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CURRENCIES TECHNICAL ANALYSIS May.24

Euro

 

The single currency remains on recovery-mode so far on Thursday. The euro pushed away from the lower limit of the descending channel and headed to its upper one. Buyers left the 1.1700 in the early Asian session and were able to reach the 1.1750 hurdle by noon. The major ran through fresh offers over there and bounced back after that. The technical indicators turned bearish again and confirmed a sell signal. The resistance resides at 1.1750, the support comes in at 1.1700.

 

Despite the current incline, the spot is in the red and tending to extend its losses. We believe that the euro will revisit the 1.1700 support and will head towards 1.1600 afterwards.

 

GBP/USD

 

The US dollar started the day on the defensive. The pound started a recovery in the night and was able to revere a portion of its recent losses. The positive bias remained intact in the European session and the major continued its recovery and was able to reach the 1.3400 hurdle where the upward momentum lost legs. MACD is growing in the negative territory. RSI left the oversold area and is neutral right now. Only the moving averages continued moving downwards. The resistance lies at 1.3400, the support comes in at 1.3300.

 

The pound is approaching the upper limit of the descending channel which is reinforced by the EMA50 and EMA100. This barrier is unlikely be broken and will most probably reject the sterling downwards. If so, the spot may extend losses towards 1.3200 in the coming days.

 

USD/JPY

 

The US dollar remained under pressure on Thursday. Sellers tightened their grip and sent the major out of the ascending channel this week. However, they took a pause when they reached 109.50. As we can see, this level is well defended by buyers whose bids do not allow sellers to move lower. The technical indicators are mixed. MACD and RSI are on the sellers’ side giving us a sell signal. The 50,100 and 200 EMAs continued their vertical slope. However, they started to show first signs of a turn over. The resistance resides at 110.00, the support comes in at 109.50..

 

The US currency is unlikely to continue its decline. We assume that the major found a bottom in the 109.50 area and started to gather steam for a recovery. If we are right, we will see the spot returning above 110.00 in the coming sessions.

 

GBP/JPY

 

GBP/JPY pair continued bottoming between the 147.00 and 146.00 level. Sellers reached the 146.00 handle on Wednesday, bit failed to overcome it. Exhausted they gave up control and allowed buyers to reverse some losses. Buyers used this chance and lifted the spot to 147.00 where they lost steam and stopped. All the technical indicator give us a strong sell signal. The resistance lies at 147.00, the support is at 146.00.

 

The market sentiment is still bearish and we expect further losses for the pound. The major may revisit the 146.00 level and break it after that. If so, the sterling may reach 145.00 in the coming sessions.

 

EUR/JPY

 

The overall picture is still negative and sellers still lead the way. They reached the level 128.00 in night session which failed to regain at once. The single currency pulled back after that and reverted a minor portion of its losses. The price spiked to the 129.50 where the spot found fresh offers and turned to the downside again. The resistance lies at 128.50, the support is at 128.00.

 

A break below 128.00 would open up the way for a move to 127.00 in the coming days.

 

AUD/USD

 

The Australian dollar recovery stalled at 0.7600 last week. The spot found selling rejection at the level and moved downwards after that. Sellers tried to regain the 0.7550 level, but failed. The EMA50 and EMA100 which are located below the level limited sellers’ advance and the pair rebounded to the 0.7580 region. The resistance stands at 0.7600, the support is at 0.7550.

 

We believe the AUD/USD will continue losing ground and may test 0.7500 in the short-term. In this case, a further extension to 0.7400 is not ruled out.

 

NASDAQ

 

Buyers stopped sellers on Wednesday when they were trying to overcome the mark 6830. The EMA100 helped buyers to stop bears rejecting the spot upwards. The rate recovered to the 6930 area where it spent the first part of Thursday. The resistance lies at 6930, the support exists at 6870.

 

If buyers do not preserve control, NASDAQ may drop below 6870 again. In this scenari selles will move the price to the 6810 area.

 

DAX

 

DAX had another negative day on Thursday. The index gapped downwards at the open and started the day at 12900 where the benchmark found some bids and jumped to 13000 where sellers regained control and sent the rate to the prices opening. The resistance lies at 13000, the support exists at 12900.

 

Traders decided to ignore the oversold reading and continued pushing DAX lower. When sellers break 12900, the level 12800 will come back to the play.

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