EURO
During last month's trading, the Euro versus Dollar pair failed to maintain levels above 1.4135 despite reaching a high of 1.4200 to result in a bearish candlestick supporting further downside movements this month as it confirms the previous month's closing.
Monthly Technical Analysis - July 2009
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GBP
After reaching levels above 1.6700, the pair reversed to the downside to breach the first support within the intraday ascending channel which opened the way for further declines on the intraday.
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JPY
Not much has changed since the previous month where we see trading remains volatile around the 38.2% correction near 96.00 as it trades within a short term downside channel as seen in the image below.
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CHF
The pair's continuous attempts to breach the 161.8% correction at 1.0660 failed the past month resulting in an incline near the key resistance for the downside channel at 1.0915 and the 23.6% correction at 1.0875
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CAD
The pair exited the short term downside channel as it was able to breach 1.1545 where we currently see trading around the 38.2% correction at 1.1650 for the last decline.
In the above image, we see that the bullish direction on the medium term remains yet has adjusted to the downside on the intraday and short term basis as it failed to maintain levels above the previously mentioned 1.4135 level where we believe the pair is to the decline towards the 50 day MA at 1.3820 and the 38.2% correction at 1.3785.
The above image indicates that the pair still has further inclines as we believe he key resistance for the downside channel is to be breached opening the way this month to the 38.2% and 50% corrections at 1.1040 and 1.1170 respectively.
The pair was able to breach the support level at 1.3995 – 1.4000 to confirm the downside movements supported by the RSI adjusting to the downside alongside obvious weakness in the uptrend as seen on the ADX indicator. Due to that our outlook remains targeting the 50 day MA mentioned above.
The third image illustrates the fact that the pair has initiated a new bearish trend since 03-06-2009 where the high for the month was the 76.4% correction. We believe the pair may target the 100% expansion for the wave at 1.3605.
From here dear reader, we believe that trading this month will be to the downside targeting 1.3605 at the very least and perhaps 1.3540 where the latter level is the key support for the ascending channel seen in the first image. Although we do expect a decline, we shouldn't neglect that the medium term trend remains to the upside and the current decline is an attempt to gather bullish momentum.
Support 1.3890 1.3785 1.3605 1.3540 1.3450
Resistance 1.3995 1.4135 1.4185 1.4365 1.4510
Recommendation According to our analysis, we believe the pair is to gather bearish momentum from 1.3995 with targets at 1.3605 yet if trading reverses to maintain levels above 1.4185, our downside movements become invalid
In the above image, we see that momentum and direction indicators are adjusting to the downside and will be confirmed by the breach of 1.6200 where we do expect to witness a breakout targeting the 50 day MA at 1.5890.
In the second image, the pair seems to be forming a bearish technical pattern to support our outlook to the downside towards 1.6195 and 1.5850 respectively which are the 23.6% and 38.2% correction for the uptrend that started on 22-04-2009 and ended on 30-06-2009.
However, looking back at the first image, despite the expected decline, the medium term trend remains to the upside within a bullish channel with a key support at 1.5705 where as far as this level remains intact, the uptrend will prolong
From here we see the trend this month is to the downside in an attempt to relieve momentum indicators that have been trading within an overbought area; to gather enough bullish momentum to rebound to the upside.
Support 1.6195 1.5850 1.5705 1.5590 1.5325
Resistance 1.6350 1.6425 1.6585 1.6640 1.6735
Recommendation According to our analysis, we believe the pair is to gather bearish momentum from 1.6350 targeting 1.5850 yet if trading rebounds above 1.6585, our downside movements become invalid
The stochastic indicator seems to be supporting the downside trend as well as far as the key resistance for the channel at 97.60 remains intact with targets at the 50% correction at 94.30 which will help determine the medium term trend.
In the above image, the 94.30 level has proven to be a critical level as it is the neckline for two bearish technical patterns seen on the medium and short terms. As a result, the overall trend will remain to the downside in an attempt to successfully breach the 94.30 level.
Hence, the bearish momentum will prolong despite the inclines seen last month, as we believe the pair will be able to maintain levels below 94.30 as far as the 97.60 level remains intact and the medium term resistance at 99.40.
Support 95.10 94.30 93.60 92.65 90.50
Resistance 96.30 96.80 97.60 98.80 99.40
Recommendation According to our analysis, we see the pair is to gather bearish momentum from 96.30 with targets at 94.30 and 92.65 yet if trading rebounds above 99.40, our downside movements become invalid.
In the second image, indicators are supporting the uptrend on the short term, including the stochastic and the weakness in the ADX indicator, alongside the key support at 1.0650 which will keep the trend to the upside as far as the pair maintains trading above this level.
From here we believe the pair is to incline this month towards 1.1040 where a breakout will open the way for the pair towards 1.1170 as far as 1.0615 (the low on the above daily charts) remains intact.
Support 1.0830 1.0790 1.0700 1.0615 1.0480
Resistance 1.0915 1.1040 1.1170 1.1265 1.1380
Recommendation According to our analysis, we believe the pair is to gather bullish momentum from 1.0790 with targets at 1.1170 yet if trading reverses below 1.0615, our upside movements become invalid
The Stochastic indicator is showing the pair being overbought yet still is providing bullish signals alongside the RSI yet the pair is to attempt to breach the above mentioned correction level to incline towards the 50% correction at 1.1915.
Taking a closer look, we see an ascending channel with a key support at 1.1375 and a 20 MA on the four hour charts at 1.1565 which may provide the pair with enough bullish momentum to reach the key resistance at 1.1820 as it breaches the 38.2% correction and targets at 50% gradually within the channel
The uptrend we expect for the pair remains as far as 1.1460 is intact on the intraday and short terms while the medium term trend may be quite volatile and may prolong this month.
Support 1.1545 1.1460 1.1410 1.1375 1.1240
Resistance 1.1795 1.1820 1.1915 1.2030 1.2225
Recommendation According to our analysis, we expect the pair to gather bullish momentum from 1.1565 with targets at 1.1915 yet if it reverses to maintain levels below 1.1410, our upside movements become invalid
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