Thread: InstaForex Wave Analysis

USD/CHF candlestick analysis for December 30, 2010

The USD/CHF currency pair has been refreshing all-time highs amid low trading volumes. The viewpoint on the currency pair is still bearish. The breakout of the support level 0.9500 targeted the USD/CHF pair to 0.9400 with 0.9350 as the next traget.
Earlier on a 4-hour graph the USD/CHF has formed the combination of candlesticks Falling Three Methods which indicates the downside movement.
This combination of candlesticks shows that the USD/CHF was increasing during a couple of weeks, but the rebound took place after the USD/CHF failed to break out the level of 1.0066. This means that the bulls did not manage to solidify here and the bears started increasing their influence. The downside movement is supported by the fact that the currency pair broke through the line of the uptrend.
A breakthrough of support level of 0.9850 confirms this point of view.
It is recommended to place the stop-orders slightly above 0.9669 as the breakout of this level will target the currency pair to 0.9850.

Overbought/Oversold

Assuming that the prevailing trend is up it's preferable to use oversold readings of the Detrended Oscillator or its cross below the zero level to consider long positions. The zero level is just within some 5 pips away from the current price, the oversold area is 15-20 pips away from the current price - and corresponds to 1.0089 support.
Performed by Vladimir Donin, Analytical expert
InstaForex Companies Group © 2007-2010
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GBP/USD candlestick analysis for December 30, 2010

On a 4-hour graph the GBP/USD is approaching the upper limit of the downtrend. The viewpoint on the pair is still bearish. Earlier the pair dropped sharply after it failed to break out the resistance level of 1.5900. Nevertheless, if the 1.5650 level is broken it will be recommended to close short positions since this will lead to advance to 1.5900.
As mentioned before, on a 4-hour graph the GBP/USD formed the combination of candlesticks Bearish Engulfing which indicates the decline, confirmed further.
This combination of candlesticks developed after the currency pair could not break through the resistance level near 1.6085-1.6096, which means that the bulls did not solidify here. Further the bears started increasing their influence.
A breakthrough of 1.5841 means that this point of view is correct.


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

AUD/USD candlestick analysis for December 30, 2010

The AUD/USD has reached a new all-time high 1.0197.
Earlier on a daily chart the AUD/USD has formed the combination of candlesticks Bullish Engulfing which indicates the uprising movement, confirmed further.
This combination of candlesticks developed near the support level of 0.9537, where the bulls started to increase their influence and a rebound took place after a downside movement. This combination of candlesticks provided a good opportunity to open long positions.
A breakthrough of the resistance level of 0.9710 means that this point of view is correct.
However, in case the reversal takes place and the AUD/USD breaks through the support level of 0.9710, then long positions should be closed, as it will lead to the further decline to 0.9537.


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

The USD/JPY wave analysis for December 30, 2010





Highly dynamical decrease of the USD/JPY pair allowed the price to fall even deeper than expected. At the same time, in spite of the seemingly complete 5-wave structure of the whole downtrend, started December 15, the yen may decrease further and reach 81.40 – 81.20 levels. However, taking MACD divergence into account, a reversal in favor of the dollar may occur anytime.



Performed by Alexander Dneprovskiy, Analytical expert
InstaForex Companies Group © 2007-2010


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The EUR/USD wave analysis for December 30, 2010






In general the EUR/USD pair situation has been developing as expected, but it was more dynamic. As a result we can see that the d wave of the supposed triangle is completed and the growth from the 1.3080 level will be limited by its future e wave. At the same time, forthcoming holidays might provide the conditions for the wave of the correction triangle to become more complex and prolonged, which will allow the price to advance to levels above the 34 figure.

Performed by Alexander Dneprovskiy, Analytical expert
InstaForex Companies Group © 2007-2010



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The EUR/USD technical analysis and trading recommendations for December 30, 2010



4-hour timeframe




Overview:
Euro has been demonstrating uncertain holiday movement, thus it is recommended to refrain from trading. The buy signal is strong and confirmed since the Chinkou Span fixed above the price graph and the price managed to fixate inside the Ishimoku cloud. Thus, the first target for the upside movement is 1.3270 – the second resistance level. If the second resistance level is passed the next target will be the third resistance level of 1.3340. The upside movement continues while the price is above the Kijun-Sen(1.3165), if the price manages to fixate below this line it is recommended to cut long positions. The Chinkou Span fixed above the price graph, which confirms the current buy signal and shows bullish sentiment. The Bollinger bands show the beginning of the upside movement, the lines are diverging and directed up. The MACD is ascending, thus pointing to the current upside movement.


