Russian view on financial markets

[Dmitry Shagardin]

GBP/USD. Technical analysis.

GBP/USD maintained its upward momentum yesterday and after breaking its trendline, the writing was on the wall for GBP/USD bears. The pair has currently hit a wall of resistance at $1,6130. This level is key for both bears and bulls. Strong signs of reversal could see the pair plummet but on the flipside this level breaks and we see an H4 candle close above this level then $1,6200 – $1,6250 become realistic intraday targets. Intraday support is at $1,6000 and $1,5940.
According to H4, MACD rises in positive area (at daily chart MACD tends to rise in negative area). “Fast” RSI (red line) raises overbought area at mark 96. “Slow” RSI (green line) is overbought too. Stochastic oscillator lines show upward movement in overbought zone. Now Cable moves above 200 SMA that is positive for British pound. Strong resistance is at $1,6230, then the pair will go to $1,6350.
Chart 1. H4 GBPUSD.

Chart 2. Daily GBPUSD.

Notes: 50 SMA – brown line; 100 SMA – green line; 200 SMA – orange line.

 

[Dmitry Shagardin]

USD/JPY. Technical analysis.

USD/JPY. Technical analysis.
Earlier we expect a pullback in price towards ¥89,00 before heading to the upside. Currently we have hit ¥89,00. Intraday a bullish bias is warranted against ¥89,00 for a trade towards ¥90,15 and possibly a challenge of the recent ¥90,50 high. A break above ¥90,50 will likely see the upside accelerate.
However, if the pair breaks below ¥89,00 and trades below ¥88,60 then the bullish bias evaporates and should see ¥88,25 challenged.
At H4 MACD starts to grow in positive area near zero mark (at daily chart MACD tends to decline). “Fast” RSI (red line) rises in overbought area. “Slow” RSI (green line), after reaching oversold zone at mark 60, tends to grow. Stochastic oscillator lines show strong upward movement in neutral area.
Chart 1. H4 USDJPY.

Chart 2. H1 USDJPY.

Resistance 3: ¥91,60
Resistance 2: ¥90,50
Resistance 1: ¥90,15
Support 1: ¥89,00
Support 2: ¥88,60
Support 3: ¥88,25
Notes: 50 SMA – brown line; 100 SMA – green line; 200 SMA – orange line.

 

[Dmitry Shagardin]

EUR/USD. Technical analysis

The EUR/USD yesterday broke out of its range to the downside and met our second intraday profit target of $1,4850. The pair has also, broken its uptrending support line that has kept this recent uptrend intact since the beginning of October as shown on the chart 1. Looking ahead for the Euro there is mounting evidence that the $1,5062 high registered yesterday might be the high for 2009 and a bearish bias against this high is more than justified with current information. Intraday the pair has pared back some of its losses from yesterday’s selloff and short term momentum oscillators are extremely oversold so be cautious that more upside might be observed before heading lower.
Resistance intraday and potential reversal points exist at $1,4930, $1,4960 (50-day SMA), $1,4990.
Although there is strong evidence that the Euro has reversed, nevertheless traders are reminded that a break below its longer term uptrending support line from the beginning of March must be broken in the coming trading sessions and equity markets to continue to selloff. Intraday a break above $1,5015 jeopardises the bearish outlook at which point we would have to revise the situation but current data favour the downside.

Chart 1. H4 EUR/USD.


Chart 2. Daily EUR/USD.


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[Dmitry Shagardin]

GBP/USD. Technical analysis

GBP/USD yesterday was relatively quiet and subdued amidst the selloff in the Euro which helped EUR/GBP shorts. Intraday a trade above 50-day SMA (brown line) could see the pair trade towards $1,6420 and possibly $1,6500. If price makes it to either of these resistance zones then traders are advised to pay careful attention to price action and any signs in loss of momentum and reversal candlestick patterns could see the pair start heading for a trade below $1,6250.
Chart 1. H4 GBP/USD.

 

[Dmitry Shagardin]

USD/JPY. Technical analysis

USD/JPY yesterday initially weakened and found support on ¥91,60 and made a new high at ¥92,30. Intraday a break above ¥92,30 sees strong resistance at ¥93,30. A break above ¥93,30 sees the next level of resistance at ¥94,00. However, a break below ¥91,90 could see the pair trade towards ¥91,60. A break below ¥91,60 will likely see ¥91,00 challenged.

Chart 1. H4 USD/JPY.



Chart 2. Daily USD/JPY.


See you!

