred this week have been in favor of the EUR and GBP, while going against the USD and JPY. The markets are trending strongly right now; as it is typical of the next few days following gaps in the markets.

EURUSD: There has been a serious bullish pressure on the EURUSD. There is currently a neat trading signal, coming with the bullish confirmation pattern. The price is above the EMAs 11 and 56, while the RSI period 14 is above the level 50. The price could reach the resistance line at 1.3050.

USDCHF: There is a bearish confirmation pattern on this pair. The RSI 14 period is below the level 50, and the price is trying to cross both the EMAs to the downside. Should this bias continue for the rest of today, it might lead to further short-selling, as the price goes to break the support level at 0.9300 to the downside.

GBPUSD: The Cable has cruised upwards by up to 120 pips in this week. On the 4-hour chart, there is a bullish confirmation signal, as the price goes above the 2 EMAs, being ready to touch and possibly break the distribution zones at 1.6150 to the upside. The Williams’ % Range is in the overbought zone – indicating very strong buying pressure.

USDJPY: As it was forecasted yesterday, the USDJPY did break out of its defined range; in favor of bulls. This was made possible since the bullish signal itself was still valid when the pair was in that protracted range. The indicators on the chart have given more northward strength. The territory at 82.50 was broken northwards – the price could reach the supply territory at 83.00.

EURJPY: This cross rose up sharply in this week – out of the indecision it saw at the beginning of the week. It has risen by more than 160 pips, in a significant bullish context. The price is pushing up through the supply zone at 107.00. Should this prove successful, the next target would be the supply zone at 107.50.

 

Daily Trading Forecasts (December 13, 2012)

With the significant, and sometimes volatile movements in the markets, more fundamental figures would be released today. Some of them are Libor Rate, SNB Monetary Policy Assessment, SNB Press Conference (affecting the CHF); Core Retail Sales m/m, PPI m/m, Retail Sales m/m (affecting the USD), and many more. These figures are expected to have impact on the markets.

EURUSD: There is a minor retracement on this pair – bearish in nature. This is understandable since the pair is not expected to go in a straight line. Right now, the price is staying above the line at 1.3050. If the bullish pressure resumes, it might reach the resistance line at 1.3100.

USDCHF: The support level at 0.9250 has rejected further bearish plunge, albeit temporarily. When the price resumes its southward bias, it could break that support level to the downside, going towards the level at 0.9200. The trend remains bearish.

GBPUSD: This pair, which presumably should be weak in December of every year, is now retracing downwards in the context of the current bullish scenario. The bullish scenario is still valid, though the Williams’ % Range is showing an overbought situation. The accumulation zone at 1.6100 should halt any further bearish retracement.

USDJPY: The USDJPY is relentless in its bullish effort. The RSI period 14 is already over the level 70 (overbought condition). The territory at 83.50 is under attack; the next target would be the supply at 84.00, after the market breaks the territory at 83.50 to the upside.

EURJPY: This cross is also relentless in its northward journey. Like most other JPY pairs, this move has been significant (more than 250 pips right now). The price zone at 109.00 has even been breached to the upside, and the next supply zone to be tested would be 109.50.

 

Daily Trading Forecasts (December 14, 2012)

This week has been great so far. The currency instruments trend strongly, as pairs and crosses form higher highs and lower highs (lower lows and higher lows in downtrends). These biases could continue; even some pending corrections are understandably something transient and transitory in the current biases.

EURUSD: The EURUSD has moved up by over 180 pips this week. This is a bull market. The EMA 11 is above the EMA 56, as the RSI 14 period is above the level 50. The price could reach the resistance line at 1.3100 eventually.

USDCHF: This is a bear market – it has fallen by over 120 pips this week. The EMA 11 is below the EMA 56, and the RSI 14 period is almost going into the oversold region. There are more support levels to be breached to the downside, say, 0.9200 and 0.9150.

