Trading idea on major pairs: 24th October -28th October
The medium-term uptrend in the EURUSD pair has come to an end and last week the price broke the key support level at 1.09553.There has been a massive confusion into the mind of investors about the next move of the EURUSD pair but traders are somewhat relaxed since the pair has broken significant support level and the U.S dollar has gained some strength in the market over the past week. The first key support for this pair lies at 1.08206 level where the pair might find some support for a minor bullish retracement. In the upcoming week, ECB President Mario Draghi is going to deliver his speech about the current performance of the European economy. Though the pair is strongly bearish technically but the professional traders are overly cautious about upcoming ECB press conference. If the pair manages to breach the critical support level at .107110 then we will see a strong drop in the EURUSD price towards the next critical support level at 1.05218.Traders are expecting a significant amount of support from that level since the price has respected that area many times in the past. A clear decisive break below the 1.05218 level will bring strong bearish momentum in the market towards the next critical support level at 1.03730.Shorting this pair at the current level will be an immature act since the price is trading too close to the support level and the FED has not given any clear indication about the interest rate hike. In the upcoming week, the most important event for this pair would be the ECB press conference since it might help the EURO to gain some strength in the market. Considering all the technical and fundamental parameter the EURUSD pair remains bearish in the upcoming week. Selling this pair at a higher level will bearish price action confirmation signal will be our first priority. But if the pair fails to retrace then we will enter shortly after the clear decisive break of the minor support level at 1.08128
The NZDUSD pair started the previous week with fresh buying pressure but ultimately failed to hold its strength. The pair falls sharply after rejecting the critical resistance level at 0.72617.Currently, the price is trading below the 100 day SMA level which is clearly a threat to the bullish momentum of this pair. If the pair manages to breach the critical resistance level at 0.72617 then we will see a decent bullish move of this pair towards the next critical resistance level at 0.73568.But there upward momentum of the NZDUSD pair is mostly likely to be ceased since there are too many resistance in the upward direction for this pair. The first bearish target for this pair from this current level would be the low 13th October 2016.A valid break below the critical support level at 0.709306 level will bring strong bearish move in the NZDUSD pair towards the key support level at 0.69572.This level is going to provide a significant amount of support to the NZDUSD pair since the 200 day SMA also lies at that level. Professional traders will look for small term buying opportunity near the 0.69572 level in presence of bullish price action confirmation signal. Considering all the parameter the overall bias remains strongly bearish for the NZDUSD pair since there is too many resistance for this pair to lead north. Selling this pair near the critical resistance level at 0.7200 marks would be our priority setup.
There has been a false breach in the triangle resistance level at 0.76875 in the last week. Currently, the triangle pattern is nearly finished and the price is getting ready for the breakout. In the daily chart, the price has formed a nice bearish engulfing pattern which is a strong indication of a potential bearish move in this pair. The weekly chart pin bar is also indicating strong selling pressure in the AUDUSD pair. The critical support level at 0.75547 is the only barrier for the sharp fall in the price of this pair. The will find some difficulty in breaking this level since the 100 day SMA also lies at that level. A clear break of that level will confirm the new selling pressure in the market which will eventually lead this pair towards the next critical support level at 0.74521.In the eyes of trained professional, this level is going to provide pretty strong support to AUDUSD pair since the 200 day SMA also lies at the level. Professional traders will enter short in this pair aggressively after the clear break of the 200 days SMA in the daily chart. A clear decisive break below the critical support level at 0.74521 level will confirm the end of the medium-term uptrend in the AUDUSD pair and will bring fresh selling pressure in the market. If the pair manages to breach the critical support level at 07142 level then we will see a sharp drop in the price of this pair towards the next key support level at 0.6920 level. Though the overall bias remains strongly bearish for the AUDUSD pair but sellers will not dominate the market easily. To be precise the bearish momentum of the market will face too many critical support level before it retests the 17th January 2016.However, if the pair manages to break the low at 0.68275 level then we will see strong bearish move in the market in favor of the long-term bearish trend.