General analysis about forex market: 12th December – 16th December

6 years ago forexsimulation 0

GBPUSD technical analysis:

The high of the last week was 1.29274 for Great Britain Pound and after hitting that high the pair sharply dropped down just below the 100 days SMA. The dynamic resistance level was at 1.2775(100 day SMA). The market got intense selling pressure on that area and fall back to 1.2570 which is the key support level for the GBPUSD pair. The pair is most likely to get strong support in this level .Next week the pair will target the key resistance zone 1.2730-1.2750 for its first bullish movement. If it can break this strong resistance zone then it will target 1.2905 which is the next key resistance level. We saw some bullish move in the last few week in this pair and it might get faded out in the next week due to strong resistive zone.

Though we see some bullish movement for this pair but in the bigger picture, the Great Britain Pound is in a bearish mood. On the other side, the green bucks have gained some strength on last Friday which gives us some clue that bears are waiting in the market. A trader will be looking for the opportunity to sell this pair and go along with the long-term prevailing bearish trend. To be precise we might see some fresh selling pressure in the market in the next upcoming week.

If the Great Britain Pound can’t break the key resistance zone (1.2730-1.2750) it will fall back at 1.2360 which is the next support level for this pair. If this support level is broken more seller will enter the market. At this level, we can see some rebound and the market might go higher. If price drop below the critical support level at 1.2360 the seller will regain the control over the market .To be precise we will be seeing strong selling pressure in the market. Such a sharp drop in the market price will ultimately lead the pair towards the key support level at 1.2000. Considering the technical parameter the over bias remain bearish. On the other hand, Fed is likely to go for a hike in next FOMC meeting which might become the key driving catalyst for the sellers.

USDJPY technical analysis

USDJPY hold its rally upwards for the 5th consecutive week. It gained almost 300 pips in the last week. On its bullish move, it found a very strong resistance level at 114.00. After breaking this resistance level it was eyeing for the key resistance level at 115. Before it cracks the key resistance level 115 it strongly broke the minor resistance level at 114.80 and made a new higher high in 115.36 level.  Last February we watched this pair in that level which is the highest since last nine months. After the breaching of the critical resistance level, it’s now targeting to make a significant high in the market. It also breaks the weekly SMA and the market closed above the moving average.

Next week we might see some retracement in the market and price might fall down. It can fall in the next support zone which is on 114.60 – 114.80. The weekly moving average is also in that area which means it can hold that price level allowing the market to go up. USDJPY remains in the bullish mood so seller needs to do much more work to make this price go below the critical support level at 114.80. Further support for this pair is at 114.00 and 113.00 level. On the other hand, the market broke the critical resistance level at 115 without having much trouble which is a great news for those who are in buying mood. But we have very strong resistance ahead near 115.60 level which is also the 61.8 Fibonacci retracement level (drawn from the high of 31st may 2015 to the low of 19th June 2016). If price can breach this Fibonacci retracement level then it will not face any strong resistance in near distance which means the price will go higher. Next key resistance level for this pair is at 116 level. Overall scenario for this pair is bullish. The market will take that advantage if fed do the hike at their next meeting.

USDCAD technical analysis

USDCAD remained bearish in the last week. There have been more than four hundred pips down in the USDCAD pair at last trading week. Last week the Canadian dollar had some positive economic news release in the market. That news made the Canadian dollar intensively strong and pulled the USDCAD pair down.  Thursday’s economic news releases showed that Canada has strong housing data. Organization of Petroleum Exporting Countries (OPEC) also agreed to cut their production rate since 2008 which dragged the pair down in the market. To be precise OPEC decision give Canadian dollar more strength in the market. In the last week, out of five days, it fell for 4 days. On the other day, the gain was too small which is not notable. It breaks the 100 daily moving average on its rally without any struggle and currently the pair is trading at the price 1.3169.

Next near term resistance is at 1.3195 – 1.3200 level and in between that 100 daily moving average is standing. If the price can break that resistance level we might see some upper run for this pair. The market will go higher until it gets it next resistance level and that resistance level can be found in 1.3250 level. Though it’s not a strong resistance but it might hold the price and buyer need to do some work to break that level. Next key resistance level is at 1.3320. If it will fall down from that level and breaks the daily moving average making new lower low then the price will go down further.  Because seller has more control over buyer it will be easy for the pair to drop sharply. The market will fall down until buyer gets any sub sequential reason to buy this pair. So it might easily go to the 1.3026 level which is the key support level for the USDCAD pair. At that point, more seller will more likely to take a step back and buyer might enter the market. If the buyer can’t make that point count then the price will fall much more down.