January 19th 2021: Greenback Concludes off Best Levels; Forms Daily Shooting Star Pattern

January 19th 2021: Greenback Concludes off Best Levels; Forms Daily Shooting Star Pattern, FP Markets

Note – Charts provided by Trading View

EUR/USD:

Monthly timeframe:

(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)

Following the break of long-term trendline resistance (1.6038) in July, and subsequent break of supply at 1.1857/1.1352 in August, buyers made an entrance heading into the close of 2020 and recorded fresh multi-month highs.

This—despite January’s current slide off 2021 pinnacles (1.2 percent)—reasons additional upside towards ascending resistance (prior support – 1.1641) may eventually be on the horizon.

The primary uptrend has been in play since price broke the 1.1714 high (Aug 2015) in July 2017.

Daily timeframe:

Partly modified from previous analysis –

Demand from 1.1923/1.2001 has recently been thrown into the spotlight—a significant zone given it was here a decision was made to achieve fresh peaks above 1.2011 (September 1 high). Traders will also note the demand is complemented by trendline support (1.0774).

Through the lens of the RSI indicator, late movement last week swept aside trendline support and voyaged through the 50.00 centreline. The value currently stands at 42.50.

H4 timeframe:

After support at 1.2164 relinquished position last week, demand at 1.2040/1.2065 made an entrance on Monday, accompanied by a Fib cluster at 1.2063/1.2071 (38.2% Fib level/1.272% Fib projection).

Buyers failing to occupy the aforesaid demand area could perhaps unshackle bearish flow to daily demand located at 1.1923/1.2001.

H1 timeframe:

Braced on the back of RSI bullish divergence, buyers assumed control Monday, sluggishly lifting the currency pair out of a support area assembled from 1.2050 support, support at 1.2058 and the 100% Fib ext. at 1.2065.

With H4 demand at 1.2040/1.2065 providing additional technical impetus, H1 buyers could visit the 1.21 resistance level today and possibly even reach resistance at 1.2125.

Momentum, as measured by the RSI indicator, shows the value on course to approach the lower side of 50.00 following last Friday’s oversold condition.

Observed levels:

Partly modified from previous analysis –

The monthly timeframe remains calling for higher levels. However, in light of January’s slide, retesting demand at 1.1857/1.1352 is possible.

Daily demand at 1.1923/1.2001 could hold back selling, taking into account the area fuses with trendline support.

H1 support between 1.2050 and 1.2065, in association with H4 demand at 1.2040/1.2065 (and Fib cluster support), delivered a floor to work with Monday. This could trigger additional movement towards 1.21.

However, the threat of further weakness is also visible, potentially pushing through H4 demand to reach daily demand—an area the market is likely to monitor for bullish activity.

January 19th 2021: Greenback Concludes off Best Levels; Forms Daily Shooting Star Pattern, FP Markets

AUD/USD:

Monthly timeframe:

(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)

Following two spirited months of gains off demand at 0.7029/0.6664 (prior supply), buyers, despite January trading off best levels, appear free to explore as far north as 0.8303/0.8082—a supply zone aligning closely with trendline resistance (prior support – 0.4776).

In terms of trend, the primary downtrend (since mid-2011) remains south until breaking 0.8135 (January high [2018]).

Daily timeframe:

Partly modified from previous analysis –

Since January 6 refreshed 2021 tops at 0.7820, AUD/USD has consolidated gains.

In terms of technical levels to be mindful of, support at 0.7647 could wave in price action today. Buyers embracing this level throws light on supply at 0.7937/0.7890.

In terms of the RSI indicator, support at 60.00 collapsing on Friday draws support at 52.00 into range.

H4 timeframe:

Demand at 0.7665/0.7644 (prior supply) embraced price action on Monday, following an early trendline support (0.6991) breach. You may also recognise this zone shares space with daily support noted at 0.7647.

Demand at 0.7600/0.7625 stalks lower terrain, awaiting any break of 0.7665/0.7644. 0.7600/0.7625 was a key decision point.

H1 timeframe:

The uninspiring effort to hold 0.77 led H1 into demand from 0.7654/0.7672 on Monday, with early London attracting bullish flow.

0.7654/0.7672 is interesting in terms of technical confluence—fastened to the upper side of H4 demand at 0.7665/0.7644. However, according to the H1 chart, a break beneath 0.7654/0.7672 sheds light on support from 0.7623, which happens to coincide with H4 demand at 0.7600/0.7625.

RSI fans will also note the indicator exited oversold territory and is within close range of 50.00 and trendline resistance (prior support).

Observed levels:

While monthly price is poised to take on higher levels, the daily chart suggests a 0.7647 support retest may be in the offing beforehand. H4 demand at 0.7600/0.7625, therefore, could make a show (an area holding H1 support at 0.7623) and offer a platform to work with.

January 19th 2021: Greenback Concludes off Best Levels; Forms Daily Shooting Star Pattern, FP Markets

USD/JPY:

Monthly timeframe:

(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)

Over the span of four years, USD/JPY carved out a descending triangle pattern between 118.66/104.62.

Although December pursued terrain south of 104.62, January has so far arranged a modest comeback and is within relatively close range of retesting 104.62.

