Sample Category Title

AUD/USD – 0.7878

Original strategy :

Bought at 0.7895, Target: 0.8050, Stop: 0.7865

Position: - Long at 0.7895
Target:  - 0.8050
Stop: - 0.7865

New strategy :

Hold long entered at 0.7895, Target: 0.8050, Stop: 0.7865

Position: - Long at 0.7895
Target:  - 0.8050
Stop:- 0.7835

As aussie has slipped again after brief recovery to 0.7916, suggesting caution on our bullishness but as long as support at 0.7865-67 holds, prospect of another rebound remains, above 0.7916 would bring test of indicated resistance at 0.7963, break there would add credence to our view that low has possibly been formed at 0.7808 early last week, bring a stronger rebound to 0.8000, however, break there is needed to signal the pullback from 0.8066 top (wave iii peak) has ended at 0.7808 (wave iv) and bring eventual retest of this level.

In view of this, we are holding on to our long position entered at 0.7895. Below said support at 0.7865-67 would dampen this bullish scenario and suggest the rebound from 0.9808 has ended, bring another test of this level, below there would signal the wave iv correction from 0.8066 is still in progress for weakness to 0.7786 support, however, oversold condition should prevent sharp fall below 0.7750 and price should stay above i top at 0.7712, bring rebound later. We are keeping our latest bullish count that recent impulsive waves is unfolding as (1 2, (i)(ii), i ii) and may extend headway towards 0.8150. 

On the 4-hour chart, the move from 0.8066 is the wave 5 with i: 0.8860, ii: 0.8315, wave iii is an extended move ended at 1.0183, iv: 0.9706 and wave v has ended at 1.1081 (also the top of entire wave 5). The subsequent selloff is the major correction which is unfolding as ABC-X-ABC and 2nd A leg has ended at 0.8848, followed by a-b-c wave B which ended at 0.9758, hence, 2nd C wave is now in progress and indicated downside target at 0.7000 and 0.6950 had been met, so further fall to 0.6710-20 cannot be ruled out.

Weekly
    •    Last Candlesticks pattern: N/A
    •    ime of formation: N/A
    •    Trend bias: Near term up

Daily
    •    Last Candlesticks pattern: Doji
    •    Time of formation: 21 Jul 2017
    •    Trend bias: Up

EURGBP – 0.9045

As the single currency has surged again this week, adding credence to our bullish view that medium term upmove is still in progress and upside bias remains for the uptrend to extend headway to 0.9250-55, then towards 0.9290-00, however, near term overbought condition should prevent sharp move beyond 0.9350-55 and price should falter below 0.9380-85 (100% projection of 0.8312-0.8950 measuring from 0.8743), risk from there is seen for a strong retreat to take place later.

On the downside, whilst initial pullback to the Tenkan-Sen (now at 0.9144) and 0.9100-10 cannot be ruled out, reckon 0.9060-65 would limit downside and brig another rise later. A daily close below the Kijun-Sen (now at 0.9033) would defer and risk test of support at 0.9008 but a daily close below there is needed to signal a temporary top is formed, bring test of previous resistance at 0.8950 and later towards 0.8895-00, having said that, reckon the upper Kumo (now at 0.8841) would contain downside, bring another rise later.

Recommendation: Buy again at 0.9070 for 0.9270 with stop below 0.8970.

On the weekly chart, this week’s rally looks set to form another white candlestick (4th in a row), adding credence to our bullish view that recent erratic rise from 0.8304 is still in progress and upside bias remains for this move to extend gain to 0.9250-60, then 0.9300-10, however, near term overbought condition should limit upside to 0.9350 and reckon 0.9380-85 (100% projection of 0.8312-0.8950 measuring from 0.8743) would hold. Looking ahead, break there is needed to retain bullishness and signal the entire correction from 0.9576 top has ended at 0.8304 and encourage for further subsequent gain to 0.9450.

