Technical signals from Forex4you

[joaquinmonfort]

GBP/USD: consolidating just under major support

 

Cable's v.short-term trend is unclear, although its short-term trend is down. It has fallen to and temporarily pierced below major support from the upper-border of a triangle situated at about 1.6000. It is currently consolidating just below the border-line, it could go either way in the very short term.

 

A break above 1.6226 would confirm a continuation higher, with the next target at the monthly pivot at 1.6301.

 

Alternatively given the strength of the down-trend, it is also quite possible there might be a resumption of the down-trend. The 1.5951 lows would need to be breached, as well as the S1 monthly pivot at 1.5960. A clear break below these levels, including a 20-pip confirmation margin - so below 1.5940 – would probably confirm a move down to support at 1.5855.

 

http://blog.forex4you.com/wp-content/uploads/2014/10/GBPUSD13.png

[joaquinmonfort]

EUR/USD: v.short-term trend still bullish

 

The EUR/USD pair is in the process of correcting the previous down-trend which started in May a and lasted till the early October lows. There has been a v.short-term bullish reversal on the 4-hr chart with the establishment of two higher highs and two higher lows. This was followed by a pull-back temporarily last Thursday and Friday but yesterday the pair began climbing higher again.

 

In the very short-term I'm cautiously bullish and a break above the monthly pivot, including a 20-pip confirmation buffer - so above 1.2805 – would probably confirm a move higher up to resistance at 1.2855.

 

http://blog.forex4you.com/wp-content/uploads/2014/10/EURUSD14.png

[joaquinmonfort]

USD/JPY: new down-trend extending lower

 

Evidence is growing that this pair is undergoing a bearish reversal: there appears to be a double top pattern at the highs, which has breached its neckline generating a down-target of 105.79. This not far from the S1 pivot at 105.84, another potential support area. There are also now more than two lower lows and two lower highs on the 4-hour chart, indicating that the very short-term trend has reversed.

 

Given the evidence that a new fledgling down-trend has developed I expect it to fall lower. A break below the current 106.75 lows would probably confirm a continuation down to the aforementioned support zones starting at 105.84.

http://blog.forex4you.com/wp-content/uploads/2014/10/USDJPY14.png

[joaquinmonfort]

EUR/USD: sideways consolidation unfolding

 

The v.short-term trend is still technically up but when you look at price action it seems more consolidation in nature. The dollar's rally seems to have run its course for now and investors are not sure whether it will continue or reverse.

 

Whilst the overall trend is down and will probably continue eventually - perhaps to a longer-term target of around 1.2250 - the bullish direction of the v.short-term trend may still play out over the very short-term, with a rise above the monthly pivot at the range highs, including a 20 pip margin – so above 1.2805 - signalling a move higher to resistance at 1.2855.

 

http://blog.forex4you.com/wp-content/uploads/2014/10/EURUSD15.png

[joaquinmonfort]

GBP/USD: new bearish move now below S1 monthly pivot

 

GBP/USD has moved lower, breaking below the previous lows, and extending the short-term down-trend, which began back in July, after the negative inflation data out yesterday parked ambitions the BOE might increase rates before the end of the year.

 

Although price is not falling very strongly - signaled by a lack of momentum and volume - it nevertheless is extending down, and has breached the S1 monthly pivot at 1.5960, no doubt after a battle will bulls, which perhaps explains the lack of momentum.

 

It is expected to continue – first to my previous target at 1.5855, and then perhaps to the next cluster of targets around the 1.5770 level. Therefore, a break below the psychologically significant 1.5850 could yield another leg down to the aforesaid target at 1.5770.

http://blog.forex4you.com/wp-content/uploads/2014/10/GBPUSD15.png

[joaquinmonfort]

EUR/USD: spike higher reafirms v.short-term up-trend

 

EUR/USD spiked higher yesterday after negative U.S data caused global growth fears. The pair posted pinnacle highs at 1.2887, before falling back down to 1.2800, just above the R1 monthly pivot at 1.2785, where it is currently consolidating.

 

The very short-term trend continues to be bullish and is expected to extend. A break above the spike highs at 1.2887 would signal a probable continuation higher, as well as a even stronger major trend-reversal sign. Such a move would probably reach the next important target at the 1.2995 support and resistance level.

