GBP/JPY: Would it break the 135 to the downside?

The GBP/JPY has fallen rapidly during Friday’s session after the Bank of Japan disappointed the markets by implementing a lower than expected stimulus package, which made the Yen rally versus its major peers. The pair has reached the 135.00 level where it stalls, but the bearish momentum may stay in place and it is possible to see a breakdown of that level for the next couple of trading sessions. If the pair does break below the 135.00 level, then it may reach the 132.00 or the low at the 128.67 level. If the pair bounces to the upside, then the first resistance could be the 139.00 level or the 55 day exponential moving average, purple line.

Range is getting tighter on the GBP/USD

The GBP/USD on the daily chart has been consolidating around the 1.3200 level and the range has been getting tighter forming what it appears to be a symmetrical triangle. From this point on, the pair may break out in any direction, but usually these formations act as continuation patterns. If the breakout is to the upside, then the pair may find resistance around the 1.3532 level or the 55 day exponential moving average. If the breakout is to the downside, which in such case it would be called a breakdown, then the first support could be at the 1.3000 level, but a much better support could be the low at the 1.2800 level.

EUR/GBP: Consolidation continues

The EUR/GBP has been consolidating as shown on the daily chart and the range has been getting tighter forming what it appears to be a symmetrical triangle. From this point the price may break out in any direction. But there could be a slight probability of it breaking to the upside, due to the fact that the pair had been trending upwards and the current consolidation may just be a pullback to continue higher. If the price breaks to the upside, then the high at the 0.8629 could act as a resistance. To the downside, the 0.8200 or the 55 day EMA may act as support. Below those levels, we can see some important support levels at the 0.8000 and at the 200 day exponential moving average, around the 0.7856 level.

The EUR/JPY breaks the 116.00 level

The EUR/JPY has found a good resistance zone around the 118.00 level as shown on the daily chart. Very close to the 118.00 level we can also see the 55 day exponential moving average, which has also contributed in making that zona a good resistance. The price bounces to the downside and today it breaks below the 116.00 level after the Yen strengthen amid expectations of the decision by the Bank of Japan for this Friday. The pair may continue lower and if it does then it may reach the 111.00 level.

Breakdown confirmation on Oil

WTI oil has been dropping steadily for the past few trading days and today it breaks below the 200 day exponential moving average and the 44.00 level. The bearish trend may continue and right now the road is clear all the way to the 40.00 level. However, we must be attentive to a pullback to the 200 day EMA, where the price may bounce back down and complete a breakout-pullback pattern. Above the 200 day EMA, its next resistance may be the 46.00 level along with the 55 day EMA, purple line. As long as the price of WTI oil stays inside the bearish channel shown on the daily chart, it may continue lower.

Breakdown attempt on WTI oil

WTI oil has been in a well-defined bearish channel with a good support at the 200 day exponential moving average. To the upside the 46.00 level has been acting as a good resistance and it may continue to do so. Today the price of WTI oil breaks below its 200 day EMA and below the 44.00 level, but the breakdown was short-lived due to the fact that the price went back up above the 44.00 level. If during next week oil continues going down, it may try to go and visit the 40.00 level, with the road practically clear until that level. The bearish momentum may accelerate, but also a bullish bounce is possible.

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107 for the USD/JPY

The USD/JPY continues its rally and reaches the 107.00 level where it is trying to stall at the moment. Usually, those round number levels tend to act as support or resistance zones, but the bullish momentum on the pair is such that it may break it to the upside and continue towards the 109.00 level. The better than expected earnings reports out of the US is making the Dollar rally. With a rise in risk appetite, the Yen suffers and falls, hence the bullishness on the USD/JPY. In case of a bearish pullback, the pair may retrace to the 55 day exponential moving average, purple line, around the 105.41 level. If such scenario develops, then the pair may form a breakout-pullback pattern around the 55 day EMA.

Follow up on the Dollar index

Possible bullish breakout of the ascending triangle or flag that we identified on the daily chart of the USD/JPY. The pair breaks above the 96.84 level and if it continues rallying it may get to the 98.59 level. The golden cross of the 55 day exponential moving average above the 200 day exponential moving average is almost complete. Such cross has bullish implications. If the pair goes back below the 96.84 level, it could leave behind a false breakout and it would go back to the congestion zone. Inside the consolidation there are no clear entries, but we could get a breakout and pullback pattern, which could give us a long entry. We will stay attentive.

Flag on the Dollar index

We can see on the daily chart of the Dollar index that it has been consolidating above the 200 day exponential moving average, around the 95.71 level, forming what it appears to be a bullish flag or an ascending triangle. The resistance of the formation is at the 96.84 level, where the pressure is rising to the upside. A break out of that level to the upside may cause the index to rally towards the high at the 98.59 level. The support of the formation is at the 95.34 level and a breakdown of that level could take the index to the low at the 93.00 level. Lastly, a bullish cross of the 55 day exponential moving average, purple line, of the 200 day exponential moving average may confirm a continuation of the bullish trend.

