Charts: Trading View

EUR/USD:

(Italics: previous analysis)

Weekly timeframe:

Mid-week movement has Europe’s single currency 0.4 percent lower against its US counterpart, consequently penetrating prime support at $1.1473-1.1583. Further selling—action that breaches current support—unlocks the door to a 61.8% Fibonacci retracement as low as $1.1281.

Technically speaking, however, it’d be unwise to overlook $1.1473-1.1583 right now. Long-term sell-stops tripped south of late September lows at $1.1612 (2020) could help fuel buyer interest.

Trend studies, on the other hand, show that with the break of $1.1612 lows, the pair is perhaps in the early phase of a trend change to the downside.

Daily timeframe:

Clocking levels not seen since July 2020 amidst a healthy USD bid, EUR/USD slipped 0.5 percent on Wednesday. Surging energy markets firing up inflation concerns and better-than-anticipated US ADP non-farm employment data pulled the currency pair to within a stone’s throw of Fibonacci support between $1.1420 and $1.1522 (glued to the lower side of the weekly timeframe’s prime support).

Adding to the above, the relative strength index (RSI) has its value touching oversold territory and pencilling in what’s referred to as hidden bullish divergence.

H4 timeframe:

The combination of resistance at $1.1622, a previous Quasimodo support, and descending resistance, extended from the low $1.1794, served sellers well.

In one fell swoop, Quasimodo support coming in from $1.1563 was brushed aside, potentially setting the stage for extended losses to support at $1.1495, derived from March 2020 highs.

As underlined in previous writing, medium-term flow facing southbound since June increases the odds of continuation selling.

H1 timeframe:

A closer reading of price action on the H1 scale reveals buyers and sellers squaring off from a 1.272% projection at $1.1535 and a 1.618% Fibonacci expansion at 1.1541.

H4 resistance offers clear structure to work with on the H1 at $1.1563, while H1 Quasimodo support demands attention lower on the curve at $1.1520, arranged just north of $1.15.

Observed Technical Levels:

Recognising the possibility of buyers entering the fight from weekly prime support at $1.1473-1.1583 is a MUST.

With that in mind, testing daily Fibonacci support between $1.1420 and $1.1522 may be on the cards. What’s also technically interesting is the next obvious H4 support resides within the noted daily Fibonacci base at $1.1495, in addition to H1 Quasimodo support from $1.1520 and the $1.15 figure.

Therefore, technical studies suggest support could emerge between $1.1495 and $1.1522.

AUD/USD:

(Italics: previous analysis)

Weekly timeframe:

Buyers and sellers remain battling for position around the upper perimeter of prime support at $0.6968-0.7242.

$0.6968-0.7242 buyers have prime resistance at $0.7849-0.7599 to target; failure to command position from $0.6968-0.7242, on the other hand, opens up support at $0.6673.

Trend studies on the weekly scale show we’ve been higher since early 2020. Consequently, any decisive response from $0.6968-0.7242 might be the start of a dip-buying attempt to join the current trend.

Daily timeframe:

Fibonacci support between $0.7057 and $0.7126 is a key base on this timeframe, as is prime resistance at $0.7506-0.7474. Immediately above, we also see Quasimodo support-turned resistance at $0.7621, which happens to join closely with the 200-day simple moving average at $0.7581, a 61.8% Fibonacci retracement at $0.7585 and a 100% Fibonacci projection at $0.7551.

From the relative strength index (RSI), the value is seen touching the lower side of the 50.00 centreline. Journeying higher remains something to keep an eye out for, as well as clear 50.00 rejection.

H4 timeframe:

Price action continues to echo an undecided tone in between resistance at $0.7317 and support from $0.7223.

Outside of the said levels, stacked supply is seen between $0.7376 and $0.7347 and Quasimodo resistance at $0.7394. In the event sellers take the wheel from current price, support is at $0.7144, joined by a deep 88.6% Fibonacci retracement.

H1 timeframe:

Following a somewhat disorderly test of Quasimodo resistance-turned support at $0.7237 during London on Wednesday, bulls went on the offensive amid US hours and climbed $0.7258 resistance to throw light back on $0.73.

Clearing the psychological level exposes Quasimodo resistance coming in at $0.7339, a level dovetailing with a 1.618% Fibonacci projection at 0.7333, a 1.272% Fibonacci expansion at $0.7336 and a 100% Fibonacci projection at $0.7339.

Observed Technical Levels:

H1 price maintaining position above support at $0.7258 could have $0.73 re-enter the frame.

H1 snapping above $0.73 offers and bringing in bearish orders from H4 resistance at $0.7317 remains a possible scenario. Downside momentum drawn from a $0.73 whipsaw, nevertheless, could be limited, thanks to weekly price engaging prime support at $0.6968-0.7242. Therefore, $0.7317 shorts are urged to work with strict trade management rules.

