In this article, we would like to present the weekly technical forecast targeting the prospects of major financial assets during the period from Feb 19 to Feb 23.
The Euro – Greenback has recorded a positive week testing back the Jan 25 peak of 1.25350 as we have predicted earlier. Nevertheless, Friday saw a bearish candlestick which indicates a potential reversal develope, presenting that prices are likely to surrender to this barrier and turn lower for the foreseeable future. The first substantial support threshold is determined at 1.22052 (Feb 2 nadir, SMA 50) once the 20-day EMA is penetrated. Alternatively, a break above 1.25350 will likely target the 61.8% Fib expansion of 1.27113.
The British Pound – US Dollar managed to escape the EMA 20 – SMA 50 territory to the topside. However, later this week also witnessed bears come into the fray, but they were not too aggressive. We forecast that prices will likely be rangebound in the near future. The nearest resistance obstacle is ascertained at 1.43415 (Jan 25 high), with a turn above that exposing the 61.8% Fib expansion of 1.44043. Otherwise, in case of a move back into the EMA 20 – SMA 50 area, a retest of the solid barrier at 1.37902 is totally possible.
This week recorded a highly pessimistic affair for the Greenback – Japanese Yen with prices plunging sharply, breaking below both of the solid hurdles at 108.289 and 107.304. Nevertheless, bullish momentum has appeared on Friday with the RSI likely to jump back above 30, suggesting that a rally could present in near-term. The 107.304 level support-turned-resistance is likely to be challenged if the currency pair corrects higher. Alternatively, USD/JPY may confront again the newest support barrier at 105.538.
No clear signals have been offered this week. Looking at the action of the EMA 20 & SMA 50, we also see that the area composed of them are narrow, indicating for no obvious trading opportunities. The best plan is to wait until a new driver enters the game and leads prices to make remarkable movements. The nearest resistance obstacle is determined at 1.26836 (Feb 9 peak), with a daily close above that paving the way for a further advance to challenge the steadfast barrier of 1.29143. Alternatively, a turn below 1.23645 will make the Jan 31 base of 1.22486 on the radar.
The Australian Dollar – Greenback recorded a bullish movement this week but also saw signs of profit taking. The zone between the 20-day EMA and 50-day SMA also narrowed, suggesting for a consolidation in the near future. The nearest support level is spotted at 0.77610, with a penetration below that opening the door for a confrontation of the next stable barrier around 0.76486. Otherwise, AUD/USD could trade higher to test back the resistance obstacle of 0.81340 (Jan 26 top).
A sanguine week of the Kiwi – Greenback has been marked with prices retesting the Jan 24 peak at 0.74327. By the end of the week, the sell side was back in play, signaling that the bullish movement is likely to end for the foreseeable future. A retracement back to recheck the 20-day EMA is entirely possible, with a break below that on a daily closing basis exposing the SMA 50. Alternatively, given the 0.74313 obstacle submitted, NZD/USD may ascend further to approach the 61.8% Fib expansion at 0.75796.