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FX analysis

Short-term FX Technical Strategy (19 Apr 2022)

foreign exchange

EUR/USD – Broke below 1.0800, potential impulsive down move resumes

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The EUR/USD has broken below the 1.0800 short-term pivotal support as per highlighted in our previous report on 14 April which invalidated the corrective bounce scenario. It printed an intraday low of 1.0756 on 14 April post ECB monetary policy decision.

Flip back to a bearish bias below 1.0850 key short-term pivotal resistance for a potential drop towards the next support at 1.0720 and a break below it may open up scope for a further decline towards 1.0665/0640 next (major descending channel support from May 2021 high & a cluster of Fibonacci extension levels).

On the other hand, a clearance with an hourly close above 1.0850 revives the corrective bounce scenario towards the intermediate range resistance of 1.0935 in place since 6 April.

GBP/USD – Failure bullish breakout, reintegrated below 1.3060

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The GBP/USD has failed to make a positive follow through after its bullish breakout above 1.3060 on 13 April and reintegrated back below it on 14 April that invalidated the corrective bounce scenario.

A continuation of its impulsive down move sequence; flip back to a bearish bias below 1.3100 key short-term pivotal resistance for a further potential drop to retest the 13 April swing low of 1.2975 before the next support at 1.2930/2910 (also the lower boundary of the minor descending channel from 23 March 2022 high).

However, a clearance with an hourly close above 1.3100 revives the corrective bounce scenario towards the next resistance at 1.3175 in the first step.

USD/JPY – Clearance above 126.30 resumes potential impulsive up move

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The USD/JPY has staged a bullish break above the 126.30 short-term pivotal resistance as per highlighted on our previous report on 14 April that invalidated the minor corrective pull-back scenario.

Flip back to a bullish bias with 126.10/125.80 as the key short-term pivotal support zone for a further potential rally towards the next resistances at 127.90 and 128.60 (also the upper boundary of the minor ascending channel from 31 March 2022 low).

On the other hand, an hourly close below 125.80 revives the corrective pull-back scenario for a drop back towards the next supports at 124.70 and 124.15.

AUD/USD – Drifted down towards ascending channel support with mixed elements

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The AUD/USD broke below the 0.7365 key short-term pivotal support and staged a drop towards the lower boundary of the medium-term ascending channel in place since 28 January 2022 low, it printed an intraday low of 0.7340 on 18 April, US session.

Mixed elements now; prefer to turn neutral between 0.7330 and 0.7410. A clearance with an hourly close above 0.7410 revives the corrective bounce scenario towards 0.7490 in the first step. On the flipside, a breakdown with a 4-hour close below 0.7330 sees another leg of impulsive down move towards the next support at 0.7230.

Time stamped: 19 Apr 2022 at 8.00am SGT

Source: TradingView

 

 


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