November 17th 2020: Dollar Unchanged Despite Improved Risk Appetite on Moderna Vaccine Hopes

November 17th 2020: Dollar Unchanged Despite Improved Risk Appetite on Moderna Vaccine Hopes, FP Markets

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, buyers and sellers have since squared off around the upper section of supply from 1.1857/1.1352. Though this argues additional upside may be on the horizon, targeting ascending resistance (prior support – 1.1641), a dip to retest the recently penetrated trendline resistance (support) is also still on the table.

The primary downtrend (since July 2008) remains intact until 1.4940 is engulfed (May 2 high [2011]).

Daily timeframe:

Brought forward from previous analysis –

Supply at 1.2012/1.1937 remains a key zone to be mindful of on the daily chart, active since May 2018. Another interesting feature to be aware of is a possible falling wedge pattern between 1.2011 and 1.1612. Yet, do be aware some traders could interpret this arrangement as a descending triangle pattern.

In terms of support beyond the aforesaid pattern, 1.1553 and 1.1495 offer prominent levels.

RSI fans will also note the value modestly rotated higher above 50.00 by the week’s end, and remains entrenched within the upper region of an ascending channel.

H4 timeframe:

Partly modified from previous analysis –

Mid-week trading, as you can see, welcomed demand at 1.1711/1.1746, inspiring a reasonably motivated recovery into the week’s close. Monday was initially optimistic, firing to peaks at 1.1868. Though, as you can see, the rally was short-lived, establishing a shooting star candlestick formation followed by moderate selling.

At the time of writing, although price tentatively hovers around unchanged levels, supply from 1.1928/1.1902 (prior demand) remains a key zone to be mindful of.

H1 timeframe:

Heading into London Monday witnessed buyers slice into buy-stops above 1.1850 resistance to test supply around the 1.1871/1.1861 region. This delivered a half-hearted shooting star pattern along with a subsequent decline to lows just ahead of the 100-period simple moving average at 1.1810.

Buyers making a stand going into US trading positioned candles within close proximity of 1.1850, as of current price. Persistent upside today could eventually dethrone the aforesaid supply zone and charge the 1.19 level.

In terms of the RSI oscillator, the value is seen rebounding from 52.89 support.

Observed levels:

Daily price is in the process of chalking up what appears to be a rather large falling wedge pattern, on a timeframe that’s mostly trended higher since early 2020. Monday, however, finished indecisively, closing within the upper region of the falling wedge by way of a doji indecision candle.

With H4 demonstrating room to travel to higher levels, intraday buyers on the H1 may invade supply at 1.1871/1.1861 and stretch for 1.19, a round number that aligns with the lower side of H4 supply at 1.1928/1.1902 (prior demand).

November 17th 2020: Dollar Unchanged Despite Improved Risk Appetite on Moderna Vaccine Hopes, FP Markets

AUD/USD:

Monthly timeframe:

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

The months of September and October, as you can see, developed a mild correction and addressed the upper border of demand at 0.7029/0.6664 (prior supply). Buyers have so far responded well from the demand (up by 4.1 percent in November), free to explore as far north as 0.8303/0.8082 in the coming months, a supply zone aligning closely with trendline resistance (prior support – 0.4776).

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

Daily timeframe:

Supply at 0.7345/0.7287 (a rally-base-drop formation) was under considerable pressure Monday as monthly buyers continue to flex their financial muscle off demand. Neighbouring supply at 0.7453/0.7384, extended from August 2018, therefore could be thrown in the mix.

The RSI indicator is on track to test overbought levels, after toppling 52.00 resistance at the beginning of November.

H4 timeframe:

Monday observed an early push out of a fresh descending channel (0.7340/0.7252), establishing a demand zone at 0.7281/0.7297 as price elbowed to peaks at 0.7326.

Resistance at 0.7340 is next on the list, a horizontal level that’s held buyers back since the beginning of September. A break here, however, uncovers another film of resistance at 0.7383.

H1 timeframe:

Partly modified from previous analysis –

Early trading Friday delivered a bottom ahead of demand at 0.7202/0.7220, seated a few pips north of the 0.72 level. Consequently, buyers voyaged above resistance at 0.7242 and retested the latter by way of support heading into the US session, ending the day challenging the 100-period simple moving average around 0.7268.

Monday continued to build on recent optimism, dethroning the 100-period simple moving average and the 0.73 level, exposing 0.7340 resistance (H4) and the 0.7350 resistance level. This also simultaneously pulled the RSI oscillator modestly into overbought space.

Observed levels:

Healthy buying off monthly demand at 0.7029/0.6664, in conjunction with weak daily supply from 0.7345/0.7287 and space for H4 and H1 buyers to stretch their legs declares a potential bullish stance in this market, technically speaking. With this being the case, a 0.73 (H1) retest could stir buyers today, with 0.7340 H4 resistance initially targeted.

