Hello Forex Traders,
After a mild and timid reaction yesterday to the FOMC meeting minutes, let us review the charts together in anticipation of tomorrow’s NFP and unemployment figures for the U.S.
CABLE MARCHES FORWARD
When analyzing the chart Forex traders can make an easy conclusion: the Cable is an uptrend. In fact price recently bounced off of the bottom of the uptrend channel.
As long as price remains in the uptrend channel (blue) and above support (magenta), any dips could be buying opportunities for more upside continuation until the -27.2% Fibonacci target and the next resistance (red).
The EURUSD is classical example of where the trend is clashing with a support or resistance – in this case a resistance level. The structure has become a triangle with a clear top trend line (magenta) and a bottom line (purple) marking the lines in the sand.
A breakout to either direction would constitute a break out opportunity. After the breakout, this currency pair does not have much space before it runs into a next layer of S&R, but the break would still be good enough for smaller swing trades.
Please take a look at the screenshot to review how far each break of the support and resistance could go and what the target would be for those breaks.
USDJPY is showing almost the opposite picture compared to the USDJPY. The latter pair remains in a major uptrend and so far there are no signs of exhaustion or reversal.
Obviously if price remains in the uptrend channel (blue), then all pullbacks, consolidations and retracements are opportunities to muscle oneself in this ongoing trend.
Even if the uptrend channel breaks and price would make a bigger retracement, then I am still bullish and looking for rebounds back as long as price stays above support (green levels).
The target of this grand uptrend is 109-111 zones for the moment. There is resistance at the level from higher time frames, plus the -27.2% target of the 38.2% Fibonacci retracement bounce earlier at 93.50.
What do you think of the Majors? How do you think the NFP and unemployment figures will impact the charts? Do you see USD strength or weakness? Let us know down below!
The USD index reflects the choppiness of the USD. The weekly chart shows the multiple triangles and contracting consolidation.
From the daily perspective though, price is breaking out of a down sloping trend line (black) to the upside. The USD bearishness in December 2013 has been replaced by bullishness ever since the start of the New Year. The resistance level (red) would need to break before a breakout trade to the top of the next wedge (purple) has a decent chance of succeeding.
Better than expected NFP and unemployment figures tomorrow could help lift the USD, whereas slower numbers might cause dips. Also keep an eye on the interest rate announcements of the Euro ad Pound and their subsequent press conferences and news announcements.
Before we close, make sure to check out these links:
Thanks for reading and sharing this article! Wish you Good Trading!
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