Daily Key Short Term Technical Levels Fri 27 Oct 2017

Blue avatar for FOREX.com guest contributors
By :  ,  Financial Analyst

FX – USD strength resurgence in the short to medium-term

  • EUR/USD – Broke below 1.1785 short-term support that invalidated the short-term up move scenario. Daily close below 1.1680/70 key medium-term support (neckline of the bearish “Head & Shoulders” in place since 02 Aug 2017) has opened up scope for a potential medium-term (multi-week) decline. Yesterday (26 Oct) post ECB’s steep decline may see a minor rebound first above 1.1615 (minor swing low area of 24/26 Jul 2017 + 1.1618 Fibonacci projection of the drop from 20 Oct 2017 high to 23 Oct 2017 low projected from 26 Oct 2017 high, minor degree bearish impulsive wave iii potential target) couple with an extreme oversold reading seen in  the hourly Stochastic oscillator. Key short-term resistance at  1.1688/1.1705 (former minor swing low area of 06 Oct 2017 + 38.2% Fibonacci retracement of yesterday drop from 26 Oct 2017 minor swing high of 1.1837). Next intermediate support coming in at 1.1570/1555 (lower boundary of the medium-term descending channel from 08 Sep 2017 high + Fibonacci projection cluster).
  • GBP/USD - Broke below 1.3210 short-term support that invalidated the short-term up move scenario.  Yesterday’s drop lead it back to hover right above the range support of 1.3100 in place since 20 Oct 2017 minor swing low area. Hourly Stochastic oscillator has flashed a bullish divergence signal at its oversold region. Mix elements, prefer to turn neutral between 1.3100 & 1.3230 (failure bullish breakout level of 25 Oct 2017 + close to the 61.8% Fibonacci retracement of the current drop from yesterday, 26 Oct Asian session high).
  • AUD/USD – Daily close below 0.7000 key major support has invalidated the countertrend rebound scenario. Further potential drop in progress below key short-term resistance at 0.7690 (minor steeper descending trendline from 24 Oct 2017 minor swing  high + 23.6% Fibonacci retracement of the current drop from 19 Oct 2017 high). Next intermediate support coming at 0.7595/7585 (lower boundary of medium-term descending channel from 21 Sep 2014 high + Fibonacci projection cluster).
  • NZD/USD – Despite a break below the 0.6850 support as per highlighted yesterday, elements are still mix at this juncture. Current price action is now resting at 0.6830/6810 which is the medium-term swing low area of 11 May 2017 + Fibonacci projection cluster) coupled with a bullish divergence signal seen in the hourly RSI oscillator. Prefer to turn neutral between 0.6810 & 0.6910 (minor swing high areas of 25/26 Oct 2017 + 23.6% Fibonacci retracement of the current drop from 17 Oct 2017 high).
  • USD/JPY – Surpassed the 114.05 upper neutrality zone as per highlighted yesterday. Right now, the pair is likely to have resume its short-term minor degree bullish impulsive wave sequence in place since 16 Oct 2017 low. Flip back to bullish bias above 113.34 key short-term support for a further potential push up towards the intermediate resistances of 114.40 follow by 114.70 (major descending trendline from Jun 2015 + Fibonacci projection cluster) next.

   Commodities – Corrective decline resumes for Gold

  • Gold – Broke below the 1272 lower neutrality zone as per highlighted yesterday. Flip back to bearish bias reinforced by resurgence of USD strength and risk-on environment. Key short-term resistance now at 1272 (former minor swing low areas of 23/25 Oct 2017) for a further potential push down towards the 1260 support (minor swing low of 06 Oct 2017) follow by 1252 next (swing low area of 08 Aug 2017 + medium-term ascending trendline from 15 Dec 2016 low).
  • WTI Crude (Dec 2017) -  Broke above the 52.75 upper neutrality zone. Turn bullish above 51.93 key short-term support (yesterday, 26 Oct U.S. session low + minor ascending trendline from 09 Oct 2017 low) for a further potential push up to test the next intermediate resistance at 53.76 (medium-term swing high of 12 Apr 2017) within a long-term complex range configuration.

Stock Indices (CFD) – Bullish exit for Germany 30 with S&P 500 poised for further potential upside

  • US SP 500  - Bounced up towards the 2565 upside trigger level as expected. No change, maintain bullish bias above a key short-term support now at 2557 (minor swing low area formed yesterday + pull-back support of former minor descending trendline from 23 Oct 2017 high) and an hourly close above 2565 is likely to reinforce a potential bullish impulsive upleg to retest 2579 current all-time high before targeting the next resistance at 2590 (Fibonacci projection cluster) in the first step.
  • Japan 225 –  Short-term corrective decline/consolidation scenario invalidated through the bullish break of 21850. Right now, potential bullish impulsive wave sequence in progress with key short-term support now at 21755 (congestion area of 26 Oct 2017 + minor ascending trendline from 26 Oct 2017 low) for a further potential up move to target the next resistances at 22315 follow by 22475 (lower limit of medium-term resistance, see weekly technical outlook).
  • Hong Kong 50 – No change, maintain neutrality stance between prefer to turn neutral between 28000 & 28545 (“Head & Shoulders” invalidation level). Only an hourly close above 28545 shall validate a potential bullish exit towards 29100.
  • ASX 200 - Tested the 5880 short-term support without an hourly close below it yet (printed a current intraday low of 5850 in today Asian session which is also closed to our key medium-term support of 5860, see weekly technical outlook). Maintain bullish bias for a potential push up towards the intermediate resistance of 5950 (swing high areas of 12 Apr/01 May 2017) in the first step.
  •  Germany 30 – Bullish breakout above the 13050 upper neutrality zone as per highlighted yesterday and rallied straight towards the medium-term resistance/target of 13240 (see weekly technical outlook), (printed a current intraday high of 13226 in today’s Asian session). No clear signs of bullish exhaustion, except the risk of  a minor pull-back/consolidation below 13260 (4.236 Fibonacci projection of the rally from 26 Oct 2017 low which is the minor degree impulsive wave iii potential target). Key short-term support will be at 13090/13050 (former swing high area of 18 Oct 2017 + pull-back support of the  former minor descending range resistance from 18 Oct 2017 high) with next resistance coming in at 13435 (see weekly technical outlook).

*Levels are obtained from City Index Advantage TraderPro platform


This report is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this email, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs. All queries regarding the contents of this material are to be directed to City Index, a trading name of GAIN Capital Singapore Pte Ltd.

Trading CFDs and FX on margin carries a high level of risk that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit cityindex.com.sg for the complete Risk Disclosure Statement.


Related tags: Commodities Forex Indices

Open an account today

Experience award-winning platforms with fast and secure execution.

Web Trader platform

Our sophisticated web-based platform is packed with features.
Economic Calendar