Forex Review for Feb 18th


Bottoming, expecting upward reversal


With oscillators diverging and turning upwards from oversold levels, price is trapped inside the Ichimoku cloud in the 4 hour chart around the important support area of the 38% Fibonacci retracement. EURUSD is expected to reverse higher. Resistance is at 1.1160-1.1180 and a break above this area will open the way for a new up trend towards new highs maybe near 1.15 if not higher.


Still in bearish trend

Price remains inside the downward sloping channel and new lows are more probable as long as price is trading below 1.4575.


Price is also below the Ichimoku cloud and has broken both the tenkan- and kijun-sen indicators. All indicators point lower  as long as short-term resistance at 1.44 is not breached. If we break this resistance trend will change to neutral.


At important long-term resistance, bearish wedge pattern.


Green line – support

upward sloping blue line- short-term support

Downward sloping blue line – long-term trend line resistance

AUDUSD is testing the long-term downward sloping trend line resistance and shows signs of weakness as the rejection at this trend line is not a bullish sign. On the contrary I believe we best try short positions as long as price is below the long-term resistance trend line. If the lower green wedge boundary is broken we should expect more selling to come and push prices to new lows towards 0.68. On the other hand a break above 0.72 could signal a bigger upward correction even towards 0.75.


Under important long-term resistance, risk/reward favors bears


Price is testing the long-term trend line resistance. Already we have two touches and two rejections. Soon we will have a breakout or a new rejection that will start the push lower towards 0.64-0.62.


Price is making lower lows and lower highs after topping at 0.6750. A break below 0.6550 will open the way for a new round of selling pressures to push price towards 0.6450 at least for the short-term.


Possible double bottom


Price has reached the previous low around 1.3650 and  with oscillators oversold this could be a very interesting area to go long as support is huge now at 1.36.


USDCAD is approaching the long-term upward sloping trend line support. It is also at the lower boundary of the daily Ichimoku cloud. Support is here. Risk reward favors bulls at current levels.


Shallow bounce, bearish rejection expected


Price did not manage to overcome the 38% Fibonacci retracement. Equity indices continued their rally but USDJPY did not follow. This divergence is a bearish sign for both. Price remains below the 38% Fibonacci retracement and is testing the Ichimoku cloud in the 4 hour chart. I expect a rejection and a push towards 113-112.50 over the coming days.

That is all from me today, thank you for  taking the time to read my thoughts.

Have a nice day

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