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[Dmitry Shagardin]

EUR/USD. Technical analysis

Monday’s trading session began with Gold extending its gains to new historical highs which in turn saw the American dollar battered again. But the Euro yesterday spent the European session correcting and then traded lockstep to the upside with US equities. The pair is currently strongly correlated with equity markets so it is no surprise that it found a bid tone which also carried all through the Asian session as well. However, the pair is facing strong intraday resistance above $1,4935 (50-days SMA). The first level to watch is $1,4890-1,4900. Either of these levels could prove to be reversal areas for the pair. A break above $1,4935 will likely see the pair retest $1,4990 and possibly $1,5015. However, a trade below $1,4845 will re-enforce the bearish scenario.
The price is under the levels of 50-, 100- and 200-days SMA that is no so good for euro (chart 1). But all technical indicators moves up. MACD is rising in negative area at H1 EUR/USD graph that is good for “bulls” in short term period. Slow RSI (green line) moves up in neutral area while fast RSI (red line) is oversold. “Bullish” scenario confirms by stochastic oscillator that is in oversold area too.
The price is above the levels of 100- and 200-days SMA but under 50-days SMA (chart 2). MACD continues to decline in negative area. “Slow” RSI (green line) has practically stolen up to oversold area that in general it is positive for euro. “Fast” RSI (red line) tends to rise in neutral area. Fast curve %К and slow curve %D smoothly rise. According to technical analysis, the euro will retreated positions versus the greenback.
In long-term period, generally speaking the USD is at a critical juncture and if we see a big sell off in equity markets then risk aversion will likely lead to broad dollar strength and vice versa. Traders should monitor price behaviour in equity markets very closely for any signs of weakness.

Chart 1. H1 EUR/USD.



Chart 2. H4 EUR/USD.




Notes: SMA 50 – brown line; SMA 100 – green line; SMA 200 – orange line.

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[Dmitry Shagardin]

USD/JPY. Technical analysis

The pair yesterday made a low at ¥88,80 but did not have a 4hr candle close below ¥88,55 (strong support for the pair and last chance support for USD/JPY bulls).
Intraday if the pair manages to stay above ¥88,80 then price action should be to the upside. However, the pair faces strong resistance at ¥89,55 (support now turned resistance) and ¥89,80. A trade above ¥90,44 should see the upside accelerate.
However, a 4hr candle close below ¥88,80 voids any bullish hopes and if the pair exceeds yesterday’s ¥88,74 low then the downside should accelerate and ¥88,00 firmly in the pair’s sights.
At H1 chart, MACD moves down in negative territory. Both lines of stochastic oscillator decline in neutral area. And “fast” RSI is near oversold area. The possibility of downturn movement is likely possible in short-term period.

Chart 1. H1 USD/JPY.



Chart 2. H4 USD/JPY.



Notes: SMA 50 – brown line; SMA 100 – green line; SMA 200 – orange line.

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[Dmitry Shagardin]

GBP/USD. Technical analysis

The cable trades above short term upward trendline. If the pair breaks below this line, $1,6760 and $1,6690-$1,7005 (100- and 200- days SMA) are intermediate support levels.
On the H1 GBP/USD chart, the pair comes nearer to level of 50-days SMA which will be the nearest tensile testing ($1,6800). If the pair manages to punch this boundary, $1,6880 will be the following level of resistance. $1,6300 and 1,6260/40 are intermediate support levels.
MACD declines in positive area, moves towards a zero mark. “Slow” RSI (green) is at the average values (50), “fast” RSI (red) is in overbought area at mark 73. Fast curve %К and a slow curve %D show prompt growth. In short-term prospect there is a possibility of pound easing as on 4-hours chart technical indicators tends to decline.
Strong support is at $1,6760 (minimum of November, 17th), than $1,6690. Strong resistance is at $1,6855, than $1,6880 (maximum of November, 16th). Chart 2. H4 GBPUSD.
Chart 1. H1 GBP/USD.



Chart 2. H4 GBP/USD.



Notes: SMA 50 – brown line; SMA 100 – green line; SMA 200 – orange line.

