Technical Analysis 22-02-2017
By Antonis Vasloos
The EUR/USD fell to six-week lows on Tuesday, as the pair tested a critical short-term support around the 1.05 region. The euro has declined around 130 pips against the dollar over a three-day losing streak, as the greenback continues to enjoy renewed buying interest across the spectrum.
- Support (daily): 1.0502, 1.0466, 1.0408
- Resistance (daily): 1.0596, 1.0654, 1.0690
The pair was last seen trading in the mid-1.05 region. Price action is weakening, with the 20-day and 100-day simple moving averages on clear downward trajectories.
The British pound bounced from nearly one-month lows on Tuesday, as the market returned to a familiar range around 1.2500 U.S. The GBP/USD approached the lower end of the Bollinger Band last week, which predicted a short-term reversal. That reversal was actualized over the last two days, when the pair rebounded around 70 pips.
- Support (daily): 1.2420, 1.2366, 1.2335
- Resistance (daily): 1.2505, 1.2536, 1.2590
Relative strength is back in neutral territory, confirming the sideways trading range for the pair.
Outlook: Slightly Bullish
Oil prices advanced on Tuesday, breaking out of a three-month range on route to their highest settlement in a year-and-a-half. The U.S. West Texas Intermediate (WTI) contract rose 66 cents to close at $54.06 a barrel, matching their December 26 high. Prices on the New York Mercantile Exchange closed at $54.33 a barrel earlier in the day.
- Support (daily): $53.38, $52.70, $52.05
- Resistance (daily): $54.71, $55.36, $56.04
Crude oil is gaining momentum, based on the short-term oscillators. It faces initial resistance at $54.71, and a breach above that level would lead to a test of the $55 a barrel mark.
The bullion rally ran into resistance on Tuesday, although losses were limited by strong technical support. Bullish settled at $1,236.90 a troy ounce on Tuesday, having gained more than 2% since the start of the month. Prices have been remarkably steady amid the dollar’s latest rally, with measures of relative strength and the MACD showing continued positive momentum.
- Support (daily): $1,231.30, $1,225.10, $1,222.10
- Resistance (daily): $1,240.50, $1,243.50, $1,249.70
Price action is strengthening, with the 20-day EMA begins to cross above the 100-day EMA.