GBP/CHF may retrace; covering short positions is favoured Trend News

Technical outlook and chart setup:

As depicted in the 4H chart view here, the price action since 1.4670 can be defined as consolidation. The single currency pair has been confined between 1.47 and 1.4950 price band since then and needs a clear breakout of either of the levels to trade with conviction. Higher up resistance levels are placed at 1.5050 and 1.5150, while support is at 1.46 and 1.45 respectively. As seen here, prices did manage to breach the 1.47 mark for a meager 20/25 pips, but stayed above the counter trend line of support. Keeping these facts in mind, it is recommended to cover the short positions taken earlier.

Trading recommendations:

1. Conservative: Cover short positions if taken earlier. Flat for now.

2. Aggressive: Go long again, stop at 1.4650, target open.

Good luck!

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Fundamental analysis for January 23, 2013 Trend News

The Forex market had no significant movements in the European session on Wednesday. Only a Euro’s recovery from the low of 1.3284 that occurred during early trading hours and slow growth of the sterling, which rose due to the Minutes of the Bank of England decided not to change interest rates, and maintain bond purchases, as it has done for several months.

The probable formation rate that we saw earlier this week, double top, was undermined, and in this context, taking the previous upward movement, the break of 1.3375 could mean the beginning of a new upward cycle. It seems, however, that this will happen easily.

The situation is different in the New York Stock Exchange. The Dow Jones continues to break records, now more than four years before the outbreak of the 2008 crisis. Of course, trading volumes are much lower than that time, and prices are sliding toward either side, more easily in such a context.

The yen continues recovering its positions, although more slowly. The Bank of Japan's policy is designed to overcome deflation and achieve sustainable economic growth.

During the U.S. session monetary policy of the Bank of Canada will be announced, which will probably leave rates unchanged benchmark interest at 1%. The Canadian dollar remains in expectation of the data, but could give positions during the day, seeking parity with the dollar.

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GBP/USD buy above fractal 1.5788 - for January 23, 2013 (daily strategy) Trend News

The British pound has been testing above the 1.5788 fractal for three days and recorded the minimum at 1.5801. This morning during the American session it has recovered from the downward pressure. Now it is trading at 1.5883, the fact that this pair could not break the 1.58 level is an indication that this pair wants to go higher, towards the level of 1.60, psychological level. In the medium term it will be trading again until 1.63. Our bullish signal will be activated only if the pair closes above the 200 day moving average periods (blue).

Therefore, I believe that we will see a return to the quotation level 1.63. Therefore, it is recommended to buy above 1.5788 fractal and above the level of 1.58, with a target in the medium term to 1.63.

If you need personal consultation, contact me via e-mail: gerardo.porras@analytics.instaforex.com

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EUR/JPY fractal 118.45 - for January 23, 2013 (daily strategy) Trend News

The EUR/JPY pair has a very strong bullish trend but it could not hold the level above 1.20. If the Japanese yen exceeds the level of 90, this pair may try to negotiate again above 120 yen per euro, psychological level. But if you look at the chart, the pair has broken the fractal 118.45, so the recommendation is that you can sell below this fractal level with a very tight stop loss at 119. Although we know that this pair will continue rising for a long term. It is more likely that the pair will take a break until the next fractal 113.59. We must be cautious as this pair is very volatile, beware of leverage. On the other hand, if your strategy is to buy, it is recommended to buy at the weekly supports.

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GBP/USD intraday technical analysis and trading recommendations for January 23, 2013 Trend News

The GBP/USD pair started the new year with a sharp bullish move above 1.6300. As we see on the daily chart, the last push has ended up expressing significant bearish price action indicating a false break above 1.6300 establishing a significant resistance zone.

Price levels 1.6115, 1.6080, and 1.6000 have been broken down confirming the bearish bias for the pair; these levels were lost as support triggered considerable bearish momentum which was apparent on Friday.

It is important to note that the pair has already broken down a long-term uptrend line that came to meet the pair around 1.6000, the loss of which opens the way towards 1.5910 then 1.5825. However, consolidation below 1.5910 (Intraday resistance) is necessary to maintain the bearish momentum for this week.

Considering the possible extension of the current bearish move since the 1.6330 false spike, the pair focused at the 100% retracement around 1.5825 which was hit yesterday. That is why, rebound was seen yesterday, which will probably extend towards 1.5910.

