Daily Forex Technical Strategy (Mon 25 Nov)

Further potential USD strength seen in EUR/USD. GBP/USD & AUD/USD while USD/JPY continues to churn.

EUR/USD – Broke below 1.1050, down move validated

click to enlarge chart

  • The pair has staged a breakdown below the lower limit of the 1.1050 neutrality zone on last Fri, 22 Nov as per highlighted in our previous report (click here for recap).
  • Flip to a bearish bias in any bounces below 1.1050 key short-term pivotal resistance (former minor range support from 20/22 Nov 2019 & the 61.8% retracement of the recent slide from 22 Nov high to today’s 25 Nov Asian session current intraday low of 1.1014) for a further potential push down to target the next near-term supports at 1.0990 and 1.0940 (also the lower boundary of the minor descending channel from 31 Oct 2019 high).
  • However, an hourly close above 1.1055 negates the bearish tone for a push up to retest 1.1090 (minor range top since 06 Nov 2019 high & close to the upper boundary of the minor descending channel).

GBP/USD – Failure bullish flag breakout, minor corrective slide reinstated

click to enlarge chart

  • The pair has broken below the 1.2880 key short-term support that has invalidated the prior minor “bullish flag” breakout triggered on 18 Nov 2019.
  • Flip to bearish bias below 1.2975 key short-term pivotal resistance for a further potential corrective slide to target the next near-term support at 1.2700 (former minor congestion area of 11/16 Oct 2019 & 38.2% Fibonacci retracement of the previous rally from 09 Oct low to 21 Oct 2019 high) with maximum limit set at 1.2570.
  • However, a break with an hourly close back above 1.2975 revives the bullish tone for another round of impulsive upleg sequence to target the next intermediate resistance at 1.3210/3240 (3 Apr/03 May 2019 swing high area & Fibonacci expansion).

USD/JPY – Churning remains in progress

click to enlarge chart

  • The pair has continued to churn within the medium-term bearish “Ascending Wedge” range configuration in place since 26 Aug 2019 low with mix elements now.
  • Prefer to turn neutral now between 109.05 and 108.25 where bears need to have a break with an hourly close below 108.25 to trigger a bearish breakdown to target the next supports at 107.90 follow by 106.60 next. On the flipside, an hourly close above 109.05 sees a push up to retest the recent 08 Nov 2019 swing high of 109.50 and even the upper boundary of the Ascending Wedge at 110.25/60 (also the former major ascending support from Jun 2016 low).

AUD/USD – Bearish tone remains intact

click to enlarge chart

  • No change, maintain bearish bias below 0.6845 key short-term pivotal resistance for a retest on the recent 14 Nov 2019 minor swing low area of 0.6770 and a break below it reinforces a further potential drop to target the next near-term support at 0.6720 (09/16 Oct 2019 swing low areas & lower boundary of the minor descending channel in place since 05 Nov 2019 high).
  • However, a clearance with an hourly close above 0.6845 negates the bearish tone for squeeze up to retest 0.6900/6930 (31 Oct/05 Nov 2019 swing high & the major descending channel resistance from 03 Dec 2018 high).

Charts are from eSignal

Disclaimer: The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.

Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Losses can exceed your deposits. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex and commodity futures, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that we do not provide any investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to Forex.com or GAIN Capital refer to GAIN Capital Holdings Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.

Open an Account