Weekly Forex Techincal Analysis March 01 - 05
The currency strength meter can tip you off to several trading situations you should be aware of, such as the strength and weakness of a currency in relation to other currencies.
Last week, the price of the euro against the US dollar made an attempt to consolidate above the level of 1.2165, however, the upward movement was not confirmed, and the price again returned to the borders of the sideways range, the significance of which we spoke about in the previous review. Once again, we confirm that the range demonstrates its strength, including this is expressed by the fact that the level of moving averages is located in it. Thus, for the upcoming trading week, we consider the change in the value of this asset within the range and trade from level to level.
The past trading week led to a clear suggestion of an uptrend, however, the final day of trading literally caused the value of the British pound to collapse against the US dollar, as a result of which the upward movement was questioned. At the very least, we are obliged to state the fact that the price for the first time in a very long time was below the trend level. At the same time, it is still above the level of the moving averages. Indicators do not give specific signals for trading, since they are confirmed by upward dynamics. Thus, we can expect that the market will make a downward correction and again return to an upward movement. Therefore, we will consider options for trading up, and the optimal entry point will be close to the level of moving averages.
The value of the US dollar against the Japanese yen is developing within the upward trend. Characteristically, the uptrend practically coincides with the levels of the moving averages. The growth dynamics is confirmed by all indicators, but this dynamics is most clearly visible on the oscillator, which is mainly formed in the area above 50 and periodically reaches the overbought area. Please note that recently the price tested the trend line and at the same time the important level of 105.170. This was followed by an upward movement, which confirms the strength of the upward dynamics. Therefore, we can consider options for trading upwards, but a trade can only be opened after a correction. The optimal entry point will be close to the level of the moving averages and to the trend line.
The past week continued to form an upward trend for this currency pair, although the trades were mostly high volatility and with movement in both directions. Pay attention to the fall in the price of the Australian dollar against the US dollar at the end of the week. As a result, the histogram has almost reached zero levels, and the oscillator for the first time in a long time found itself in the area below 50. The asset price itself came close to the uptrend line and to the level of moving averages. Thus, we can expect that a correction will take place at about this level and the price will return to growth again.
The US dollar against the Canadian dollar continues to work out the triangle pattern, which we talked about earlier, and form a downward movement. The current stage of this movement is interesting for the significance of the level 1.2642. Recently, the price has tested this level at least three times from bottom to top, and each time this has led to a pullback movement downward and to the formation of a candlestick candlestick with a sufficiently long upward shadow on the chart. Thus, we can say that the downward dynamics has its own strength and it is confirmed, among other things, by indicators. Therefore, you can consider trading options for a fall. An upward contract can only be opened if the price consolidates above the designated level. In this case, we must take into account that the level of moving averages is on top.
As a result of trading in recent weeks, the value of the US dollar against the Swiss franc was squeezed within the sideways range of 0.9019 and 0.9061. Please note that both the color chart and the indicators show an upward trend, and the oscillator has tested the overbought level several times in a fairly short period of time. Nevertheless, we can only say that the pack price is within the range and cannot be traded. We are waiting in which direction the range will be broken and trade in the direction of the breakout.
For the US dollar against the Russian ruble, the current significant sideways range is the channel with the borders of 73.32 and 74.80. The upper line of this channel practically coincides with the levels of the moving averages, and the chart shows at least two situations when the price tested both the moving averages and the indicated level. This led to a slowdown each time. Thus, we can expect that this time the same slowdown will occur and the price will move down. An upward contract can be hidden only if the price consolidates above the designated range.
Gold continues to form a downward movement, however, for the first time in a long time, we have all the prerequisites for opening an upward contract. First, we note the fact that the price is at its local minimum value. If you look at the indicators, they do not confirm this minimum. Moreover, there is a clear divergence in price and indicators. This is most clearly seen in the oscillator. We add to this fact that the price has moved very far down from the level of the moving averages, and an upward contract can be opened.