The USD/JPY is still consolidated

The USD/JPY is still oscillating around the 55 day exponential moving average, purple line, around the 105.41 level. From this level the pair may head in any direction, but the consolidation may act as a continuation pattern or a resting point to continue going higher. The next resistance on the daily chart may be the 107.00 level or the 109.00 level, but a much important resistance level is the 111.00 zone along with the 200 day EMA, blue line. To the downside we have a support zone between the 103.00 and the 104.00 level. The 100.00 level continues being its most important support.

The USD/JPY stalls its rally

The USD/JPY has been rallying lately as the risk appetite keeps growing in the markets and it is making the Yen less attractive as a safe haven currency. On the daily chart we can see how the price rallies to the 55 day exponential moving average, purple line, around the 105.41 level and stalls there. The price may try to bounce to the downside from here and if it does so, it may try to go and visit the 104.00 level or the 103.00 level. Below the 103.00 level, the next support could be the 100.00 level. To the upside, the next resistance above the 55 day EMA could be the 107.00 level or the 109.00 level.

Good pullback on the EUR/JPY

The EUR/JPY retraces to the 55 day exponential moving average, which is currently at the 118.00 zone. On the daily chart we can see that the 55 day EMA has acted as a good resistance in the past; therefore, it is possible to see a bearish bounce from this level. If the prices continues falling, then the first support could be the 114.82 level, followed by the 111.00 level and much lower the 109.37 level. To the upside, above the 55 day EMA, the first resistance could be the 122.00, followed by the 200 day EMA, blue line, around the 123.96 level.

The GBP/JPY reaches the expected resistance

The GBP/JPY has been rallying since yesterday as shown on the daily chart and today it reaches the 139.00 round number level. From this point the pair may give us an opportunity to enter either to the upside or to the downside. If the price breaks to the upside, it may try to go and reach the 146.00 level, but to open a buy position we must be patient and wait first for confirmation of the breakout in the form of two or three bullish candles above the 139.00 level and then wait for the pullback to the same 139.00 level for a buy entry. If the price bounces to the downside from the 139.00 level, then it may fall to the low at the 128.67 level, which could act as support.

Consolidation continues on the EUR/USD

On the daily chart of the EUR/USD se can see that the pair has stayed in a range between the 1.1000 level and the 1.1100. The size of the real bodies of the last few candles is relatively small, which is an indication that the pair has been very undecided and after the formation that looks like a symmetrical triangle, the price may break out in any direction. To the upside, the next important resistance is the zone around the 200 day exponential moving average, blue line, around the 1.1177 level, but we also have the 1.1200 level around that zone, which could also contribute for that zone to become a good resistance. To the downside, the only important support at the moment is the 1.0900 area.

The EUR/JPY stays at a good support zone

The EUR/JPY has found a good support zone around the 111.00 level, where it has been consolidating for a while as shown on the daily chart. A breakdown of the 111.00 level could take the price to the low at the 109.37, which could act initially as support, but it may break it also to the downside. Below those level, its next support could be the 109.00 level. The 55 day exponential moving average, purple line, may be used as a trend indicator. The angle of inclination of the 55 day EMA is showing us that the bearish trend is still in place and it is gaining strength. To the upside, the high of the pullback at the 114.82 level may act as resistance, along with the 116.00 level.

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Bullish flag on the USD/CHF

On the daily chart of the USD/CHF we can see that the price has formed what it appears to be a bullish flag formation, which usually acts as a continuation pattern. The 200 day exponential moving average, blue line, is very horizontal, which indicates that we should be suspicious of the visits that the price makes to that moving average, due to the fact that sometimes the price breaks it, but other times it bounces from it. The price has really been consolidating between the 0.9700 as support and the 0.9800 as resistance. If the price breaks to the upside, then the 0.9900 level may act as resistance. Since the price could also break to the downside, even though there is a higher probability of a bullish breakout, it may go to the 0.9600 level, which could act as support.

New low for the GBP/JPY

The GBP/JPY has been falling rapidly during the last few days and it has reached the 131.00 round number level where it stalls at the moment. The bearish momentum may continue, but we could also see a bullish bounce from the current levels, due to the fact that the stochastics are in the over-sold zone and prone for a correction. Since the stochastics cannot fall below 0%, they stay consolidating in the over-sold zone while the price may continue falling. To the upside we do not see any relevant resistances all the way to the 145.44 level.

Consolidation continues on oil

WTI crude oil, which trades in the US continues in a well-defined consolidation, which has been tightening its range. On the daily chart we can see how the 50.00 level has been acting as a good resistance. To the downside, it is possible for the 200 day exponential moving average to act as resistance in case the price drops to that zone, around the 44.39 level. Below that moving average the next support could be the 40.00 level. On the stochastics chart we can see that the lines have been converging, creating what it appears to be a symmetrical triangle. The formation on the stochastics is an indication that the price may come out in any direction.

Sideways movement on oil

The consolidation continues on WTI oil, as shown on the daily chart of the august contract. The sideways movement has formed just below the 50.00 level and the range seems to be tightening. The longer the consolidation lasts, the stronger the price may move in case of a breakout to the upside or to the downside. Above the 50.00 level we have seen that its next resistance is the 60.00 level. To the downside, the 200 day exponential moving average, around the 44.00 level could act as support. The stochastics are also consolidating without taking a clear direction.