Daily Technical Forex Report 16.11.2018

EUR/USD

EUR/USD tested the level of support 1.1267, but could not break it down and corrected upwards. The price is currently trading within the local consolidation between this mark and the previous level of resistance 1.1425.

(this is a futures chart, so the price here differs from the Forex, but it moves totally the same)

Therefore, we can consider new positions only after the sure and abrupt exit of the price from the local consolidation. Moreover, the breakout move should be supported by the large volume, which will be a more reliable and accurate signal for entering the market.

While the pair is located inside this range, we should omit this instrument from our trading plan.

The bottom line: waiting for the exit of the price from the range.

GBP/USD

GBP/USD showed a huge fall supported by the large volume and broke down the previous level of support, which is a great bearish signal. So now we should give preference exactly to short positions.

(this is a futures chart, so the price here differs from the Forex, but it moves totally the same)

We can enter the market after the continuation of the drop and the confident breakdown of the new support level 1.2742. The sink must be keen and supported by the large volume, which will insure us against a fake breakdown and will be a more precise signal for entering the market. A stop loss should be placed above the breakdown volume bar. A potential of the deal is more than 120 points.

The bottom line: short positions after the breakdown of the support level.

USD/JPY

USD/JPY broke down the previous level of support, but after the formation of the new volume level 113.10, it corrected upwards. Nevertheless, the price has already resumed falling and is trading near this mark now. Therefore, we can consider a scenario of its breakdown, which will allow us to open short positions. The drop must be abrupt and supported by the large volume, which will insure us against a fake breakdown. A stop loss should be placed above the breakdown volume bar. A potential of the deal is around 80 points.

The bottom line: sales after the keen breakdown of the support level.

USD/CAD

USD/CAD carried on adjusting down and now is located within the local consolidation between the level of support 1.3055 and the level of resistance 1.3258. Thus, the best solution with this pair is just to wait for the sure exit of the price from this local range and only after that we can regard new positions. The breakout move must be sharp and supported by the large volume, which will insure us against a fake breakout and will be a more accurate signal for entering the market.

The bottom line: new positions after the sure exit of the price from the range.

AUD/USD

AUD/USD tested the resistance level, but could not break it out and is currently trading nigh this mark, so we can consider a scenario of its breakout. It will be a good bullish signal. The rise should be keen and supported by the large volume, which will insure us against a fake breakout. A stop loss should be placed below the breakout volume bar. A potential of the deal is more than 80 points.

The bottom line: long positions after the sharp breakout of the resistance.

XAU/USD

Gold went on growing and broke out the previous resistance level. The move was on the increased volume, which is a good bullish signal. We also should point out the new level of support 1210.00. Given these factors, we should give preference to long positions.

(this is a futures chart, so the price here differs from the Forex, but it moves totally the same)

We can enter the market after a smooth downward correction of the price, in order to obtain a more profitable entry point. A stop loss should be placed below the level of support. A potential of the deal is around 130 points.

In case of the breakdown of the support, we should stay out of the market.

The bottom line: long positions after a smooth downward correction.

The mood of retail traders (trading against the "crowd"): this indicator totally affirms our scenarios with GBP/USD and AUD/USD. The opposite situation with USD/JPY and XAU/USD, so we should be more careful. As with other pairs, we should wait for the exit of prices from local ranges and only then we can consider new positions. 

The best deals: GBP/USD, AUD/USD

Potentially good deals: USD/JPY, XAU/USD

Stay out of the market: EUR/USD, USD/CAD

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