Trading recommendations:
Currently it is recommended to trade up with the target to 1.3270, in case this level is passed the target will be 1.3340. Stop Loss should be placed below 1.3165. In case the MACD reverses down long positions should be cut 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
InstaForex Companies Group © 2007-2010


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AUD/USD Downwards Movement , December 31, 2010 (Daily Strategy)





AUD/USD

In the last two weeks trading, the AUD/USD experienced much bullishness, as it stands now at 1.0175. Forex traders can take advantage of this imminent downward movement by entering short positions at an excellent entry price.

It is best to place the sell order at a higher, more attractive rate (1.0175) in case the pair continues moving in a shuffle before it continues its downward movement. As such, the 1.0190 resistance weekly level can serve for this purpose. That said, the pair can move downwards at the current level without any correction. Therefore, a breach in the support level at 1.0090 will serve as another trigger for a sell deal with a final exit goal for the position market at 0.9700 AUD/USD

Performed by Gerardo Porras Palomino, Analytical expert
InstaForex Companies Group © 2007-2010


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GBP/CHF,Expect an Upward Movement in the Pair , December 31, 2010 (Weekly Strategy)






British Pound - Swiss Franc

The GBP/CHF pair, poised in an unusual negative momentum, has closed the trading day yesterday at the meaningful support level of 1.4400. This creates a strong probability for the beginning of a technical correction for the aggressive wave of downwards movements, and perhaps even a trend reversal.

A correct timing of the upwards movements would be for the case of breaching the minor trend line that has been accompanying the pair since the beginning of the wave of downwards movements. The 1.4990 and 1.5180 resistance levels can form as key points for partial realizations, while the high resistance level at 1.5900 can form a final, full realization goal on the position.

Performed by Gerardo Porras Palomino, Analytical expert
InstaForex Companies Group © 2007-2010


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Fundamental Analysis, December 31, 2010



A mixed trend has been recorded this morning on Asia's stock markets due to yesterday's index declines on Wall Street. The Tokyo stock exchange is closed to day, and trading is expected to be very limited in Europe, with the German and British stock markets closed for New Year's Eve.

In the macroeconomic arena, several positive economic data have been published yesterday in the United States. The ISM has announced that the rate of growth in business activity in the Chicago area had leaped up surprisingly in December to a 22-year high, having climbed to a level of 68.6 points as opposed to 62.5 points in November. Economists have predicted a descent to a level of 61 points.

The Bureau of Labour Statistics had announced yesterday that the amount of new unemployment claims in the United States has declined last week by 34 thousand to a rate of 388 thousand - the lowest rate since July 2008. The descent recorded was significantly higher than the predictions of economists for 415 thousand new claims.

Also in the macroeconomic sphere, the real estate agents' association of the United States had announced that the amount of existing home sales in that country had grown in November by 3.5%, after a 10% rise in October. The rise was sharper than predicted by economists, who expected a rise of only 0.8%. That said, the amount of sales in November was 5% lower than in November 2009.

Performed by Gerardo Porras Palomino, Analytical expert
InstaForex Companies Group © 2007-2010


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AUD/USD candlestick analysis for January 3, 2011

The AUD/USD is continuing to reach all-time highs.
Earlier on a daily chart the AUD/USD has formed the combination of candlesticks Bullish Engulfing which indicates the uprising movement, confirmed further.
This combination of candlesticks developed near the support level of 0.9537, where the bulls started to increase their influence and a rebound took place after a downside movement. This combination of candlesticks provided a good opportunity to open long positions.
A breakthrough of the resistance level of 0.9710 means that this point of view is correct.
However, in case the reversal takes place and the AUD/USD breaks through the support level of 0.9825, then long positions should be closed, as it will lead to the further decline to 0.9537. 


