The Sterling jumped strongly near its yearly lows and found strong demand at 1.2860 level yesterday. In addition, prices broke above 1.3000 barrier, which triggered a big rally in the pair.
However, when looking at the daily picture, the trend remains bearish and as far as prices keep trading below 1.3370 peak, the upside potential is likely to stay limited. Therefore, traders should expect a strong rejection near 1.3180/1.3200 resistance zone if the pair continue its recovery in the coming hours.
In the near-term, 1.3095 is seen as a major support and a daily close below it will confirm that the recent correction has ended. Conversely, a clear breakout above the mentioned resistance should confirm a trend change in the daily chart.
Gold failed to overtake 1357 hourly resistance for the third time in a row and the yellow metal showed another negative rejection candle yesterday. As of now, we can see that momentum indicators are beginning to turn lower, which warns about a potential corrective wave in the next days.
Technically, a re-test of the yearly high around 1375 level still possible. However, gold has shown three consecutive lower highs (1375-1367-1357) from its yearly peak and we will focus on a daily close below $1328 support to confirm a bearish reversal in the next hours. In the flipside, a break above 1357 resistance will bring the bullish outlook in the short-term and should expose $1375 soon.
To summarize, the positive trend started to show some signs of weakness in the hourly chart and traders should not be surprised if gold extend its losses soon as far as 1357 peak remain intact.
The pair lost some of its bullish momentum by the end of last week as bears managed to push prices below 0.7700 handle.
Looking at the recent price action, the Aussie found strong resistance after reaching the daily resistance of 0.7760 , which is considered as the last barrier before to reach the yearly high of 0.7830 and by now, a deeper correction in the direction of 0.7595 support remain possible.
This support represents the 61.8% retracement of the entire bullish cycle that began from 0.7495 low, and therefore we may see some buyers around it.
Actually, we maintain the positive outlook for the pair in the daily chart and only a close below 0.7495 level, will confirm a bearish reversal. While in the hourly chart, the trend has turned neutral and prices should break above 0.7720 resistance to re-gain its strength.
The pair has become strongly bearish after breaking below 1.3000 psychological support.
The pair has erased the entire gains posted after the recent NFP release, reinforcing the bearish outlook in the near-term. Actually, 1.2920 zone turned resistance in the hourly chart and as far as this level holds, we believe that the pair has found a top at 1.3250 and should see further weakness towards 1.2650/75 zone in the coming days.
Meanwhile, prices have reached a major support level, which stands at 1.2760 as it represents the 61.8% retracement of the recent recovery seen from 1.2445 low. Therefore, a corrective wave to the upside may begin soon.
Conversely, only a break above 1.2917 peak will cancel this negative view and should push prices into a larger correction to the upside.
Otherwise, USD/CAD will remain under pressure in the short-term.
The Euro remain positive above 1.1220-1.1240 levels as this zone represents a former resistance area that turned support for the time being.
Technically, the single currency has turned bullish in the near-term as prices broke above the hourly bearish trend line that comes from 1.1612 peak reinforcing the positive outlook in this pair.
In the meantime, the weekly trend remain sideways and a close above 1.1420 barrier is needed to confirm another rally towards 1.1600/1.1700 monthly resistances. In the opposite, 1.1045 represents the bullish pivot in the daily chart and only a clear break below this level, will put the single currency under pressure again. Otherwise, the Euro should continue heading north in the coming weeks.
The Sterling jumped strongly near its yearly lows and found strong demand at 1.2860 level during last week. In addition, prices broke above 1.3000 barrier, which triggered a big rally in the pair.
However, when looking at the daily picture, the trend remains bearish and as far as prices keep trading below 1.3370 peak, the upside potential is likely to stay limited. Therefore, traders should expect big volatility in the pair in the week ahead and we will focus on daily close above 1.3180 barrier to confirm another extension higher. Otherwise, the last wave should be considered as corrective and we will wait for a daily close below 1.2975 support to confirm that the recent correction has ended and the pair is ready for another push to the downside.
In the near-term, the fight is taking place between 1.3120 in the upside and 1.3025 in the downside.
Gold keep fighting for a clear direction in the near-term as bears continue to preserve 1357 hourly resistance. In the meantime, we did not see any clear breakdown below 1332/1328 support zone, which keeps the near-term outlook neutral for gold prices.
Technically, a re-test of the yearly high around 1375 level still possible. However, gold has shown three consecutive lower highs (1375-1367-1357) from its yearly peak and we will focus on a daily close below $1328 support to confirm a bearish reversal in the next days. In the flipside, a break above 1357 resistance will bring the bullish outlook in the short-term and should expose $1375 soon.
To summarize, the positive trend started to show some signs of weakness in the hourly chart and traders should not be surprised if gold extend its losses soon as far as 1357 peak remain intact.
The pair found strong resistance around 0.7720 during last week and turned sharply lower to reach the hourly support of 0.7585 earlier this morning.
Looking at the recent price action, the Aussie remain positive in the daily chart, while in the hourly chart the pair is trading sideways and therefore, traders should wait for further price action development before to confirm the next directional move in the pair.
As of the week ahead, we are watching 0.7585/50 levels as a strong support zone. In the opposite, if the pair manage to bounce in the coming hours, we will look for resistance around
Actually, we maintain the positive outlook for the pair in the daily chart and only a close below 0.7495 level, will confirm a bearish reversal. While in the hourly chart, the trend has turned neutral and prices should break above 0.7720 resistance to re-gain its strength.
USD/CAD rallied on Friday after prices have reached the 61.8% of the entire recovery that began from 1.2445 low and therefore, we were expecting to see strong buyers around this level, which stands at 1.2765. The pair managed to bounce strongly, ending the week by showing a bullish engulfing candle in the daily chart.
As of now, another extension to the upside remain possible in the coming hours as the near-term trend switched from bearish to neutral. Meanwhile, the daily trend still negative, and consequently the upside potential is likely to remain limited in this pair as far as 1.3085 peak is in place.
Technically, the recent jump can reach as high as 1.2960-1.2985resistance zone before the downside pressure resume.
The pair remain bearish from both a fundamental and technical standpoint.
Fundamentally, BoJ is ready for more stimulus to boost economic growth and Japan remain one of the fewest country that opted for negative interest rates.
Technically, it is clear that the pair is oversold in the hourly chart and we have seen a strong reaction each time the pair tried to break below 100.00 psychological support.
This level is watched by Bank of Japan officials, and we may continue to see some interventions from time to time around this level. Meanwhile, when looking at the daily chart, the pair keep printing lower highs/ lower lows since 114.90 peak and consequently the upside potential is likely to remain limited.
For the time being, the pair may continue its path in the direction of 99.00 (2016 low) followed by 98.00/97.50 monthly support zone in the coming weeks. This scenario should remain valid as far as prices keep trading below 102.80/103.55 barrier.
Therefore, only a daily a close above the mentioned above zone will cancel this negative view and should trigger a larger correction to the upside. While a close below 100.00 handle, should be a confirmation signal for another sell-off.
