FX Majors: EUR/USD Overshooting; EUR/GBP Sideways Trading
Swissquote Ltd | Feb 15, 2018 12:09
Overshooting
EUR/USD made a drastic rise, reaching the 1.25 range and heading toward 1.2537. Hourly resistance is now at 1.2537 (25/01/2018 high) while hourly support is maintained at 1.2165 (17/01/2018 low). The technical structure suggests further upside moves.
In the longer term, the momentum is turning largely positive. We favor a continued bullish bias. Key resistance is holding at 1.2886 (15/10/2014 high) while strong support lies at 1.1554 (08/11/2017 low).
Strengthening
GBP/USD continues bouncing and trades between resistance at 1.4003 (23/01/2018 high) and support at 1.3742 (16/01/2018 low). The technical structure suggests further upside move.
The long-term technical pattern is reversing. The Brexit vote had paved the way for further decline but the pair is moving to 2016 highs. Long-term support and resistance are given at 1.1841 (07/10/2017 low) and 1.5018 (24/06/2016 high).
Failing to bounce
USD/JPY is declining again under strong selling pressures, heading toward 106 range. Hourly resistances at 111.50 (18/01/2018) and 113.75 (12/12/2017 high) are further distanced. The technical structure suggests short-term downside moves.
We favor a long-term bearish bias. Support is given at 105.55 (03/05/2016 low). A gradual rise towards the major resistance at 125.86 (05/06/2015 high) seems unlikely. Expected to decline further support at 101.20 (09/11/2016 low).
Decline
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USD/CHF is weakening. The declining trend line remains intact, as resistance at 0.9257 (01/02/2018) has been broken. Heading toward 0.92. Hourly resistance stands at 0.9559 (24/01/2018 high) while further resistance remains at 0.9668 (17/01/2018 high).
In the long-term, the pair is still trading in range since 2011 despite some turmoil when the SNB unpegged the CHF. Support at 0.9259 (24/08/2015 low) is now reached. Key support remains at 0.9072 (07/05/2015 low) while resistance at 1.0344 (15/12/2016 high) is distanced. The technical structure favours a long term bullish bias since the unpeg in January 2015.
Downturn
USD/CAD is strongly decreasing following recent sideways trading. The pair broke support at 1.2480 (20/10/2017 low) and heads toward the range of 1.2450. Hourly resistance is maintained at 1.2748 (24/11/2017 high) and new support is given at 1.2251 (31/01/2018 low). The technical structure indicates that further short-term weakness is expected.
In the longer term, the pair is trading between resistance point at 1.3805 (05/05/2017 high) and support at 1.2128 (18/06/2015 low). Strong resistance is given at 1.4690 (22/01/2016 high). The pair is likely to head lower. The pairs is trading below its 200 DMA.
Reversing pattern
AUD/USD quickly bounced back from 0.7773 (14/02/2018 low) and continues its hike above resistance at 0.7925 (12/01/2018), heading toward 0.80. Hourly support remains at 0.7638 (15/12/2017 low). The technical structure suggests further short-term upside moves.
In the long-term, the upward trend resumes after failing to reach key resistance at 0.8164 (14/05/2015 low). Key support stands at 0.6009 (31/10/2008 low). A break of the key resistance at 0.8164 (14/05/2015 high) is needed to invalidate our long-term bearish view.
Sideways trading
EUR/GBP is stabilizing near resistance at 0.8929 (12/01/2018 high). Hourly support remains at 0.8687 (25/01/2018). The technical structure suggests further short-term upside move.
In the long-term, the pair has largely recovered from 2015 lows. The technical structure suggests further upside pressure. The pair is trading above its 200 DMA. Strong resistance can be found at 0.9500 (psychological level) while support remains at 0.8304 (05/12/2016 low).
Strong upside pressures
EUR/CHF is heading higher and closer to resistance at 1.15850 (19/10/2017 high) while strong resistance at 1.1833 (15/01/2018 high) remains. Hourly supports are given at 1.14269 (04/10/2017 low) and 1.1388 (02/10 2017 low).
In the longer term, the technical structure has reversed. Strong resistance is given at 1.20 (level before the unpeg). Yet, the ECB's slowing QE program is likely to cause buying pressures on the euro, which should weigh in favour of the EUR/CHF. Support can be found at 1.0234 (20/04/2015 low).
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