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)
March, down by 1.8 percent, recently revisited 1.1857/1.1352 demand.
Any notable rebound from the aforesaid demand shifts attention back to the possibility of fresh 2021 peaks and a test of ascending resistance (prior support – 1.1641).
In terms of trend, 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 –
The US dollar continued to rally against the majority of its peers on Monday, elevated on higher US Treasury yields. Consequently, this has elbowed EUR/USD through support at 1.1887 and unearthed a 127.2% Fib projection at 1.1843 along with a 100% Fib extension at 1.1848.
Technical elements also reveal the 200-day simple moving average hovering nearby, circling the 1.1812ish neighbourhood.
In response to recent selling, momentum, as measured by the RSI oscillator, is shaking hands with oversold space.
H4 timeframe:
Technical conditions out of the H4 chart landed candle action at an interesting support zone between 1.1818 and 1.1860 (green)—made up of Quasimodo support at 1.1818, a 100% Fib extension at 1.1860 and a 161.8% Fib projection at 1.1835. Note this area is closely linked with the daily timeframe’s Fibonacci studies and the 200-day simple moving average.
Upstream from the current support zone, resistance is seen anchored to 1.1952.
H1 timeframe:
Supply at 1.1881/1.1865 is currently accommodating sellers, with buyers also welcoming 1.1850 support.
Above supply, technical trading conditions point to 1.19, while beneath 1.1850 we see 1.18
Interestingly, the RSI oscillator is forming bullish divergence after recently making its way out of oversold territory.
Observed levels:
The upper side of monthly demand at 1.1857/1.1352 elbowing into the spotlight, alongside Fib supports on the daily timeframe around 1.1845 and the H4 timeframe also throwing 1.1818/1.1860 (green) in the pot as support, could have buyers retaliate today.
With that, traders may monitor lower timeframe price action within 1.1818/1.1860 for a potential bullish scenario.
AUD/USD:
Monthly timeframe:
(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)
February finished considerably off best levels, establishing what many candlestick fans call a shooting star pattern—a bearish signal found at peaks. Also interesting was February’s movement came within striking distance of trendline resistance (prior support – 0.4776), sheltered under supply from 0.8303/0.8082.
March, as you can probably see, trades lower by 0.8 percent.
In the context of trend (despite the trendline resistance [1.0582] breach in July 2020), the primary downtrend (since mid-2011) remains in play until breaking 0.8135 (January high [2018]).
Daily timeframe:
Partly modified from previous analysis –
The robust dollar bid continued to weigh on any AUD/USD upside attempts on Monday, leaving the currency pair under water into the close.
Technical structure reveals the currency pair overturned trendline support last week, taken from the low 0.5506. For that reason, technically speaking, there’s scope for further depreciation to February 2nd low at 0.7563, with a break unmasking demand at 0.7453/0.7384 (prior supply).
Concerning trend on this scale, however, price action has remained convincingly higher since March 2020.
Against the backdrop of price action, the RSI oscillator voyaged through the 50.00 centreline at the tail end of last week and is currently zeroing in on 40.00.
H4 timeframe:
Supply at 0.7696/0.7715 made an entry in recent movement, with sellers welcoming the zone and pushing back at the recovery attempt out of demand at 0.7601/0.7627 (houses a 127.2% Fib projection at 0.7607 and is positioned just north of Quasimodo support at 0.7592).
H1 timeframe:
For those who read Monday’s technical briefing you may recall the following (italics):
In spite of Friday’s modest recovery, H4 supply at 0.7696/0.7715, together with the 0.77 figure on the H1 and neighbouring trendline resistance, could pose a problem for buyers in early trade this week.
With the above taken into account, a short-term bearish scenario may emerge between H1 trendline resistance and the 0.77 figure (green), an area reinforced by H4 supply. Should bearish bets hold the aforementioned zone, 0.76 entering the frame should not surprise.
As evident from the H1 chart this morning, the green zone between H1 trendline resistance and the 0.77 figure welcomed sellers on Monday.
From the RSI indicator, we can see the value rejecting trendline resistance and the 50.00 centreline.
