DowJones - Are we poised for a move higher

It was a strong day for US equities on Friday and we could be on course for a breakout.  Financial stocks led the way after bullish job market data gave rise to expectations that the economic recovery is back on track and that interest rates may rise sooner than previously thought.  I must add that we do need a follow through at the beginning of next week to confirm this move however.

EURUSD - Rethink after yesterday's surprise cut

Yesterdays surprise rate cut from the ECB to a record 0.25% caught a fair few out, shown with a viscous sell off immediately after the announcement, but did it manage to recover later in the day to settle back above the 1.3400 mark.

We have convincingly broken out of the trend channel but now seeing some support from the 100day SMA and 38.2% Fibb retracement level / previous high at 1.3420 level.  Given the combination of these, this could prove to be a strong support so needs to be watched closely.

EURUSD - Under pressure

Its been a heavy week for the Euro after an very impressive recent run.  After lower than expected inflation data released earlier this week, it has promoted people's view that the ECB could be about to loosen their monetary policy and cut interest rates next week in their meeting on the 7th November, in order to stimulate the eurozone growth.

USDJPY - Rangebound

Symmetrical triangle continues to form on the USDJPY, with the range tightening so a breakout of the chart pattern is looking more likely as it approaches the apex.  Bystanders are patiently waiting for further action from the BOJ mentioned in the post on 13/08/13. Range trading is the best option for now whilst waiting for a breakout.  On a breakout of the chart pattern on the upside would give it a projection of 108.00

DowJones - Retesting all time highs

Disappointing US jobs data is keeping equities well bid as expectations that the tapering of the FED stimulus package is not going to happen quite as soon as people had previously expected.  Combine this with an impressive earnings season for US stocks and you can understand the strength seen recently.

Were having a 3rd attempt to break the 15,700 level which is proving to be a strong resistance level with double/triple top chart formation developing.  A failure on the upside will result on the focus back on the support area around 14,850/14,700 and the 2008 high of 14,167.  A break on the upside could propel the index up to around the 16,825 on the 138.2% Fibonacci projection.

Brent - Testing supports

This is the 3rd consecutive day of losses on the Brent contract but we might see some support come back in around the 106.50/106.00 area.  After testing the 117.00 level due to the escalation in the Syrian crisis, the risk premium has been slowly reduced as the western intervention seems less likely now.   The technicals aren't giving us a clear story at the moment, but taking step back and looking at a longer term view, we are still in a slow uptrend as we still have a couple trendlines intact.

AUDUSD - Hitting heavy traffic

 Since my last post the AUDUSD as performed very well reaching the upside target of 0.9700.  This is the 50% retracement of the April-August down move as well as the bottom of the sideways trend channel of 2011 / 2012.  Both events could offer strong resistance to further up moves so this level should be watched closely.  On a  confirmed break on the upside, that would give the green light that we have re-entered the previous sideways trend just mentioned and see a swift run up back to the 1.020 level.

GBPUSD - At a pivotal point

Well today we're rejecting the 1.6200 level once again, as the currency pairing is really struggling to sustain the gains above this level.  The USD has suffered severe weakness following the failure for the FED to reduce the buying back scheme, contrary to market expectations, and the palaver over the US debt ceiling and government shutdown.  But this begs the question after all these recent setbacks are we due for a recovery??

AUDUSD - Looks Strong but for how Long?

Well the AUDUSD has seen a good recovery in the run up to, and post government elections.  But is simply changing governments enough to sustain the recent gains?  Change is often for the better, but there are plenty who are still sceptical of its recent run and believe that a lower exchange rate is still needed in order to rebalance the local economy, not just a change in government.

Brent - Starting to fail

We had strong upside rejection yesterday breaking the first trend line.  This down move was  pretty violent and resulted in the MACD crossing down off the back of it.

Looks like we could be forming a Double Top chart pattern, if so a break of the neckline of 112.24, would give downside target of 108.00.  But till then we will have to sit on the fence as we may see a temporary recovery after yesterdays move.   The Maribuzo line is worth noting as a key resistance to watch out for at 114.45.  So long as this holds we should expect lower numbers yet to come.  Other key levels to be aware of are indicated on the chart.

Charts sourced from ig.com