On the downside, although pullback to 0.9100-10 cannot be ruled out, reckon 0.9050-55 would limit downside and the Tenkan-Sen (now at 0.8990) should hold, bring another rise. A drop below support at 0.8891 would defer and suggest top is possibly formed, bring retracement of recent upmove to 0.885-60, then 0.8795-00 but reckon support at 0.8743 would hold. Only a weekly close below this support would retain bearishness for subsequent decline to 0.8650-55 but the lower Kumo (now at 0.8571) should remain intact, bring another rally later.

Weekly

    •    Last Candlesticks pattern: Long white candlestick
    •    Time of formation: 24 Jul 2017
    •    Trend bias: Up

Daily

    •    Last Candlesticks pattern: Morning doji
    •    Time of formation: 25 Jul 2017
    •    Trend bias: Up

EUR/CHF – 1.1399

As the single currency found support at 1.1259 and has staged a strong rebound, suggesting the pullback from 1.1538 has possibly ended there and consolidation with mild upside bias would be seen for gain to 1.1444, however, break of resistance at 1.1479 is needed to add credence to this view, bring retest of this level later. Only a break of said recent high at 1.1538 would confirm recent upmove has resumed and extend headway to 1.1600-10, having said that, further sharp move beyond 1.1700 should not be repeated and price should falter below 1.1770-80, bring retreat later.

On the downside, whilst pullback to the Tenkan-Sen (now at 1.1369) cannot be ruled out, reckon support at 1.1343 would limit downside and bring another rise later. Below 1.1320 would risk weakness towards said support at 1.1259 but only break there would abort and extend the corrective fall from 1.1538 top for retracement of recent upmove to 1.1185 (50% Fibonacci retracement of 1.0833-1.1538), however, sharp fall below 1.1100-05 (61.8% Fibonacci retracement) should not be repeated and 1.1050 would hold, bring rebound later. 

Recommendation: Buy at 1.1355 for 1.1555 with stop below 1.1255.

On the weekly chart, the single currency traded narrowly after retreating from recent high at 1.1538, retaining our view that consolidation below this level would be seen, however, support at 1.1259 should contain downside and bring another rise later, above 1.1479 resistance would signal the pullback from 1.1538 has ended and bring retest of this level. Only a break of this recent high would revive bullishness and extend the major rise from 0.8426 low for headway to 1.1590-00, then towards 1.1700-10, however, overbought condition should prevent sharp move beyond 1.1800 and reckon 1.1900-10 would hold from here, risk from there has increased for a retreat to take place later. 

On the downside, expect pullback to be limited to 1.1320-25 and bring another rise later. Below said support at 1.1259 would bring test of the Tenkan-Sen (now at 1.1192), break there would defer and suggest a temporary top is formed instead, bring retracement of recent rise to 1.1100-05 (61.8% Fibonacci retracement of 1.0833-1.1538), then test of the Kijun-Sen (now at 1.1087) but reckon support at 1.0987 would remain intact.

USDJPY is neutral after pausing a decline at 108.60. Risk to the downside is high as there was a bearish signal from the crossover of the 50-day moving average (MA) with the 200-day MA on July 18. Momentum indicators are in bearish territory, with RSI below 50 and MACD below zero.

However, the RSI and MACD are no longer sloping down and are moving sideways, suggesting downside momentum has weakened and there is diminished risk for further declines in the near term. Prices are hovering near the key 109.00 level but a daily close below this would shift focus to the downside. First target is the August 18 low of 108.60 ahead of the round number at 108.00. An extension lower from this point would change the big picture and shift the bias to bearish from neutral.

USDJPY would need to rise back above 110.00 resistance to ease downward pressure. The level at 110.90 is an important barrier as it acted as resistance as well as support in the past. From here prices could resume upside towards the 50-day moving average (MA) at 111.33 and 200-day MA at 112.52. A move higher from this point would turn the focus to the July 11 peak at 114.49. This is the top of the medium-term range. Breaking above this area would shift the outlook to bullish.

