16 Feb 2015

MAJORS UPDATE 16.02.2015


The rate seems to be forming a bear flag formation, however a breakout from the range from the last week is still needed for a clear direction.

A break above 1.1500 should take the rate up to test the former support at 1.1750 and then further up to 1.2000.

A break below 1.1260 would indicate resumption of the broader downtrend and most likely take the rate down to test the yearly low at 1.1097 and the major psychological support at 1.1000.


The rate cleared some major resistance levels last week, indicating that the downside break from the massive rising wedge formation back in december was a false one.

We'll see the latest inflation data from UK tomorrow, however, even with  another expected weaker reading, BOE is pushing for a rate hike sooner rather than later, and the old resistance should now provide support at 1.5350.

A clearing of the resistance area between 1.5500-1.5600 is needed to confirm the rate is ready to continue trading higher.

Only a daily close back below the 1.5300 level would invalidate my immediate bullish outlook for the pair.


The rate is now trading in a box range. Prevailing downtrend makes me look at it as a bear flag and a break below the support at 0.7626 should open up a way lower to test the long term rising trendline support around 0.7300.

A break above 0.7850 would indicate that the current range is a double bottom instead, however, only a daily close above the former support/new resistance at 0.8030 and the medium term falling trendline around the same level, would invalidate my medium term bearish bias for the pair.


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