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Forexpros Daily Analysis - 13/09/2010

Discussion in 'Forex Daily News & Outlook' started by forexpros2, Sep 13, 2010.

  1. forexpros2

    forexpros2 Member

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    ForexPros Daily Analysis September 13, 2010


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    Expert: Kris Matthews
    When: Thu, Sep 16, 2010, 07:00 ET

    Unfortunately many traders fall into the trap of following technical analysis systems without understanding what charts are really telling them about the behavior and sentiment of the market. Kris Matthews presents in the final webinar of this four part series on trading sentiment, how to spot certain recurring types of price action that reveal valuable clues about the sentiment/direction of the market going forward.


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    Euro Dollar

    The Euro jumped after the market’s open and continued a bounce it started on Friday, going back above 1.28. Now the question is will the EUR succeeds in creating yet another test of 1.2920? In fact, we do not believe it will, and even if it did, this will provide a selling opportunity. At the time these words are written, the EUR is trying to break short term 61.8% Fibonacci level (please refer to the attached chart). We believe that surpassing this level will be easy, as our eyes are set on the last important level before 1.2920, which is 1.2853. Our strategy for today will be waiting for the Euro to reach this high, in order to sell with a stop/reverse above 1.2920. Therefore, the resistance levels are 1.2853, and 1.2920 which if broken will leave our negative outlook void, and we will target 1.3047. But, as long as we are below 1.2920, this pair is a “sell”. On the other hand, the support is at 1.2764, then there is 1.2724 which would make an ideal target for a sell at 1.2853. Then there is 1.2658 & 1.2608.

    Support:
    • 1.2764: the rising trend line from Friday’s low on intraday charts.
    • 1.2658: Wednesday’s low.
    • 1.2608: Aug 25th low.

    Resistance:
    • 1.2853: Sep 1st high, and the last important resistance before 1.2920.
    • 1.2920: Aug 19th top.
    • 1.3047: Fibonacci 61.8% for the medium term.

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    USD/JPY

    No change for our negative technical outlook for this pair, as long as we are trading below the falling trend line from June 4th top. Last week, we adjusted the falling trend line on the hourly chart to include Friday’s jump. We still believe in USD\/JPY weakness, and we believe it will travel south. Only a break of this line in specific will change our minds. This line is currently running at 84.72 (please refer to the attached chart). To keep trading below it, indicates more downside activity, especially after the BoJ disappointed again last week, as the “Japs” said once again they are watching closely, but they did nothing! The market has had it with these comments, and now the Japanese authorities should buy tickets to the “Yen Show”, and see what it will do to the Dollar & the Euro! Short term support is at 83.79, and if broken, we will be on the way to our long-awaited target at 82.00, then we will see the psychological level at 80.00. On the other hand, the above mentioned trend line is at 84.83. If broken, the Dollar will be violent to us all, as it will shoot up to 86.25 & 86.95.

    Support:
    • 83.79: the rising trend line from Wednesday’s low on intraday charts.
    • 82.00: the falling trend line on the weekly chart, combining the monthly lows of Dec 2008, Jan & Nov 2009.
    • 80.00: psychological level.

    Resistance:
    • 84.72: the falling trend line from June 4th top on the hourly chart
    • 86.25: Jul 16th bottom.
    • 86.95: Jul 1st low.

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    GBP/USD

    The Pound jumped after the market’s open and continued a bounce it started on Friday, going back above 1.54. Now the question is will is succeeds in creating yet another test of 1.5490? In fact, we could see a test of this massive resistance area, but we believe that such a test would provide a selling opportunity, with a stop above 1.5532. The reasons behind this belief are two: we have seen how this massive resistance level has rejected the price 3 times recently, and because the falling trend line from Aug 16th top is just above it providing another important resistance. It is hard to picture this pair breaking both levels today, and that is why we recommend this strategy: sell around 1.5490, stop clearly above 1.5532, and the target at 1.5344. On the other hand, breaking 1.5532 decisively is not probable today, but if it happens, the Pound will target 1.5646.

    Support:
    • 1.5395: Fibonacci 61.8% for the short term.
    • 1.5344: Sep 6th “& 10th low.
    • 1.5295: Sep 7th low.

    Resistance:
    • 1.5490: the massive resistance level containing the highs of Sep 1st & 6th.
    • 1.5532: Wednesday’s high which is just above the falling trend line from Aug 16th top.
    • 1.5646: Fibonacci 50% for the whole drop from Aug 6th top.

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    Forex trading analysis written by Munther Marji for Forexpros.

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    Disclaimer:

    Trading Futures and Options on Futures and Cash Forex
    transactions involves substantial risk of loss and may not be suitable for
    all investors. You should carefully consider whether trading is suitable for
    you in light of your circumstances, knowledge, and financial resources. You
    may lose all or more of your initial investment. Opinions, market data, and
    recommendations are subject to change at any time.
     
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