Daily Technical Analysis by Admiral Markets

[B]GBP/USD Rooftop pattern in progress[/B]

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The GBP/USD is dropping from 1.3450 zone on a strong rooftop pattern momentum. The pattern is huge and sell into rallies could be the option now provided that bearish momentum on higher time frames is intact. POC (61.8, EMA89, inner trend line) 1.3285-1.3300 should reject the price towards 1.3235. If 1.3235 breaks next is 1.3208. 4 hour close below should tank the pair towards 1.3152. If you take a look at daily chart you can see a dark cloud cover lurking at resistance where a giant rooftop pattern is on H1 timeframe. It hints for additional confluence for short trades.

EUR/USD Continuation is possible


The EUR/USD has rejected from POC as show in yesterday’s Session Recap webinar and today we might have a continuation caused by weaker than expected German ZEW economic sentiment result. 1.1235-45 zone could provide a continuation from yesterday’s drop off 1.1270 zone as long as 1.1280 stays strong. LVZ - Low volatility zone has shown within POC that is consolidating at EMA 89 and we could also see a potential M pattern. Targets for the down move are 1.1200 and 1.1175. Additionally we can see a pinbar on daily chart cueing for a further bearish continuation.

USD/JPY another higher low is printed out

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The USD/JPY aka “ninja” has been printing out higher highs and higher lows on intra day charts. If 101.75 holds we might see another push towards 102.70 and 103.05 as we can see a T89 on H4 chart. POC comes withing 102.05-102.18 (trend line/steep trend line, L3, X-Cross ™,historical buyers). Although I am not a fan of steep trend lines, this one follows the price and it is making an X-Cross ™ with other confluence factors. New rejection could use a fresh momentum from a new higher low towards fresh daily highs. However if 101.75 fails we could see a dip towards 101.30.

[B]EUR/USD hidden bullish divergence at 88.6 fib[/B]

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The EUR/USD has dropped to POC zone on 4h time frame which is still showing uptrend. August trend line is making an X cross ™ with H3 camarilla and weekly pivot point suggesting a possible retest. Daily bearish candle could use some retracement to the upside based on a direct drop on Friday. POC zone (88.6, trend line) is supported by hidden bullish divergence so the zone 1.1145-1.1166 could spike the price to the upside targeting 1.1200 and 1.1225. If the divergence fails and the price drops below 1.1115 we could see 1.1080 followed by 1.1050 and 1.1020.
Only if the price breaks 1.1225 the door towards 1.1280 will be open.

[B]EUR/USD showing strength due to USD weakness[/B]

The EUR/USD is showing strength due to neutral to dovish FED and USD weakness. The USD weakness is even more pronounced as EURGBP is flat and DAX is pushing higher that goes completely in accordance with my previous DAX analysis and US Fed decision market impact. There is a risk-on in the markets because Bond Yields are staying the same.

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At this point EUR/USD POC zone is 1.1200-1.1215 (H3,38.2,historical buyers) and a pullback towards the zone could be use for potential long trades. However a clear break and close above red trend line is needed for price to push higher towards 1.1263 that is an X-Cross ™ target confluence. 1.1285 is showing historical sellers so we might see some sell off around this level.

[B]NZD/USD Weekly pinbar suggesting bearish pressure[/B]

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The Kiwi - NZD/USD is riding higher time frame momentum. Piggyback weekly sell is reflecting on lower time frames where we could start searching for short trade opportunities. I see 2 possible scenarios. If the price proceeds below the 0.7220 and if we see 4h close below it, we could see 0.7195 and 0.7150. A pullback to POC (H3, DPP, EMA89, 38.2, inner trend line) 0.7260-75 could spike down the price towards 0.7220 and below. Judging from both weekly and daily trend and momentum, targets could be even lower then L5 is suggesting if the NZD/USD keeps dropping and we will assess it once (and if) the target L5 is reached.

[B]GBP/USD supported at 88.6 fib[/B]

<img src=“https://s13.postimg.org/z4qqb51vb/Today.jpg”>

The GBP/USD is currently rejecting off 88.6 after it dropped straight from POC zone I showed in the live webinar. 88.6 has held the drop making a double bottom and the GBP/USD is rejecting. New POC comes around 1.2970-1.2990 (H3, WPP. 78.6, X-cross) and the rejection might spike it up to 1.3060 where we see a confluence of a steep trend line and previous top. Further advancement targets 1.3090 zone and ONLY above it there is a scope for 1.3170. If the 4h candle closes below 1.2930 then the price might proceed to 1.2865.

