Major levels back in focus for many FX pairs: By Mary McNamara

Last week: There were some great trend line breakouts last week however a number were marred with a savage spike courtesy of US CPI data. I had called a trade early in the week for a LONG on the AUD/USD with a target worth 190 pips up to the 4 hr chart’s 61.8% fib and previous S/R level of 0.80/. That trade unfolded perfectly; albeit for the CPI spike mid-way through the move. Many FX pairs are back near major S/R levels so watch for new make or break activity in the week ahead.

Trend line breakouts and TC signals: there were a few trend line breakout trades last week and these were updated on my site here, here and here:

AUD/USD: 140 pips and two TC signals: one for 2.5 R and the other for 8 R.
Gold: 300 pips and two TC signals; one for 3 R and the other for 5 R.
EUR/USD: 270 pips and two TC signals: one for 2.5 R and the other for 8 R.
NZD/USD: 130 pips.
USD/JPY: 220 pips and a TC signal for 6 R.
GBP/USD: 220 pips.
Oil: 250 pips.
GBP/JPY: 170 pips.

Next week:

FX Indices: The US$ index closed lower for the week but held above major support. An update on the FX indices can be found through this link.
Major levels: I have noted over recent weeks about how many FX pairs have been negotiating major levels and some of these are back in focus again this week: The 0.80 on AUD/USD, 1.40 on GBP/USD, 1.26 now for the EUR/USD, 0.74 for the NZD/USD, 133 now for the EUR/JPY, $10,000 now on BTC/USD and $1,400 for Gold.
Yen strength: There has been a fair bit of Yen strength over the last two weeks but, with the USD/JPY sitting on a long-term support trend line, I’ll be on the lookout for any recovery moves; even if any relief is only brief. The 4hr charts of the EUR/JPY, AUD/JPY, GBP/JPY and USD/JPY show the 61.8% retracement fib back at previous S/R levels on these pairs and so I’ll be watching for any relief activity to potentially test these key levels.
Gold: is just 550 pips away from the all-important $1,400 S/R level so watch for any push higher to test this key S/R region.
Bitcoin: Bitcoin has rallied over 25% since last week and has made a weekly close above the 50% fib near $10,000. I have reviewed the charts of Bitcoin and noted potential targets for any bullish continuation from these levels. This article can be found through the followinglink.

US Stocks: the major indices all printed bullish weekly candles although those for the S&P500 and DJIA were indecision-style ‘Inside’ candles. However, the major support trend lines continue to hold and, even if they do break to the downside, I would still then be wary of any Bull Flag style activity (click on charts to enlarge view):

: S&P500 weekly

: DJIA weekly

: NASDAQ weekly

: Russell-2000 weekly

ASX Stocks: there are a few on my radar this week and you can read about them in an article found through this link.
Monday Holiday in USA: There is a public holiday in the USA on Monday for Presidents’ Day so it might be a slow start to the week.

Calendar: Watch out for impact from high impact data and there are a lot of second tier EUR PMIs to consider as well. There is a public holiday in the USA on Monday for Presidents’ Day so it might be a slow start to the week:

Forex:

EUR/USD: This pair continues to consolidate below the major 1.26 level. This is a major level for this pair as the weekly chart’s 61.8% fib is near 1.26 and it also intersects with the monthly chart’s 10-year bear trend line. Thus, the 1.26 remains as the major level to monitor in coming sessions.

Note on the monthly chart below how the 61.8% fib of the swing low move is up near previous S/R at 1.40 so this would be the longer-term target on any break and hold above 1.26. This constitutes a move worth 1,400 pips so is well worth motioning.

Any pullback would have me looking for a test of the support trend lines and the key 1.20 level.

Watch the 4hr chart trend lines for any new breakout.

EUR/JPY: Given we’ve had weakness for the last two weeks I’m on the lookout for any test of the major 135 S/R level here as I note it is the 4hr chart’s 61.8% fib.

Any break lower would have me looking to the 130 S/R level.

Watch the 4hr chart trend lines for any new breakout.

AUD/USD: The Aussie gave another great technical pullback last week with its recovery back up to the 4hr chart’s 61.8% fib near 0.80. I’d mentioned this level in a Tweet on Monday week so was spot on here 🙂 ! It failed to close the above this key S/R level though but there are new triangle trend lines to watch for any momentum breakout.

Watch the revised triangle trend lines and 0.80 level for any new breakout; especially with the AUD Monetary Policy Meeting Minutes:

AUD/JPY: As with the weakness on the EUR/JPY, I’m watching for any test of the 87 S/R level here as I note it is the 4hr chart’s 61.8% fib.

Any break lower would have me looking to the weekly chart’s 61.8% fib down near 80 S/R.

Watch the 4hr chart trend lines for any new breakout.

NZD/USD: The Kiwi continues to hover near the major 0.74 level and so this remains the level to watch for any new make or break.

Watch the 4hr chart trend lines for any new breakout; especially with this week’s NZD Retail Sales data.

GBP/USD: Price action continues to consolidate near the 1.40 level and weekly 200 EMA. This still has a Bull Flag look to it…IMHO that is.

Watch the triangle trend lines and 1.40 level for any new breakout, especially with this week’s Employment and GDP data, the Inflation Report Hearings and the BoE Carney speech:

USD/JPY: This gave a great trend line breakout and TC signal last week but price action paused at the weekly charts support triangle trend line and weekly 61.8% fib level.

I’m watching for any potential test of the 110 S/R level here as I note it is the 4hr chart’s 61.8% fib.

Watch the trend lines for any new breakout:

GBP/JPY: Like with the other Yen pairs, I’m watching for any relief rally here to test the weekly 200 EMA level here as I note it is the 4hr chart’s 61.8% fib.

Any break lower would have me looking to the 147 S/R level.

Watch the 4hr chart trend lines for any new breakout.

GBP/AUD: Not a lot has changed here this week with 1.80 and the weekly 200 EMA still in focus.

Watch the 4hr chart’s triangle trend lines, weekly 200 EMA and 1.80 for any new breakout:

GBP/NZD: A bit clearer here this week but with 1.90 S/R still in focus.

Watch the wedge trend lines and 1.90 level for any new breakout:

EUR/AUD: Still looking a bit Bull Flag like here as price consolidates back above the 1.55 level.

Any pullback would have me looking for a test of 1.55 S/R.

Watch the 4hr chart’s Flag trend lines for any new breakout:

EUR/NZD: This continues to consolidate above the key 1.675 level.

Watch the 4hr chart’s triangle trend lines for any new breakout:

Gold: Gold pushed higher last week and this has brought the $1,400 level back into focus. The $1,400 level is just 550 pips away from current price so any test of this region is worth stalking so as to try and capture some of the run. I note that any bullish breakout and move above $1,400 would support the Bull Flag seen on the monthly chart.

Any bearish retreat would have me looking for a test of $1,300 as this is near the 4hr chart’s 50% fib and, after that, the 4hr chart’s 61.8% fib which is also near the daily 200 EMA.