“Europeans” can undergo downward correction | 06 Desember 2013

EUR/USD

Monthly chart: so, bulls have formed a pinbar, whereof they seemed to guarantee themselves mid-range outlook for growth to 1.4260. Nevertheless, our main review indicator ADX went down, which predetermines either monthly bounce down (or to 50% of pin in the area of 1.3440) or a deeper correction to the area of Bollinger medium band (1.3106). This plan is described by a red arrow.

Upon that, this ADX position can lead to even a more profitable bearish line: it is a touch of 1.3834 and an active move down, to continue accumulation of volumes in a giant triangle range.

Alternative option in this case is a dash upwards, for the 1.4285 point. This plan can only be considered in the position above 1.3834.

Weekly chart: here, a role of resistance 1.3834 is also seen: upon breaking it, bulls almost will not have more obstacles for growing to 1.4260. Therefore, it is required to take into account the possibility of bounce to Bollinger medium band (1.3389), in case of a lower breakthrough, we should look for bouncing to 1.3107.

Daily chart: narrowing of Bollinger bands speaks for an impulse motion. Within this frame, a main plan is to work out movement down along to O&U pattern (red path). Otherwise, that will be a breakthrough above 1.3628 and attack of 1.3834.

Conclusion: main plan is to leave position and move downwards from current levels. Upon that, targets will be 1.3389 and 1.3107.

Alternative option is growing to 1.3834 and bounce to 1.3389. Reserve plan is to break resistance 1.3834 and grow to 1.4260.

GBP/USD

Monthly chart: the picture is similar to what we have with USD. Bollinger envelopes are based in horizontal plane, which will create troubles for bulls in the task of attacking the top band. That is why we look for a downward correction upon touching one of two zones: either from 1.6540or from 1.7042. Goal of correction is the point of support 1.6106 and Bollinger medium band (1.5771).

Weekly chart: week closure seems bullish to a high extent, thus, we look forward to upward movement, but have to take into account the possibility of preliminary rollback to 1.6106 (or – in case of breaking 1.61 - to 1.5771).

Target - 1.6540 – looks very promising.

Daily chart: 3 bars in succession are based beyond envelopes (in fact, it could not be more than 4, which was described by the features of Bollinger bands), therefore, we also look for a correction to a medium line (1.6106).

Conclusion: main plan is growth to 1.6540 and bounce to 1.6106. Alternative option — is a preliminary rollback to 1.6106 and later – growth to Reserve plan — is breaking of 1.6540 and start to 1.70.

AUD/USD

Monthly chart: there is a serious threat for continuation of a downtrend. Confirmation would be breaking of the last low (0.8850). Upon that, targets will be 0.8574 and 0.8072.

Weekly chart: Bollinger envelopes are based in a flat position, which means that support is probable to be based on the bottom line (0.8852). Probably, further to rollback to a medium one (0.9259), bears will go on with attacks.

The option with reversal up can only be considered in the case with leave above 0.9651, when double bottom as well as a subsequent break of downtrend will be recorded.

Daily chart: here is a considerable downward pressure with a confirmation of above-stated levels.

Conclusion: main scenario is a withdrawal from current levels to 0.9250 and attack of 0.8850 with targets 0.8574 and 0.8072.

Alternative option is a direct attack from current 0.8850 and start downwards to 0.8570 and 0.8072.

Another possible plan is a reversal. We can consider if growth to 0.9259 and movement to 0.9650 take place.