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EUR/USD technical analysis for January 23, 2013 Trend News

Overview:

The EUR/USD pair has broken the support level and turned towards the resistance level of 1.3330 yesterday. Therefore, the pair has already formed a minor resistance at 1.3330 and the strong resistance is still set at the level of 1.3395. Moreover, it failed to close above 1.3403 (100% of Fibonacci levels' retracement) and started showing a bearish reaction at this level. It should be mentioned that these levels coincide with strong levels for bears in the H1 chart; the pair has also formed strong resistance at the level of 1.3395. The pair will move downwards, it is convincing. The structure of the downside movement does not look corrective and is indicating a bearish opportunity below 1.3400. This can be a good sign for Sell deals below 1.3400 with the first target at 1.3350 initiating an uptrend in order to continue the bearish trend towards the point of 1.3330 and further to 1.3250. The weekly pivot point is 1.3326. If the level of 1.3326 is broken, the pair will go downwards to support 1:1.3248. However, it should also be noted that the price is still between 1.3333 and 1.3290, as the last strong support level (1.3250) is still able to start an uptrend at this level. Thus, the market indicates a bullish opportunity at the level of 1.3250 in the H1 chart with the first target at 1.3330 and continues towards 1.3395 (weekly R1).

Note: Resistance is at 1.3395. Support is at 1.3330/1.3250.

Observation(s):

If the trend is ascending, then the strength of the currency will be defined as follows: EUR is trending up and USD is trending down.

Most traders use the Fibonacci retracement to accurately determine the psychological support and resistance levels.

Stop loss should never exceed your maximum exposure amounts.

The market is highly volatile as usual when the last day had a huge volatility.



Technical analysis:

R3: 1.3542

R2: 1.3473

R1: 1.3395

PP: 1.3326

S1: 1.3248

S2: 1.3179

S3: 1.3101



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Silver breaks above counter trendline. Bullish bias remains intact Trend News

Technical outlook and chart setups:

The wave structure here remains unchanged as depicted. Immediate support is at 31.80 level, followed by 31.00, 30.00, and 29.20, while immediate resistance is at 32.50, followed by 33.80, and 34.30.40. Also it should be noted that the prices have broken out of the counter downtrend line, as depicted here. Keeping into consideration the daily trend structure, it is highly recommended to hold earlier long positions and utilize intraday dips as buying opportunities. The prices remained just shy of the resistance at 32.50 yesterday and it is expected to break above soon. Immediate trend line support arrives at 31.50/60 region today.

Trading recommendations:

Hold on to long positions taken earlier, book partial profits above 32.50. Stop is at 3.00 and target remains open.

Good Luck!

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Gold inching higher towards 1,710/20 levels Trend News

Technical outlook and chart setups:

A 4H wave structure for the yellow metal remains unchanged for now. As depicted here, immediate support is at 1,665.00 level, followed by 1,650.00 and 1,625/30; while resistance is at 1,720/25, followed by 1,750 respectively. Charts remain exhausted at the moment, but a push towards 1,710/20 levels remains quite possible before a meaningful pullback materializes. Therefore, it is recommended to take any intraday dips as opportunities to build long positions. Immediate trendline support is at 1,685.00 level for now.

Trading recommendations:

Hold on long positions. Build further longs on intraday dips. Stop is at 1,630.00. Target is open.

Good Luck!

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EurJpy: Upside potential still remains. 116.40 is immediate support Trend News

Technical outlook and chart setups:

The single currency made a low at 117.30 yesterday, that triggered measured stops at 117.50. Immediate support is at 116.40 level, followed by 115.00 (past resistance) and below 114.00, while Fibonacci resistance extends possibly till 121.00 level. Till the time 116.40 level remains intact, a possibility remains for a push through 121.00 before finally giving it up. Hence it is recommended to go long again (118.05/08). Yesterday’s lows also converge at Fibonacci 0.786 support level as depicted here. 116.40 remains key.

Trading recommendations:

Go long (118.00), stop is at 116.50, and target is at 121.00.

Good Luck!

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GbpChf: Bears eyeing 1.47 break. Remain short from yesterday if triggered Trend News

Technical outlook and chart setups:

The 4H wave structure remains unchanged at the moment. A counter rally did not materialized yesterday as expected, and the prices continued decline from the 1.4800 level. Potential resistance for intraday rallies remains at 1.4900 region. The 1.5050/60 resistance is trend defining, followed by 1.5150, while support is at 1.4680/1.4700, followed by 1.46, and 1.45 respectively. If short positions were initiated yesterday, it is recommended to hold them further; while fresh shorts should be taken on a breakdown of 1.4700 or an intraday rally. Bearish below 1.5050.

Trading recommendations:

1. Remain short, if positions were taken yesterday, stop is at 1.5060, and target is open.

2. Fresh shorts can be built on intraday rallies towards 1.4900 or a breakdown of 1.47, stop is at 1.5060, and target is open.

Good Luck!

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