Week Ahead 15th June Technical Analysis from FXMars

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Week Ahead 15th June Technical Analysis from FXMars

Postby fxmars » Sun Jun 15, 2014 8:46 pm

Posted by fxmars.com
The price has completed about 80% of the double top formation (green) with tops from March 13 and May 8 on the D1 chart. Furthermore, the pair went through the support at 1.35583, which speaks of a continuation of the downward activity. The latest movement of the price happens in a bearish corridor (yellow), which is a result of the bearish movement of the double top formation. As you see, in the last three trading days the price was testing the lower level of the yellow corridor, and a bullish bounce even occurred. For this reason, we believe that the price might eventually do a bullish correction of the downward movement, before any other decrease. The stochastic oscillator is about to give a signals for an oversold market, which supports the correction of the bearish movement.
After testing the interaction point of the 102.770 resistance and the lower level of the purple triangle from the end of December 2013, the price bounced in bearish direction. The followed bearish movement broke through the 3-times tested blue bullish trend line from May 21. After two bearish candles on D1, the price created a bullish candle, which established a bottom at 101.587. As a typical change in a trend, we expect the price to meet the small blue bullish trend line as a resistance and eventually to bounce from it. In such case, the 101.587 would be a crucial level for the continuation of the bearish movement. After all, after the bounce from the 102.770 resistance, the price is expected to meet the 101.197 support and eventually the 100.756 support.
After creating an impression for a double top formation on D1, the cable increased again to the resistance at 1.69952. Currently, the price demonstrates that the level is stronger than the price, which is the reason for the decrease after the interaction with the level. At the same time, the stochastic oscillator is about to enter the 100-80 zone, which would signalize for an overbought market. If the price bounces from the 1.69952 resistance, an interaction with the supports at 1.68377 and 1.67214 is likely to occur. If the price breaks through the 1.69952 resistance, the level might be turned into a support, which would probably be the beginning of a new bullish wave.
After the price formed a bottom at 0.89045 (blue), the price went through the resistance at 0.89486 and formed a top around 0.90100. This top lies on a bullish line (pink) with the last few tops of the price, which means that the line might be perceived as a resistance. Having in mind that the price decreased its intensity after interacting with the pink line, we could expect the price to decrease again, for example, to the 0.89486 support or even to the blue support at 0.89045. Furthermore, there is a small bearish divergence between the price and the stochastic oscillator, which supports the bearish correction. Moreover, the stochastic oscillator is about to enter the 100-80 zone and to signalize for an overbought market. On the other hand, we should not forget that there is a big and confirmed double bottom formation here (green), which is likely to send the price higher and higher. On its way up, the price might meet the resistances at 0.90367 and 0.90825.
The Aussie broke through the purple bearish line from April 10, which rapidly decreased the bearish expectations in some way. The price even broke the resistance at 0.93787 and currently the price is testing it as a support. Having in mind the break through the purple bearish line, we might expect the price to decrease to the same line and to test it as a support before any further bullish activity. At the same time, the stochastic oscillator gives a clear signal for an overbought market, which supports the eventual decrease. If the price breaks through the 0.93787 support, it might reach the purple bearish line as a support, or even the 0.92027 support again. If the price bounces in bullish direction, the crucial level would be resistance at 0.94580, which indicates the 6-months high of the price.
The price has been moving in a bearish corridor recently. The beginning of the corridor was set by a small top on March 23. This bearish corridor brought the price through the 1268.56 support on May 25, which set a second bottom and the lower level of the corridor respectfully. Currently, the price is moving toward the upper level of the corridor and it is about to reach it in the next few days. During the interaction with the upper level of the corridor we should be careful for a break or a bounce, because, as we see, the tests of the upper level of the corridor are much more intense than the tests of the lower level. The more likely outcome would be a bearish bounce from the upper level of the corridor. Furthermore, the stochastic oscillator gives signals for an overbought market. If the price bounces from the upper level of the corridor an interaction with the supports at 1268.56 and 1230.82 is likely to occur.

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