Thread: InstaForex Wave Analysis

EUR/USD candlestick analysis for February 22, 2011

The EUR/USD currency pair has found a strong resistance level near 1.3720-1.3740, to roll back further.
Earlier on a 4-hour graph the EUR/USD has formed candlestick combination Falling Three Methods, indicating downside movement.
This candlestick combination shows that the currency pair had been demonstrating upside movement for several weeks. However, near the resistance level 1.3852 (3-month high) the bears started to increase their influence and a rebound took place.
Downside movement is supported by the MACD divergence and Evening Star and Bearish Engulfing candlestick combinations on the day graph.
Break of the support level 1.3538 proves this viewpoint. Now we should expect a downside movement to the support level 1.3227, where Fibonacci correction level 61.8 is also located.
If the resistance level 1.3853 is broken, short positions should be closed as it will lead to an advance to 1.4000.


Performed by Vladimir Donin, Analytical expert
InstaForex Companies Group © 2007-2010
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AUD/USD Elliott wave count and Fibonacci levels - February 22, 2011

The AUD/USD is developing subwave C (colored orange red in the chart) within potential wave C of medium term downtrend (colored magenta in the chart). To confirm wave C break below 0.9943 is needed - it's the top of wave A. Now the targets below the current price are Fibonacci expansions off 1.0199-0.9943-1.0157, 1.0517-1.0073-1.0098.
Supports:
- 1.0014 = objective point (OP), already hit (!)
- 0.9999 = contracted objective point (COP)
- 0.9962 = expanded objective point (XOP)
- 0.9901 = OP
- 0.9878 = super expanded objective point (SXOP)
If the price reverses up the immediate resistances will be Fibonacci retracements of the wave down from 1.0157 - this wave is not developed yet.

Overbought/Oversold
Assuming that the medium term trend is down, it's preferable to use overbought readings (15-20 pips away from the current price) of the Detrended Price Oscillator, or the overbought area (40-50 pips above the current price) to consider short positions.

Performed by Roman Molodiashin, Analytical expert
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USD/JPY candlestick analysis for February 22, 2011

At the moment the USD/JPY currency pair has found a good support near83.00-82.25. However, a break of this level will cause a decline to 81.80.
Earlier on a 4-hour graph the USD/JPY pair has formed Hammer candlestick, indicating upside movement. This candlestick shows that the currency pair was decreasing for several days, but rebounded near 80.93.
This viewpoint is supported by the fact the pair has successfully broken the 23.6 Fibonacci correction level. Breakout of the resistance level 82.85 has targeted the pair to 84.50. 
As mentioned before, if the support level 80.93 is broken, long positions should be closed as a break of this level will cause the pair to decrease to 80.93.

Performed by Vladimir Donin, Analytical expert
InstaForex Companies Group © 2007-2010
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Fundamental Analysis, February 22, 2011


Europe's stock markets, which completed a third weekly rise in a row, have closed yesterday on index declines on the

background of concerns that an escalation of the conflicts in the Arab world will lead to continued growth in oil prices and

inflation and hurt global economic growth. By the end of yesterday's trading day, the London Stock Exchange locked at a 1.1%

decline, while the Paris and Frankfurt exchanges dropped by 1.4% each.


A magnitude 6.3 earthquake had struck near Christchurch, on New Zealand’s southern island. As a consequence of the event, the

New Zealand stock exchange dives by 1.4%, the New Zealand dollar weakens by 0.8% against the Dollar to a level of 0.75 for

one New Zealand dollar.

Analysts warn that expanding of the uprisings in the Middle East and North Africa – the area where over a third of the global

oil production is concentrated – may cause a leap in oil prices that will drag the global economy into a renewed recession.

On the background of these events, as well as the strengthening political tensions in Libya, the price of gold crossed the

level of 1,400 United States dollars for one ounce of gold, the price of silver rose by over 4% , reaching a 30-year high,

while the price of crude oil leaped up by more than 7%, to a level of 93.0 United States dollars for one barrel of oil on the

background of concerns of a possible disruption of the global oil supply.