EURUSD has been consolidating since reaching a 2½-year high of 1.1909 on August 2. The 50-period moving average (MA) has flatlined on the 4-hour chart, pointing to a neutral bias in the short term and indicating that the strong rally that began in April has run out of steam.

However, the risk is to the upside as both the RSI and the MACD are in bullish territory. The RSI is trending down but remains comfortably above 50, while the MACD histogram is just above the red signal line.

To regain upside momentum, prices would need to break above the 23.6% Fibonacci retracement level of the July-August upleg from 1.1479 to 1.1909. The 23.6% Fibonacci level is also the 1.18 handle. A sustained rise above this level would open the towards the August peak of 1.1909, but before then, the pair might meet a hurdle at around the 1.1845 area, which previously acted as resistance. A break above 1.1909 would signal a resumption of the uptrend and reinforce the bullish outlook in the medium-term. The next key resistance after this point is the psychological 1.20 level.

To the downside, the 50-period MA at 1.1632 should be watched as a drop below this line would weaken the positive short-term bias, if not, push it to negative. Further down, support should come from the 38.2% and 50% Fibonacci levels at 1.1745 and 1.1695 respectively. Failure to hold above the 50% Fibonacci level could lead to a sharper correction and bring into view the 200-period MA (currently at 1.1665).

A drop below the 200-period MA could accelerate the decline towards the 50-day moving average on the daily chart, which is currently around 1.1560, threatening the medium-term bullish structure.

The dollar managed to recoup some of yesterday's losses against the yen, when the US currency tumbled on the President's remarks about a government shutdown. Other majors also weakened with the kiwi underperforming as it tumbled to more than a two-month lows against the greenback. Oil prices slipped after yesterday's surge.

During another relatively quiet trading day in Asia, the dollar managed to reverse its losses and post a moderate gain against the yen. Dollar/yen was last trading at 109.27, up a quarter of a percent on the day. President Trump rattled markets yet again with his speech about a possible government shutdown and exit from the NAFTA trade treaty on Tuesday night. The dollar took a breather today and gained against the yen, as the US Congress is in summer recess until September 5 and upon return, it will have about 12 working days to approve spending measures and prevent the government from shutting down. Traders will be focusing on the central bankers' meeting in Jackson Hole that starts today. They will be on the lookout for any clues about future monetary policy steps by either the European Central Bank or the Federal Reserves.

Internal political woes shook up the currencies down under. The kiwi lost ground and tumbled against its US counterpart, deepening yesterday's losses when it fell on curtailed economic growth outlook by the New Zealand government. Many investors have raised concerns over political instability and question the government's chance to be re-elected next month. Kiwi/dollar was last trading at 0.7197, hitting its lowest point since mid-June. Its cousin, the aussie also tumbled and was last trading at $0.7837. The aussie weakened on news that some high-profile politicians with dual citizenship may not be able to stand for Parliament unless they renounce their other citizenship.

Sterling was under pressure as the British currency dipped below the $1.28 level for the first time since June. Concerns over Britain's economic prospects and its exit from the EU are increasing and pushing the pound lower. Markets are unimpressed with the UK government's efforts to provide clarity and stability during this painful process. All eyes will be on the release of the second estimate of second-quarter GDP figure for the UK at 8:30 GMT, which will include details on business spending. Pound/dollar was last trading at $1.2790.

The euro faded against the greenback to trade at $1.1791 as traders await the Jackson Hole meeting with ECB President Draghi expected to speak tomorrow. The common currency also fell modestly against the pound to last trade at 0.9218, after four days of gains.

Oil prices fell slightly against yesterday's surge with Brent last trading at $52.48 a barrel and WTI at $48.29. Linked to the dollar strength, gold prices gave up most of yesterday's gains and fell to $1,286.32.

The EURUSD pair has again been contained by the 61.8 Fibonacci retracement level, at 1.1815, with price action continuing to print bearish lower daily high's, just below the current weekly price high.

Despite the euro's latest bullish move above the 1.1800 level, the pair still remains somewhat cautious ahead of the Jackson Hole symposium.