 

http://blog.forex4you.com/wp-content/uploads/2014/10/EURUSD16.png

[joaquinmonfort]

USD/JPY: trending lower; consolidating at 50% fibonnacci level

 

The USD/JPY pair sold off sharply on Wednesday, reaching lows of 105.19. It has since rebounded back up to the 105.70s. The v.short and short term trends are now bearish and expected to continue but caution needs to be exercised at current levels which are close to the 50% Fibonacci retracement level of the previous rally, a common level where prices rotate.

 

A clearance of the 50% fib at 105.45 would be required before expecting an extension down. A move below the 105.19 spike lows, therefore, would provide the clearest confirmation of more down-side. The next target would probably be at the 61.8% fibonacci level at 104.35.

http://blog.forex4you.com/wp-content/uploads/2014/10/USDJPY16.png

[joaquinmonfort]

EUR/USD: bullish correction continues

 

EUR/USD continues correcting higher after forming major lows at 1.2499 on the 3rd of October. It spiked higher on Wednesday but that spike-high has not been surpassed since. Nevertheless it crystallised the infant bullish trend visible on the 4hr chart and the pair is now forecast to continue the very short-term trend higher.

 

Keep an eye on support from the R1 monthly pivot at 1.2785 which rates have been respecting. Given continued bullish expectations, I would ideally wish to see a break above the spike highs for confirmation of further upside, with the next target situated at the 1.2995 support and resistance level.

http://blog.forex4you.com/wp-content/uploads/2014/10/EURUSD17.png

[joaquinmonfort]

GBP/USD: correcting back to upper border-line of multi-year triangle

 

The GBP/USD is trading at the level of a major support and resistance supplied by the upper-border-line of a multi-year triangle in the low 1.6100s. On the weekly or lower timeframe charts the exchange rate appears to be below the border-line, however, on the monthly chart it appears to be resting on the line, with a shooting-star candlestick forming, although the month is far from over and the shape of the candle could still change.

 

The down-trend remains dominant and expected to resume and continue lower, however, the fact that the monthly chart looks bullish and we are at such a major support level indicates the possibility of a recovery. I think it could go either way, but I should like to see a clear breach above the triangle border-line at 1.6130, and then above the 1.6225 peak highs for confirmation of more upside. Such a move could lead to a move up to the next target at the monthly pivot at 1.6301.

 

Alternatively a move lower is also possible, with a break below the 1.5874 lows signalling a continuation down to support and resistance at 1.5770.

http://blog.forex4you.com/wp-content/uploads/2014/10/GBPUSD17.png

[joaquinmonfort]

EUR/USD: correction continuing to unfold

 

No real change here: the EUR/USD continues correcting higher in a channel after planting major lows at 1.2499 on October 3. The very short-term trend is bullish and likely to extend. I would want to see a break above the spike highs at 1.2887 for confirmation, with a target at the 1.2995 support and resistance level.

 

On the 4-hour chart there is a possible flag or pendant forming which also suggests the possibility of more upside to a similar target level, although its too early to say for sure.

http://blog.forex4you.com/wp-content/uploads/2014/10/EURUSD201.png

[joaquinmonfort]

USD/JPY: v.short-term trend at pivotal crossroads

 

The trend on all time-frames remains down despite the gap up this morning. There is still a strong possibility that the pair is forming an a-b-c correction (visible on the 4-hour chart), although a break above the current highs at 107.38 would probably reverse the v.short-term trend and lead to a bullish move higher, to a target at the R1 monthly pivot at 107.84.

 

The exchange rate is currently pulling-back down, however, and will probably close the gap at 106.91, although after that it may rotate higher.

 

In the event that the highs are not broken and the down-trend resumes then I stick with my previous forecast that a move below the 105.19 spike lows would confirm a move down to the next target at the 61.8% Fibonacci level at 104.35.

http://blog.forex4you.com/wp-content/uploads/2014/10/USDJPY20.png

[joaquinmonfort]

EUR/USD: right-angled triangle completing

 

The pull-back from the October 3 lows has grown into a mini up-trend, which will probably continue. U.S CPI data released tomorrow, however, potentially provides the impetus for a continuation higher, if it disappoints as many investors expect.

 

There is further bullish evidence from a right-angled triangle forming on the 4-hour chart which favours an eventual breakout to the upside and move up into the 1.29s. This triangle is currently forming its E leg and this could play out today. Once it finishes the triangle will be technically complete. Thereafter I see a possible breakout higher. For confirmation I would want to see a clear move above the triangle upper-border – perhaps for safety with a 20-pip margin – so above 1.2862, confirming a move up to a minimum expectation at the 61.8% extension of the height of the triangle at 1.2925.