Performed by Gerardo Porras Palomino, Analytical expert
InstaForex Companies Group © 2007-2011

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EUR/USD Bullish Perspective, February 22, 2011 (Daily Strategy)







EUR/USD

After a drop of 150 points around 1.3526 the pair has managed to rebound to the level of 1.3688, as in his fall he founds the

first weekly support and fell to negotiate the same price the day of yesterday

due to the pair not managed to stay down, we mention that a return to weekly pivot at 1.3611 would be a good entry point in

long, with a target around 1.3790

Performed by Gerardo Porras Palomino, Analytical expert
InstaForex Companies Group © 2007-2011


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GBP/JPY Bearish Outlook, February 22, 2011 (Daily Strategy)






GBP/JPY

The day yesterday we were the expectation for the breaking of the trendline in the pair British Pound - Japanese Yen, now we

can say that our bearish outlook is standing, as the pair's price is below the weekly pivot, in 134.67 And as the momentum

indicator shows us even deeper low, which may eventually lead the pair to support the significant level of 129.92 yen per

British Pound.



Performed by Gerardo Porras Palomino, Analytical expert
InstaForex Companies Group © 2007-2011


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EUR/USD wave analysis for February 22, 2011








Having declined by slightly more than 50 pips the EUR/USD currency pair is demonstrating uncertainty in its attempt to form

another downside section of the estimated inclined triangle. At the same time its d wave looks quite complete which together

with overbought Stochastic might indicate forthcoming formation of the e wave of this complicated correction structure.

However, we should not exclude the possibility of the wave in the d to become more complex and prolonged, which might result

in advance above the 1.3750 level.

Performed by Alexander Dneprovskiy, Analytical expert
InstaForex Companies Group © 2007-2011


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AUD/USD Elliott wave count and Fibonacci levels - February 23, 2011

The AUD/USD is developing corrective subwave B (colored red in the chart) within potential impulse wave C of the medium term downtrent (colored magenta in the chart). The targets of the upmove are Fibonacci retracements of 1.0098-0.9963, 1.0157-0.9963, and expansions off 0.9943-1.0157-0.9963.
Resistances:
- 1.0031-37 = confluence area of .50 and .382 retracements, already hit (!)
- 1.0046 = .618 ret
- 1.0060 = .50 ret
- 1.0083 = .618 ret
- 1.0095 = contracted objective point (COP)
- 1.0177 = objective point (OP)
If the price keeps declining the immediate supports will be Fibonacci expansions off 1.0199-0.9943-1.0157.
Supports:
- 0.9901 = OP



Performed by Roman Molodiashin, Analytical expert
InstaForex Companies Group © 2007-2010
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GBP/JPY Elliott wave count and Fibonacci levels - February 23, 2011

The GBP/JPY is now developing corrective wave 4 of medium term uptrend (colored light green in the chart). The targets of wave 4 are Fibonacci retracements of 129.75-135.56, 131.62-135.56, and expansions off 135.54-133.31-134.20.
Supports:
- 133.13 = .618 retracement
- 132.82 = contracted objective point (COP)
- 132.66 = .50 ret
- 131.97 = confluence area of objective point (OP) and .618 ret
If the price keeps advancing the immediate resistances will be Fibonacci retracements of 135.54-133.31, and if the price goes above 135.56, we'll use Fibonacci expansions off 129.49-132.64-129.75, 129.75-133.31-131.62, 131.62-135.56-133.31.
Resistances:
- 134.43 = .50 ret
- 134.69 = .618 ret
- 135.74 = COP

Overbought/Oversold
Assuming that the medium term trend is up, but now a corrective wave is developing, it's preferable to stand aside, until wave 5 manifests itself.

