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Technical Overview: EUR/USD, GBP/USD, USD/CAD And USD/CHF

By:
Anil Panchal
Updated: May 24, 2016, 12:07 UTC

EUR/USD During last week, hawkish FOMC minutes and slew of upbeat comments from Fed policymakers dragged the EURUSD to close below 50-day SMA for the

Technical Overview: EURUSD, GBPUSD, USDCAD And USDCHF

EUR/USD

During last week, hawkish FOMC minutes and slew of upbeat comments from Fed policymakers dragged the EURUSD to close below 50-day SMA for the first time since late-February. The pair maintained its downturn on following days and is presently seems an inch closer to its 100-day SMA support level of 1.1160, which if broken can further extend the southward trajectory to 1.1100 & the 50% Fibonacci Retracement of its December 2015 – May 2016 upside, near 1.1065, closely followed by the broader ascending trend-channel support of 1.1050. Should the pair drops below 1.1050, the 1.1000 mark can act as an intermediate halt for its plunge towards 1.0830 support. If the pair refrains from breaking the 100-day SMA mark of 1.1160, the 1.1240 is likely an immediate resistance that it could aim during bounce-back, clearing which 1.1280 and the 50-day SMA level of 1.1320 may try to restrict its further upside. Further, a sustained trading above 1.1320 needs to clear the 1.1360 mark, comprising 23.6% Fibo, before propelling the pair to 1.1450-55 resistance.

GBP/USD

gbpusd

Unlike all other majors, the GBP stands tall against its US counterpart; however, short-term descending trend-line resistance, near 1.4635, might hold its immediate up-moves captive. Should the pair surpasses the 1.4635, the 1.4700 and the May month highs around 1.4770 are likely consecutive barriers it needs to clear before aiming for the 1.4800 mark, encompassing 61.8% FE of its April – May upside. On the contrary, a dip below 23.6% Fibonacci Retracement of its February – May north-run, at 1.4550, can trigger pair’s corrective moves toward 1.4470. Given the pair’s extended decline below 1.4470, the 1.4410-20 area, including the 38.2% Fibo and immediate upward slanting trend-line, becomes important for the pair traders to watch, which if broken negate chances of its near-term advance and can drag the prices to 1.4330 and the 50% Fibo level around 1.4300 mark.

USD/CAD

usdcad

Even as the USDCAD maintains it’s up-move beyond 50-day SMA and trades beyond six week highs, a short-term ascending trend-line, being part of a “Rising-Wedge” like formation, might restrict its further up-move around 1.3225-30. If the pair refrains from respecting the 1.3330 mark, the 50% Fibonacci Retracement of its May 2015 – January 2016 upside, near 1.3300, and the 200-day SMA level of 1.3360 are likely landmarks that it could mark. Though, pair’s profit booking moves from the present levels can have 1.3070 and the 1.3020 as immediate supports, breaking which confirms the nearby bearish pattern which then can drag the prices to 50-day SMA level of 1.2920 and the 1.2800 mark. Given the pair’s extended downside below 1.2800, the 1.2750 becomes a small barrier to crack prior to testing the 1.2600 support level.

USD/CHF

usdchf

Following the break above 0.9790 – 0.9800 resistance-zone, the USDCHF managed to clear 100-day & 200-day SMA confluence and is presently trades around more than two month high. Looking at the present overbought RSI, chances are brighter for the pair’s pullback towards 0.9870 immediate support, breaking which 38.2% Fibonacci Retracement of its May – November 2015 upside, near 0.9845, quickly followed by the SMA confluence region of 0.9830-35, becomes strong enough to limit its downside. If the pair declines further below 0.9830, it can revisiting the 0.9800 – 0.9790 horizontal region, which if cleared tames possibilities of near-term advance and can make the pair vulnerable enough to test 50% Fibo level of 0.9700. Meanwhile, pair’s successful encounter of the immediate 0.9950 resistance can swiftly propel it towards 1.0000 psychological magnet and then the 23.6% Fibo level of 1.0030. However, a downward slanting trend-line resistance of 1.0120 might hold the pair’s further upside beyond 1.0030 captive.

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About the Author

An MBA (Finance) degree holder with more than five years of experience in tracking the global Forex market. His expertise lies in fundamental analysis but he does not give up on technical aspects in order to identify profitable trade opportunities.

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