104.62 ceding ground, however, throws light on support from 101.70, with a break uncovering trendline support (76.15) and the descending triangle’s take-profit level at 91.04 (red).

Daily timeframe:

Brought forward from previous analysis –

Buyers and sellers continue to square off ahead of trendline resistance (111.71), following the 103.08 support rebound at the beginning of January.

Beyond the aforesaid areas, demand is visible at 100.68/101.85 (encases monthly support at 101.70), together with supply at 106.33/105.78 and the 200-day simple moving average.

Also prominent is the RSI indicator recently crossing paths with resistance at 57.00, a level hindering upside since July 2020.

H4 timeframe:

Brought forward from previous analysis –

104.16 resistance and demand at 103.46/103.58 (prior supply) remain centre stage on this timeframe.

Downriver, demand is set around 102.95/102.82, arranged beneath daily support at 103.08, while skies above 104.16 are relatively blue until resistance at 104.76—placed north of 104.57 (December 10 high).

H1 timeframe:

Partly modified from previous analysis –

Besides the 100-period simple moving average curbing buyers in early trade Monday, technical observations remain unchanged.

The 100-period simple moving average serves as immediate (dynamic) resistance, while above, 104 resistance, in addition to supply at 104.03/104.10 (prior demand), is positioned in close view.

However, sellers assuming control could have price join hands with 103.50 support, with a break unmasking a Fibonacci cluster between 103.24 and 103.32 (blue).

Observed levels:

The monthly timeframe shows 104.62 is likely to still be retested (unites closely with daily trendline resistance) before reaching for 101.70 support.

H4 areas to be watchful of are 104.16 resistance and demand at 103.46/103.58; a break of the latter may have sellers target 103.08 daily support.

The H1 shows the Fibonacci cluster at 103.24/103.32 may garner attention, as might 104 owing to the local confluence it brings to the table (supply at 104.03/104.10).

January 19th 2021: Greenback Concludes off Best Levels; Forms Daily Shooting Star Pattern, FP Markets

GBP/USD:

Monthly timeframe:

(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)

December’s 2.5 percent extension elevated GBP/USD to multi-month highs and stirred trendline resistance (2.1161).

January, off fresh highs, is currently south by 0.6 percent.

In terms of trend, the primary trend has faced lower since early 2008, unbroken (as of current price) until 1.4376 gives way – April high, 2018. In effect, the aforesaid high represents the next upside objective on the monthly chart.

Daily timeframe:

Partly modified from previous analysis –

After renewing 2021 highs last week, ahead of resistance at 1.3755, GBP/USD fell sharply on Friday and settled at session lows. Despite this, Monday witnessed buyers step forward and establish a hammer candle pattern off lows at 1.3519.

The pair has favoured an upside bias since early 2020, therefore Monday’s bullish pattern may fuel buying today.

The swing low at 1.3450 (January 8) could be challenged if buyers fail to come through, with support at 1.3176 targeted if increased downside is seen.

The RSI indicator has revealed a rangebound environment since November, limited by support around 47.00 and resistance at the 66.00 region.

H4 timeframe:

Demand at 1.3576/1.3607 had its lower side taken over on Monday, and is now currently serving as supply.

Giving up 1.3576/1.3607 throws light on demand at 1.3401/1.3446 (and associated Fibs).

H1 timeframe:

Located ahead of the 1.35 level, demand at 1.3503/1.3530 attracted buyers on Monday with enough force to reclaim 1.3550 resistance and draw 1.36 into the realm of possibility.

The move also highlights 1.3611 resistance (last Wednesday’s swing low) and the 100-period simple moving average nearby at 1.3630.

From the RSI indicator, the value has begun spinning lower off 50.00, crowded together with trendline resistance.

Observed levels:

Partly modified from previous analysis –

Despite scope to travel north on the monthly timeframe, a retest at the recently breached trendline resistance could be ahead. Interestingly, daily support at 1.3176 is arranged just south of the monthly trendline.

1.3576/1.3607 offering supply on the H4 today is a possibility, though before short-term sellers attempt to step in H1 could test 1.36 offers.

January 19th 2021: Greenback Concludes off Best Levels; Forms Daily Shooting Star Pattern, FP Markets

DISCLAIMER:

The information contained in this material is intended for general advice only. It does not take into account your investment objectives, financial situation or particular needs. FP Markets has made every effort to ensure the accuracy of the information as at the date of publication. FP Markets does not give any warranty or representation as to the material. Examples included in this material are for illustrative purposes only. To the extent permitted by law, FP Markets and its employees shall not be liable for any loss or damage arising in any way (including by way of negligence) from or in connection with any information provided in or omitted from this material. Features of the FP Markets products including applicable fees and charges are outlined in the Product Disclosure Statements available from FP Markets website, www.fpmarkets.com and should be considered before deciding to deal in those products. Derivatives can be risky; losses can exceed your initial payment. FP Markets recommends that you seek independent advice. First Prudential Markets Pty Ltd trading as FP Markets ABN 16 112 600 281, Australian Financial Services License Number 286354.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  • January 19th 2021: Greenback Concludes off Best Levels; Forms Daily Shooting Star Pattern, FP Markets
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