Performed by Roman Molodiashin, Analytical expert
InstaForex Companies Group © 2007-2010
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USD/CAD candlestick analysis for February 23, 2011

Support levels: 0.9820, 0.9780, 0.9711
Resistance levels: 1.0000, 1.0057, 1.0212

On a 4-hour graph the USD/CAD currency pair is bouncing off after it could not breal the support level 0.9820-0.9830. Nevertheless, the currency pair will probably find a resistance level near parity.
As mentioned before, break of this support level might provoke the USD/CAD to test the support level 0.9780 with further target at 0.9711.
However, if the support level 0.9930 is not broken, this might result in advance of the US dollar. If the USD/CAD breaks the 1.0057 resistance level, further advance to 1.0212 should be expected. Further break of the 1.0380 level will denote that the rollback from 1.0680 is completed and further growth should be expected.
In the midterm the breakout of the support level at 0.9930 indicated continuing midterm downtrend from 1.3063 (2009 high) with 0.9700 as a target. However, this downside movement is probably a correction, and a strong support level is located near 0.9056-0.9700.
Thus, if a reversal takes place, the breakout of 1.0851 will prove the downtrend broken through from 1.3063. In this case the USD/CAD is expected to go up to the resistance level 1.1126 with 1.1866 as the next target.


Performed by Vladimir Donin, Analytical expert
InstaForex Companies Group © 2007-2010
More analysis - at instaforex.com

USD/JPY candlestick analysis for February 23, 2011

On a 4-hour graph the USD/JPY currency is declining further after it could not break the resistance level near 84.00. Besides, the pair has broken the support level near 83.00-82.25, which will probably cause a decline to 81.80.
Earlier on a 4-hour graph the USD/JPY pair has formed Hammer candlestick, indicating upside movement. This candlestick shows that the currency pair was decreasing for several days, but rebounded near 80.93.
This viewpoint is supported by the fact the pair has successfully broken the 23.6 Fibonacci correction level. Breakout of the resistance level 82.85 has targeted the pair to 84.50. 
As mentioned before, if the support level 81.80 is broken, long positions should be closed as a break of this level will cause the pair to decrease to 80.93.


Performed by Vladimir Donin, Analytical expert
InstaForex Companies Group © 2007-2010
More analysis - at instaforex.com

EUR/USD candlestick analysis for February 23, 2011

The EUR/USD currency pair is still trading in the range between 1.3520-1.3740. Earlier on a 4-hour graph the EUR/USD has formed candlestick combination Falling Three Methods, indicating downside movement.
This candlestick combination shows that the currency pair had been demonstrating upside movement for several weeks. However, near the resistance level 1.3852 (3-month high) the bears started to increase their influence and a rebound took place.
Downside movement is supported by the MACD divergence and Evening Star and Bearish Engulfing candlestick combinations on the day graph.
Break of the support level 1.3538 proves this viewpoint. Now we should expect a downside movement to the support level 1.3227, where Fibonacci correction level 61.8 is also located.
It should be mentioned that stop loss should be placed slightly above 1.3853 as its breakthrough will lead to an advance to 1.4000.

Performed by Vladimir Donin, Analytical expert
InstaForex Companies Group © 2007-2010
More analysis - at instaforex.com

Fundamental Analysis, February 23, 2011

In the global macroeconomic arena, the Case-Shiller index for home prices in the 20 largest

cities in the United States fell yesterday by 2.4% for December – the sharpest decline in

the previous year. For comparison, in November home prices fell by 0.4%. Furthermore, in

the fourth quarter of 2010 home prices in the United States fell by 4.1% - the sharpest

quarterly decline in over two years. For comparison, in the parallel quarter of 2009 a 3.9%

decline has been recorded.

Furthermore in the macroeconomic sphere, the U.S. Consumer Confidence Index reached a

3-year high February, crossing the 70-point bar as compared to 67 points in January. This

goes against analysts' predictions that the index would only reach the 65.6-point level.

The S&P credit ratings agency reduced Libya's credit rating by one level to the level of

BBB+. The agency warned also that further downgradings are possible in the near future, and

that the step was taken due to the political risks inherent in Libya's situation and the

expectations that it would continue to escalate. S&P joins the Fitch ratings agency, which

has taken this step two days ago, in downgrading Libya's credit rating.

Index declines have been recorded in Europe yesterday based on the political tensions in

the Middle East. By the end of the trading day, the London Stock Exchange declined by 0.3%,

the Frankfurt stock exchange declined by 0.1%, while the Paris stock exchange dropped by

1.2%.

