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Mysticforex

Chart of the Day

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Taking a look at the daily chart of EUR/AUD, there is a clear inverse head and shoulder pattern with a neckline at 1.45. EUR/AUD is trading above this level, which means the neckline has been broken. While the break is shallow and not strong, we still believe that this bullish technical pattern will pave the way for a stronger move up to 1.48. However if EUR/AUD drops back below 1.44, then the pattern will be negated and the outlook for the currency pair turns bearish.

EURAUD102014.png.a9fef60443f62ac084da7610ac87fd90.png

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Technically the spike bottom at 92.00 is the key support for the pair and a break there opens the floodgates for a run to 90.00 but a move above 94.50 would confirm that the bottom is in and that the pair is likely headed to 95.00

AUDJPY_10_20_14.jpg.f71c5bf7b8541e19aa3435abe70bbb63.jpg

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From a fundamental and technical perspective, EUR/CAD is headed back down to 1.40. The euro was hit hard today by the talk of corporate bond buying by the European Central Bank. If true it would be another step by the ECB to increase stimulus. Corporate bond buying is complex and difficult to implement but the mere fact that this is a possibility reinforces the central bank’s bias to ease. The euro is in play this week with the PMI reports scheduled for release on Thursday and the bank stress tests results due on October 26. Given the recent deterioration in Eurozone data, I expect the PMI reports to show a further slowdown in economic activity that should keep pressure on the euro. At the same time, tomorrow’s retail sales report and Bank of Canada rate decision should be positive for the CAD. The loonie has become deeply oversold due to the decline in oil prices but based on the uptick in job growth, increase in core prices and weakness of the exchange rate, the statement could be less dovish, leading to a much needed reversal in USD/CAD. Canada is widely expected to raise rates after the Fed and before the BoE, which makes the CAD a bargain against the euro.

EURCAD102214.png.d9f4f9960c040ebbd71e709e3ab940a6.png

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Taking a look at the weekly chart of GBP/USD, 1.60 is not only a psychologically significant level but also the 50% Fibonacci retracement of the 2013 to 2014 rally. Once this level is broken, the next support is the 2014 low of 1.5875. If it holds, meaning GBP/USD does not close below this level then it is likely to retest 1.62.

GBPUSD102414.png.9bb2a208b9e8d9041302f3b59f7a45d7.png

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The EUR/JPY has now set a strong triple bottom with a spike low at 135.00 and a move above 137.50 would open a run towards the 139.00 level and establish a strong case for a breakout rally. On the other had a close below 136.00 would point to a possible retest of the lows at 135.00

EURJPY_10_25_14.jpg.a8347b2634cf5e7f24d8412899956902.jpg

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Technically NZD/JPY has set a higher double bottom which is a bullish sign and if the pair can hold above 85.50 then 86.00 would come into view. On the downside support lies at 84.50 with much deeper support at 83.0

NZDJPY_10_27_14.jpg.8adfe4fd04b5176f6e37ca241345d3dd.jpg

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Hello i found that info:

 

The recovery from 168.01 extended higher and could continue. But again, near term outlook stays cautiously bearish as long as 175.00 resistance holds and we'd expect further fall ahead. Prior break of 169.34 support was taken as an indication of medium term topping at 180.70. Below 171.06 minor support will turn bias back to the downside for 168.01 first. Break will target 163.87 support next. Nonetheless, break of 175.00 will dampen this bearish view and target a test on 180.70 high instead.

gbpjpy20141029a1.png.68b3279aa967eaa633c76ea29a4a49d7.png

Edited by Mysticforex
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Taking a look at the daily chart of USD/CHF, we can see a triangle in formation, which is a classic breakout pattern with 95 and 94 cents being the key levels to watch. If 95 cents is broken, there is no major resistance until the October high of 0.9689. If 94 cents is broken, the next stop should be the 23.6% Fibonacci retracement of the 2011 to 2012 high at 0.93 cents.

USDCHF102814.png.0344dc91479436b3bb01c273965fe3c6.png

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The EUR/USD remains in a long secular downtrend and the latest rally was simply corrective in nature running out of steam at the 1.2800 level. The test to the downside will target the yearly low at 1.2500 and break there would open a run towards 1.2250. Meanwhile only a close above 1.2800 relieves the bearish bias.