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[Dmitry Shagardin]

EUR/USD. Technical analysis. Wednesday, 20:10

The EUR/USD continued to slide and made a low of $1,4668. Technically the pair has closed below its daily 50 EMA (currently at $1,4830) and this bodes very well for the reversal scenario.
At H1 chart the pair is under levels of 50-, 100- and 200-days EMA that is not so good for euro (chart 1). MACD rising in negative area at H1 EUR/USD graph that is positive for “bulls” in short-term period. “Slow” RSI (green line) moves up in neutral area while “fast” RSI (red line) is near overbought. “Bearish” scenario confirms by stochastic oscillator which is moving down in neutral area.
At H4 chart the price is under levels of 50-, 100- and 200-days EMA (chart 2). MACD continues to decline in negative area. “Slow” RSI (green line) oscillates around oversold area that in general is negative for euro. “Fast” RSI (red line) tends to decline in neutral area. Fast curve %К and slow curve %D smoothly rise. According to technical analysis, the euro will retreated positions versus the greenback.
In long-term period, generally speaking, the USD is at a critical juncture and if we see a big sell off in equity markets then risk aversion will likely lead to broad dollar strength and vice versa. Traders should monitor price behaviour in equity markets very closely for any signs of weakness.
Intraday the Euro is likely to exceed the $1,4668 low and head towards a challenge of the $1,4630 swing low. A break below this level sees immediate support at $1,4630 (daily 100-days EMA), and $1,4550 (minimum 29/09/09, 01/10/09, 02/10/09). If we do observe another leg down in the Euro intraday then the pair might begin correcting some of its recent losses from the $1,5140 high.
However, if $1,4668 remains intact then the pair could head towards $1,4767 and possibly a retest of the daily 50 EMA (now turned dynamic resistance).

Chart 1. H1 EUR/USD.


Chart 2. H4 EUR/USD.


Chart 3. Daily EUR/USD.


Notes: EMA 50 – brown line; EMA 100 – green line; EMA 200 – orange line.

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[Dmitry Shagardin]

GBP/USD. Technical analysis. Tuesday, 9:00 GMT+3

The GBP/USD continues to weaken amidst whispers regarding the Aaa credit rating of the UK coming under scrutiny. The pair is currently on its way to test the 61,8% Fibo retracement level ($1,6150) of the recent $1,5706–$1,6877 advance so pay attention to this level if price gets there. A break below this level sees the next level of support at $1,5957 which is the 78,6% Fibo retracement level.
However, any signs of reversal at $1,6150 backed by bullish momentum oscillators could see the pair correct back towards $1,6320.
The cable trades near the lower border of long term upward trendline (from December, 2008).
On the H1 GBP/USD chart, the pair trades in frames of short-term downturn trend (blue lines).
Cable is under levels of 50-, 100- and 200-days EMA that is not so good for British currency (chart 1). MACD is declining in negative area that is negative for “bulls” in short-term period. “Slow” RSI (green) moves down in neutral area while “fast” RSI (red) is oversold. “Bearish” scenario confirms by stochastic oscillator which is dropping in neutral area.
At H4 chart the GBP/USD is under levels of 50-, 100- and 200-days EMA (chart 2). MACD starts to rise in negative area. “Slow” RSI (green line) oscillates around oversold area that in general is negative for cable. “Fast” RSI (red line) tends to decline in neutral area too. Fast curve %К and slow curve %D smoothly rise in neutral area.
At daily chart 3, MACD declines in negative area. “Slow” RSI (green) is at the average values (44), “fast” RSI (red) is in oversold area at mark 22. Fast curve %К and a slow curve %D show prompt decline. According to technical analysis, the cable will retreat positions versus the greenback in long term period.

Chart 1. H1 GBP/USD.


Chart 2. H4 GBP/USD.


Chart 3. Daily GBP/USD.


Notes: EMA 50 – brown line; EMA 100 – green line; EMA 200 – orange line.

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[Dmitry Shagardin]

USD/JPY. Technical analysis. Tuesday, 10:20 GMT+3

On Tuesday, the pair continued to weaken as Japan announced a ¥7,2 trillion stimulus package. The pair yesterday traded below ¥88,30 and is currently a few pips away from the 50% Fibo retracement level of the recent ¥84,84 - ¥90,76 advance. Therefore if ¥87,80 gives way then be advised that the next levels of support come in at ¥87,15 and then ¥86,10. However, any signs of a reversal at or near ¥87,80 could see the pair head towards ¥89,00 and possibly ¥89,50. However, judging from the current speed of the decline a breach below ¥87,80 is highly probable for a challenge of ¥87,15.
At H1 chart, MACD moves down in negative territory. Both lines of stochastic oscillator decline in neutral area. “Slow” RSI and “fast” RSI grow in neutral area. The possibility of upturn movement is likely possible in short-term period. The nearest resistance is at ¥88,20 – maximum of December, 9th and 50- and 200 EMA.

Chart 1. H1 USD/JPY.


Chart 2. H4 USD/JPY.


Chart 3. Daily USD/JPY.


Notes: EMA 50 – brown line; EMA 100 – green line; EMA 200 – orange line.

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