FX – Mix bag & GBP/USD rallied towards 1.3350 key medium-term range resistance ahead of new Brexit deal vote
- EUR/USD – Trend bias: Sideways. The pair has pushed up by 69 pips from its last Fri, 08 Mar U.S. session low of 1.1178 to print a current intraday high of 1.1273 in today, 12 Mar, Asian session before it retreated from the tightened 1.1265 key short-term resistance (former swing low areas of 28 Nov/14 Dec 2018 & 11 Feb/15 Feb 2019 + 38.2% Fibonacci retracement of the decline from 28 Feb 2019 high to 07 Mar 2019 low) as per highlighted in previous report. Mix elements now, prefer to turn neutral between 1.1220 (yesterday, 11 Mar low) and 1.1285. Only an hourly close below 1.1220 revives the bearish tone for a further potential push down to target the next support at 1.1130 (61.8% Fibonacci retracement of the last corrective up move cycle from 03 Jan 2017 low to 16 Feb 2018 high + swing low areas of 30 May/20 Jun 2017) and below 1.1130 exposes 1.1060 next. On the flipside, a clearance above 1.1285 sees a continuation of the bounce towards the next intermediate resistances at 1.1320 and 1.1360 (minor swing high areas of 06/07 Mar 2019 + 61.8%/76.4% Fibonacci retracement of the decline from 28 Feb 2019 high to 08 Mar 2019 low).
- GBP/USD – Trend bias: Push down within range. The pair has continued to drop lower within its 5-month range configuration in place since 20 Sep 2018 on last Fri, 08 Mar and it hit the expected short-term support/target at 1.2980 (printed a low of 1.2960 on Mon, 11 Mar Asian session) before it pushed up by 300+ pips to print a current intraday high of 1.3290 in today, Asian session on the backdrop that PM May has strike a new Brexit deal with EU ahead of the U.K parliament vote on the new deal today. Right now, the rally has led the pair to hover just below the 1.3300/3350 key medium-term range resistance with the 4-hour Stochastic oscillator at an extreme overbought level. Bearish bias below 1.3350 resistance for a potential push down to retest 1.3080 near-term support (the pull-back support of a former minor descending resistance from 27 Feb 2019 high). On the flipside, a clearance above 1.3350 opens scope for a bullish range breakout to target the next intermediate resistances at 1.3470 and 1.3640 (50%/61.8% Fibonacci retracement of the previous decline from 17 Apr 2018 high to 03 Jan 2019 low).
- USD/JPY – Trend bias: Down. The pair has staged the expected push to hit the short-term support/target of 111.05 (printed a low of 110.75 in last Fri, 08 Mar U.S. session). Maintain bearish bias in any bounces below 111.60 key short-term resistance (former minor swing low areas of 05/07 Mar 2019 + Fibonacci retracement/expansion cluster) for another round of potential push down to retest 110.75 and below it opens up scope for another minor downleg to target the next support at 110.30/110.00 (minor swing low areas of 15/27 Feb 2019 + ascending channel support from 03 Jan 2019 flash crash swing low area). On the flipside, a clearance above 111.60 invalidates the bearish scenario for a squeeze back up to retest the 112.20 key medium-term resistance.
- AUD/USD – Trend bias: Pushed down within range. The pair has broken above the 0.7050 upper limit of the short-term neutrality zone as per highlighted in our previous report. It has staged a further push up and printed a current intraday high of 0.7081 in today, Asian session which is closed to the next intermediate resistance at 0.7090 (minor swing high areas of 05/06 Mar 2019 + Fibonacci retracement/expansion cluster). In addition, the 4-hour Stochastic oscillator has flashed a bearish divergence signal at its overbought region. Flip back to a bearish bias below 0.7090 key short-term resistance for a potential push down to retest the 0.7020/0.7000 neckline support of the minor “Head & Shoulders” bearish reversal configuration in motion since 11 Jan 2019 swing high. On the flipside, a break above 0.7090 negates the bearish tone for a further push up towards 0.7125 (61.8% Fibonacci retracement of the previous push down from 27 Feb 2019 high to 08 Mar 2019 low + minor congestion area of 27 Feb to 01 Mar 2019).
- NZD/USD – Trend bias: Sideways. The pair has broken above the 0.6790 upper limit of the short-term neutrality zone as per highlighted in our previous report. It has staged a further push up and almost hit the short-term resistance/target of 0.6830/6850(minor swing high areas of 04/05 Mar 2019). It has printed a current intraday high of 0.6846 in today, Asian session. Mix elements now, thus prefer to maintain the neutrality stance between 0.6850 and 0.6805 (former minor swing areas of 08 Mar/11 Mar 2019). An hourly close below 0.6805 reinstates the potential push down within range scenario for a slide towards 0.6750/6720 (08 Mar 2019 low + the lower boundary of the medium-term “Symmetrical Triangle” range configuration in motion since 04 Dec 2018 swing high). On the flipside, a clearance above 0.6850 sees a further potential push up towards the next resistance at 0.6900 (the swing high areas of 25/27 Feb 2019 + upper boundary of the medium-term “Symmetrical Triangle” range configuration).
GAIN Capital UK Limited (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.
No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.