USD/JPY:

(Italics: previous analysis)

Weekly timeframe:

Despite USD/JPY concluding last week off 19-month highs at ¥112.08 and establishing a shooting star candlestick pattern (bearish signal) ahead of supply at ¥113.81-112.22, buyers are now on the offensive.

A bearish scene, nonetheless, directs flow to familiar demand at ¥108.40-109.41—arranged north of descending resistance-turned support, taken from the high ¥118.61.

Daily timeframe:

Wednesday finished undecided, ranging between ¥111.79 and ¥111.20.

The 1.618% Fibonacci expansion at ¥112.05 is in sight—a level drawing bearish movement last week. In terms of support, we see ¥110.70.

Out of the relative strength index (RSI), technicians will note support developed at 56.85. This informs traders that momentum remains to the upside for the time being, with overbought space perhaps targeted.

H4 timeframe:

Despite a deep test of supply-turned demand (formed early July) from ¥110.99-110.79, recent interest to the upside maintained the area and lifted price action to a high of ¥111.79 before spinning lower.

Quasimodo resistance is seen at ¥112.17, arranged a handful of pips north of yearly peaks at ¥112.08, while below current demand, support falls in at ¥110.42.

H1 timeframe:

Prime support made its way into the spotlight on Wednesday from ¥111.12-111.24, welcoming a bullish phase heading into US hours. Extending gains from current price has yesterday’s peak at ¥111.79 in sight, closely followed by ¥112, as well as a 100% Fibonacci projection at ¥112.17 and a 1.618% Fibonacci extension from ¥112.15.

Levels of interest south of prime support are the ¥111 figure and a 38.2% Fibonacci retracement at ¥110.95.

Observed Technical Levels:

Should H1 prime support at ¥111.12-111.24 hold position, and fuel a break of yesterday’s high at ¥111.79, watch ¥112. An additional watch, of course, is price whipsawing above ¥112 to test H1 Fibonacci structure around ¥112.16. This could bring about selling, as H1 Fibonacci levels share space with the daily timeframe’s 1.618% Fibonacci expansion at ¥112.05 and H4 Quasimodo resistance at ¥111.17.

Alternatively, a ¥111.12-111.24 breach opens up ¥111 as possible support on the H1.

GBP/USD:

(Italics: previous analysis)

Weekly timeframe:

Supply-turned demand at $1.3629-1.3456 continues to emphasise a distressed vibe after having its lower limits clipped in recent trading. In spite of recovery attempts this week, the fact price recently closed below a double-top pattern’s ($1.4241) neckline at $1.3669 signals bears are looking to take charge.

The double-top pattern’s profit objective—measured by taking the distance between the highest peak to the neckline and extending this value lower from the neckline—sits around $1.3093. Conservative pattern sellers are likely to pursue a candle close beneath $1.3629-1.3456 before pulling the trigger.

Daily timeframe:

Rising energy prices stirred a USD bid on Wednesday, elbowing the DXY to recent one-year pinnacles which knocked sterling to lows of $1.3544.

The $1.3736-1.3659 decision point remains on the radar, organised underneath trendline resistance, taken from the high $1.4250, and the 200-day simple moving average at $1.3840. To the downside, a Fibonacci cluster is seen between $1.3121 and $1.3167.

A test of $1.3736-1.3659 could encourage more of a decisive sell in this market as the pair has traded southbound since June, and the relative strength index (RSI) is seen closing in on the lower side of the 50.00 centreline to perhaps forge resistance.

H4 timeframe:

Wednesday settled around support at $1.3640, following a reasonably dominant showing from resistance at $1.3640 (prior Quasimodo support).

Space south of current support implies a drop back to last Wednesday’s low at $1.3412, suspended a touch above Quasimodo support at $1.3380. In the event sterling explores higher levels, the $1.3750-1.3721 decision point commands position.

H1 timeframe:

Leaving resistance at $1.3658 unchallenged (joined by a 50.00% retracement at $1.3662 and a 78.6% Fibonacci retracement at $1.3661), early London watched GBP/USD swing below $1.36 to touch a low of $1.3544.

With respect to technical structure, $1.36 and $1.35 offer possible levels on the H1 scale. Note that trendline support, drawn from the low $1.3415, converges closely with $1.35.

Observed Technical Levels:                              

Long term, sterling appears to favour lower price levels. The daily timeframe’s decision point at $1.3736-1.3659, therefore, is a base to continue monitoring.

Short term, on the other hand, has H1 looking at the lower side of $1.36 to shape resistance. Sellers defending this psychological level places a question mark on H4 support at $1.3570 and throws $1.35 in the mix as a possible downside target for shorts on the H1.

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