EUR/USD

Due to the combination of increased market confidence with the Euro currency and geopolitical concerns with the US dollar, the dollar fell to a 4-month low against the Euro. ECB officials shared comments about how their interest rates are still below historical levels. These remarks, along with additional comments of a strengthening Euroland recovery, helped the Euro skyrocket over 170 pips today. Supposedly, this is the start of a bull run, but I'm still skeptical. With the FOMC meeting nearing, we could be in for a wild ride these next two weeks.
Risk aversion is another theme that seems to be playing out in the markets right now since nobody is really sure what's going to happen with the ongoing argument between Iran and the West regarding Iran's nuclear activities. Iran might be put on trial in front of the UN Security Council where they might be spanked with economic sanctions mainly meaning they won't be able to sell their oil. This could be bad news for the world as doom-and-gloomers are saying if Iran can't sell their oil, then oil supply will become so tight, that barrel prices might reach $100! Stay tuned to your world news channel this week. We could be in for some interesting news.

Weekly Chart

Yee haw! We're finally getting some movement with this pair. On this weekly chart, it managed to rise above it pink 50 EMA. Keep in mind that this candle hasn't not closed yet, so it's still possible for the pair to fall back under its 50 EMA. We'll have to wait until the end of the week, but if the pair closes above the pink 50 EMA, I'm looking for it to rise up to its blue 100 SMA and the 38.2 Fib retracement level (highlighted in purple).

Daily Chart

Check out how this pair sliced through three resistance areas (top of its channel, its purple 200 SMA, and its 61.8% Fib line) like a hot knife through butter! Next stop? I'm eyeing that next Fib line off course. Short-term support right now is its 61.8% Fib line. The pair has closed above its 200 SMA. This is huge. It hasn't done this since May of last year. Could this be the start of a bull run?

Since the pair was able to close above its purple 200 SMA, here are some price levels where it might rise. If you look to your left, I've highlighted the pair's previous highs in red. This is where I see the pair headed if it continues to go up.

4 Hour Chart

I've squished this 4-hr chart so you can see the beginning of the channel formation. It looks like it's broken out of it now. Let's zoom in to try and guess where it's headed.

I've applied Fibonacci extension levels on this chart to see how high this baby will go. For now, the pair has hit resistance at its 76.4% Fib line.
This is what will happen because I'm psychic. The pair will probably fall and try to break back into its old channel but will find support (red oval) and rise back up and test its 100% Fib line (purple oval). Whenever this pair breaks out of its channels, it get scared because it's out of its comfort zone, and tries to return back into the channel, but eventually gains the required confidence to leave its old channel behind.

GBP/USD

Weekly Chart

Here's a chart that's still developing. Right now, it has broken above its 23.6% Fib line and seems like it's going to test its pink 50 EMA soon. If this pair is able to do that this week, look for it to rise up to its next Fib line at 38.2%

Here's another weekly chart that's in the works. It's found support on its top Fibinnel. It's now eyeing that pink 50 EMA, then its blue 100 SMA.

Daily Chart

Check out this daily chart. The pair closed about its 50% Fib line. It wants to touch its purple 200 SMA. This area along with its 61.8% Fib line is a strong resistance area. Will be able to break above this area? We'll have to wait and see.

4 Hour Chart

If this pair decides to continue its ascendancy, this is where I see it going. I don't know exactly where it'll stop but I believe it'll be at one of those Fib extension levels. My prediction? I think it'll have trouble when it reaches the 1.8000 level. Or not.

USD/JPY

Weekly Chart

The way things are going right now in the market with the dollar selling off, it looks like this pair might test the bottom of the channel. The purple 200 SMA and pink 50 EMA also provide additional support. If the pair is able to close below these resistance areas though, look for it fall to its blue 100 SMA.

Here's another weekly chart. The 38.2% Fib retracement level along with the bottom of the ascending channel is acting as good support here. As long as the pair doesn't drop below this Fib line, I'm still looking for it to rise to its 23.6% Fib line.

Daily Chart

This daily chart tells a different story though. The pair is currently below its blue 100 SMA and pink 50 EMA and looks like it's going to try and test its support level at the 76.4% Fib extension level.If it's able to close below this Fib level, I'm going to sell this pair and target its 100% Fib level especially since additional support is provided by its purple 200 SMA. My stop loss would be placed above the 61.8% Fib line.

Here's the daily chart with Fibonacci retracement levels. The same story here. It looks like the pair will try and test its support at the 61.8% Fib level. If it closes below this Fib line, it will drop to its 200 purple SMA. Looking at this chart, I'm not convinced of any bullish movement unless it's able to close above its 38.2% Fib level.

4 Hour Chart

Now that I've seen this chart, I don't know what to think. The pair has now fallen back into its old sideways channel. Until the price has closed below the bottom of the sideways channel, I'm not even going to think about shorting. And unless the price rises back into its most recent sideways channel and breaks and closes above it, I don't see any good long trades.

Comments (0) | Email to a friend | Printer friendly version