Trade view /
31 August 2016 at 4:47 GMT
: The index continued its move to the upside yesterday from Friday's low of 94.20. There is no clear indication of a change or trend but the rally has stalled at the top of the daily Ichimoku cloud. Ample scope for a correction lower but we look for dips to be bought into.
Source: Saxo Bank
is the FX major of choice today and we look to buy into dips.
Monthly: The chart highlights a bearish Gartley formation. However, we have had a five-month period of consolidation with scope for a mild move to the upside without impacting this negative bias.
Weekly: We are in a corrective channel formation higher. We are assessed as being in the final bullish leg of this pattern. We have a Marabuzo level from the week of August 8 at 1.3052 (mid-point from open and close). However, we see no real barrier until 1.3310. This is the base of a deep Ichimoku Cloud and the 38.2% pullback of the 1.4689-1.2459 move.
Source: Saxo Bank. Create your own charts with SaxoTrader; click here to learn more
Intraday (six-hours): We are breaking the expanding wedge formation to the upside. This has a minimum target of 1.3250 (start of the wedge). We also have a 261.8% extension of the 1.2762-1.2959 move located at 1.3278, just below the aforementioned 1.3310 barrier. This is our target ‘zone’ (1.3250-1.3310).
We are just posting an inverted hammer close to the 161.8% extension of 1.3081 so we prefer to buy into mild dips today. Bespoke support is seen at 1.3035.
Management and risk description
A move through 1.3200 and we move stop to entry.
Entry: Buying a 1.3040.
Target: 1.3250-1.3310 zone.
Time horizon: This week.
— Edited by Susan McDonald
Non-independent investment research disclaimer applies. Read more