Weekly Analysis

Weekly Analysis (29/08/2016)

Hi Guys,

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



The pound saw bullish candles print for the first three days of the week, moving back into the resistance zone of 1.32 and the middle of the range which has been ongoing since BREXIT. Price in fact formed an inside bar on Thursday at this resistance and short term downwards trend line, before Friday’s movement which printed a engulfing bearing pin bar.

Compared to other currencies, the GBP didn’t move a huge amount off the Yellen’s speech, but it still created a reaction which saw the candle close bearish below resistance and the trend line. We will possibly see further downside, back down to test the lows at 1.286.

> Resistance Areas: 1.32, 1.37, 1.40, 1.44 & 1.48
> Support Areas: 1.28




In last weeks post I identified an area with key confluence of horizontal support and short and long term trend lines all crossing each other at 1.1232 area. This week saw rice move down towards this key area, however off the back of Yellen’s speech powered through the support and trend lines to close below on Friday. Similar to the Pound, Thursday created a inside bar pattern and Friday printed an engulfing bearish pin bar.

Because we have broken through these levels, and the upwards trend channel price was in, with a large power candle, there could be further downside expected. A retest of the broken support and trend lines would be a good opportunity to get short.

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



The Aussie has had an interesting week. In my previous post I mentioned I was looking for a break to the upside after a test of 0.76. Price had moved down to this level and consolidated for most of the wick with a lot of long tailed wicks (bullish & bearish), showing some indecision in the market. It wasn’t until Friday’s speech that price finally saw some meaningful movement. First it broke out to the upside making new weekly highs, before being rejected and pushing through the 0.76 area and several trend lines, to close just above the 50EMA.

In hindsight looking at the recent highs, price had been creating a lot of long rejection wicks on the daily chart, signaling sellers are trying to push price back down. Now with Friday’s news and the breaking of key support and trend lines with a strong engulfing bearish pin bar, we could expect price to move further South to test the 0.74 horizontal support and a longer term upwards trend line.

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




As with the Aussie Dollar, last week I was expecting a push up, out of the wedge pattern price had found itself in after a bounce off the upwards trend line of the wedge. This week we saw a move to this level and a rejection on the Monday which resulted in a push to the upside. However nothing too convincing as each bar printed rejection wicks. Wednesday and Thursday’s candlesticks showed rejection wicks but were also within the range of Tuesdays bar, creating an inside bar. It wasn’t until Friday that we saw a push to the upside once again and a bigger rejection before moving strongly to the downside and breaking through the trend line of the wedge.

With a strong rejection above and a strong close below the upwards trend line, further downside may be expected, although support of 0.72 is just below, seeing a break of this level will only confirm the downside momentum.

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


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.