Daily Insight Report 14/08/2017

• 14 Aug 2017

USD/CHF

The USD/CHF pair has broken two resistance levels; the 20-period exponential moving average (EMA) and the 0.962 price level. Price action has been bullish since the break and MACD has broken the zero line to turn more positive.  However, there are signs that the bullish move will not last, with RSI hitting and then flattening out at the 70 overbought zone. Volume also appears to be declining, suggesting little conviction from buyers to drive prices higher. Therefore there is potential for a bearish reversal in today’s trading session.

USD/JPY

The USD/JPY 1 hour chart shows the pair also breaking through several resistance lines. Price action recently broke the 109.25 price level which represented a previous support and the bullish momentum has been confirmed by MACD. However, RSI has hit overbought territory and volume has risen with an increase in selling pressure, denoted by the long upper shadow in yesterday’s candlestick. This suggests that the bullish trend may lose steam and a series of doji candles indicate several breaks/exhaustion in the middle of the bullish move. It is likely that positive sentiment for the pair will not last.

AUD/USD

The AUD/USD chart indicates the pair is testing the 0.788 price level which previously represented a resistance level for the pair. Price action has also broken the 20 period moving average. RSI has a downward trajectory and MACD appears to be turning less positive. A full break (a candle closing below) the 0.788 price level and the 20-period EMA will be required to confirm the downtrend. Volume has spiked during the bearish candle which initiated the move.

GBP/USD

The GBP/USD pair has also broken below a previous resistance line at the 1.300 price level. MACD had flattened and RSI has a downward trajectory. Volume is very low with no real momentum building for a breakout. A break of the 20-period EMA will confirm the downtrend.