Weekly Analysis

Weekly Analysis (17/07/2016)

Hi Everyone,

This weeks post covers my view on Cable, EUR, Aussie & Kiwi.

Any questions, get in contact with me at  enigmaforex@hotmail.com or @Enigma_FX

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GBPUSD

The Pound this week moved up from 30 years lows after breaking out of a small consolidation consisting of a several inside bars, with the break happening on Tuesday. After the initial move upwards, price traded around 1.32 S/R level before moving higher still to re-test 1.347. It was unable to break above and similar to the EUR had a down day on Friday, ending up back in the 1.32 level.

As it currently stands the GBP has created a small Head and Shoulders pattern, a break above the 1.347 level would signal continued movement upwards, any strong movement to the downside would negate this pattern.

> Resistance Areas: 1.37, 1.40, 1.44 & 1.48
> Support Areas: 1.32

GBPUSD_TV_Daily_170716

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EURUSD

This week the EUR has continued to trade in a range, having ended the week down at the 1.106 zone, price begun pushing upwards during the week reaching the highs of last week around 1.115. What’s interesting to note is on its upwards journey, the daily candle sticks kept producing large wicks showing signs of rejection. As it happens price reached 1.115, failed to close above previous highs and promptly dropped on Friday before closing back in the 1.106 support area.

The 1.115 zone has been a key short term support / resistance level over the past month or so, having had several rejections / consolidations around the area.

Although Friday’s candlestick printed strong selling momentum and closed within the 1.106 area, a break and close below 1.10 would provide a stronger confirmation of the EURs downward intentions as it is still trading within the wedge pattern after the wake of BREXIT.

> Resistance Areas: 1.146
> Support Areas: 1.08 & 1.106

EURUSD_TV_Daily_170716

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AUDUSD

The Aussie had a slow start on Monday, trading within last Friday’s candlestick range, creating an inside bar. Tuesday saw an strong push upwards, breaking through the 0.76 resistance and downwards trend line. From there, there wasn’t any follow through, price over the next two days just hovered just above 0.76. Friday’s bar created an engulfing pattern, having engulfed both Wednesday’s and Thursday’s price action.

Although we finished the week back below 0.76, we have been in an uptrend since the end of May, if price can push back down, I would expect a bounce off 0.75. But if we see a convincing push higher, target of 0.784 and previous highs will be on the radar.

> Resistance Areas: 0.784, 0.79 & 0.76
> Support Areas: 0.74 & 0.725

AUDUSD_TV_Daily_170716

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NZDUSD

Looking at my last weeks analysis I mentioned price could retrace back down to the short term support shelf of 0.712 as a re-test before continuing upwards. Price has in fact done that, but not in the way I had expected. The Kiwi was ranging around the highs of the previous week, before seeing some large movements to the downside on Thursday and then again on Friday. It was Friday’s bar that hit the 0.712 and in fact closed just below it.

Because we have seen two days of strong downward movement, the 0.712 support level could see a complete break and let price move further downwards. We would still however have the support of the long term upwards channel (bottom trend line), and at this rate the 50EMA.

If you zoom out on the daily, you an clearly see that price is going from the bottom left of the chart to the top right, identifying an upwards trend. And as we have long term momentum towards the upside, I favor continued movement in that direction.

> Resistance Areas: 0.742
> Support Areas: 0.674, 0.689 & 0.72

NZDUSD_TV_Daily_170716

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Disclaimer
Market commentary and trade ideas are solely my opinion and are not to be considered as trading advice. Presented in a blog format, it is intended for informative and entertainment purposes only. Please do not follow or act upon these opinions, you should undertake your own analysis and be aware of the risks involved.  
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