Trend Line Analysis : 21/08/2015

Introduction to Trend Line Analysis
Welcome to our newest feature; Trend Line Analysis. Our professional market technician showcases intraday / swing trade setups on a broad spectrum of FX currency pairs. The most effective way to use the setup are:
▪ If indicated price zone holds; consider partial profit taking between 20-40 pips before aiming for the maximum listed target.
▪ If the price zone fails to hold; we likely to see price moving against us. Fail means; the candle closing higher or lower to indicated price zone.

 

GBPUSD

The pair is seeing a lackluster move; as it is about to do something and something soon. We are looking at T2 been the possible range top and as such decent looking resistance to set shorts up if we see a test to it and a hold.

Overall dynamic seems bullish on the pair; hence T2 serves as a break point but with a possible wedge formation within the channel ( T2 & T5 ) hinting that perhaps we can yet see a test lower to the T4 zone before next round of buying possibly lifting the pair higher.

GBP is caught up on anticipation whether it can see rate hikes sooner or later. It’s a debate that’s been lingering on for quite some while and perhaps it will come but not anytime soon. With dovish FOMC where most of the USD majors rallies; GBP failed to test the resistance and was found weaker on the crosses as well.

Hence; with no major news event tomorrow on the pair; any move unfolding to test the 5740 or around zone and a hold to it; would prompt us to go short aiming for initial 50-60 pips with 5575-80 been the main support to look for target. Incase opting to hold to see whether we can break and close under T5; 542X comes in as an excellent target run on the shorts.

Alternatively can look to buy a clean break higher to 5740-45; for it opens up the run towards 59XX on the pair.

GBPUSD 8 hrs - T2 possible Range Top - A test & hold constitute shorts off it
GBPUSD 8 hrs – T2 possible Range Top – A test & hold constitute shorts off it

CADJPY

The two stand along currencies; both distinct as compare to other USD majors.

We are looking at a possible falling wedge pattern and T1 zone comes in as the base and a tempting spot to try longs in anticipation of a lift off towards T3 ( dotted trend line ).

CAD has been hit hard past few days on falling oil prices; only to recover some ground today on rising oil prices. The rate cuts earlier along with falling commodity prices had subdued CAD for a while now. CAD is finding some technical resistance  towards today’s high and along with dovish FOMC and possible lift off on the oil  can cause the pair to carry out a relief rally.

JPY as been benefiting with the falling stock prices and has been bought up on safe heaven status. It carries an important support towards 123.10 zone and likely to get tested which can see CADJPY to our desire levels.

CAD has some hard hitting data tomorrow in the form of CPI and Retail Sales and as such would expect the pair to carry a heavy tone. Amongst the expected volatility on the CAD; it can strike lower to the base of the falling wedge and if holds we have a case for some longs to consider for an optimum move towards T3.

CADJPY - 8 hr - T1 possible base of the falling wedge tempting to buy on a test
CADJPY – 8 hr – T1 possible base of the falling wedge tempting to buy on a test

 

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