Wednesday 12th May: Technical Outlook and Review

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EUR/USD:

Looking at the weekly chart, we can see that prices are seeing further limited upside before it reaches our resistance area at 1.22000 – 1.22800. On the daily chart, prices are near our resistance area at 1.2200 where we could see a limited upside here. 

On the H4 timeframe, prices are facing bullish pressure from our support level at 1.20631, in line with our graphical overlap support and 61.8% retracement where we could see a further upside above this level, with 1.22218 as our next resistance target. Failure to hold above the 1.20631 support could see a swing towards our next support target at 1.19893. 

Areas of consideration:

  • 1.22218 resistance area found on H4 time frame
  •  1.20631 support area found on H4 time frame

GBP/USD:

Looking at the weekly chart, we can see that prices are facing bullish pressure from our ascending trend line and support at 1.36622 where we could see a further upside above this level to our resistance target at 1.43000, in line with the 78.6% fibonacci extension. The daily time frame echoes the same bullish view as well where we could see a limited upside above our support level at 1.38000 with 1.43000 as our resistance target. 

On the H4 timeframe, prices are facing bullish pressure from our support at 1.39871, in line with the 50% fibonacci retracement where we could see a further upside above this level with 1.42200 as our resistance level. Failure to hold above our support level at 1.39871 could see price swing towards our next support target at 1.39230. 

Areas of consideration:

  • 1.42200 resistance area found on H4 time frame
  • 1.39871 support area found on H4 timeframe

AUD/USD:

From the Weekly timeframe, price has tapped and reversed from resistance at 78.6% fibonacci retracement and extension level of 0.79018. From the daily timeframe, we see that price has closed up its gap from yesterday and is currently retesting the previous swing high level where resistance turned-support.

On the H4 timeframe, we see price approaching 0.78100, in line with Daily resistance turned-support, 61.8%, 127% fibonacci retracement and 61.8% fibonacci extension as well as previous major level of 0.78. And using fibonacci retracement on the last move, we could see how price has reversed from 0.78419, in line with 61.8% fibonacci retracement. If price continues to push lower, the complete move is done when price hits the -27% fibonacci retracement, in line with our next port of call for a long towards where the previous high and weekly resistance are 0.78991, in line with major figure 0.79.

Areas of consideration:

  • H4 is pulling back to 0.78100 support area before pushing up towards 0.78991.
  • Daily and weekly time frames showing bullish momentum and more space towards the upside.

USD/JPY:

From the weekly timeframe, prices are facing resistance from horizontal swing high resistance which coincides with 50% Fibonacci retracement and 78.6% Fibonacci extension, taking support from 104.224 level which is in line with 78.6% Fibonacci retracement and 78.6% Fibonacci extension. On the daily time frame, prices are facing support from 108.425 level which coincides with 61.8% Fibonacci retracement and 50% Fibonacci extension. Prices might bounce towards daily resistance level 110.978 in line with 78.6% Fibonacci retracement. Daily EMA is also below prices, showing a bullish pressure for prices.

On the H4 timeframe, prices have broken out of descending trendline resistance and came back to retest the descending trendline resistance and is taking support from the daily support level of 108.425 level. Prices might push up towards 110.978. If prices push down further, prices might take support from 106.916 level which is also in line with 161.8% retracement. 

 Areas of consideration:

  •  On the H4, prices might push up towards 110.978 daily resistance level
  • Price are taking support on 108.904 level on both the daily and weekly timeframe

USD/CAD:

The weekly chart shows price breaking below the support level at 1.21198, in line with the -61.8% fibonacci retracement and horizontal graphical swing low taken from 11 september 2017. From here, we may see a further drop down towards the horizontal swing low from 11th May (2015).

In the daily time frame, we are seeing similar pictures where there’s more space for bearish movement.


The H4 timeframe we are able to see that price reversed off the 1.20786 level, in line with 78.6% fibonacci extension, where it may return to 1.21339, in line with the weekly support turned-resistance, 61.8%, 127% fibonacci retracement level. From there, we can expect a bearish continuation towards the weekly support at 1.19993

Areas of consideration:

  • The weekly and daily time frame shows a break in the strong support level and continuation of the bearish move.
  • On H4, price may pullback towards 1.21339 before swinging towards next support at 1.19993

USD/CHF:

USD/CHF is now testing the weekly 0.89800 support, in line with 61.8% Fibonacci retracement and 78.6% Fibonacci extension. The daily chart shows that price is now holding below the key daily 0.92300 support-turned-resistance, and has also broken below the ascending trendline support-turned-resistance. The weekly 0.89800 support level is a key level to watch.

On the H4 chart, we can see that price has made a small bounce at the weekly 0.89800 support area, which is in line with 78.6% Fibonacci retracement level as well. We note that Stochastics has also reacted at the 3.41 lower support level, showing signs of bullish pressure. The weekly 0.89800 support area will be an important intraday level to watch. We could see a further pullback to the upside to test the 0.90800 resistance in line with 100% Fibonacci extension. However, if price were to break and close below the 0.89800 level, we could see it push lower to test the next 0.87600 weekly support.

Areas of consideration:

  • The 0.89800 weekly support is a key intraday level to watch.
  • We could see a pullback to test the 0.90800 resistance, or a further push down to test the next 0.87600 weekly support.

Dow Jones Industrial Average:

On the weekly chart, price pushed higher, and closed above previous weekly resistance. With price holding above long term moving average, we can expect further bullish pressure above 32765 support. On the daily chart, price pulled back lower but continues to hold above moving average and also above ascending trendline support. It is possible to see buyers add to their longs above 33800 support with upside target at 35970 resistance. Otherwise, price could also swing the other way towards 32180 support.

On the H4, price dropped lower and is currently testing moving average support and 34270 support. With technical indicators still showing room for further bullish momentum, it is possible to see price face bullish pressure and push higher towards 35970 weekly resistance. Otherwise, breaking below 34270 will see price drop towards 33800 daily support.

Areas of consideration:

  • Technical indicators across all timeframes confirm bullish momentum
  • Watch daily support 33800

XAU/USD (Gold):

On the weekly timeframe, price pushed higher, closing above previous weekly resistance. We could see renewed bullish pressure this coming week. On the daily, price is still capped below daily descending trendline resistance. Price could see bearish pressure below 1850 resistance. Otherwise, a daily close and break above 1850 could see price push higher towards weekly resistance at 1965.

On the H4, price traded sideways and is now holding between 1850 daily resistance and 1822 support. A break of either of this level could see price push higher towards 1867 resistance or drop towards 1800 support. We prefer to remain neutral for now.

Areas of consideration:

  • Stochastic on H4 is testing resistance

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