Daily FX Technical Trend Bias/Key Levels (Wed 29 May)

USD strength still faces the risk of a further pull-back.

EUR/USD – 1.1120 remains the key support to watch


click to enlarge chart

  • The pair had dipped down as expected from Mon, 27 May high of 1.1215 and manged to hold above the 1.1120 key short-term pivotal support as per highlighted in our previous report (click here for a recap). In addition, the hourly RSI oscillator has shaped a bullish divergence signal at its oversold region which suggests a slowdown in the downside momentum seen yesterday.
  • Maintain bullish bias above 1.1120 key short-term pivotal support and a break above the minor descending trendline at 1.1190 reinforces a further potential push up to target the minor range resistance at 1.1245/1260 (recent post FOMC swing high areas & medium-term descending resistance from 24 Sep 2018).
  • On the other hand, an hourly close below 1.1120 resumes the bearish impulsive downleg sequence towards the next near-term support at 1.1060/1040 (Fibonacci retracement/expansion cluster).

GBP/USD – 1.2600 remains the key support to watch


click to enlarge chart

  • No major changes on its short-term elements; maintain bullish bias above 1.2600 key short-term pivotal support for a further potential corrective rebound to target the 1.2750/1.2785 intermediate resistance (also the upper boundary of the minor descending channel in place since 03 May 2019).
  • On the other hand, an hourly close below 1.2600 resumes the slide towards the major support at 1.2545/2530 (also the primary ascending range support in place since 07 Oct 2016 low).

USD/JPY – Further downside towards major support


click to enlarge chart

  • Drifted down lower as expected towards the 13 May 2019 minor swing low area of 109.00. Maintain bearish bias with a tightened key short-term pivotal resistance at 109.70 (also the minor swing high area of 24 May 2019 & the descending trendline from 24 Apr 2019 high) for a further potential push down to target the major support at 108.50.
  • On the other hand, an hourly close above 109.95 invalidates the bearish scenario for a squeeze up towards the next resistance at 110.65 (21 May 2019 swing high area).

AUD/USD – Corrective bounce scenario remains intact


click to enlarge chart

  • Traded sideways yesterday above the 0.6900 key short-term pivotal support. No major changes on its elements, maintain bullish bias for another potential leg of corrective rebound sequence to target the next intermediate resistance at 0.6985.
  • On the other hand, an hourly close below 0.6900 resumes the slide for a retest on 0.6860 before targeting 0.6830 next.

Charts are from eSignal






Join our live webinars for the latest analysis and trading ideas. Register now

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.

For further details see our full non-independent research disclaimer and quarterly summary.