Dukascopy Bank Team
Dukascopy Bank SA
GBP/JPY 4H Chart: Channel Up
Comment: GBP/JPY is currently struggling to move past resistance at 188.40, represented by the September high. Still, the overall outlook remains bullish. The currency pair has formed a well-defined ascending channel, which implies that losses are to be limited by the trend-line at 186.20, while the risks are skewed to the upside. The positive bias is also confirmed by the daily technical indicators. Additional ‘buy’ signal is the fact that the Sterling is oversold—58% of open positions in the SWFX marketplace are short. On the other hand, should the price fall below 186.20, the initial major support will be at 185.45 (200-period SMA), followed by the weekly S2 and monthly PP at 184.50.
EUR/SGD 4H Chart: Channel Down
Comment: Observing price development since mid-October, EUR/SGD might seem in a good position for an upward correction, but the bearish risks are in fact increased. The reason is the falling resistance line that connects Oct 2 and Nov 13 highs. Accordingly, there is a higher chance of a break-out through support at 1.5070/40 than a breach of 1.5230 and an ensuing recovery up to 1.53. A close beneath 1.5070/40 will be a strong bearish signal, as there will be no strong demand areas until the July low at 1.48. The counter-arguments are the mixed indicators and a small number of potential sellers, being that 70% of the market participants are already short the Euro.
This overview can be used only for informational purposes. Dukascopy SA is not responsible for any losses arising from any investment based on any recommendation, forecast or other information herein contained.
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