The USD/SGD is still trying to break the 1.3242 level

The US Dollar versus the Singaporean Dollar has stalled at the resistance zone around the 1.3242 level. At the current stage, if there is a bounce to the downside, a double top pattern may be formed. We must keep in mind that the longer the price stays consolidated around the current levels, the higher the probability of the price breaking out instead of bouncing. If we see a breakout to the upside, then we patiently wait for the pullback to the same 3242 zone for a possible long entry. Up to now, the uptrend remains intact.

Double top on the USD/SGD?

The US Dollar versus the Singaporean Dollar is currently visiting an important resistance level around the 1.3242 area. If the price bounces to the downside from this zone, a double top pattern may formed. The double top pattern is a bearish reversal pattern and the price may try to go and test the confirmation line of the pattern which is the 1.3000 level. Besides the 1.3000 level, we also see around that area the 55 exponential moving average on the daily chart. We should wait and see if the price bounces to the downside from current levels and drops to the 1.3000 area or if it breaks the resistance at the 1.3242 level and shows a pullback for a possible long entry.

AUD/USD 4 hour chart, Descending Triangle?

Apparently, the AUD/USD has formed what it looks like a descending triangle on the 4 hour chart, due to all the consolidation that the price has had lately. During these periods of consolidation is when these chart patterns appear, many with possible trading opportunities. On the formation shown on the chart, it would be better to use the 0.8100 level as our confirmation line or breakout line. If the price breaks below this level and pulls back to it, then we could get a chance of going short, expecting a continuation to the downside of the main bearish trend.

Symmetrical triangle on the EUR/JPY 4 hour chart

The Euro versus the Yen has been much undecided today, even though during the week there was a lot of volatility, but not a clear direction or trend. That volatility has formed a symmetrical triangle on the 4 hour chart. A symmetrical triangle is a chart pattern which could break in any direction, but if the trend coming into the pattern is bearish, then there is a higher probability of seeing a breakout to the downside.

Sustainable downtrend on the EUR/USD

On the daily chart of the EUR/USD we can see that since the 55 period exponential moving average crossed below the 200 period exponential moving average, the pair has kept a very sustainable downtrend, supported by the fundamentals from each region. The 55 EMA, purple line, has acted as a very good resistance lately. The distance or separation between the 55 EMA and the 200 EMA is relatively wide and it looks like it will separate even more.

However, the rate at which the pair has been falling is getting smaller and a breakout of the 55 EMA is possible. If that is the case, then the price may try to correct all the way to the 200 EMA.

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High volatility on the Dow Jones

The Dow Jones Index has been very volatile for today, along with the major markets due to the high price fluctuations on Crude and a comeback of risk aversion. The index has found a good support around the 17000 round number level, with a good resistance at the 17433 level. The current Doji formation is an indication of indecision with high volatility due to the long shadows. If the next daily candle is bullish, then we could see an end to the current correction and the price may try to go higher and probably try to visit the next round number level of the 18000.

The GBP/JPY visits the 200 EMA on the 4 hour chart

The Pound versus the Yen continued dropping today and it broke below the 186.00 level to go visit the 200 exponential moving average on the 4 hour chart, around the 184.00 level. We can see that the drop was more than 200 pips, but when the price got to the 184.00 zone it stalled there and it is currently trying to bounce to the upside. A break below the 184.00 level could give us trading opportunities. The 186.00 level has now become its most relevant resistance.

Light Crude Oil from the US has almost reached the 57 level

The over-production in oil has kept the prices under pressure and the Light Crude Oil has broken below the 60 dollar a barrel mark to come very close to touching the 57 dollar a barrel level. The drop has been really steep and this has made some OPEC members to rethink about imposing some production cuts. However, the United States is currently keeping its production at all-time highs and demand is falling. We don’t know for sure how far down can oil go, but we do know that a lot of oil exporting countries are really feeling the pain of the dropping prices.

