Trade view /
16 August 2016 at 7:34 GMT
: The index is pushing to the downside in what looks to be a bearish Head and Shoulders pattern. The neckline is seen at 94.77 (current price 95.24). There is caution in this call with both the six-hour and two-hour charts highlighting Demark exhaustion counts, but we expect rallies to be sold into.
I am short EURCHF and long AUDUSD this morning. Here is an outline of the EURCHF trade.
Weekly: Trading has been mixed for the last nine weeks with spikes seen in both directions. For the last seven weeks we have posted Inside Soldiers, a clear sign of indecision. However, we are yet to hold levels above the Marabuzo level of 1.0957, set on the week of June 6. Trendline support is located at 1.0633.
We are in an expanding wedge formation so would expect this support to hold with the pattern having a bullish bias.
Weekly (inside bars):
Six hour: Choppy five wave sequence to the downside (Elliott wave). We have since seen (from the 1.0624 low) a choppy corrective pattern with inside waves being made up of three waves. Levels close to the 61.8% pullback of 1.0937 have been rejected with the six-hour chart highlighting a bearish Outside Candle. First support seen at 1.0827 (trend of higher lows)
Six-hour chart (completes a complex correction):
Create your own charts with SaxoTraderGO click here to learn more
Source: Saxo Bank
Entry: short 1.0875.
Target: 1.0830 then 1.0640.
Time horizon: first target within two days.
— Edited by Michael McKenna
For more on forex click here
Non-independent investment research disclaimer applies. Read more