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I’m going to get started on the Greater British Pound versus the US Dollar [GBPUSD]. Starting here on the Weekly Chart, over the past several weeks, we’ve been studying this larger range highlighted by the blue box in the middle of the chart. We’re not going to look at the current time first. We’re going to go back a little ways in time, all the way back here to 2013, where it went between – we’ll call it – September of 2013, all the way through the mid or end part of November, where it finally broke out of here.
We found resistance and support, and I’ve highlighted it with this red box, so you can really see that area. A couple of months here finding support at the bottom of the main, blue box and the top or the red box here, whichever one you want to concentrate on. The support and resistance, top and bottom is what you really need to concentrate on. The blue zone and the orange-shaded area at the very bottom are our current supports. As we reach back up towards the top and into the purple-shaded area or the green-shaded area, that’s what we’ll look for resistance within the top of the range.
We go back even further. We’re going back to the left-hand side of the blue box. We’re going back into January of 2013, all the way back into September of 2012. We found resistance at the top, support at the bottom, and only when we finally saw a clear singular candle body break out of that blue box to the bottom side over here on the left – it’s circled over here on the left – when we saw a single candle body underneath it did we expect it to continue to pressure lower.
The same thing on the top. As we come back over here into the end of 2013, you could see the singular candle bodies breaking out above the green-shaded area, the top of the red and blue box, and then it continued to pressure higher. Until we see an open and close outside of the blue box, like we could see on either side of it over here on the left, we are still constrained within the larger range. We’re looking at support at the bottom and resistance at the top, so it gives us clear areas to concentrate our trading efforts. When it’s closer to the bottom, we potentially look for buys and reversal signals to go back up. When it’s at the top, we look for sells and reversal signals to go back down.
And at some point in time in the future, we’ll look for that breakout of that blue box and either an uptrend on the upside or a downtrend on the downside to continue for the GBPUSD. One last thing here on the Weekly Chart. We take Fibonacci from the lowest low on the chart to the highest high, and the 50% of that range, 50% of this previous uptrend sits right at 1.6000. That’s basically where the current market is stalled out right now and has been since the end of last week here for the GBPUSD.
Let’s go ahead and take all of that information now down to the Daily Chart. And as we get down here, we could still see the blue box. We could see it now divided up into more detailed support and resistance with the shaded areas. We see the orange-shaded area at the very bottom is the lowest low we see. The blue-shaded area has been historical support all along here inside that blue zone. We see congestion and resistance inside the purple-shaded area, and then all the way back up towards the top of the blue box, the yellow and the green-shaded area as our main resistance.
Now, we have seen some falling highs over the past several weeks. We see three highs. If we’re going to see a similar pattern, we probably would look for it to push closer towards the 1.6100-level before we find new resistance again for that same pattern to develop. Right now we’re at the bottom of the range, and we see actually a higher low. This low is higher than this. The past three days have been higher than this last low. So, very interesting. Some contraction happening within the larger range. Higher lows. Lower highs.
A downtrend has lower highs and lower lows. An uptrend has higher lows and higher highs, and we don’t see that in either direction here at least on the Daily Chart for the GBPUSD. Interesting this week is that the Forex Black Book trend bar, the bar at the very bottom of the chart, has gone from red to green, and that could be a foreshadowing of things to come as the last time it turned green, we saw the push back to the top of the box or the top of the range into the green and yellow-shaded area. So, if that’s going to be very similar, we don’t know if it will or not, but if that’s a similar foreshadowing of things to come, we could be looking for it back towards 1.6100 or even towards the 1.6200-level as we look for it to rise off the bottom of our larger range.
Let’s go ahead and take that information now down to the 4-Hour Chart. And as we get down here, we can squeeze it in just a little bit. In fact, what I’ll do is zoom it out like this. So, we could see the larger blue box, top and bottom of the range here. There’s the green zone at the top and the blue box that we’ve been studying there at the top of the green zone. There is the orange-shaded area at the bottom and the blue box, so we’re looking at support closer than we are resistance. There’s the green trend bar with the Forex Black Book.
And by the way, on Friday, we see our bank flow levels. Actually Thursday and Friday of last week, we see our bank flow levels popping in as buy levels. Sell levels went away. Buy levels popped in as of late last week. So, as we start to see that, just take a look back here to the left-hand side. When those buy levels started to pop back in, we eventually saw the rise back to the top of the larger range and back towards the green-shaded area at the very top of our chart.
