Technical Analysis | November 2012

EUR/USD GBP/USD USD/JPY USD/CHF AUD/USD USD/CAD

EUR/USD
Downside structure appears promising on the EURUSD with the formation of a double top pattern on the daily chart. The currency pair accelerated selling after breaching SMAs, breaking through the consolidation low at 1.2801, increasing the chances for a bearish wave. At the time being the currency pair remains below 1.2801 broken support however is limited by the lower Bollinger band at 1.2763. Breaching 1.2763 will shift focus the next lower boundary at 1.2614. Alternatively, should the lower Bollinger band hold ground the FX pair could bounce up to 10 and 50 SMAs at 1.2897 ahead of weekly peak at 1.3017. RSI (14) is moving on the same direction with the prices confirming lower lows, however Momentum (7) is marginally bullishly diverging, hence possibilities for a retracement or a consolidation in the short-term are slightly more than earlier.

GBP/USD
The dynamics of the last two months for GBPUSD looks contradictory. There is no sharp trend that is confirmed by too low current values of the ADX trend strength indicator. The pair has been trading predominantly within 1.5910-1.6150 sinse the beginning of October, approaching to the lower border now. The nearest strong support may be expected at 1.5910 or slightly higher. There is a lower line of Bollinger Bands indicator located at the same level for now, as well as the 38.2% of Fibonacci extension for the growth wave within 1.5270-1.6310. The approach to 1.5900 may provide opportunities of opening new long positions. Stochastic warns that the pair may possibly be oversold. Closing below 1.5850 can serve as a confirmation for GBP lowering prospects and additional sell signal, the current values of 100 - and 200-DMAs.

USD/JPY
USD/JPY shows the sharp uptrend, starting in the end of September. Seems like the current growth segment will have 5-waves structure. At the moment, it is hard to precisely define if the 4th correction wave is ended or not. The fact that the current drop correction is confirmed in particular by the RSI indicator that does not get below 40. There is no exclusion that the pair may retreat below the channel line, around 79.15. As it is seen, the other strong support zone is located at 78.75.

Either way, any price retreat will be considered as an opportunity of buying for the purpose of local high at 80.37 renewal and probably for heading to 80.80.

USD/CHF
In the previous report on USD/CHF we noted the divergence between price movement and oscillators that can be considered as a reversal signal in the US dollar favor. The growth higher than the trend line at the level 0.9300 has become a confirming signal for buyers. As a result, the pair has grown to 200 DMA at 0.9385 and now it keeps the growth potential. The resistance breakthrough at Andrewss pitchfork may open the passageway to 0.95 at 50% fibo-correction. To reverse trend in bearish direction, the price movement lower than 0.9250 is required.

AUD/USD
The situation regarding AUD/USD did not change significantly since the last tech analysis report. It is still traded around 200daily average. We noted that only violation of Andrewss pitchfork signal line can provide a strong buy signal to the bulls. This vision is kept in force. The price tested the designated area, and now slightly pulls back. Two nearest sessions closure is important for further dynamics definition. The US Labor market data (for September 1 and 2) can lead to significant movement of the pair. Bulls can take an advantage when the resistance at 1.0380 is violated; bears will be favored as soon the price moves below 1.0300. Target levels in case of breakthrough are shown on the chart.

USD/CAD
Growth in USDCAD started in the middle of September was arrested slightly higher than the parity level at 1.0020. There is also 200-daily SMA located at the same level that increases importance of this resistance. According to this circumstance, closing higher than 1.0020 could provide a new growth impulse for the pair. However, the tech indicators currently testify in the price lowering favor: price divergence in Stochastic dynamics, MACD fallen lower than the signal line and the upward movement weakness confirmed with ADX. The nearest support levels appear at 0.9920 (SMA 20) and 0.9870 (fibolevel at 38.2%).