Archive for October, 2009
GoLearnForex Daily Technical Analysis
AUD/USD:
The AUD continues its recent retrace. Many traders use different time frames for different currency pairs. The longer the time frame the more valid the pattern you are charting is. Moving Averages are basic tool that even the most sophisticated trader needs to always be cognizant of. The markets tend follow the moving averages generated off of the daily charts.
In Chart below I use a moving average from an 8 hour chart. I strongly encourage traders to be vigilant of at least checking a weekly, daily, 8 and or 4 hour chart and then any time frame less than 4 hours that you may want to look at.
INSERT CHART
You can see that the yellow line representing the SMA 50 was breeched and prices continued a steady fall (The Red line is the 100 SMA). There are also a number of near candle formations that support this price depreciation.
Circled in blue is a near Falling Three Candle pattern. Typically you have a red candle followed by 3 or so small green candles that are contained by the original red candle. Following the last green candle is another red candle with price closing below the original red. The Falling Three pattern is nearly followed by Three Black Crows. This candle pattern forms when you have the candles each open in the midsection of the proceeding candle but also close lower than the proceeding candle. This pattern nearly forms between the 2 white lines.
GBP/USD:
This pair has been range bound since May. When a pair trades in a range, price is confined to a narrow margin of highs and lows. In the Chart below the 2 red lines represent the range support and resistance lines.
The 2 red boxes indicate when minor breakouts have occurred. The tops and bottoms of the boxes would be your absolute stops depending on the handle you entered the trade at. Another point of consideration is the 50 SMA and 100 SMA. You can see that the SMA’s are also moving sideways. Price typically pops when it passes above/below a significant SMA. With SMA moving into a sideways march we are approaching congestion on this pair and that should signal another breakout. Obviously if the dollar continues to strengthen as it has GBP should be headed south.
INSERT CHART
Analysis by http://www.golearnforex.net
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Daily Review
USD Dollar (USD)
The Dollar rose across the board. A rise in risk aversion following an unexpectedly drop in New Home Sales sent stocks lower worldwide. The Dow Jones fell for the 4th consecutive session and ended at 9,763.The Standard & Poor’s 500 Index dropped 2% on concern a rally in equities this year outpaced the prospects for economic growth. New-home sales unexpectedly fell last month to an annual rate of 402K, from a revised 417K pace in August. Crude oil fell from $79 a barrel to $77.20 on stronger Dollar. Gold (XAU) continues to move away from the highs of the year and fell to test levels below $1,030 an ounce. Today, The Gross Domestic Product (GDP) is expected at 3.1% vs. -0.7% previously. The Initial Jobless Claims are expected at 520K vs. 531K previously.
EURO (EUR)
The Euro kept weakening versus the Dollar for the 4th day in a row. The currency slumped against Dollar and Yen, reaching a 2 week low against both safe havens. The German Consumer Price Index (CPI) came out as expected at 0.1%. Overall, EUR/USD traded with a low of 1.4690 and with a high of 1.4840. Today, The German Unemployment Change is expected with 15K vs. -12K previously. The German Unemployment Rate is expected at 8.3% vs. 8.2% previously.
EUR/USD – Last: 1.4700
|
Resistance |
1.48 |
1.4842 |
1.489 |
|
Support |
1.471 |
1.4675 |
1.465 |
British Pound (GBP)
The Pound failed to hold above 1.6400 versus the Dollar finding support only at 1.6360 following economic data in the U.S and Dollar\’s strength. GBP/USD peaked at the highest price for the current week but it was unable to hold versus the strengthening Dollar. Overall, GBP/USD traded with a low of 1.6285 and with a high of 1.6466. Today, Net Lending to individuals is expected unchanged at 0.7B. The Mortgage Approvals also expected unchanged at 52K.
GBP/USD – Last: 1.6368
|
Resistance |
1.651 |
1.6575 |
1.6640 |
|
Support |
1.6355 |
1.6285 |
1.6240 |
Japanese Yen (JPY)
The Yen rose sharply versus most majors as weak economic data sent world stocks lower fueling risk aversion. The Yen reached the highest in 2 weeks against the Euro amid signs the global economic recovery is losing steam, damping demand for higher-yielding assets. Industrial Production came out 1.4%better than 1.1% expected. Overall, USD/JPY traded with a low of 90.54 and with a high of 91.80. Today, Household Spending is expected lower with 1.2% versus 2.6% and Tokyo Core CPI is expected with -2.0% versus -2.1% prior.
USD/JPY-Last: 90.42
|
Resistance |
91.3 |
91.75 |
92.1 |
|
Support |
90.5 |
90.1 |
89.9 |
Canadian dollar (CAD)
Canada’s currency depreciated against its U.S. counterpart to the lowest level in more than three weeks as declines in crude oil, the nation’s largest export, and stocks damped demand for higher-yielding assets. Overall, USDCAD traded with a low of 1.0636 and with a high of 1.0810. Today, The Raw Materials Price Index (RMPI) is expected at 1% vs. 3.7% previously.
CAD/USD – Last: 1.0790
|
Resistance |
1.08 |
1.0855 |
1.0898 |
|
Support |
1.068 |
1.063 |
1.0587 |
Research by http://www.ufxbank.com
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