Technical Update – EURGBP, EURJPY, EURCAD and EURAUD

EURGBP

The pair seems to have found some support near 0.6935-30 area, marking 61.8% Fib. expansion level and also coinciding with a short-term descending trend-line support. This descending trend-line support seems to constitute towards formation of a bullish reversal pattern, Falling Wedge, on daily chart. Hence, from current levels the pair seems more likely to make a fresh attempt to move back above 0.7000 round figure mark and test an intermediate horizontal support turned resistance near 0.7060-65 area. A decisive move above this immediate resistance is likely to be followed by a further up-move towards its next major resistance near 0.7150-60 area, marking another descending trend-line resistance forming the upper trend-line of the bullish Falling Wedge chart pattern. Meanwhile on the downside, 61.8% Fib. expansion level near 0.6940-20 zone might continue providing immediate support for the pair. A decisive weakness below this strong support and a subsequent drop below 0.6900 mark would negate the bullish chart-pattern formation, thus opening room for continuing the near-term downward trajectory towards its next major support near 0.6750 area, marking 100% Fib. expansion level.

EURJPY

On daily chart, the pair seems to form a bearish Head and Shoulders chart pattern, which would be confirmed only once the pair decisively breaks below neck-line support near 133.00 region. From current level, a drop below 134.50-40 horizontal support is likely to be followed by an immediate drops towards retesting the neck-line support. Further, a decisive break below the neck-line support seems to accelerate the fall immediately towards 131.60-50 support area and fall could further get extended towards 130.00 psychological mark support. Meanwhile, a move above 135.50 immediate horizontal resistance area is likely to confront a strong resistance near 137.00 horizontal region. A decisive move above 137.00 mark might negate the bearish Head and Shoulders pattern formation, thus paving way for a retest of the very important resistance near 140.00 mark.

EURCAD

On Tuesday, the pair decisively strengthened above a short-term symmetrical triangular formation on 4-hourly chart, which constituted towards formation of a bullish continuation pattern, Pennant. Hence, from current levels the pair seems more likely continue with its upward trajectory initially towards 1.4330-50 resistance area, which might eventually get extended towards 1.4500 resistance area, marking 2015 highs. On the downside, 1.4150 level now seems to provide immediate support for the pair. Failure to hold this immediate support, might immediately drag the pair back towards 1.4100-1.4080 area, representing 23.6% Fib. retracement level of June low to July high up-swing. Further, a decisive weakness below 23.6% Fib. retracement level might negate the bullish expectations and might trigger extension of the corrective move towards its next support at 38.2% Fib. retracement level near 1.3970-60 area.

EURAUD

On daily chart, the pair continues to oscillate within a short-term ascending trend-channel formation, intact since late April 2015. The pair is currently witnessing a pull-back after testing the upper trend-line resistance of the channel and hence weakness below 1.4700 mark now seems to be followed by additional weakness towards testing the lower trend-line support of the channel, currently near 1.4600-1.4580 area. A decisive drop below 1.4600, marking a break below the ascending trend-channel, might negate the bullish continuation pattern, thus triggering extension of the near-term corrective move towards its next major support near 1.4400 horizontal zone. Meanwhile, a move back above 1.4800 round figure mark now seems to provide the required momentum to lift the pair beyond 1.5000 psychological mark resistance and continue with its appreciating move towards testing the upper trend-line resistance of the channel, currently near 1.5200 mark.

Follow me on twitter @Fx_Haresh for latest market updates