Daily Technical Analysis for EURUSD as at 31st October 2013
DAILY OVERVIEW
Trend : Long
Ambush Zone : -
Target 1 : -
Target 2 : -
Stop : -
Comments
Yesterday EURUSD opened and closed under the 8 period moving averages and this negativity has continued this morning with a breach of the 1.3710 support are. With support being in the area of trend line and 34 period moving averages it would not be unexpected to see the price action trading down to these levels. A move to this area would also coincide with 50 to 61.8 Fibonacci support area.
However there appears to be a RSI positive divergence forming which would indicate that this corrective down move could lose momentum. This could lead the price action to flipping back up to the long side. The obvious question being do you start taking nibbles on the upside now or follow the market down to the support areas mentioned.
In terms of the daily trend the swing bias continues to be positive and this direction is being confirmed on the weekly time frame. Upside targets 1.3710, 1.3835 and 1.4250 all being previous isolated highs.
Scenario 1
As the dominant daily trend is up retracements into support could be viewed as buying opportunities.
Scenario 2
Alternatively as EURUSD is trading beneath the 8 period moving averages and the 1.3710 support level there is a possibility that the price action will correct further with targets being the area of trend line and 34 period moving averages.
Daily Technical Analysis for GBPUSD as at 31st October 2013
DAILY OVERVIEW
Trend : Long
Ambush Zone : -
Target 1 : -
Target 2 : -
Stop : -
Comments
Yesterday GBPUSD opened and closed beneath the 34 period moving averages and trend line support. This morning the price action is now trading deep into Fibonacci support.
GBPUSD does continue to trade above the prior isolated low. Furthermore GBPUSD is now trading within the previous day’s range and a positive RSI divergence is forming. This may indicate that this squeeze in volatility will lead to an upside pop.
However with the price action now printing a double top and trading beneath two broken trend lines there is also a probability that an attempt is made to breach the 16th October isolated low.
On an intraday basis the H1 (1 hour) chart seems to be putting in a double bottom. Our focus for the time being is 1.6077 and 1.5997 being the previous day’s High and low with a breach of these levels potential indicating the today’s market direction.
On a daily swing bases GBPUSD continues to trend positively on both daily and weekly time frames. However the current price action would appear to be attempting to print a lower high. Therefore it is important for the health of the current uptrend for the price action to not trade beneath the 16th October isolated low. Furthermore if GBPUSD can trade above the isolated highs of the 23rd and 1st October then the 1.6400 target level that coincides with a prior weekly pivot high will come back into play.
Scenario 1
As the dominant daily trend is up retracements into support could be viewed as buying opportunities.
Scenario 2
Alternatively as there has been a breach of trend line there is a possibility of a move down to 1.5893 being a prior isolated low that was printed on 16th October.
Daily Technical Analysis for USDCHF as at 31st October 2013
DAILY OVERVIEW
Trend : Down
Ambush Zone : -
Target 1 : -
Target 2 : -
Stop : -
Comments
Following the printing of two bullish hammers at the 0.8930 level USDCHF has experienced a good corrective retracement past the 8 period moving averages. This morning USDCHF continues to trade higher. As the price action is now trading above the 8 period moving average value areas we are monitoring developments for signs of negative rotation that will push USDCHF back to the 0.8930 level.
However yesterday USDCHF did try to breach the 0.9020 level and a further attempt was made this morning. If USDCHF can overcome this level then the next target is the 34 period moving averages.
On a swing bases the trend continues to be negative with support areas on a weekly swing pivot basis being 0.8930 and 0.8570 areas.
Scenario 1
As the dominant daily trend is down corrective pullbacks could possibly offer selling opportunities with retracements back to the averages, the prior pivot low and broken support being value areas where shorts could potentially be added.
Scenario 2
Alternatively a breach of the 0.9020 level could see USDCHF trade up to the 34 period moving averages.
Daily Technical Analysis for USDJPY as at 31st October 2013
DAILY OVERVIEW
Trend : Short
Ambush Zone : -
Target 1 : -
Target 2 : -
Stop : -
Comments
Following the bounce off trend line support yesterday USDJPY traded higher and into the 34 period moving averages. This morning the price action opened negatively but continues to trade above this technical indicator. With USDJPY printing a higher low if the price action can now trade above the isolated high of the 17th October the swing bias will change to positive. However the current swing bias on the daily chart continues to be negative and this is confirmed by the negatively layered averages and downside pressure offered by Fibonacci resistance.
In terms of the bigger picture USDJPY continues to trade within a converging triangle. However the breach of the 96.80 level coincides with a prior swing low. This breach of this pivot has effectively changed the trend to short on a swing basis.
However the trend change to down maybe limited due to the strength of the uptrend’s that can be found in both Monthly and Weekly time frames. Therefore breaks of the converging triangle formation should be treated with care and possible entered after further confirmation is received.
Scenario 1
As the dominant daily trend is down retracements into resistance could be viewed as selling opportunities
Scenario 2
Alternatively the printing of a higher lower and with the price action now trading above the 34 period moving averages could prompt USDJPY to trade up to the 17th October isolated high.