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

GBP/USD candlestick analysis for January 3, 2011

On a 4-hour graph the GBP/USD has failed to break through the resistance level at 1.5650 to rebound further. The viewpoint on the pair is still bearish.
Earlier the pair dropped sharply after it failed to break the resistance level of 1.5900. Nevertheless, if the GBP/USD manages to close above the 1.5650 level, it will be recommended to close short positions since this will lead to advance to 1.5900.
As mentioned before, on a 4-hour graph the GBP/USD formed the combination of candlesticks Bearish Engulfing which indicates the decline, confirmed further.
This combination of candlesticks developed after the currency pair could not break through the resistance level near 1.6085-1.6096, which means that the bulls did not solidify here. Further the bears started increasing their influence.
A breakthrough of 1.5841 means that this point of view is correct.


Performed by Vladimir Donin, Analytical expert
InstaForex Companies Group © 2007-2010

USD/CAD technical analysis for January 3, 2011

Support levels: 0.9930, 0.9820, 0.9750
Resistance levels: 1.0212, 1.0290, 1.0380
On a 4-hour graph the USD/CAD has successfully broken through the support level near 0.9980-1.0000. At the moment the viewpoint to the pair is bearish.
Most of 2010 this level has demonstrated substantial demand since Canadian companies tend to buy dollars for lower price. However, low trading volume caused exaggerated fluctuations of this currency pair last week. Therefore the bears have easily broken the 0.9980 level. As mentioned before, the breakout of support level at 0.99880 will allow this pair to reach 0.9930 with 0.9750 as the next target.
Nevertheless, if a reversal takes place and the USD/CAD breaks the 1.0212 resistance level, this will lead to upside motion with the target to 1.0290. Further breakout of 1.0380 will denote the end of a rollback from 1.0680 and that further advance should be expected.
In the midterm the currency pair will probably remain within the limits of its wide range between 1.0000 and 1.0750-1.0850. Nonetheless, in case the reversal takes place, then the breakout of 1.0680 will confirm that the consolidation ended and that the downtrend with 1.3063 is broken through. In this case it is expected that the USD/CAD will move upside to the Fibonacci correction level 38.2 from 1.3063 to 0.9929 at 1.1126 with the next target to the Fibonacci correction level 61.8 at 1.1866.


Performed by Vladimir Donin, Analytical expert
InstaForex Companies Group © 2007-2010
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EUR/GBP candlestick analysis (long term view)

The EUR/GBP currency pair ended the previous week on the upside amid typical end of month purchases.
Nevertheless, as mentioned before, successful breakout of the support level near 0.8430-0.8450 targeted the pair to 0.8143.
The view on the currency pair remains bearish as earlier the EUR/GBP has formed a combination of Bearish Engulfing candlesticks in a downward trend.
In addition, the support level breakthrough at 0.8535 proves that this point of view is correct. Now the pair is likely to decline to 0.7750-0.7700.
The downside movement is supported by the fact that this combination of candlesticks was formed near the upper line of the downward trend where the bulls could not solidify, the bears started increasing their influence and the rollback took place.
It is worth pointing out that short positions should be closed in case of breakthrough of Fibonacci correction level 50.0, as it will mean that the downtrend is overcome and the currency pair will target to 0.98.


Performed by Vladimir Donin, Analytical expert
InstaForex Companies Group © 2007-2010
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USD/CHF candlestick analysis for January 3, 2011

USD/CHF candlestick analysis for January 1, 2011
The USD/CHF currency pair is continuing to reach all-time lows. The viewpoint on the currency pair is still bearish. The breakout of the support level 0.9350 targeted the USD/CHF pair to 0.9300 with 0.9250 as the next target.
Earlier on a 4-hour graph the USD/CHF has formed the combination of candlesticks Falling Three Methods which indicates the downside movement.
This combination of candlesticks shows that the USD/CHF was increasing during a couple of weeks, but the rebound took place after the USD/CHF failed to break out the level of 1.0066. This means that the bulls did not manage to solidify here and the bears started increasing their influence. The downside movement is supported by the fact that the currency pair broke through the line of the uptrend.
A breakthrough of support level of 0.9850 confirms this point of view.
It is recommended to place the stop-orders slightly above 0.9560 as the breakout of this level will target the currency pair to 0.9669.


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