Technical View Ahead of the ECB Decision (June 9th 2022)

Technical View Ahead of the ECB Decision (June 9th 2022), FP Markets

Charts: Trading View

(Italics: Previous Analysis)


Primary Trend: bearish since early 2021

Although price action on the daily timeframe portends an extension to the recent recovery off support at $1.0638—targeting the ascending support-turned resistance, drawn from the low $1.0340—weekly price is shaking hands with the lower side of a heavy-duty weekly Quasimodo support-turned resistance at $1.0778. Against the backdrop of higher timeframes, H1 resistance also calls for attention between $1.0787 and $1.0773 (made up of an equivalent AB=CD bearish structure and an alternate AB=CD bearish pattern). Interestingly, this area is located north of H1 resistance at $1.0758 and H4 resistance at $1.0762, hinting at the possibility of a run on stops above the aforesaid levels. Therefore, a test of $1.0787-1.0773 is likely to be of interest to sellers.

Technical View Ahead of the ECB Decision (June 9th 2022), FP Markets


Primary Trend: bearish since early 2021 (decisive downside bias also evident on the monthly scale since 2011)

In light of the longer-term trend, and three-week pullback on the weekly timeframe, this remains a sellers’ market for the time being. A closer reading of price action on the daily timeframe has buyers and sellers battling for position around the 200-day simple moving average at $0.7254. Although sellers have the edge here, Fibonacci resistance between $0.7364 and $0.7322 merits consideration. Adding to the technical landscape on the daily, the relative strength index (RSI) is above its 50.00 centreline (positive momentum); a close under this value would be a welcomed visual for any sellers.

With H1 threatening a break under $0.72, completing an equivalent AB=CD bullish pattern at $0.7163 (just above Quasimodo support at $0.7159) could be in the offing, and may be a location short-term bids emerge from. This is strengthened by H4 demand coming in at $0.7147-0.7204. How much of a bullish showing develops, nevertheless, is questionable, in view of the higher timeframe (bearish) picture.

Technical View Ahead of the ECB Decision (June 9th 2022), FP Markets


Primary Trend: bullish since early 2021 (upside bias also evident on the monthly scale since 2012)

USD/JPY remains an unstoppable force, up 2.4 per cent week to date and on the verge of crossing swords with ¥135.16: 28th January high (2002) on the weekly chart. And according to the daily timeframe’s technical landscape, after dethroning Quasimodo resistance at ¥133.45, limited resistance is visible until ¥135.16. With the bigger picture displaying scope to climb until ¥135.16, it appears to be a ‘play on big figures’ on the H1 timeframe, with traders currently pursuing a break/retest scenario at ¥134, targeting ¥135ish.

Technical View Ahead of the ECB Decision (June 9th 2022), FP Markets


Primary Trend: bearish since February 2021 (decisive downside bias also evident on the monthly scale since 2008)

It was another sluggish day for sterling on Wednesday, despite ending the session 0.4 per cent lower against the buck. As evident from the daily timeframe, price action is now within reach of trendline resistance (etched from the high $1.3639), sheltered south of a daily Quasimodo support-turned resistance from $1.2762 which is also placed nearby weekly resistance at $1.2719. Notably, the relative strength index (RSI) on the daily chart remains testing the lower side of its 50.00 centreline, echoing resistance and somewhat supportive of a bearish landscape right now.

Limited noteworthy movement remains on the H4; therefore, the following is text acquired from Wednesday’s technical briefing. H4 resistance between $1.2686 and $1.2614, made up of a number of technical resistances, is close by—an area capping buying since the beginning of May. As a result, H4 support is watched at $1.2475.

Out of the H1 timeframe, focus remains directed towards $1.26 and $1.25. Note that $1.26 is sited just beneath H4 resistance at $1.2686-1.2614, and shares a close connection with the noted daily trendline resistance. As such, sellers may be drawn to this region in the event of a test.

Technical View Ahead of the ECB Decision (June 9th 2022), FP Markets


Primary Trend: bearish since November 2021

In conjunction with the primary bear trend, and daily support from $28,849 struggling to motivate buyers, we have recently established a daily pennant pattern, pencilled in from $30,091 and $31,418. The pattern is generally viewed as a continuation formation, therefore a dominant breakout lower could spell the end for $28,849. As underlined in recent writing, overthrowing this level would be disturbing for many buyers at this point as the next obvious area of support resides around $20,000. Adding to the bearish picture, the relative strength index (RSI) is rejecting the lower side of the 50.00 centreline (negative momentum).

Support on the H1 timeframe at $29,358 has proved an effective floor, withstanding several downside attempts. However, recovery from the level is visibly thinning: each time price tests the level, the crypto fails to form a meaningful high. This sets the stage for a bearish scene and potential move for H1 support at $28,694, arranged just beneath the daily support level underlined above.

Technical View Ahead of the ECB Decision (June 9th 2022), FP Markets

Gold (XAU/USD):

Early Primary Trend: bearish since March 2022

The daily timeframe’s technical view has remained pretty much unchanged since mid-May:

Price is seen engaging with a harmonic Gartley pattern’s PRZ (Potential Reversal Zone) on the daily timeframe between $1,815 and $1,843, aided by the 200-day simple moving average at $1,841. Should the relative strength index (RSI) break above the 50.00 centreline (positive momentum) this would add weight to further buying (average gains exceeding average losses). Upside price targets are at $1,896 (38.2% Fibonacci retracement derived from legs A-D of the current harmonic pattern) and a $1,959-1,974 resistance zone.

After coming within a close reach of H1 support between $1,828 and $1,836, Wednesday observed price test Quasimodo resistance at $1,856. With buyers at the wheel right now, overthrowing the said resistance is perhaps in the offing, to target H1 Quasimodo support-turned resistance at $1,872, closely shadowed by a 1.618% Fibonacci projection at $1,874.

Technical View Ahead of the ECB Decision (June 9th 2022), FP Markets


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, 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.

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Source - database | Page ID - 22430

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