Observed levels:
0.76 on the H1 appears to be on the cards as a downside target, following a successful 0.77 retest. Traders short the 0.77 region have likely reduced risk to breakeven and liquidated a portion of profits
USD/JPY:
Monthly timeframe:
(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)
Following January’s bullish engulfing candle and further outperformance in February, March is on the verge of mounting a bullish assault (up by 2.3 percent) on descending resistance (not considered traditional trendline resistance), etched from the high 118.66.
To the downside, support inhabits 101.70.
Daily timeframe:
Partly modified from previous analysis –
Advancing US Treasury yields underpinned a USD bid Monday, eking out a fourth successive bullish close for the USD/JPY.
Clawing higher uncovers Quasimodo resistance at 109.38, a level merging with the monthly timeframe’s descending resistance.
The recent climb has also pulled the RSI oscillator into overbought waters, throwing light on resistance at 83.02 (active since 2015).
H4 timeframe:
Two resistances stood aside on Monday at 108.56 and 108.81 (both now [potential] supports), perhaps paving the way for Quasimodo resistance coming in from 109.16. Note this level is anchored just beneath the daily Quasimodo at 109.38.
H1 timeframe:
After creating demand at 108.47/108.60 off 108.50 during the early hours of London on Monday, the unit settled within striking distance of the 109 figure.
Despite the spirited advance, the RSI oscillator echoes bearish divergence, showing momentum to the upside slowing.
Observed levels:
109 could be a level to watch on the H1 scale today, backed by H4 Quasimodo resistance at 109.16, as well as daily Quasimodo resistance from 109.38 and the monthly descending resistance.
So, between 109.38 and 109, we could see a bearish theme emerge and countertrend traders possibly make a show.
GBP/USD:
Monthly timeframe:
(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)
The pendulum, as you can see, swung in favour of buyers following December’s 2.5 percent advance—movement that stirred major trendline resistance (2.1161). February followed through to the upside (1.7 percent) and refreshed 2021 highs at 1.4241, levels not seen since 2018.
March currently trades lower by 0.8 percent, though remains within the walls of February’s range.
Despite the trendline breach, primary trend structure has faced lower since early 2008, unbroken (as of current price) until 1.4376 gives way—April high, 2018.
Daily timeframe:
Partly modified from previous analysis –
A closer reading of price action on the daily chart reveals GBP/USD trades within close proximity of support at 1.3755, a level sharing chart space with trendline support, drawn from the low 1.1409.
Any sustained move south of 1.3755 places Quasimodo support at 1.3609 in the line of fire.
With reference to the RSI indicator, the value dipped a toe beneath the 50.00 centreline and shook hands with support made up between 46.21 and 49.16. RSI support forming around the 40.00/50.00 range in trending environments is common.
H4 timeframe:
Partly modified from previous analysis –
As you can see from the H4 timeframe, movement was restricted Monday, with upside limited by 1.3852 resistance (above here, trendline resistance [taken from the high 1.4240] can be seen).
1.3761/1.3789 demand also remains in the fight, with an interesting demand zone residing just beneath current demand at 1.3730/1.3749. Although relatively small in range, this area is where a decision was likely made to break above 1.3757 tops. And with price leaving the demand unchallenged following the formation of the zone’s base, buyers may be drawn to this area.
H1 timeframe:
Between 1.38 and Quasimodo support from 1.3786 and 1.3861/1.3847 resistances (two previous Quasimodo support levels), we are seeing price action forge a pennant pattern between 1.3778/1.3869.
Note that the H1 Quasimodo support at 1.3786 is housed within H4 demand at 1.3761/1.3789, while beneath the Quasimodo formation we have nearby H4 demand at 1.3730/1.3749 in sight.
From the RSI oscillator, trendline resistance is seen close by as the value rejects the underside of the 50.00 centreline.
Observed levels:
Unchanged from previous analysis –
On the bigger picture, as noted in previous writing, monthly suggests room to approach higher levels over the coming weeks until reaching the 1.4376 top. Before the above graces the charts, a retest of daily support at 1.3755 and intersecting trendline support could be on the cards, a move likely welcomed by dip-buyers.
With daily support from 1.3755 (and merging daily trendline support) wedged between the two H4 demand areas at 1.3730/1.3749 and 1.3761/1.3789, this is a location buyers may still be attracted to. This, then, may call for a test of the 1.3750 support based on the H1 scale, a move potentially triggering a bullish theme.
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