 

My previous recommendation of a break above the spike-highs at 1.2887 confirming a move up to 1.2995 still stands except I'd moderate my target to a more conservative 1.2975.

 

Triangles can break either way and, although less probable, a down-side breakout could occur with a move below the 1.2704 lows confirming a wave down to 1.2625.

 

http://blog.forex4you.com/wp-content/uploads/2014/10/EURUSD21.png

[joaquinmonfort]

GBP/USD: border-line of major triangle impeding up-trend

 

Cable continues to recover and push higher. It has reached major resistance from the upper-border of a major multi-year triangle at 1.6210 and is consolidating beneath that level at the moment. There is a possibility that with the release of U.S inflation data out tomorrow it could lead to much volatility.

 

The current very short-term trend is bullish and I expect it to continue rising. The border-line is a major impediment to further upside, however, and for stronger confirmation of more upside I would ideally want to see a clearance of the line and the 1.6226 highs. For extra confidence a move above 1.6235 would be necessary; such a move would probably be expected to reach the 50-day MA at about the 1.6320 level.

 

http://blog.forex4you.com/wp-content/uploads/2014/10/GBPUSD21b.png

Edited October 21, 2014 by joaquinmonfort

[joaquinmonfort]

EUR/USD: breaking down out of triangle

 

The EUR/USD is breaking lower, out of its triangle pattern and also out of the rising channel for the correction. It will probably move down towards the minimum expectation for the triangle breakout at 1.2625 (the 61.8% projection of the height of the pattern). A move below the 1.2700 lows would probably indicate follow-through to the downside.

 

Of slight concern is that important inflation news which has yet to be released but will be published latter today could affect the exchange rate in a volatile way, potentially altering its trend.

 

The v.short-term trend is still bullish so there is a possibility it could resume at anytime and carry prices higher. However, I would want to see a break above the 1.2840 highs, including a 20-pip margin for confirmation. Such a move – above 1.2860 – could probably lead to a continuation higher to the next target at the 61.8% extrapolation of the width of the consolidation at 1.2925.

http://blog.forex4you.com/wp-content/uploads/2014/10/EURUSD22.png

[joaquinmonfort]

USD/JPY: possible bearish Elliot 5th wave completing

 

The USD/JPY could be tracing out a bearish Elliot wave starting from the 110.08 highs. It is currently probably starting the 5th wave down, “(5)” on the chart below, since the bearish resumption on the 20th October.

 

The v. short-term trend remains bearish and a break below the swing lows at 106.24 would indicate a continuation down. The next target would be at the S1 monthly pivot at 105.84, not far below. A move below that including a 20-pip margin for confirmation - so below 105.64 - however, would probably confirm an extension down to the 105.19 lows.

 

Alternatively, there is a possibility that the exchange rate could reverse its v.short-term trend and move higher. A break above the 107.38 highs would indicate a reversal higher. Such a move would offer limited upside potential, however, since the monthly pivot lies not much higher at 107.84, and the exchange rate would probably encounter tough resistance at that level.

 

Indeed it is possible the pair may be in a larger bullish Elliot wave, visible on the daily chart, which began at the July 10th lows, and could be completing wave 4, and be about to start a 5th wave - “5th” on the chart, soon.

 

A break above the pivot, including a 20-point margin, at 108.04 would probably indicate an extension higher with wave 5 moving all the way back up to the 110.08 highs.

 

http://blog.forex4you.com/wp-content/uploads/2014/10/USDJPY22.png

[joaquinmonfort]

EUR/USD: v.short-term up-trend reversing

 

The EUR/USD has probably reversed its very short-term up-trend and the correction from the October 3 lows may have finished. The recent triangle which formed at the highs on the 4-hour chart broke down on Wednesday, and this was a further sign of a reversal of the v.short-term up-trend: price patterns are normally good indicators of trend-change.

 

The move out of the triangle fell to a minimum expectation of a 61.8% extrapolation of the height of the triangle at 1.2625; this level is also at the upper part of a quite formidable support zone. The pair had since started to bounce but the down-trend remains intact and likely to resume eventually.

