Technical analysis of USD/JPY for July 18, 2014 Trend News

Overview:

USD/JPY is expected to trade in a lower range. It is undermined by the flows to haven JPY and unwinding of JPY-funded carry trades amid increased risk aversion (VIX fear gauge jumped 32.18% to 14.54, S&P 500 tumbled 1.18% overnight) as the tensions between the West and Russia are escalating after the U.S. and European Union imposed a fresh round of sanctions on Moscow over the Ukraine conflict. The Malaysia Airlines passenger jet with 295 people aboard was shot down near the Russia-Ukraine border. The risk sentiment is also dented after the Chinese construction company Huatong Road and Bridge Group Co. said it may default on both the bond principal and interest payments on a 400 million yuan ($64.5 million) bond that matures next week. USD/JPY is also weighed by the lower U.S. Treasury yields and Japanese export sales. But USD/JPY losses are tempered by the demand from Japanese importers and positions adjustment before Japan's long weekend (financial markets in Japan are shut for public holiday on Monday). U.S. data overnight were mixed as less-than-expected 302,000 U.S. jobless claims in the week ended July 12 (versus 310,000 forecast) and surprise rise in Philadelphia Fed's index of general business activity to 23.9 in July from 17.8 in June (versus forecast for drop to 16.0) were offset by surprise 9.3% on-month fall in U.S. housing starts to nine-month low of 893,000 in June (versus forecast for rise to 1.015 million) and unexpected 4.2% on-month decline in U.S. building permits to 963,000 in June (versus forecast for rise to 1.04 million).

Technical comment:
The daily chart is negative-biased as MACD and stochastics has turned bearish.

Trading recommendations:
The pair is trading below its pivot point. It is likely to trade in a lower range as far as it remains below its pivot point. Short position is recommended with the first target at 101.05. A break of this target will move the pair further downwards to 100.80. The pivot point stands at 101.60. In case the price moves in the opposite direction and bounces back from the support level, then it will moves above its pivot point. It is likely to move further to the upside. In that scenario, a long position is recommended with the first target at 101.80 and the second target at 102.05.

Resistance levels:

101.80

102.05

102.25

Support levels:

101.05

100.80

100.60

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Technical analysis of NZD/USD for July 18, 2014 Trend News

Overview:

NZD/USD is expected to trade in a lower range. It is undermined by the Kiwi sales on soft NZD/JPY cross amid increased investor risk aversion and continued impact from softer-than-expected New Zealand 2Q CPI which dented odds of further rate hikes from the Reserve Bank of New Zealand, weak dairy prices, and Kiwi sales on buoyant AUD/NZD cross. But NZD/USD losses are tempered by the NZD-USD interest differential and positions adjustment before the weekend. The daily chart is negative-biased as MACD and stochastics is bearish, five-day moving average is falling below 15-day MA.

Trading recommendations:
The pair is trading below its pivot point. It is likely to trade in a lower range as far as it remains below its pivot point. Short position is recommended with the first target at 0.8650. A break of this target will move the pair further downwards to 0.8630. The pivot point stands at 0.8725. In case the price moves in the opposite direction and bounces back from the support level, then, it will moves above its pivot point. It is likely to move further to the upside. In that scenario, a long position is recommended with the first target at 0.8745 and the second target at 0.8785.

Resistance levels:

0.8745

0.8785

0.8815

Support levels:

0.8650

0.8630

0.86

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Technical analysis of GBPJPY for July 18, 2014 Trend News

Overview:

GBP/JPY is expected to trade in a lower range. It is undermined by the increased investor risk aversion and Japanese export sales. But GBP/JPY losses are tempered by the demand from Japanese importers and positions adjustment before Japan's long weekend. The daily chart is negative-biased as MACD and stochastics is bearish, although the latter is nearly in the oversold zone; five-day moving average is below 15-day MA and is declining.

Trading recommendations:
The pair is trading below its pivot point. It is likely to trade in a lower range as far as it remains below its pivot point. Short position is recommended with the first target at 172.80. A break of this target will move the pair further downwards to 172.35. The pivot point stands at 173.55. In case the price moves in the opposite direction and bounces back from the support level, then it will moves above its pivot point. It is likely to move further to the upside. In that scenario, a long position is recommended with the first target at 174.10 and the second target at 174.55.

Resistance levels:

174.10

174.55

175.15



Support levels:

172.80

172.35

172

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GBP/USD intraday technical levels and trading recommendations for July 18, 2014 Trend News

Bullish breakout above the DAILY bearish channel took place exposing price levels around 1.6985 as a projection target.

Simultaneously, daily closure above 1.6820 took place enhancing a bullish impulse towards 1.6900 and 1.7000.

The GBP/USD pair managed to break through the psychological resistance around 1.7000 which previously provided extensive bearish pressure during the last visit on May 6.

