Daily FX Technical Trend Bias/Key Levels (Wed 27 Feb)

Recent rally in GBP/USD at risk of minor pull-back/consolidation.

FX – Mix bag with GBP/USD bulls at risk of minor pull-back/consolidation

  • EUR/USD – Trend bias: Push up within range. The pair has managed to inch higher as expected and met the resistance/target of 1.1400 as per highlighted in our previous report (printed a high of 1.1402 in yesterday, 26 Feb U.S. session). No clear signs of bearish reversal at this juncture, maintain bullish bias with a tightened/adjusted key short-term support now at 1.1345 (the minor swing low area of 26 Feb 2018 + close to the lower boundary of a minor ascending channel from 15 Feb 2019 swing low) for a further potential push up to target the next resistance at 1.1440 (upper boundary of the medium-term descending triangle range configuration in motion since 13 Nov 2018 low of 1.1214 + upper boundary of a minor ascending channel from 15 Feb 2019 swing low + Fibonacci retracement/expansion cluster). However, failure to hold at 1.1345 negates the bullish tone for a deeper pull-back towards the next near-term support at 1.1300/1280 (19 Feb 2019 minor swing low + pull-back support of former minor descending trendline resistance from 08 Feb 2019 high).
  • GBP/USD – Trend bias: Sideways. Pushed up as expected and it is now coming close to the resistance/target of 1.3310 as per highlighted in our previous report (1.00 Fibonacci expansion of the recent rebound from 14 Feb 2019 low to 21 Feb 2018 high projected from last Fri, 22 Feb low + medium-term swing high area of 09 Jul/20 Sep 2018). It printed a high of 1.3288 in yesterday, 26 Feb U.S. session on the back of an offer from U.K PM May to allow U.K parliament on a vote to delay Brexit). The 4-hour Stochastic oscillator has reached an extreme overbought level coupled with a bearish divergence signal seen in the 1-hour RSI oscillator at its overbought region. Risk of a pull-back/consolidation, prefer to turn neutral now between 1.3310 and 1.3210. A break below 1.3210 triggers a pull-back towards 1.3130/3090 (50%/61.8% Fibonacci retracement of the recent push up from 22 Feb 2019 low to yesterday high of 1.3288 + ascending trendline from 14 Feb 2019 low + former minor swing high areas of 21/25 Feb 2019) before another potential upleg materialises. On the flipside, a clearance above 1.3310 shall rocket the bulls towards 1.3410 next (swing high area of 05 Jun 2018 + 50% Fibonacci retracement of the down move from 17 Apr 2018 high to 03 Jan 2019 low).
  • USD/JPY – Trend bias: Push down within range. Continued to inch down lower as expected. No change, maintain bearish bias below 111.20 key short-term resistance  for a further potential push down to retest the 110.10/110.00 near-term support (former minor swing high areas of 23 Jan/04 Feb 2019 + minor ascending channel support from 03 Jan 2019 swing low area). On the flipside, a break above 111.20 sees the revival of bulls for another push up to probe 111.80 (former swing low areas of 15/26 Oct 2018) follow by 112.30 resistance (former swing low areas of 20 Nov/06 Dec 2018 + close to 76.4% Fibonacci retracement of the recent decline from 12 Nov 2018 high to 03 Jan 2019 swing low area).
  • AUD/USD – Trend bias: Push down within range. Reacted off the 0.7200 key short-term resistance after a test on it in today, 27 Feb early Asian session. No change, maintain bearish bias with 0.7200 remains as the key short-term resistance and adjusted the downside trigger level to 0.7160 (minor ascending trendline that is holding the on-going rebound since 22 Feb 2019 low of 0.7067). A break below 0.7160 is likely to reinforce a potential push down to retest the 0.7080 near-term support in first step (the minor swing low areas of 14/22 Feb 2019). However, a break above 0.7200 negates the bullish tone for an extension of the corrective rebound to target the next resistance at 0.7250 (the descending trendline from 03 Dec 2018 high + 76.4% Fibonacci retracement of the recent slide from 31 Jan 2019 high to 12 Feb 2019 low).
  • NZD/USD – Trend bias: Push down within range. No change, as price action continues to hover right below the upper boundary of a “Symmetrical Triangle” range configuration. Maintain bearish bias below 0.6900/6920 key short-term resistance (the upper boundary of the “symmetrical triangle” + Fibonacci retracement/expansion cluster) for another potential slide to retest 0.6756 and 0.6725 next. However, a break above 0.6920 invalidates the push down scenario for a squeeze up to retest 0.6970 (04 Dec 2018 swing high) in the first step. Above 0.6970 opens up scope for a further potential up move to target the next resistance at 0.7050 (swing high area of 06 Jun 2018 + medium-term descending trendline from 27 Jul 2017 high).                   

     


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