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Daily Forex Technical Strategy (Fri 19 Jul)

EUR/USD – Mix elements

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  • Surpassed above the 1.1250 key short-term pivotal resistance that has negated the preferred bearish tone. Mix elements at this juncture; prefer to turn neutral between 1.1285 and 1.1240. An hourly close above 1.1285 shall validate an extension of the corrective rebound towards the 1.1345 intermediate resistance in the first step.
  • On the flipside, a break with an hourly close below 1.1240 reinstates the bearish tone for a slide back to retest the 1.1180 minor support.

GBP/USD – Countertrend rebound target met, watch 1.2590 key resistance

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  • Push up as expected and met the minor countertrend rebound target of 1.2520 as per highlighted in our previous report (click here for a recap).
  • Hovering right below the descending channel resistance in place since 03 May 2019 high coupled with an extreme overbought reading seen in the hourly RSI oscillator. Flip to a bearish bias below 1.2590 pivotal resistance for another potential downleg to target 1.2450 follow by 1.2370 next.
  • However, an hourly close above 1.2590 invalidates the bearish tone for an extension of the corrective rebound towards 1.2760 range resistance.

USD/JPY – Further drop in progress

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  • Broke below the 107.80 downside trigger level as expected. Key short-term elements remain negative, maintain bearish bias below a tightened key short-term pivotal resistance now at 107.95 for a further potential push down to target the 107.10 near-term support in the first step.
  • However, a clearance with an hourly close above 107.95 negates the bearish tone for a squeeze up to retest the 109.00 key medium-term resistance.

AUD/USD – Descending Wedge bullish breakout

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  • Broke above with a daily close above the 0.7050 pivotal resistance that has invalidated the preferred bearish scenario as per highlighted in our previous report.
  • Yesterday’s bullish price action has surpassed the upper boundary of a medium-term “Descending Wedge” range configuration in place since 03 Dec 2018. This observation suggests a more pronounced corrective rebound is in play (multi-week) to retrace the former major downtrend from 22 Jan 2018 high.
  • Flip to a bullish bias in any dips above 0.7035 key pivotal support for a further potential push up to target the next intermediate resistance at 0.7130. However, a break with an hourly close below 0.7035 indicates a failure bullish breakout for a slide back towards 0.6960 in the first step.

Charts are from eSignal

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