 

I would expect confirmation of more downside to come from a break below the key October 10 lows at 1.2605, plus a 20-pip confirmation margin, so at 1.2585. This would probably lead to a move down to the major Oct 3 lows at 1.2500.

http://blog.forex4you.com/wp-content/uploads/2014/10/EURUSD23.png

[joaquinmonfort]

GBP/USD: Down-trend intact despite bullish signs

 

Cable has fallen in a strong short-term down-trend ever since the exchange rate hit a peak of 1.71 on the 13th July and rolled over. It has now reached support from the 50.0% fibonacci retracement of the 2013-14 rally and it is possible it could reverse at this level and start to move higher.

 

Other bullish evidence includes a possible head-and-shoulders pattern forming at the lows, but given the right shoulder is unfinished it's too early to say. There is also a long-wick pin-headed hammer on the weekly chart last week - another relatively reliable bullish signal.

 

Until these bullish signs lead to a tangible recovery, however, the down-trend remains intact, and a move below the 1.5874 lows would be a very bearish sign, opening the way to a target at 1.5800 first and then 1.5720 at the 61.8% fib.

http://blog.forex4you.com/wp-content/uploads/2014/10/GBPUSD23.png

[joaquinmonfort]

EUR/USD: down-trend resuming after triangle breakout

 

The v.short-term trend has changed and is now probably bearish after the recent breakout from the triangle and the upwards trend-channel which was forming as the currency corrected back after a long down-trend. Bears seem to have taken control again, however, after yesterday's breakdown.

 

The pair is probably going lower particularly if the exchange rate breaks below Thursday's 1.2613 lows. Support from previous lows not much lower, however, at 1.2605 could could provide a rallying-point for bullish resistance. So ideally I'd want to see a break below 1.2590 for more cast-iron confirmation of further down-side, as this would see bulls completely capitulate and the extension of a probable down-move to a target at the previous lows at 1.2500.

 

http://blog.forex4you.com/wp-content/uploads/2014/10/EURUSD24.png

[joaquinmonfort]

USD/JPY: Elliot 5th wave rising back up to 110 highs

 

The release of higher-than-expected U.S inflation data on Wednesday helped soothe deflation fears and as a result the dollar started rising again. On the chart of USD/JPY below we can see that this lengthened the recovery from the October 15 lows. The v.short-term trend is now in line with the broader longer-term up-trend and it is likely to continue said trend higher.

 

From an Elliot-wave perspective this is the 5th wave of a formation which began in the summer. The recent sell-off down to the 50-day MA was probably a wave 4.

 

The MACD indicator supports this view after peaking at the end of wave 3, falling below the zero line for 4 and now pushing back above the zero line for 5 - which will probably rise up to retouch the 110.08 highs, on lower momentum forming a divergence with price.

 

It is still a long way up to 110.08 so for more conservative traders I would advise a target at round-number resistance at 109.00, with another trade after a 20-pip confirmation gap, at 109.20, leading to the final move up to the 110.08 highs.

 

http://blog.forex4you.com/wp-content/uploads/2014/10/USDJPY24.png

[joaquinmonfort]

EUR/USD: short-term down-trend resuming

 

The short-term trend is still probably down. Yes – we have had a pull-back up to 1.2715 but the mini-up trend higher from the October 3 lows probably ended after the ascending triangle, visible on the 4-hr chart failed, breaking lower instead of higher last Tuesday.

 

The current pull-back which started at Thursday's swing lows looks like it has probably completed and is giving way to the dominant down-trend, which may drive it lower. Later on today there is more event risk as the ECB publish details from their Covered Bond programme, and this may cause more volatility. There is a possibility that a break below the 1.2613 lows could lead to a further move down to the key 1.2499 lows of October 3.

http://blog.forex4you.com/wp-content/uploads/2014/10/EURUSD27b.png

Edited October 27, 2014 by joaquinmonfort

[joaquinmonfort]

GBP/USD: inverted H&S forming

 

With the completion of the right shoulder we now have an almost textbook example of an inverted head-and-shoulders pattern on the 4-hr chart. This has increased the possibility that the short-term down-trend (which began at the July highs), may be reversing and the longer-term up-trend from 2013 could be resuming.

 

Further evidence includes the fact the exchange rate has fallen 50% of the previous rally and that this coincides with a bullish, pin-headed, long-wick, hammer candlestick on the weekly chart.