So, definitely some things to think about there for the beginning part of this week. Potential resistance all the way at the top. Support at the bottom. If you’re going to buy this, of course you’re looking for support, reversal. Right now we’re kind of stuck inside this blue-shaded area. Let’s zoom it in a little bit here on the 4-Hour Chart so we could see this a little bit better. There’s that blue-shaded area. We’ve been, over the past several days, kind of stuck in there. We’ve already filled in the gap from the weekend, so that’s not really part of our scenario for the day today, but what I would look for is an open and close above 1.6000.
A good, solid breakout above 1.6000, we’re easily looking for it back to 1.6060 or higher. That’s the purple-shaded area up here. If we get back underneath 1.6000, we fall back to 1.5960. That’s the bottom of the blue zone. A push back underneath the blue zone, we’re looking for it to target back down here towards the orange-shaded area. We’ll definitely be watchful for our bank flow levels today. If they’re still down there in the orange zone or even closer into the blue-shaded area, or if we see sell levels pop up in the purple or the yellow-shaded area, it gives us more of a directional purpose for our trading on the intraday.
At least for the day today, I think we need a breakout of this blue zone. Green trend bar. We have a green arrow. I probably would wait for a little bit more support to develop here and not trade so close to the beginning of the week with the Forex Black Book because it just changed over to green. If you’re going to still consider the sell side, your sells are up into the 1.6060s, towards 1.6100, the purple zone. If you’re going to buy this, I think you’re waiting for it to break above the purple zone or, sorry, the blue zone. 1.6000 or even dip all the way back down to the orange-shaded area and the 1.5900-level for the GPBUSD this week.
Next, moving over to the US Dollar versus the Swiss Frank [USDCHF]. We’re going to start here on the Weekly Chart. Some things that we looked at late last week of course is the previous downtrend. High, down to low of the previous downtrend puts the .886 fib at 0.9708, and that’s the top of our pink-shaded area at the very top of the chart. The .886 fib, 0.9708, top of the pink zone. So, that’s our current resistance.
So, let’s go ahead, while we’re here on the Weekly Chart, put two arrows. That .886 fib in the pink zone. If it breaks above it, we look for the continuation to the yellow-shaded area and we’ll put a bearish arrow there. Underneath that .886 fib and underneath the 0.9700-level, if it continues to hold resistance there for the day today, we’re going to stay underneath it and probably look for support back down here towards the 0.9600-level, where that blue trend line sits. So, there’s four arrows there, pink, purple, and yellow that give us our areas of interest for the day today.
Take it on down to the Daily Chart. Let’s get it zoomed back over to current time, back here on the Daily Chart. There we are. There is the purple-shaded area of course that we just highlighted as a potential support. And it could probably be as deep as the orange-shaded area down here, just underneath the 0.9600-level. The pink-shaded area is of course our current resistance. Above there, we go back up towards the yellow-shaded area, which is into the upper-0.9700s, towards 0.9800.
Not too hard to see that even here on the Daily Chart. Double-top scenario. We’re into the pink-shaded area. I suspect if you’re going to sell this, you want to be as close to that top as possible. 0.9675 to 0.9700, targeting the purple zone or lower. The closer you are to the pink-shaded area would be very discouraging about buying this at the current moment. I wouldn’t want to buy it too close to that pink zone. More likely, selling it. If you’re going to buy it, I think you need it to go back down, purple or the orange-shaded area, before you would even consider a new buy scenario for the USDCHF.
Take it on down to the 4-Hour Chart. Not much difference except for the fact that now we could see even last Friday’s bank flow levels confirming resistance into that pink-shaded area. There’s the bank flow levels from Friday. Resistance into the pink zone. Even the gaping here finding resistance into the 0.9675-level, now coming back down. Current support will be, again, back here at 0.9600. We’re at 0.9645 or so right now, so back to 0.9600 doesn’t seem like too much of a stretch for this to take a little bit of a dip lower. All that changes on a breakout above the pink zone. 0.9700. Again, we look for it all the way back up here, 0.9780 or even towards 0.9800.
All of that would likely change. A breakdown of the purple zone, we’re back down orange or maybe even the blue-shaded area, all the way down here towards the blue trend line for the USDCHF this week.
