Note – Charts provided by Trading View
EUR/USD:
Monthly timeframe:
(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)
Following the break of long-term trendline resistance (1.6038) in July, and subsequent break of supply at 1.1857/1.1352 in August, EUR/USD, by way of two back-to-back bullish candles, welcomed 2021 in good health.
This—despite January’s modest 0.4 percent slide—reasons additional upside towards ascending resistance (prior support – 1.1641) may eventually be on the horizon.
The primary uptrend has been in play since price broke the 1.1714 high (Aug 2015) in July 2017.
Daily timeframe:
Partly modified from previous analysis –
The technical scene on the daily chart witnessed modest upside unfold in recent days, aided by a waning greenback and the 38.2% Fib support level at 1.2059. Sustained buying invites the possibility of retesting 2021 tops at 1.2349.
In case of a EUR/USD dip, demand at 1.1923/1.2001 occupies space south of 1.2059—an area complemented by trendline support (1.0774).
The RSI indicator ascended the 50.00 centreline on Tuesday, currently trading at 52.00. This implies momentum could continue to gather traction to the upside.
H4 timeframe:
Partly modified from previous analysis –
EUR/USD staged a recovery on Tuesday, a whisker ahead of a 61.8% Fib level at 1.2104.
Resistance at 1.2179 is in the crosshairs (holding back buyers since the middle of January), while a 1.2179 breach shines light on 1.2214 resistance. Interestingly, the aforesaid level is sheltered under supply coming in from 1.2282/1.2245. Fib fans will also note the 61.8% Fib level inhabits territory at 1.2241.
H1 timeframe:
A textbook retest of the 100-period simple moving average at 1.2147 took place in early US trading on Tuesday, sending light towards familiar H1 AB=CD resistance at 1.2177 (placed below the 1.22 level).
Aided by RSI support forming around the 50.00 centreline, additional resistance worth taking on board is 1.2235 and 1.2250.
Observed levels:
Partly modified from previous analysis –
Cemented within a clear uptrend, with monthly price observing higher levels, this could provide buyers with enough conviction to maintain a bullish position above the daily timeframe’s 38.2% Fib level at 1.2059.
The above may elbow H4 price north of resistance at 1.2179 and extend gains off the H1 timeframe’s 100-period simple moving average retest.
Breakout buyers above 1.22 are likely to tread cautiously, having noted H4 resistance at 1.2214.
AUD/USD:
Monthly timeframe:
(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)
Following two spirited months of gains off demand at 0.7029/0.6664 (prior supply), early 2021 shines light on a possible continuation higher to 0.8303/0.8082—a supply zone aligning closely with trendline resistance (prior support – 0.4776).
In terms of trend, the primary downtrend (since mid-2011) remains south until breaking 0.8135 (January high [2018]).
Daily timeframe:
Brought forward from previous analysis –
Recent developments show price continues to work within a bullish pennant pattern, forming between the 2021 high at 0.7820 and January 4 low at 0.7642.
Technicians will also note the aforesaid pattern balances off support at 0.7647, with supply at 0.7937/0.7890 to perhaps make an arrival in the event a breakout higher develops.
Out of the RSI indicator, the value remains entrenched within an early descending channel. Support is seen at 52.00, while resistance is set around 80.19.
H4 timeframe:
Early movement on Tuesday welcomed a bottom just ahead of demand at 0.7665/0.7644 (prior supply), an area in which daily support at 0.7647 inhabits.
Resistance at 0.7805 remains a worthwhile note if buyers extend Tuesday’s recovery, with a violation bumping resistance at 0.7843 in position.
H1 timeframe:
Demand at 0.7654/0.7672 (an area made note of in Tuesday’s technical outlook) delivered a podium for buyers to lift AUD/USD above 0.77 and the 100-period simple moving average at 0.7733 on Tuesday, shoving 0.7750 resistance in play.
Additional observations, of course, is the retest of the 100-period simple moving average holding almost to the pip.
Above 0.7750, bullish eyes are immediately drawn to Thursday’s high at 0.7782, followed by 0.78 resistance and surrounding Fib levels (the 100% Fib extension at 0.7793 and the 127.2% Fib projection from 0.7803).
Another worthwhile note is the RSI indicator hovering within close range of overbought space.
Observed levels:
All four timeframes echo the possibility of increased upside beyond 0.7750 resistance. On that basis, a H1 close above the aforesaid resistance may wave in breakout buyers, with Thursday’s high at 0.7782 targeted as a primary upside objective.
USD/JPY:
Monthly timeframe:
(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)
Over the span of four years, USD/JPY carved out a descending triangle pattern between 118.66/104.62.
Although December pursued terrain south of 104.62, January has so far attempted a comeback and is within relatively close range of retesting 104.62.
