Not only was last week the end of the month, so to was it the end of the first quarter of 2017, with all the political events over this period I find it hard to remember such a volatile quarter. The trigger of Article 50 was a big one this week and it went as planned, the GBP actually made some impressive gains. On a domestic front, I don’t have to remind anyone on the cabinet changes that sent the ZAR spiralling as the rand lost almost 11% of value this week.
The GBPUSD was the clear winner this week as it closed above both the 100 and 200 hour MA at 1.2500. We did highlight this pair on Tuesday and warned that we could see a short squeeze in cable as traders took profit on long term positions. Statistical data is still showing that traders are still sitting on record short positions in this pair, I would be hesitant to enter any big short positions just yet, the close above 1.2500 is massively bullish and I wouldn’t be surprised if this pair continues to march higher.
The USDJPY was also the recipient of much dollar selling this week, the week found a high at 112.10 which was the 38.2% fib level from the March high. We closed the week around 111.20 which is the 200 hour MA level. This price level will be pivotal next week and the bulls and bears will fight it out at these levels, could be an interesting tussle. A break below these levels will target 110.00.
The EURUSD on the other hand was the big loser for the week as it lost a lot of ground to the dollar, a lot of the weakness would have been from the crosses – in particular the EURGBP. The 1.0700 level was a key level this week and the fact that the EUR could not hold onto that level meant that the sellers were able to remain in control. I am sure you could see some profit taking early on Monday, but if it is not able to hold, the first support level will come in at 1.0620 – this will be the pivotal level to watch for.
If there is ever a confused pair that has the ability to drain trader accounts, then presently it is the USDCAD. Just when you think that we care going to see a bounce it turns the other way and it is getting driven by an unpredictable oil price. There does seem to be a range forming between 1.3290 and 1.3390, I think that I am going to only trade this pair when it is trading at the extremes of the range.
There is a lot of chatter around the USDZAR after the chaos on Thursday evening, I am searching for positives in this pair, and it did find some resistance at 13.6100 on Friday which had confluence in the form of monthly pivot levels. The issue for me is that rumours of a credit downgrade will start to surface again – the rating agencies have downgraded countries for far less and so the risk for the ZAR is to lose even more value. Using our channel over the last 6 weeks has brought some success and maybe it’s time to move to another pair, I am not comfortable trying to pick a “top” just yet.
We live in interesting times, and it feels as though we are waiting for event risk on a daily basis. I have taken the conscious decision to only trade the most liquid products for now – and I have to remind myself that this excess volatility will also usher in a lot of opportunity.
Weekly Ranges 03/04/2017 – 07/04/2017
Majors
EURUSD
Resistance 1.0780 – 1.0810
Support 1.0610 – 1.0580
GBPUSD
Resistance 1.2540 – 1.2570
Support 1.2400 – 1.2380
AUDUSD
Resistance 0.7690 – 0.7720
Support 0.7600 – 0.7580
NZDUSD
Resistance 0.7065 – 0.7085
Support 0.6970 – 0.6950
USDCAD
Resistance 1.3390 – 1.3420
Support 1.3280 – 1.3260
USDJPY
Resistance 111.80 – 112.00
Support 110.60 – 110.40
USDCHF
Resistance 1.0030 – 1.0050
Support 0.9890 – 0.9850
Rand
USDZAR
Resistance 13.4150 – 13.4550
Support 12.7850 – 12.7540
EURZAR
Resistance 14.2890 – 14.3555
Support 13.7550 – 13.7240
GBPZAR
Resistance 16.8500 – 16.9000
Support 16.0348 – 16.0000
Minors
AUDCAD
Resistance 1.0240 – 1.0260
Support 1.0160 – 1.0130
AUDJPY
Resistance 85.60 – 85.80
Support 84.30 – 84.10
EURCHF
Resistance 1.0730 – 1.0750
Support 1.0680 – 1.0650
EURGBP
Resistance 0.8640 – 0.8660
Support 0.8480 – 0.8450
EURJPY
Resistance 120.20 – 120.50
Support 118.60 – 118.40
GBPJPY
Resistance 139.80 – 140.20
Support 137.90 – 138.70
GBPCAD
Resistance 1.6750 – 1.6770
Support 1.6550 – 1.6520
GBPCHF
Resistance 1.2560 – 1.2580
Support 1.2350 – 1.2330
Indices
DE30
Resistance 12320 – 12360
Support 12050 – 12030
UK100
Resistance 7370 – 7400
Support 7300 – 7280
US500
Resistance 2380 – 2400
Support 2340 – 2310
US30
Resistance 20750 – 20900
Support 20570 – 20500
SA40
Resistance 45800 – 46000
Support 44800 – 44500
Commodities
BRENT
Resistance 52.70 – 52.90
Support 50.70 – 50.50
XAUUSD
Resistance 1250.00 – 1280.00
Support 1230.00 – 1200.20
XAGUSD
Resistance 18.10 – 18.40
Support 17.70 – 17.40