Bullish pressure was applied at retesting the bullish channel lower limit depicted on the 4H chart. This pushed the pair towards 1.7150 where the upper limit of the depicted channel is located.

Bullish pressure was once applied as a trial to break through the upper limit of the 4H movement channel. However, lack of follow-through existed as bullish pressure being applied was not enough to ensure success of the bullish breakout.

On the other hand, Intraday resistance was established around 1.7150-1.7190. A short-term SELL position was suggested in the previous articles with SL located just above 1.7190.

The price levels of 1.7050 constitute a significant support level to meet the pair on its way downwards. It's also the key level to determine how deep bearish correction can go before resuming the bullish momentum.

The GBP/USD pair remains trapped roughly between 1.7170 and 1.7050 ( which is being tested today ). Breakout in either direction is needed to pursue towards further targets.

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Intraday technical levels and trading recommendations on EUR/USD for July 18, 2014 Trend News

The price zone of 1.3800-1.3880 (dotted on the chart) provided considerable SUPPLY for the EUR/USD pair. This price zone managed to pause the bullish momentum that originated off the depicted bullish trend line.

A Double Top pattern was formed after the neckline located at 1.3700 got broken down. Projection targets have already been hit shortly after.

Previous prominent bullish engulfing daily candlesticks emerged off 1.3500 (the lower limit of the ongoing channel) thus fixating again above 1.3560 (the key level corresponding to the previous prominent bottom).

As long as the backside of the broken bearish channel keeps holding the price above, the bulls will keep pushing higher towards 1.3640 and probably 1.3740.

The EUR/USD pair has been facing difficulty to fixate above the key level around 1.3640-1.3660 then successive bearish engulfing candlesticks originated off this price zone.

Bearish pressure which originated off 1.3650 has been applying pressure on 1.3560 (the key level corresponding to the previous prominent bottom) for two days resulting in daily closure below this price level exposing 1.3500 for retesting.

Bullish fixation above 1.3560 then 1.3640 is a must to pursue towards further bullish targets.

As long as the bulls keep defending the demand zone between 1.3500-1.3475, the bullish momentum is most likely to pursue towards further targets.

On the other hand, breakdown of 1.3500 invalidates the bullish structure allowing the bears to pursue initially towards the price level 1.3420.

Bullish pressure is expected to be applied around the current prices provided that the bears fail to fixate below 1.3500 on the daily basis.

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Intraday technical levels and trading recommendations on GBP/USD for July 18, 2014 Trend News

Successive ascending bottoms around 1.6465, 1.6555, and 1.6665 (corresponding to the uptrend line) constituted a solid bullish structure that kept pushing higher.

However, during the previous visit in May, the bullish momentum wasn't strong enough to allow the bullish breakout above 1.7000 to pursue towards further targets. Instead, this breakout lost its bullish momentum showing successive lower highs that temporarily managed to breakdown the depicted uptrend line.

This had been taking place until the GBP/USD pair showed bullish recovery around 1.6690 which was followed by strong bullish pressure that pushed above 1.7000 and 1.7150 thus challenging the new price levels that have not been visited since 2008.

Lack of bullish momentum and indecision were observed on the daily chart. This means the pair is trapped within a small congestion zone between 1.7050 and 1.7170.

On the other hand, the most dependable DEMAND level is located around 1.7050 (being tested today) where significant bullish rejection was expressed at retesting that took place on Tuesday.

Bullish fixation above 1.7000 enhanced the bullish channel scenario, thus enabling the bulls to reach 1.7100 and 1.7160 shortly after.

As expected, the price zone between 1.7140 - 1.7170 keeps providing evident bearish price movement each time a price zone is tested.

A pattern of multiple-tops was confirmed after breakdown of the depicted bullish channel. Moreover, the first bearish target was hit around 1.7055.

To avoid possible sudden reversals, bearish targets should be located at 1.7055 and 1.7000 where obvious demand levels are located.

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EUR/NZD analysis for July 18, 2014 Trend News

Overview:

Since our previous analysis, the EUR/NZD pair has been trading upwards. The price tested the level of 1.5623. We can observe low activity on the market today, so we are waiting for larger movement and volume. I have placed Fibonacci retracement to find potential resisntace level and I got Fibonacci retracement 61.8% at the price of 1.5615 (currently on the test). Be careful when buying and watch for potential selling opportunities. The third major short-term downstation is still at the price of 1.5335 (Fibonacci expansion 161.8%). According to the 4H timeframe, we can observe supply (up-thrust bar) in a volume above average.

Daily pivot Fibonacci points:

Resistance levels:

R1: 1.5608

R2: 1.5630

R3: 1.5665

Support levels:

S1: 1.5337

S2: 1.5515

S3: 1.5479

Trading recommendations: Be careful when buying the EUR/NZD pair and watch for selling opportunities after retracement.

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