GBPUSD: The price on the Cable is currently having a pullback into the accumulation zone of 1.6100 (which could halt further pullback below that zone). This must happen because the Williams’ % Range was recently in the extremely overbought region. As long as the price is above the EMA 56, the long signal is intact.

USDJPY: The USDJPY has gone above the territory at 83.50, as predicted. The upward possibility is still very much potent. Should buying pressure continue today or next week, the supply territory at 84.00 would also be breached to the upside. Any bearish correction that could occur is expected to be short-term in nature.

EURJPY: This cross has already gone up by more than 300 pips! The bullish outlook remains stable, even if there is any pullback (that could happen in a near-term). The supply zone at 109.50 is under siege, and when it is broken upwards, the price would continue to the supply zone at 100.00 – a great psychological level.

 

Daily Trading Forecasts (December 17, 2012)

The currency instruments trended strongly last week and ended the week as such. This week, the recent trends are expected to continue, irrespective of corrections (pullbacks and rallies in the near-term), which are normal.

EURUSD: Last week, the EURUSD moved up significantly, closing at 1.3161, with the indicators on the chart giving clean bullish confirmation. This bias could continue this week. Should this happen to be true, the pair would reach the resistance line at 1.3200, though the RSI 14 period that has gone into the overbought area signifies the possibility of a pullback.

USDCHF: This pair plummeted last week, closing at 0.9168. All indication on the chart points to a bear market. The fact that the RSI period 14 is now in the oversold area could bring about a probable short-term rally, yet the southward outlook is expected to continue. Should this happen to be so, the price would reach the support level at 0.9100 this week.

GBPUSD: The Cable was volatile last week, - though to the upside. It moved up by more than 140 pips, with the indication on the chart supporting buyers’ supremacy. The price is above the distribution zone at 1.6150, and could reach the zone at 1.6200, especially with the continuation of the current outlook.

USDJPY: The USDJPY trended strongly last week. But it gave up some of that week’s gain in a bearish correction that occurred last Friday. However, the northward outlook is still valid, and the trend ought to go on this week. The supply territory at 83.00 could halt further bearish attempts.

EURJPY: This cross moved up by more than 350 pips last week, and it closed at 109.90. The bullish outlook is still valid, but right now the price is having some difficulty in penetrating the supply zone at 110.00 upwards. Should this attempt prove to be possible, the price would reach the supply zone at 111.00 this week.

 

Daily Trading Forecasts (December 18, 2012)

Nearly all JPY pairs (including certain crosses) opened with gaps at the beginning of this trading week. This means that JPY pairs would move significantly this week and probably to the downside, based on the price action that was observed on Monday. Other currency instruments could continue their biases.

EURUSD: This market moved sideways yesterday – as the RSI period 14 stayed flat in the overbought region. The bullish bias is still valid. The price is resting on the support line at 1.3150, and if the support line could not be broken downwards, the price could go up towards the resistance line at 1.3200.

USDCHF: Like the EURUSD, this pair also traded in a range on Monday. The bearish signal is still extant, and the RSI period 14 remains in the oversold region. There is a resistance level at 0.9200, and should the level hold any possible bullish attempt, the price would fall further.

GBPUSD: This instrument did not range-traded on Monday; rather, it moved upwards. The northward bias is now very strong. The price stays above the EMAs 11 and 56, and the Williams’ % Range stays in the overbought area. The distribution zone at 1.6200 remains is besieged, and when it is broken, the price could go on to the zone at 1.6250.

USDJPY: There is a significant gap on this market, after which it traded downwards. This means two things. Firstly, this market would move considerably this week. Secondly, the price could go downwards, reaching the demand territory at 83.00 this week.

EURJPY: This cross also experienced a significant gap, followed by some plunge in the market. This could be a threat to the current bullish signal, and should this prove to be true, the price could reach the demand zone at 109.00 this week. But it would have to break the demand zone at 110.00 to the downside first.