Currency prices began the week in dangerous neutral zones and now ends the week in neutrality. Neutral zones are those locations when a currency price is stuck between 2 major support or resistance levels and trades around minor supports/ resistnce points. Normally, currency pairs fly from neutral zones and result in long candles from a market input such as an out of sync news announcement, a central bank or political figure comment. So far this week, we haven’t seen any flying yet currency pairs remain trade around significant points.
EUR/USD. Significant break points for EUR/USD are located above at 1.0687 then 1.0790 and below 1.0617 and 1.0548. The downtrend renews at 1.0548 with a break at 1.0617. Most vital is 1.0687 and 1.0548 and minor 1.0617. The levels move 1 and 2 pips per day as EUR/USD remains stuck inside its zone.
GBP/JPY. Most telling pair all week as 140.40 broke lower and remained lower. Below 140.40 is enough to stop USD/JPY and GBP/USD from significant moves. GBP/JPY needs a break higher at 140.40 or it travels lower to 138.44 and renews its downtrend.
EUR/JPY. 121.98 break higher then the uptrend begins again while 120.29 break lower would risk 118.08. GBP/JPY broke its 140.40 point, EUR/JPY has every ability to follow.
USD/JPY. Oversold USD/JPY trades between neutral zones from 112.70 to 115.65. A break higher at 115.65 renews the uptrend and break 114.17 below is first warning USD/JPY uptrend is in trouble.
NZD/USD. The signal line pair to all currency prices must break below 0.7047 or break through massive resistance at 0.7111 and 0.7187. A break below 0.7047 renews the downtrend to 0.7001.
AUD/USD. AUD runs into a brick wall at 0.7544 and a line dropping by the day. AUD must break 0.7490 to target Below 0.7452 then 0.7400. AUD remains not only stuck in neutral zones but its a lost currency pair in its price decisions.
AUD/EUR is currency overbought yet contained by rising supports below at 0.6942 and 0.6926. Both levels are enought to see AUD/USD to massive support at 0.7400.
CAD/ZAR, Trades currently 10.28 and must breaks must occur at 10.40 and 10.48 to see EUR/USD drop and USD/JPY rise. The telling point in CAD/ZAR’s 20 pip break point is the vast majority of currency pairs contain those same 20 pip break points. Its a cautious market all week.
Brian Twomey, Inside the Currency Market, btwomey.com