Thursday 25th February 2021: Technical Outlook and Review

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EUR/USD:

Looking at the weekly chart, we can see that prices are testing the support area of our ascending channel at 1.200, which coincides with the 50% Fibonacci retracement and 78.6% Fibonacci extension. We could see a further upside to test our resistance area at 1.2300, in line with the graphical swing high resistance and 78.6% Fibonacci extension. On the daily time frame, prices are holding nicely above the ascending trend line and support area at 1.200 which can also be found on the weekly time frame.

On the H4 timeframe, prices are facing bullish pressure from our support at 1.20941, in line with our graphical swing low support area and 50% fibonacci retracement. We could see limited upside before price reaches our resistance area at 1.21557, in line with the graphical swing high resistance level. A break above this resistance level could see a further push up to our next resistance target at 1.2300, in line with our resistance level found on the weekly and daily time frame.

Areas of consideration:

  • 20941 support area found on H4 time frame
  • 22157 resistance level found on H4 time frame

GBP/USD:

Looking at the weekly chart, we can see that prices are holding nicely above our ascending trend line and weekly support area at 1.35000 where we could see a further upside to the weekly resistance level at 1.43000, in line with the graphical swing high area and 78.6% Fibonacci extension. On the daily time frame, our support area at 1.39500 coincides with the 38.2% Fibonacci retracement.

On the H4 timeframe, prices are facing bullish pressure from our key support area at 1.40861, in line with our horizontal pullback support, 78.6% Fibonacci extension and 23.6% fibonacci retracement where we could see a bounce above this level towards our resistance target at 1.4300, in line with our 127.2% fibonacci extension which is also the resistance found on the weekly and daily time frame.

Areas of consideration:

  • 4300 resistance area found on weekly and daily time frame
  • 40861 support area found on H4 timeframe

AUD/USD:

From the Weekly timeframe, we can see that the price has pushed past the 0.78207 level where the previous high was made and has closed above that level, signalling the continuation of this bullish momentum. On the Daily timeframe, price has reached the Quasimodo resistance at 0.79749, which is also in line with the 161.8% fibonacci retracement. On H4, AUDUSD has broken and pushed away from the Resistance turned-support zone between major figure 0.79 to 0.79161 towards 0.7956 level, where -27% fibonacci retracement and 100% fibonacci extension are. We can see that price has reversed from the Daily resistance  and is currently testing the previous Resistance turned-support level. As the Bullish momentum strengthens, we may witness the continuation of this trend towards the next H4 resistance level of 0.79963, in line with 161.8% fibonacci extension, 200% fibonacci retracement and the major figure of 0.8.

Areas of consideration:

  • H4 may break push further towards major figure 0.8 after breaking the Daily resistance.
  • Weekly and Daily time frames are showing strong bullish momentum.

USD/JPY

From the weekly timeframe, we can see that price is holding nicely above a steady ascending trendline support. Price is above the support which coincides with the 127.2% fibonacci extension and 61.8% fibonacci retracement. On the daily timeframe, price is also on a steady uptrend and prices have broken past the resistance turned support zone which is also a  127.2% fibonacci extension and 61.89% fibonacci retracement fibonacci confluence zone. On H4, prices are taking support from the ascending trendline as well and have bounced up from previous trendline support which coincides with 61.8% fibonacci retracement. Prices might continue pushing higher from bullish momentum to make a higher high before pulling back to the ascending trendline as it faces resistance from horizontal swing high resistance which also coincides with the 127.2% fibonacci extension level. Prices are also holding above the Ichimoku cloud showing bullish pressure.

Areas of consideration:

  • 05 resistance on the H4 and daily time frame is a possible upside target
  • 921  support level on H4 in line with the ascending trendline support as well as 61.8% fibonacci retracement

USD/CAD:

Looking at the weekly chart, price is currently testing the 2018 Yearly Opening level of support at 1.2579, and is still respecting the descending trendline drawn from 13 April (2020) high. It is important to note that the long-term picture has pointed the direction down (trend) since March (2020). In the daily time frame, price has closed beneath the previous low from 21 Jan (2021) as well as the Weekly support turned-resistance level, and is currently testing the Daily support level at 1.25154. And on the H4 timeframe, we are able to see that price has broken past the 1.2542 support level, in line with -27%, -61.8% fibonacci retracement and 78.6% fibonacci extension, heading straight towards the 1.25063 Daily support level, in line with 100% fibonacci extension before showing a slight bounce. If price makes its way back into the 1.2542 support-turned resistance area for a retest, it could swing lower towards the next support level of 1.2447.

Areas of consideration:

  • H4 may push lower towards 1.1.2447 after retesting 1.2542 support-turned resistance level, or breaking and testing of the Daily support level.
  • Weekly and Daily both showing bearish momentum in the longer-term picture, in line with a bearish view.

USD/CHF:

USD/CHF is showing a strong pullback to test the weekly 0.90500 weekly resistance level, in line with our 78.6% Fibonacci extension and 61.8% Fibonacci retracement levels. However, on the daily timeframe, we can see that price has broken above the 0.90500 level and is now testing the descending trendline and moving average resistances. We could potentially see a stronger push up to test the 0.93000 weekly resistance level, which is in line with our horizontal overlap resistance.

On the H4 chart, price shows a clear break above the 0.90500 weekly resistance level. We note that the Stochastic indicator has just reversed from the 95.63 level where it has reacted from before. We could potentially see a reversal at the next resistance level on the H4 timeframe at 0.91000 level, which is in line with our -27.2% Fibonacci retracement and 100% Fibonacci extension, and a push down towards the 0.89950 support level, in line with our 61.8% Fibonacci retracement and 127.2% Fibonacci extension. Otherwise, should price fail to hold below this level, we could potentially see price making a further bullish move up to test the weekly 0.93000 weekly resistance level instead.

Areas of consideration:

  • Price broke above the 0.90500 weekly resistance level as seen on the daily and H4 charts.
  • 93000 weekly resistance level could be the next level that price could test.
  • Otherwise, 0.89950 support level is a potential downside target for sellers.

Dow Jones Industrial Average:

On the weekly chart, price continues to hold above 31272 resistance. Traders can expect to see price pushing even higher towards the next resistance at 32643. Otherwise, failure to hold above 31272 could mean that this is a fake out and probably pull back towards 29341 support. With no change for the Daily, price continues to hold very strongly above ascending trendline support. Traders should be careful when deciding to trade any short term pullbacks as the bullish momentum on the longer term still remains very strong.

On the H4, price continues edging higher, with bullish pressure from our key support at 31272 and resistance at  32643. We note that Technical indicators continue to show room for further bullish upside. Failure to hold above 31272 could see price swing to 29850.

Areas of consideration:

  • Intraday resistance at32643 level to watch
  • Intraday support at 31272 level to watch

XAU/USD (GOLD):

On the weekly timeframe, gold is still holding above long term moving average support and tested 1764 support, above which there could be a possibility of a bounce reaction. On the daily chart, with price tested and bounced above 1764 support, buyers could possibly consider this level and add to their longs while looking at 1875 resistance as a possible target. Otherwise, we could see price breaking below 1764 and push towards descending channel support at 1670.

On the 4H timeframe, price is now testing graphical overlap resistance and 50% Fibonacci retracement level at 1812. With stochastics testing resistance, we see a medium probability scenario where 1812 resistance could very well see short term intraday sellers coming in with selling pressure to push price towards 1789 support. Otherwise, failure to hold below 1812 will see price test the next big resistance at 1875.

Areas of consideration:

  • 70 Support area on the H4 time frame
  • 71 Resistance area on the H4 time frame

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