November 17th 2020: Dollar Unchanged Despite Improved Risk Appetite on Moderna Vaccine Hopes, FP Markets

USD/JPY:

Monthly timeframe:

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

Since kicking off 2017, USD/JPY has been carving out a descending triangle pattern between 118.66/104.62.

November, albeit unmoved (indecisive) at current price, is seen hugging the lower edge of the aforesaid pattern.

104.62 ceding ground shines light on demand from 96.41/100.81, followed by trendline support (76.15) and the descending triangle’s take-profit level at 91.04 (red).

Daily timeframe:

Partly modified from previous analysis –

Leaving behind supply from 106.33/105.78 and trendline resistance (111.68), as well as RSI resistance at 57.00, sellers made a strong show heading into the final stages of last week, finishing at session lows Friday.

Downside risk remains as Monday wrapped up considerably off best levels, throwing light on 103.17 lows (November 6), with a break revealing demand at 100.68/101.85, drawn from September 2016.

H4 timeframe:

Despite an indecisive start in Asia Monday, a vigorous spike to highs at 105.13 occurred heading into Europe/US trading, missing supply at 105.41/105.15 by a hair.

Support at 104.11 and familiar demand (taken from March 2020) at 103.04/103.58 remain interesting areas to the downside.

H1 timeframe:

Transitioning into London hours on Monday, after price struck the H1 ascending triangle pattern (105.64/104.82) take-profit target at around 104.50 support (yellow), witnessed the pair latch on to a healthy bid to reach 105 resistance and the 100-period simple moving average around 105.10.

The day, however, saw prices settle back around 104.50 support as 105 round number sellers clearly made an entrance.

Observed levels:

Partly modified from previous analysis –

Price action, based on the monthly timeframe, remains around descending triangle support at 104.62. However, given the lacklustre effort from buyers, due to daily price shifting lower south of supply at 106.33/105.78, and intersecting trendline resistance (111.68), sellers could take control.

With H1 sellers reaching the ascending triangle target at 104.50, additional weakness, according to the H4 (room to approach 104.11 support) and daily charts (room to test 103.17 lows), could be seen. An intraday bearish scene sub 104.50 (H1), therefore, could also form with 104.11/104 targeted.

November 17th 2020: Dollar Unchanged Despite Improved Risk Appetite on Moderna Vaccine Hopes, FP Markets

GBP/USD:

Monthly timeframe:

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

Leaving trendline resistance (2.1161) unopposed, the month of September fell 3.4 percent by way of a bearish outside reversal candle and snapped a three-month winning streak. This, despite November trading higher by 1.9 percent, advertises a possible dip to retest trendline support (prior resistance – 1.7191).

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.

Daily timeframe:

Brought forward from previous analysis –

Although the daily chart observed a deep fakeout above resistance at 1.3201 last week, half-hearted bearish follow-through movement indicates the run above 1.3201 was formed to perhaps collect stops to step higher and target the 1.3483 September high.

In case sellers make a show, however, marking 1.2860 bottoms and demand at 1.2645/1.2773 could be an idea.

The RSI oscillator has also turned over ahead of overbought space and appears set to retest support around 48.00.

H4 timeframe:

Partly modified from previous analysis –

Failing to address support at 1.3078 (secured just ahead of demand at 1.3012/1.3059), GBP/USD bulls staged a healthy recovery Friday, with enough force to reclaim 1.3182 resistance. As you can see, the latter, after a move to session highs at 1.3242 on Monday, has delivered support.

Holding off 1.3182 may unleash additional buying, with channel resistance (1.3176) targeted, intersecting with supply at 1.3320/1.3281 (and a collection of Fib studies around 1.3307).

H1 timeframe:

London opened at supply from 1.3254/1.3225 (holds a 61.8% Fib level from 1.3233) on Monday, provoking an early bearish theme that took GBP/USD south of 1.32.

1.32, as you can see, served well as resistance throughout the majority of London and also US trading yesterday, teasing the possibility of another test of trendline support (1.2854). Absorbing trendline support, on the other hand, throws light on the 1.31 level.

With reference to the RSI indicator, the value circled 50.00 on Monday, following a drop through trendline support.

Observed levels:

Lacklustre selling around daily resistance at 1.3201, together with room to run higher on the monthly timeframe and H4 holding support at 1.3182, this communicates a possible bullish vibe. Considering this, H1 trendline support and the 1.31 level may be areas buyers have on their watchlists as we move into Tuesday’s session.

November 17th 2020: Dollar Unchanged Despite Improved Risk Appetite on Moderna Vaccine Hopes, FP Markets

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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.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  • November 17th 2020: Dollar Unchanged Despite Improved Risk Appetite on Moderna Vaccine Hopes, FP Markets
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