 

There is now a strong possibility that a break above the neckline of the inverted H&S at 1.6226 could lead to a move higher, however, there is resistance clustered not far above - first at the 50-day MA at 1.6266 and then the monthly pivot at 1.6301. The initial target would be at the MA. A break above the monthly pivot at 1.6301 and a 20-pip clearance, (1.6321), might lead to a move up to the the 61.8% extrapolation of the height of the pattern, at 1.6415 – or even the 100% at 1.6535.

 

Despite all these bullish signs until the neck-line breaks the down-trend remains intact, and a break below the 1.5994 lows would give a strong bearish signal down to the S1 pivot at 1.5960, whilst a 20-pip clearance of that (below 1.5940) would probably reach the 1.5873 lows.

 

http://blog.forex4you.com/wp-content/uploads/2014/10/GBPUSD27.png

[joaquinmonfort]

EUR/USD: v.short-term bearish; possibility of upside eventually

 

After the breakdown out of the triangle a week ago the EUR/USD pair has consolidated. The v.short-term trend remains bearish, however, so the gentle up-trending channel formed over the last few days and visible on the 4-hour chart (first chart below) will probably weaken. A break below the 1.2665 level at the 4-hr hammer lows could confirm a resumption down to a target at the 1.2614 lows.

 

This move down could be setting the scene for strength later in the week, however – possibly as a result of the FOMC. This is due to that fact that the correction of the long down-trend which ended on the 3rd of October lows has so far been unusually weak, and would be expected to go a little higher, eventually. Ultimately I would want to see MACD move above the zero-line on the daily chart (second chart below) *before expecting it to finish. Given, however, that the v.short-term trend remains marginally bearish there is still as yet no basis for recommending a long position.

http://blog.forex4you.com/wp-content/uploads/2014/10/EURUSD28.png

http://blog.forex4you.com/wp-content/uploads/2014/10/EURUSD28b.png

[joaquinmonfort]

USD/JPY: 5th wave unfolding higher

 

After a short pull-back the pair is going higher again. The v.short-term trend continues to rise in line with the broader longer-term up-trend and is likely to extend higher. A break above the 108.35 highs would probably confirm a continuation up to round number resistance at 109.00, and then probably 110.08.

 

On the daily chart it looks as if we are in an Elliot wave 5 higher after wave 3 peaked on the 1st October and 4 came down to make a low on the 15th October. 5 will probably reach at least as high as the top of 3 at 110.08. The MACD supports this after peaking with 3 and then falling below the zero-line with 4; it will now probably make a lower high with 5.

 

http://blog.forex4you.com/wp-content/uploads/2014/10/USDJPY28.png

[joaquinmonfort]

EUR/USD: marginal upside bias pre-FOMC

 

The EUR/USD pair spiked up yesterday after a fall in Durable Goods Orders weakened the dollar. The small channel up which has been forming since last Tuesday's lows is continuing higher, and now I think there is a case for arguing that the v.short-term trend is marginally bullish, given the two higher highs and higher lows on the 4-hr chart.

 

There is some evidence from the MACD on the daily chart that the correction has not gone high enough because it has not yet moved above the zero-line, and its possible that this supports the expectation of higher prices from the v.short-term trend continuing higher, therefore my recommendation is that a move above the 1.2765 highs would confirm a rise to 1.2830. Some caution is advised due to the swell of volatility expected from the FOMC later today.

 

Given the longer-term trend is down, however, a move lower is also a possibility, with a break below the key lows at 1.2663, probably confirming such a break, to a target at 1.2614.

 

http://blog.forex4you.com/wp-content/uploads/2014/10/EURUSD29.png

[joaquinmonfort]

GBP/USD: inverted H&S still forming

 

There is no real change from my analysis on the 27th : the exchange rate has formed an almost textbook inverted head-and-shoulders pattern, and a break above the neckline at 1.6226 would confirm a move higher. Resistance clustered not far above - first at the 50-day MA at 1.6266 and then the monthly pivot at 1.6301- however are obstacles. The initial target would be at the MA.

 

A break above the monthly pivot at 1.6301 and a 20-pip clearance, (1.6321), might lead to a move up to the the 61.8% extrapolation of the height of the pattern, at 1.6415 – or even the 100% at 1.6535.

 

Despite all these bullish signs until the neck-line breaks the down-trend remains intact, and a break below the 1.5994 lows would give a strong bearish signal down to the S1 pivot at 1.5960, whilst a 20-pip clearance of that (below 1.5940) would probably reach the 1.5873 lows.

 

http://blog.forex4you.com/wp-content/uploads/2014/10/GBPUSD29.png