In the commodities market, crude oil traded yesterday at a 6.6% climb to a level of 91.85

United States dollars for one barrel of oil due to concerns of a long-term damage to Libyan

oil production. Gold futures locked yesterday at a climb of 1.1% to a level of 1,404 United

States dollars for one ounce of gold.

Performed by Gerardo Porras Palomino, Analytical expert
InstaForex Companies Group © 2007-2011

More analysis - at

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GBP/USD wave analysis for February 23, 2011







The GBP/USD currency pair could not continue the upside movementin the range of the

estimated 5th wave (in the 5th) and declined by 130 pips by the end of the day. At the same

time, in the range of such downside section a five-wave structure has formed, which can be

considered as the a wave (or the 1st) of the future more prolonged downtrend. If so, after

a slight move to the upside the pound might continue declining in the directiom of the 59

figure levels.

Performed by Alexander Dneprovskiy, Analytical expert
InstaForex Companies Group © 2007-2011


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The EUR/USD technical analysis and trading recommendations for February 23, 2011


4-hour timeframe






Overview:



The euro is still observing a buy signal with target level 1.3764 and the signal

strengthened again! The price suddenly reversed and fixated above the Kijun-sen and the

Ichimoku Cloud. The formed buy signal is strong and confirmed, since the Chinkou Span

fixated above the price graph and the price is above the Ichimoku cloud. Thus, at the

moment the first target for the upside movement is 1.3795 – the first resistance level. If

this level is passed the second target will be the second resistance level at 1.3898.

Upside movement remains while the price is above the Kijun-sen (1.3625), if the price

fixates below this line it is recommended to cut long positions. The Chinkou Span is above

the price graph, which confirms the current buy signal and indicates bullish sentiment. The

Bollinger bands show the continuation of the upside movement, the lines are diverging and

directed up. The MACD is ascending, which indicates current upside movement, if the

indicator reverses down it will denote the beginning of a correction.

Trading recommendations:
Currently it is recommended to trade up with target at 1.3795 and further to 1.3898. Stop

Loss should be placed below 1.3625. If the MACD reverses down it is recommended to cut long

positions manually.

In addition to technical image, one should take into account the fundamental data and the

time of their release.

The chart annotation:
Ichimoku indicator:
Tenkan-sen — red line
Kijun-Sen — blue line
Senkou Span A — light brown stipple line
Senkou Span B — light purple stipple line
Chinkou Span — green line
Bollinger Bands indicator:
3 yellow lines
MACD indicator:
The red line and the histogram with white bars in the indicators window.




Performed by Stanislav Polyanskiy, Analytical expert
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EUR/CHF Around the Monthly Pivot, February 23, 2011 (Daily Strategy)







EUR/CHF

After a prolonged downwards trend, the Euro - Swiss Franc pair has stabilized around of

1.2803, The sharp upwards movement from beginning of year brought the pair towards the

upper part around the levels of 1.3193. in this moment the pair met at the monthly pivot

and 1st weekly support , according the indicator fobonnacci the pair is in its 50%

retracement, in this level the pair has bounced upward seven times.

The positive deviation on the stochastic indicator supports a new wave of upwards

movements, we expect the pair to return to its previous highs around 1.3126





Performed by Gerardo Porras Palomino, Analytical expert
InstaForex Companies Group © 2007-2011

More analysis - at

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USD/CHF Bullish Perspective, February 23, 2011 (Daily Strategy)







USD/CHF

The United States dollar – Swiss Franc pair continues its southward journey as part of a

downwards trend that,technically, could present stagnation and change its trend, which has

formed a fractal 0.9299, and 0.9325 levels, this movement could be the formation of a

fractal and bounce upward or continue your journey to a new wave of downward movements

deeper . for this we will be very attentive.

It is possible to enter a buy deal already at the present price levels, although another

wave downwards the important support level at 0.9340 is also likely. Such a move will serve

us to increase the buy position with a brief stop loss order set around the 0.9300 level. A

partial realization can be carried out next to the nearest 0.9513 resistance monthly pivot

level, should the expected upward movement indeed occur.



Performed by Gerardo Porras Palomino, Analytical expert
InstaForex Companies Group © 2007-2011


More analysis - at

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