[B]GBP/JPY Bearish M pattern but bullish price action[/B]

<img src=“https://s22.postimg.org/u73jqw841/Today.jpg”>

The dragon, GBP/JPY shows a huge M pattern on H1 time frame, but there are lack of sellers who could tank the price more to the downside. DAX has been bullish today despite problem with Deutsche Bank (DB). DAX had a massive gap down to start with and DB is down 4 % today. Only EU 13.9BN now of worth with a USD 14BN claim makes DB technically insolvent, and DAX might lose momentum to the upside that could reflect also on GBP/JPY pair that has a very high positive correlation with DAX.
Technically because we have 2 contradicting patterns we ideally want to see breakout. Above 131.45 there is a strong scope for 131.92 and 132.20, but if 131.45 rejects the price we might see 130.90 again. Below 130.90, 130.45 and 130.00 are targets. No man’s land in between.

GBP/USD could possibly target 1.2796 short term

UK Prime Minister Theresa May said the U.K. would begin the formal process of leaving the European Union by the end of March 2017 and the pound was hit hard. Both technically and fundamentally the pair is aligned now and we might see a retest of 1.2796. At this point bears are in full control.

Bearish channel, inner trend line, 38.2, L3 and multiple rejections at POC 1.2915-30 might reject the price in the case of another retracement and if the pair proceeds below 1.2845 we might see 1.2796. In order to stay bearish short term the GBP/USD must stay below 1.2950.


GBP/JPY bearish channel in progress

The GBP/JPY has been contained within a bearish channel and it is bouncing from the support caused mainly by news that DB (Deutsche Bank) is closer to finalizing their claims with US regulator. German equities are up, FTSE is also up but GBP is still down as suggested in my previous GBP study.

Technically POC (H4, the top of the channel, 50.0, historical sellers) comes within 131.20-35 zone but we should also pay attention to H3/EMA89/38.2 strong resistance around 131.00 round number. The rejection is targeting 130.15 and on H1 momentum or H1 close below 130.07, next target is 129.75.


[B]EUR/GBP is forming reverse bearish divergence[/B]

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The EUR/GBP is coming closer to important resistance and the price is forming reverse bearish divergence. As we can see on our daily chart, the price has formed bearish pinbar so it might reject off the zone and start retracement move. The possibility that the price might reject off 0.8855 zone towards H4 and H3 camarilla pivots gets even more pronounced if we see double top( or chart pattern close to double top). However if the price retraces to POC ( EMA89,61.8,bullish order block) within 0.8760-70 zone we might see another trend trading opportunity towards 0.8850 again. Have in mind that divergence is not confirmed until we see a double top-ish price. If it doesnt happen In the case the price proceeds further above the high, 0.8900 could be tested short term.

USD/CAD triangle breakout in uptrend


The USD/CAD broke through the symmetrical triangle and is heading towards H3 weekly pivot point. In the case the price stays above 1.3220 the pair should reach 1.3360 short term. The problem for bulls might be that the price is showing huge bearish divergence and in the case the price starts dropping, I would be watching for 1.3130-50 POC zone (L4, symmetrical triangle, historical buyers). Daily chart shows strong bullish candle too, so the scenarios are:

 1.The price stays above H3 - 1.3220 and proceeds directly to 1.3300 and 1.3360.
 2.Divergence plays out, price drops below 1.3220
 3.Possible bounce within POC zone 1.3130-50 towards 1.3360.

If the price breaks below 1.3040 bullish scenario will be negated.

EUR/JPY bullish momentum is strong


The EUR/JPY has broken the trend line in a strong uptrend and that is the signal for a possible retracement. As we could see on yesterday Session Recap the GBP/JPY has respected bearish analysis/setup and I expect similar to happen with EUR/JPY as it is connected to Yen carry trades. POC zone comes within 114.55-70 (H3, bullish order block) and it is in a close vicinity of 50.0. In the case of deeper retracement next POC zones comes within 114.10-25 (L3,WPP, previous double top). The price could be rejected towards 115.40 and if we see a 4 hour close above 115.50 way towards 116.30 should be open.

[B]GBP/USD watch for 1.2225-50 zone[/B]

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The GBP/USD is still sold on rallies as analysed in our previous analysis. Today First Brexit hearing begins in the UK High Court and there could be some whipsaw movements in the currency pair. From technical perspective POC zone comes within 1.2225-50 and the zone is a bit wider due to high ATR. The pair is contained within the equidistant channel and we can spot a confluence of channel top, H3 and bearish order block. If the pair retraces to the zone we might see a rejection towards 1.2150 and 1.2090. Only a 4h close below 1.2090 could tank the pair lower to sub 1.2000 level 1.1990 where we see a confluence of H5 and channel bottom. However if the pair gets above 1.2300 we might see a breakout towards 1.2355 that will be a sign of a deeper retracement in the GBP/USD pair.