Looks like the GBP/USD is breaking out of the channel

On the daily chart of the Pound versus the Dollar we can see that the pair has formed a descending channel, which we have been following lately. Today we see that the price breaks above the 1.5700 level and we are now waiting for confirmation of the breakout. Once we see two or three bullish candlesticks above the 1.5700 level, then we could wait for the pullback to this same level for a possible long entry. If there is no pullback and the price continues heading higher, then we should pay attention to the 1.5827 level from where we could see a bounce to the downside. Above the 1.5827 level the pair has an open road all the way to the 200 day exponential moving average around the 1.6251 level.

Bearish Channel on the GBP/USD daily chart

The Pound has found a good resistance around the 1.5700 level versus the Dollar, but it has actually stayed consolidated between the 1.5600 and the 1.5700. On the Daily chart we can see that the price has formed a bearish channel or a “falling wedge” pattern; both are formations with bullish implications, because if the upper trend line of the channel is broken to the upside, then the price may accelerate in that direction. A change in trend or direction is possible.

100 pip bounce on the USD/JPY

The Dollar has been weakening since the beginning of today’s trading session versus the main world currencies, especially versus the Yen, due to the risk aversion that the markets have felt for today. The main stock exchanges around the world are in the red and that has hurt the Dollar, that is why we saw the USD/JPY plummet to the 118.00 level, only to bounce right back up above the 119.00 level. The pair moved 100 pips in one direction and 100 pips in the opposite direction.

The volatility that we have seen on the pair has been really amazing and now if the 4 hour candle closes like a “hammer” formation, then there is a good chance the trend will change to the upside and a visit to the 120.00 level is possible.

The USD/JPY may try to break new highs

Fundamentally speaking everything points out to more weakness on the Yen versus the Dollar. Even though today we had a down day for the USD/JPY, this could be an opportunity for new traders to come in or to add to current positions expecting the pair to continue higher. Therefore, let us pay attention to another possible visit of the 121.85 level, which is its latest high. For the moment, the 120.00 level stays as a good support zone.

Possible bullish pullback on the AUD/USD

The US Dollar remains very strong after today’s jobs data out of the United States showed that the US economy is in good track and the outlook seem rosy. The Non-Farm Payrolls number came out a lot better than expected, salaries went up, and the unemployment rate remained at 5.8%. This has put pressure on pairs like the AUD/USD, which has broken below the 0.8400 level. However, we should pay attention to a possible pullback to the 0.8400 level, which could act as resistance and hold the price there. That could present us with an opportunity to go short.

The USD/JPY is at levels not seen since 2007

The Dollar continues strengthening versus the Yen and today it has broken the 120.00 level to the upside for a moment. It then pulled back below the 120 level and it is currently stabilizing round that area. The USD/JPY had not visited the current levels since July, 2007. The different monetary policies that the United States Federal Reserve and the Bank of Japan are taking, might put more pressure on the Yen and we could see the pair break new highs. However, on the 4 hour chart we see a Doji formation with long shadows, this implies that the pair has been very volatile, but undecided. A possible long entry could be at the 119.00 level if we see a visit to that zone where a probable bounce to the upside could happen.

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The AUD/USD is at a good support area

The AUD/USD remains very weak, but it has currently reached the 200 period exponential moving average zone on the monthly chart, around the 0.8400 area. This visit to the 200 EMA on the monthly chart is very important and the pair my try to bounce to the upside or at least try to stall here. However, if the fundamentals from Australia keep showing weakness on the Australian economy and Friday’s Non-Farm Payrolls report out of the US comes out better than expected, then we could see a breakdown of this support.

Oil drops to 63.70 Dollars per barrel

The price of Light Sweet Oil for January delivery has reached a low for today of 63.70 Dollars per barrel as shown on the 4 hour chart, but it has recovered some loses at the moment. We may see a pullback to the 70.00 level, but the commodity remains very weak due to over-production. Even though some members of OPEC have asked Saudi Arabia to cut its production, the Saudis are not willing to take the pain all alone and want other members to cut their production too. That is why Saudi Arabia is not cutting its production yet and the price of crude keeps dropping.