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Gold, GBP/USD, USD/JPY weekly review

Gold weekly Analysis

Gold, GBP/USD, USD/JPY weekly review

Technical View

Since march 2013, gold has continually made lower highs finding  resistance at the resistance trend line. Gold failed to break past the resistance trend line after the wave (c) bounced from the support trend line, instead gold moved only up to 1160.22 before heading short again. It is anticipated that, as long as gold trades between these trend line, a channel is likely to form downwards. Any movements above the resistance trend line will signal further movements towards the upper side.

Correlation analysis
 
Traders trading gold should observe other pairs affected by the movement of gold such as AUD/USD, USD/CHF and US Dollar index. The US Dollar and AUD/USD are very sensitive to gold movements and are usually affected by it.  It is anticipated that, should gold rally downwards and close below 1103.86, short positions will be ideal, but only up to the support trend line. Any movements above 1125.03 will signal further movements to the upper side probably up to 1162.62 or even up to the resistance trend line.

Trade recommendations:
 

Should gold close below 1103.86, short positions may be ideal for the better parts of the week, however, should it close above 1125.03, then long positions are ideal for traders.  Trers trading gold should understand that, gold is a metal, and therefore, it basically drags other currencies such as AUD/USD, USD/CHF. It gives them direction.

GBP/USD weekly Analysis

Gold, GBP/USD, USD/JPY weekly review

 

Technical View:

Since September 2014, GBP/USD has continually made lower highs, we anticipated a breakout above for wave (c) unfortunately the market contained it the wave and therefore it ended up rallying downwards. It is expected that, as long as the pair remains between the upper resistance trend line and the immediate support trend line, short positions are ideal. The current corrective move should move upwards but only up to the resistance trend line before making another lower higher.

Correlation Analysis
 
Traders trading this pair should observe closely other pairs such as AUD/USD, AUD/HKD, AUD/JPY, AUD/USD, CHF/JPY, EUR/JPY, GBP/CAD, GBP/HKD, NZD/JPY and SGD/HKD. For the past few months, these pairs have had a very strong positive correlation with GBP/USD of up to + 0.96. This positive correlation is expected to continue. Thus, only buy or sell GBP/USD, if more than half of these pairs are giving the same signal.

Trade recommendations:

As long as the pair remains between the upper resistance trend line and the immediate support trend line, short positions are ideal. The current corrective move should move upwards but only up to the resistance trend line before making another lower higher.

USD/JPY weekly Analysis.

Gold, GBP/USD, USD/JPY weekly review

Technical View:
 
Since February 2013, USD/JPY has continually made higher lows. The pair has always been rejected along the support trend line for almost a year. It is anticipated that, as long as the pair trades above this support trend line, long positions are recommended but only when the price is trading along it, any movements below it will signal a break of a key support. Currently, wave(c)  is not complete, we anticipate a bounce from the immediate  resistance trend line before it rally downwards probably past 116.114, any movements above the immediate resistance trend line will signal further movements even up to the next resistance trend line.
 
Correlation Analysis
 
Traders trading this pair should observe closely other pairs such as HKD/JPY, GBP/CHF, CAD/CHF, AUD/CHF, and AUD/CAD. These pairs had a very strong positive correlation of up to +0.96 with USD/JPY, and this level of correlation is expected to continue at least for the better part of the week. Thus only buy or sell USD/JPY if more than half of the other pair are giving the same signal.
 

Trade recommendations:

Buy above 121.995, and wait for a potential bounce off from the immediate resistance trend line. Generally, we expected the pair to move short probably below the 116.121, or even lower to support trend line.

Graham Osano
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