EURUSD_10_29_14.jpg.a2b70439f97100c6353e88efbac31a7a.jpg

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Taking a look at the monthly chart of AUD/USD, the 4 year low of 0.8643 is looking extremely vulnerable especially after Monday’s big move. However having tested this level on numerous occasions, significantly weaker data or an intensification of concerns about the level of the currency or the global economy could be needed for this level to break in the next 24 hours. Beyond that, the market’s appetite for U.S. and Australian dollars will be key. A break below 0.8643 opens the door for a move down to the 50% Fibonacci retracement of the 2008 to 2011 rally at 0.8550. If this level holds, AUD/USD could trickle back up towards the top of its month long range near 89 cents.

AUDUSD110414.png.6319b5f62ef546da1ee325272ded2882.png

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Looking at the GBP/CAD technically we see a higher low on the pair and rounded bottom that suggests a potential explosion higher. A break above 1.8300 could open a run towards 1.8500 but the pair would need to collapse below 1.7900 to truly break its support.

GBPCAD_11_04_14.jpg.6a8f13380e709617c5d31e004814c72b.jpg

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Thursday’s European Central Bank Monetary Policy announcement is one of the most highly anticipated event risks this week and the euro is trading soft going into the rate decision. It is no secret that the ECB maintains a dovish monetary policy stance and intends to increase stimulus if the economy weakens further. This stance contrasts sharply with that of the Fed whose rosier outlook for the labor market reset expectations for a mid 2015 rate hike. With tightening expected to be the Fed’s next move and easing to be the ECB’s, its no wonder that EUR/USD is trading near 2 year lows. However the main question is whether these losses will continue on the back of Thursday’s announcement. We do not expect the ECB to follow in the Bank of Japan’s footsteps by increasing stimulus. Yet if they decide to expand purchases to corporate bonds, it would represent an increase in stimulus that would be negative for the euro. If they simply reiterate their plans to raise stimulus but fail to follow through with fresh action, given the overstretched nature of euro short positions, a short squeeze could drive EUR/USD higher.

EURUSD110614.png.4a9bd6e9d5a06118005c11590ab81525.png

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The 1.4000 level is a very strong base level in EUR/CAD representing triple bottom support if it is broken the drop could be precipitous to 1.3800. Meanwhile only a move above 1.4200 alleviates the downside bias.

EURCAD_11_07.14-1024x586.thumb.jpg.13bbf0f3f368c839c6db5ef917a04756.jpg

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EUR/CHF hit a 2 year low today as investors fear that a yes vote on the Swiss gold referendum at the end of the month will force the Swiss National Bank to choose between adhering to the vote or defending the EUR/CHF 1.20 peg. The vote asks whether the SNB should raise the share of gold in its asset to 20% from 8%. The reason why this could affect the currency is because if the referendum passes, it would require the central bank to sell its foreign reserves, much of them in euros to buy gold. This is a dangerous predicament because it would restrict the SNB’s ability to defend its currency. The vote will be a close one that gold bugs and EUR/CHF traders will watch carefully. However while it poses a serious risk to EUR/CHF, the vote is more than 2 weeks away and the SNB could still verbally and possibly even physically intervene in the currency to keep it from breaking the 1.20 peg before that time.

 

In a pair like EUR/CHF that is distorted by central bank intervention, technicals are not very reliable. However as shown in the daily chart, 1.20 is an obvious support level for the currency pair. In the last 2 years, the “low” for EUR/CHF was 1.1996, a level that we believe will hold before November 30th. While there appears to be resistance at 1.21, verbal and/or physical intervention could drive EUR/CHF up 100 to 300 pips in a matter of days depending the strength of the central bank’s actions.

EURCHF111114.png.8e535494681878ef14c19c019fdd8a1c.png

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Taking a look at the weekly chart of GBP/USD, 1.58 is the current support level for the currency pair and if that breaks, the next level to watch is 1.5720, the 61.8% Fibonacci retracement of the July 2013 to July 2014 rally. By the same token, resistance is at 1.60, which is not only a psychologically significant level but also the 50% Fib retracement of the same move. If this level is broken in a meaningful way, it should be a smooth ride towards 1.62.

GBPUSD111214.png.ce44cfbbf7307238e2cc5887b00ae125.png

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GBP/AUD has now made a triple top at the 1.8600 level and the distribution is facing a triple bottom at the 1.8100 level. A break there opens a runt to 1.8000 and only a close above 1.8300 relieves the downside pressure on the pair.

GBPAUD_11_12_14.jpg.dd34ab765738d7cfc2172079ff0cb930.jpg

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The 8000 level in EUR/GBP represents a triple top and a lower triple top at that suggesting that the pair is now at the top of its range and will need to trade above the 8125 level in order to establish a new bullish bias. Meanwhile the downside target is the lower end of the range at 7800

EURGBP_11_17_14.jpg.492df133b74a98bba450bf8723d47778.jpg

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