Next, moving over to the Euro versus the US Dollar [EURUSD]. First off, here on the Weekly Chart, I’ve scrolled it back a little bit, so we could see further back in history. Taking Fibonacci retracement levels from the lowest low to the highest high on the chart, that’s the first thing you want to see. Lowest low to highest high. .786 fib is right at 1.2459, and that’s important because where these two horizontal, red lines are, there’s a yellow-shaded area at the very bottom of the chart. That’s where our current support is. The .786 fib of this previous uptrend at 1.2459, so that’s where our current support is.
You need to remember where that comes from. You could see history of support and resistance around that yellow-shaded area. So, now that we see that, let’s go ahead and start to zoom it back in here. Let’s take it down to the Daily Chart. There’s the .786 fib. There’s the yellow zone. There’s our current support for the day today. If you’re going to sell this, selling it into that support is very discouraging. More likely, I think today we’re looking for support and potential clues for reversal.
Now, it’s going to take a lot of effort to get this to reverse. It’s been in a downtrend for a long time, but definitely would be discouraged about selling it again until we see either a break under this yellow zone or some reversal and a pullback here for the EURUSD. Let’s take it on down to the 4-Hour Chart. There are, again, our bank flow levels are right there at that yellow zone, very similar to what we saw opposite on the USDCHF there just a moment ago. Yellow zone, support. .786 fib. 1.2459. Bank flow levels showing support here for the EURUSD.
If we’re going to see selling opportunities, I definitely would like to see at least some pullback. Well, for the day today, the blue zone will likely be some resistance here, maybe even provide some intraday opportunities to sell this currency pair into the blue-shaded area because that is our current resistance, and we’re there right now. 1.2500, 1.2510, even as high as 1.2535 or so. The blue zone is your current resistance. A breakout above that blue zone, we’ll look for it to go back to the orange-shaded area here, and of course our current support as we know it is here at the yellow zone.
So, if you’re a seller, you’re selling the blue zone, 1.2510 or so, targeting back down to the yellow-shaded area. If you’re a buyer, I don’t think I would buy it right now, but a dip back to the yellow zone or break above the blue zone. Fibonacci here on this chart from the most recent high, the most recent high here, down to the lowest low puts the .236 fib right at 1.2516. Again, bottom of the blue zone.
So, for the day today, sellers, sell the blue zone. Target the yellow zone. Your risk is above the blue zone. If it breaks out above it, it goes back to the orange zone. Buyers, you’re being a little patient right now because it’s right into resistance. You need it to go back to the yellow zone. Find support. Maybe the bank flow levels today give you some more indication of support if and when we get those later on today, and then you look for it to maybe challenge back to the blue zone or back to the orange-shaded area.
Forex Black Book is still green. So, if you’re looking for a buy scenario, look for some bullish momentum to build and a new green arrow for the EURUSD today.
Next, moving over to the US Dollar versus the Canadian Dollar [USDCAD]. Now, I don’t want us to forget about this. This is in a longer-term uptrend. It’s been in an uptrend for quite some time. We go all the way back to 2012, bottom left-hand side of the chart, so it’s a long-term uptrend. Let’s not forget about that, so buy scenarios still remain in effect.
Also, we’re watching for resistance and reversal because we are at a pretty high level for this currency pair that we haven’t seen since of course 2012. So, very interesting dynamics here, but support and resistance will help us identify at least lower risk scenarios no matter which it goes, whether it’s back up or back down here for the USDCAD.
Let’s take it on down to the Daily Chart. At least right now, I think we have four areas that we need to pay attention to for the day today. The highest high of course on the chart is the orange-shaded area. As long as we stay underneath there, I would be very discouraged about buying it close to that orange-shaded area. It needs to go down into support before I buy this currency pair because we’re too close to a major historical resistance high here for this pair.
If, at any point, it breaks above there, we’ll change our attitude and start to look for it to go back up. Purple zone. We’re seeing some congestion in there today. We’ve seen congestion here before. Look at this. Four days. Kind of four or five days holding in that purple-shaded area as congestion. A little bit above it. A little bit below it, but still holding intraday opens and closes within that purple-shaded area several days ago. Then we broke underneath it, went between the pink and the purple-shaded area.
So, purple zone will be a pretty clear indication. Above 1.1285, we go to that orange-shaded area, and that’s pretty much what history told us here. Underneath it and underneath that purple-shaded area, which is 1.1250, we’ll go back to the blue or the pink-shaded area as support. Why? Because that’s what it did over here. So, clearly the purple zone is our breakout point for the USDCAD.