[B]GBP/JPY contained in Rising Wedge pattern[/B]

<img src=“https://s22.postimg.org/gy29vlag1/2016_10_17_13_47_06.jpg”>

The so popular “Dragon”, or GBP/JPY currency pair has really showed substantial movement within the bearish context. At this point we can spot running (still shaping up) rising wedge pattern. The running rising wedge can occur after a sharp retracement to the top of the wedge and then fall or as the wedge breakout below the low. LVZ pattern (red rectangle) marks low volatility zone and we might expect movement soon. If the pair starts a retracement watch for 127.00-15 zone (LVZ, Bearish order block, EMA89) rejection. If we don’t see any retracement a breakout below 126.35 might tank the pair down to 125.94. Only a 4h close below 125.94 might further weaken the pair towards 124.90.

[B]EUR/AUD M double top shaping up[/B]

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The EUR/AUD is making a progressive M pattern characterized by a double top which in turn makes a POC zone (H3, DPP, trend line) 1.4340-50. The move has already happened so any retest could reject the price again (2nd rejection). Ideally inner trend line should hold for continuation of bearish move. Further continuation is seen below the inner trend line and if H1 candle closes below 1.4280. Close below would target 1.4245 and h4 close below 1.4245 should aim for 1.4185.

USD/JPY Lower Highs and Lower Lows zig-zag

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ECB is unclear on its QE with regards to tapering or the end of the programme. Equities tanked due to due to the uncertainty around further ECB steps.Initially we saw de-risking but stay tuned for greater clarity in the December ECB meeting. In the aftermath of ECB, Philly’s Fed went better than expected while the US initial jobless claims came in at 260K vs. 250k estimate.
Technically USDJPY might drop further from 2 POC zones. Watch the reaction around POC1 (H4, trend line, 61.8, EMA89) within 103.80-90. If the pair proceeds above 114.05 we might see POC2 getting hit within 104.08-20 zone (H5, 88.6, trend line). Both rejections should target 103.40 and 103.20 subsequently. Only h1 momentum or 4h close below 103.15 should open the door for 102.65 test.

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USD/JPY Reversal might show up soon

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As we could see, the price respected the latest USD/JPY analysis rejecting from POC2 zone. However, with most eyes on USD data this week including, New Home Sales, Crude Oil data, Advance GDP data, we may see some additional USD volatility. BoJ will be watching their CPI data with close eyes; but I expect the bullish trend in Equities to continue with risk-on causing weakness in JPY and the general bullishness in USD to continue. We might see an uptrend until October 31. Remember Risk-on is JPY weakness into USD strength. Risk-On means investments are going long into Equities and Real Estate, in other words, traders long risky assets. When its Risk-On, JPY usually weakens. But what we have right now, is also USD bullishness.
Technically POC zone 103.70-80 (61.8, EMA89, trend line) could reject the price towards 104.10 and 104.50. We can also see a momentum trend line broken to the upside. Additionally 1h momentum or 4h close above 104.20 would further spur bullish momentum towards 104.50 and 105.00 eventually.

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[B]GBP/AUD steep trend line marks bearish zigzag[/B]

<img src=“https://s14.postimg.org/97e4l8oip/Nenaaaad.jpg”>

GBP basket has been moving a lot since Brexit vote and mostly it has been sold into rallies as I suggested. Our latest Session Recap GBP/USD trade analysis and setup has provided us with more than 120 potential pips. As our correlation table suggests, the GBP/USD and GBP/AUD have a very strong positive correlation so they move in the same direction.
The GBP/AUD is technically very bearish and we can see it on our chart. Steep trend line, L3, bearish order block make POC zone 1.5880-95. Traders should watch for any short term rejection of POC. But I would suggest paying attention to POC2 because the first POC’s trend line is to steep so it could break. If trend line breaks we could see retracement to POC2 - 1.5960-90 (DPP, H3, EMA89, X-cross). Have in mind that POC zones are wider due to ATR of the pair that is much higher than any major cross, but the chance to capture even more pips is exponentially higher if we get in the right direction.

[B]GBP/USD at resistance after 150 pip drop[/B]

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If you follow our Session Recap webinars you could have made more than 120 pips on previous GBP/USD analysis and setup. Today the Advance GDP data release has spiked the price to the upside giving us another potential chance to position for a new short trade setups. 1.2280-1.2305 is the zone where price should reject. POC zone (inner trend line, H3/H4, 88.6 fib, historical sellers) is the deeper retracement for the pair. If we see a 4h close above 1.2340 the price might turn in a short term uptrend on H1 and we would need to look for 4h time frame for further shorts. Targets are 1.2200 and 1.2141. 4h close or strong H1 momentum below 1.2140 targets 1.2080 as the first target again prior to 1.2000 flat.