104.62 ceding ground throws light on support from 101.70, with a break here uncovering trendline support (76.15) and the descending triangle’s take-profit objective at 91.04 (red).
Daily timeframe:
Brought forward from previous analysis –
Overall, buyers and sellers have remained squaring off between trendline resistance (111.71) and 103.08 support since January 12, albeit with a mildly bearish presence.
Beyond the aforesaid areas, demand at 100.68/101.85 is visible (encases monthly support at 101.70) and supply can be found at 106.33/105.78 (the 200-day simple moving average circles the lower side of the supply).
Also prominent is the RSI indicator recently crossed paths with resistance at 57.00, a level hindering upside since July 2020.
H4 timeframe:
Brought forward from previous analysis –
Local trendline resistance (104.39), as you can see, has so far done a good job of containing buyers, following Monday’s test by way of a shooting star candle pattern (red arrow).
Countering trendline resistance today throws light on last Thursday’s low at 103.32, positioned ahead of a Fib cluster around 103.28 (a collection of Fibonacci levels formed around a specific price level). Upstream, however, may direct focus to resistance at 104.16.
H1 timeframe:
As anticipated, with the immediate trend facing south since March (2020), H1 buyers were out of their depth off the 100-period simple moving average at 103.67.
Pattern traders will note that Tuesday’s decline put forward a head and shoulders top configuration, with the neckline break seen in early US trading (Monday’s low at 103.67). According to the pattern’s take-profit objective (yellow), price is perhaps on course to dethrone 103.50 support and approach support at 103.39.
RSI fans will also note the indicator is circling beneath the 50.00 centreline.
Observed levels:
Based on technical research above, sellers could attempt to take advantage of the recently established head and shoulders top and target 103.50 support on the H1 today, followed by a possible slip to H1 support at 103.39.
Should 103.39 make a show, the chances of the H4 Fib cluster receiving some attention at 103.28 is also on the table.
GBP/USD:
Monthly timeframe:
(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)
December’s 2.5 percent extension elevated GBP/USD and stirred trendline resistance (2.1161).
January, as you can see, currently trades off session lows and recorded fresh 2021 highs (up by 0.6 percent).
In terms of trend, the primary trend has faced lower since early 2008, unbroken (as of current price) until 1.4376 gives way – April high, 2018. In effect, the aforesaid high represents the next upside objective on the monthly chart.
Daily timeframe:
Partly modified from previous analysis –
In a market exhibiting an upside bias since early 2020, price action is tipped to refresh 2021 highs and invade resistance at 1.3755. Breaching 1.3755, on the other hand, brings light to supply at 1.3996/1.3918.
The RSI indicator has revealed a rangebound environment since November, limited by support around 47.00 and resistance at the 66.00 region. It is common to see higher oversold support areas form in an uptrend.
H4 timeframe:
Off demand at 1.3618/1.3637, sterling rallied strongly against the US dollar on Tuesday and took on resistance at 1.3711. Price action, according to the chart, is tipped for more outperformance until resistance at 1.3763 and nearby supply at 1.3837/1.3800.
H1 timeframe:
After coming within a whisker of tagging a Fib cluster at 1.3606 (located ahead of the 1.36 level), early Europe observed healthy buying. With enough force to overrun the 100-period simple moving average at 1.3690 and the 1.37 resistance, short-term action is now seen pencilling in a bullish pennant pattern (1.3744/1.3717), ahead of 1.3750 resistance.
With respect to the RSI indicator, we’re mildly correcting just beneath overbought levels.
Observed levels:
Daily resistance at 1.3755, as well as H4 resistance at 1.3763 could pose a problem for buyers, despite the monthly timeframe’s trendline resistance breach in December.
Traders watching the H1 timeframe’s bullish pennant configuration, therefore, may wish to take the above into account. A H1 close above 1.3763 may add bullish conviction.
DISCLAIMER:
The information contained in this material is intended for general advice only. It does not take into account your investment objectives, financial situation or particular needs. FP Markets has made every effort to ensure the accuracy of the information as at the date of publication. FP Markets does not give any warranty or representation as to the material. Examples included in this material are for illustrative purposes only. To the extent permitted by law, FP Markets and its employees shall not be liable for any loss or damage arising in any way (including by way of negligence) from or in connection with any information provided in or omitted from this material. Features of the FP Markets products including applicable fees and charges are outlined in the Product Disclosure Statements available from FP Markets website, www.fpmarkets.com and should be considered before deciding to deal in those products. Derivatives can be risky; losses can exceed your initial payment. FP Markets recommends that you seek independent advice. First Prudential Markets Pty Ltd trading as FP Markets ABN 16 112 600 281, Australian Financial Services License Number 286354.
Access 10,000+ financial instruments