Take it on down to the 4-Hour Chart. Here’s some interesting things here. First off, the bank flow levels on Friday confirming the orange-shaded area as our current resistance. We can see that with the last spike on Friday into that orange-shaded area. A breakout on either side of this purple zone will give you a clue to at least some intraday continuation higher or lower. I’m just trying to get these arrows a little bit closer. And then of course a breakout under the purple zone, we go a little bit lower.
Here’s something else interesting. We had bank flow levels as sells on Friday and now, today, we see our Forex Black Book indicator turning red. Again, could be just a false signal that it’s just turning from green to red because we saw a little bit of hesitation here on Friday and a little bit of a lower low than that last highest low here. So, I’m not sure I trust that red trend bar quite yet, but very interesting. It did turn red and we have sell bank flow levels, so it could be a clue to at least a longer-term reversal here for the USDCAD.
So, if we’re going to sell this, again, as close as possible to the orange zone or break under the purple zone becomes your selling opportunities. Your buying opportunities of course would be dipping into support or break of resistance for the USDCAD this week.
Next, moving over to the US Dollar versus the Japanese Yen [USDJPY]. Well, we’re having to look at longer-term indicators here because we’ve seen massive movement over the past few days here for the yen pairs. First off, I’ve taken Fibonacci from several different down ranges. I’ve looked. We’re looking here at the Monthly Chart, all the way back into 2005, 2006, and 2007 on the left-hand side.
The blue-shaded area at the top is where we have to look to find some resistance back here on the left-hand side, 2005, 2006, and 2007, because we’re into historical resistance highs. We haven’t seen these highs since back in 2007. So, very interesting here into that blue-shaded area. That 114.70, up to 115.70. That blue zone that we see here on the chart.
Let’s go ahead and take it on down to the Weekly Chart. We could see the market stretching today, pushing back up there towards that blue-shaded area. If I scroll back in time here on the Weekly Chart and look at that blue-shaded area, back there in 2007, we could see the resistance here. I might even bring that down just a little bit. Let’s even bring it down closer to here and let’s bring this down to about right there, and we’ll adjust the blue-shaded area as we get down to the smaller compressions again, but that brings it down between 114.17 and 115.40. You could see the congestion here.
That top of it may be a little bit lower, but I think 114.17 at least gives us a good resistance to shoot for the day today on the USDJPY. Now let’s take it back to our current time on the right-hand side of the chart. Squeeze it in just a little so we could see that blue zone. Bring it down just a little bit here. 114.17 will be our resistance for the day today.
Take it on down to the Daily Chart. Get it back to our current time. We could see stretching up towards that 114.00, 114.17. We know where that comes from on the Monthly and the Weekly Chart, so this will be our resistance for the day today. The closer it gets to that, I’d be very discouraged about continuing to buy. That becomes a resistance target for anybody buying the USDJPY right into 114.00, 114.17. Definitely watching for resistance there today.
A little bit of gap from the weekend. Definitely still sitting there. If you’re looking for the filling of that gap, I don’t think it has done that yet and it would have to come back down towards the mid to low-112s if it’s going to do that. So, there’s your current resistance and support. The green-shaded area: mid-112s and the blue-shaded area: the low-114s are your current resistance and support. Of course this week, with the bullish movement, the Forex Black Book trend bar has turned green.
4-Hour Chart doesn’t really change it at all. Just gives you a little bit of a closer viewpoint of that blue and that green-shaded area at the very top of the chart. There’s the blue zone. There is the green zone. And when I say the gap hasn’t been filled, if you’ll take a look at that green-shaded area, Friday’s candle closed at the bottom of the green-shaded area. Sunday’s candle opened above the green-shaded area, and we haven’t seen the market back inside that green-shaded area between 112.55 and 112.30. So, it hasn’t been back towards Friday’s close yet here for the USDJPY.
So, definitely something that we’ll pay attention to if the market starts to go bearish again here for the USDJPY. I think 114.00, 114.17 is your resistance right now. That’s where you’re going to look for potential intraday reversal opportunities back to the green zone. Buying right now very discouraging for the USDJPY today.
Next, moving over to the Australian Dollar versus the US Dollar [AUDUSD]. Again, we’re kind of constrained within a range. It’s very similar to the GBPUSD, isn’t it, where we could see the blue box there. We’re kind of bouncing around inside that blue box for the past several weeks here for the AUDUSD.
