Currency Index Notes
- Bullish candlestick pattern showing sharp reversal, but expecting momentum to fade as price approaches 1.59 or the region between 78.6% and 100% of the bearish flag retracement.
- Alternate view is that price could possibly turn around and just push higher.
Conclusion: Safer to leave AUD pairs alone this week and see what price action dictates.
- After the previous week’s bearish engulfing pattern, price followed through with a bearish close last week.
- Major risk comes from the dynamic support of the 52-week EMA and the trend line as well as the support/resistance at 1.6145
- Canadian Dollar could probably resume its uptrend as long as the piercing line’s low near 1.6017 is not breached.
- Daily charts formed a Doji on Thursday and then resumed its larger short term down trend. Supported by 200-day EMA
Conclusion: Follow up with daily candles for reversals above 1.6017
- Price broke down from the trend line and testing support at 1.891. Could expect a retracement back to break out level at 1.9213 before the bearish trend resumes.
- Plotted the next likely support zone on break of 1.891
- Daily charts bounced off 1.891 support with a small body, indicating a short term reversal quite likely.
Conclusion: Follow up to daily charts and look for bearish reversals from 1.9213
- Last week broke out from the support zone near 2.283 but not a conclusive break out.
- Could potentially see a retracement back to 2.30, the break out level ahead of further declines.
- Daily charts closed in a doji so short term reversal imminent.
Conclusion: Look for longs in the very short term of wait for better higher prices to short from.
- Bearish follow through after the hammer pattern. Second week of declines.
- Daily charts formed a doji at 200-day EMA, but bounces are likely to be limited.
- Expect a minor rally back to the upper trend line of the triangle
Conclusion: Stay aside GBP this week
- Break out from the trend line with a bearish close. Expect Yen to strengthen this week until it targets 60.63 zone of support/resistance.
- Daily charts formed a pullback but then closed lower on Friday. Expect continued weakness.
Conclusion: Look to taking short positions on Yen pairs.
- Weekly charts was bullish but price currently at previously established resistance level.
- Daily charts formed a bearish dark cloud cover pattern with a higher open than previous close. Appearance of this near the resistance zone indicates short term declines in Kiwi.
- 1.4855 indicates short term support level for declines.
Conclusion: Look to short NZD this week against stronger currencies only.
Weekly closed with a sharp and perfect textbook doji. Appearance of this at the top indicates a short term reversal of sentiment.
Daily charts formed a hammer few days ago and short positions recommended only on close below this level at 1.9132.
Conclusion: Look to daily charts for a daily close below 1.9132 to short the USD.
Ideal Currency Pairs to trade this week
NZDJPY: Based on the daily charts forming a bearish engulfing near resistance zone and the interim strength in the Yen. Look to hold short positions within the week. Look for short entries near 93.05, targeting 92.1
EURUSD: Long, targeting 1.2
AUDUSD: Long, targeting 0.8535, but look for trading at break even