Daily Forex Technical Strategy (Mon 25 Nov)

Further potential USD strength seen in EUR/USD. GBP/USD & AUD/USD while USD/JPY continues to churn.

EUR/USD – Broke below 1.1050, down move validated

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  • The pair has staged a breakdown below the lower limit of the 1.1050 neutrality zone on last Fri, 22 Nov as per highlighted in our previous report (click here for recap).
  • Flip to a bearish bias in any bounces below 1.1050 key short-term pivotal resistance (former minor range support from 20/22 Nov 2019 & the 61.8% retracement of the recent slide from 22 Nov high to today’s 25 Nov Asian session current intraday low of 1.1014) for a further potential push down to target the next near-term supports at 1.0990 and 1.0940 (also the lower boundary of the minor descending channel from 31 Oct 2019 high).
  • However, an hourly close above 1.1055 negates the bearish tone for a push up to retest 1.1090 (minor range top since 06 Nov 2019 high & close to the upper boundary of the minor descending channel).

GBP/USD – Failure bullish flag breakout, minor corrective slide reinstated

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  • The pair has broken below the 1.2880 key short-term support that has invalidated the prior minor “bullish flag” breakout triggered on 18 Nov 2019.
  • Flip to bearish bias below 1.2975 key short-term pivotal resistance for a further potential corrective slide to target the next near-term support at 1.2700 (former minor congestion area of 11/16 Oct 2019 & 38.2% Fibonacci retracement of the previous rally from 09 Oct low to 21 Oct 2019 high) with maximum limit set at 1.2570.
  • However, a break with an hourly close back above 1.2975 revives the bullish tone for another round of impulsive upleg sequence to target the next intermediate resistance at 1.3210/3240 (3 Apr/03 May 2019 swing high area & Fibonacci expansion).

USD/JPY – Churning remains in progress

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  • The pair has continued to churn within the medium-term bearish “Ascending Wedge” range configuration in place since 26 Aug 2019 low with mix elements now.
  • Prefer to turn neutral now between 109.05 and 108.25 where bears need to have a break with an hourly close below 108.25 to trigger a bearish breakdown to target the next supports at 107.90 follow by 106.60 next. On the flipside, an hourly close above 109.05 sees a push up to retest the recent 08 Nov 2019 swing high of 109.50 and even the upper boundary of the Ascending Wedge at 110.25/60 (also the former major ascending support from Jun 2016 low).

AUD/USD – Bearish tone remains intact

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  • No change, maintain bearish bias below 0.6845 key short-term pivotal resistance for a retest on the recent 14 Nov 2019 minor swing low area of 0.6770 and a break below it reinforces a further potential drop to target the next near-term support at 0.6720 (09/16 Oct 2019 swing low areas & lower boundary of the minor descending channel in place since 05 Nov 2019 high).
  • However, a clearance with an hourly close above 0.6845 negates the bearish tone for squeeze up to retest 0.6900/6930 (31 Oct/05 Nov 2019 swing high & the major descending channel resistance from 03 Dec 2018 high).

Charts are from eSignal

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