Nothing really new. We’ve been talking about it for weeks and weeks now here on this pair. A little bit of a gap lower today for the AUDUSD. Support will likely be down here into the purple zone. The mid to upper-0.8600s. 0.8685 is the top of that purple zone. 0.8660 is at the bottom of the purple zone. That’s where we’ll likely find support because we have for the past several weeks.
If you’re looking to sell this, you would prefer to sell it into resistance. I think currently the resistance is the pink zone. We’ve talked about that pink zone as kind of a hinge point. As long as it was above it, we looked for the green zone to be our resistance. If it got below it, we’d look for the purple zone to be our support, and that’s really the way it’s been for the past several weeks. You can go back into any of our historical recordings on the archive, and this is what I’ve been talking about for weeks and weeks.
So, nothing really new here, at least today. Probably selling under the pink zone, targeting the purple zone. If it breaks back above the pink zone, that’s the risk. We’ll look for it to go back to the green-shaded area. 4-Hour Chart. Here’s some interesting facts here on the 4-Hour Chart. Very similar to what I just mentioned on the USDJPY is the fact that we have not filled the gap from the weekend. If you take a look here, Friday’s candle closes. This little red candle right here. The candle closed on Friday; was 0.8794, and this week’s candle that opened up opened at 0.8750, and we have not seen the market back into that gap from the weekend yet.
So, if that’s going to be filled, and that’s a big if. If it’s going to be filled, we need it to get above the pink-shaded area. Otherwise, we look for the continuation down to the purple-shaded area at the very bottom of the longer-term range. Zoom it in here. There’s that gap right there. Easily see it here on the zoomed in view on the 4-Hour Chart. Holding underneath here, we look for the continuation.
If you’re looking to sell this, sell under the pink zone. If you’re looking to buy this, buy the purple zone or above the pink zone for the AUDUSD.
Next, moving over to the New Zealand Dollar versus the US Dollar [NZDUSD]. Starting here on the Weekly Chart, I think we need to get a viewpoint of the 0.7700-level. If you take a look here on this chart, and it may be a little bit hard to see, but the blue-shaded area into the middle of the chart, bottom of these two blue boxes is 0.7700. And we haven’t been under 0.7700 since 2012. Really June of 2012 was the last time we were really strongly underneath the 0.7700-level.
So, keep that mind. We have not been underneath there since 2012. If we get underneath there with any open and close, we’re easily looking for the next support, the yellow zone, down into the 0.7500s. So, from 0.7700, we go down into the mid to low-0.7500s if we get a breakout underneath there. Otherwise, we’re looking for support above 0.7700.
Take it down to the Daily Chart. There’s our 0.7700-level. The blue zone at the very bottom of the chart. We’re very close to that, proving a fairly low risk, high reward scenario. The closer you can get to 0.7700 becomes a low risk, high reward buy scenario here for this currency pair because we haven’t been underneath there since 2012, so I suspect the buyers would likely be protecting it. Just take look at the last time we were here, just on the left-hand side of the blue box. The market found support and bounced all the way back up towards the 0.8000-level.
No guarantees of that, again, but definitely something that you’ll want to take note of. You really don’t want to sell it on top of the blue zone. That’s the biggest thing. You don’t want to sell it on top of the blue zone. If you’re going to sell it, you want to sell it back into resistance, back to the green zone or even higher, back to the orange or yellow-shaded areas up here.
So, that’s your selling opportunities, not on top of the blue zone. The break of the blue zone potentially, but those are your three real selling opportunities. The green zone, orange and yellow or under the blue zone. As long as it sits on top of that blue-shaded area, I would be very discouraged about selling this currency pair. In fact, I might be encouraged on an intraday basis to buy, sitting on top of that blue-shaded area, targeting back up towards the green zone or higher for the day today and really for most of the week.
The Forex Black Book trend bar is green. I don’t think that’s really a factor at this point since we’ve been in such a large period of congestion, but I think the blue-shaded area is probably more important than that Forex Black Book trend bar as far as where a buy scenario comes into play. On top of 0.7700, buy towards the green zone or maybe even the yellow and orange-shaded area. Under 0.7700, under the blue zone, clear single daily candle, open and close underneath it, we know where we’re targeting. All the way back down into the yellow-shaded area, into the 0.7500s for the NZDUSD over the coming weeks.