The EURUSD pair remains bullish in the short-term, while trading above the daily pivot point, found at the 1.1792 level.

Key technical support below the 1.1792 level is located at the 200-week MA, at 1.1783. Critical intraday support is found at 1.1769, with further support below, at 1.1731.

To the upside, 1.1818 is the current daily price high, with resistance found at 1.1847 and 1.1858. The 1.1900 level remains critical technical resistance above the 1.1858 level.

The British pound remains soft on Thursday, with price continuing to trade below the 1.2800 technical level against the U.S dollar, ahead of the release of second quarter GDP data from the United Kingdom economy.

Later today the Jackson Hole symposium will get underway, although FED Chair Janet Yellen and ECB President Mario Draghi will be speaking on Friday.

The GBPUSD pair remains bearish on all time-frames, with price action creating bearish lower highs on shallow pullbacks, and lower price low's.

Key technical support below the 1.2777 level, is found at 1.2750 and 1.2716, with the key 200-day moving average approaching, at 1.2680.

Key short-term technical GBPUSD resistance is found at the 1.2819 and 1.2832 levels, with critical intraday resistance situated in the 1.2839 to 1.2850 zone.

The Jackson Hole Symposium is officially underway on Thursday. The annual event, which is hosted by the Kansas City Federal Reserve Bank, will attract central bankers from over 40 countries.

The theme of this year's event is 'Fostering a Dynamic Global Economy,' and will take place between 24-26 Aug. Among the attendees are Fed Chairwoman Janet Yellen and European Central Bank (ECB) President Mario Draghi.

Signs of shifting policy over the next three days could have ripple effects on the global economy. Analysts say they are not expecting any substantial signal from central bankers during the event. Reports circulated last week that Draghi could use Jackson Hole as an opportunity to deliver a big monetary policy speech. Those reports were later refuted by Reuters.

Investors can also expect a deluge of economic data from around the world. Action begins at 07:00 GMT with a report on Spanish gross domestic product (GDP). Spain's GDP is forecast to have grown 0.9% in the second quarter.

UK National Statistics will release revised second quarter GDP numbers on Thursday. Quarterly growth is expected at 0.3%, unchanged from the previous estimate.

In North America, the US Labor Department will issue its weekly jobless claims report, which provides an ongoing snapshot of the labor market. Claims are projected to rise by 6,000 in the week ended 18 August to reach 238,000.

The National Association of Realtors (NAR) will report on existing home sales at 14:00 GMT. The sale of pre-owned homes is forecast to rise 0.9% to a seasonally adjusted 5.57 million in July. On Wednesday, the Commerce Department said new home sales plunged last month.

The Kansas City Fed will also release its monthly manufacturing survey at 15:00 GMT, capping off a highly active session.

EUR/USD

The EUR/USD rebounded Wednesday as upbeat data boosted demand for the common currency. The pair broke above 1.1800, although gains stalled well below 1.1830 – a region that is likely to attract renewed selling interest. The pair faces immediate support at 1.1730.

GBP/USD

The British pound slipped to fresh two-month lows on Wednesday, as cable struggled to shake off bearish pressure. The GBP/USD was down 0.1% in Asian trade. Prices are testing an initial support level at 1.2780. A break below that level would expose 1.2750 followed by 1.2710.

GOLD

Gold prices rose on Wednesday, as risk aversion creeped back into the financial markets. Political risks were once again front and centre after US President Donald Trump said he would let the government shut down unless Congress provides funding for his planned border wall with Mexico. Bullion remains well supported in its current range, but will find it difficult to make a clean break above $1,300.00

USDJPY (109.18): The USDJPY continues to consolidate around the support level of 109.15. The currency pair fell back to this level after earlier attempts to bounce off this level faded. The support level at 109.08 thus continues to remain a strong level of support. To the upside, USDJPY will be looking towards targeting the resistance level at 110.72. However, the potential for a downside breakout in prices could formalize. Below 109.08, USDJPY could initially slip towards 109.00 followed by further declines depending on the daily close.