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Technical Analysis – Charts of The Week

GBPUSD: Trade Insights – Viable Short positions below the Pivot of 137.95 targeting the key Support at 136.70 and then with further weakness the possible test of the support cluster at 136.00 to 135.70. After this, the next support is at 134.60. Alternatively, if prices are pushed higher towards the Pivot at 137.95 then after consolidation possible long positions towards the key resistance level at 137.95 and then targeting the Resistance zone at 139.85 to 140.10 and higher.

GBPUSD

  • Resistance Zone: 139.85 to 140.10
  • Key Resistance Level: 138.80
  • Major Pivot Point: 137.95
  • Key Support Level: 136.70
  • Support Zone: 136 to 136.70
  • 200 Day EMA – Green Line
  • 50 Day EMA – Red Line

Trade Insights – ViableShort positions below the Pivot of 137.95 targeting the key Support at 136.70 and then with further weakness the possible test of the support cluster at 136.00 to 135.70. After this, the next support is at 134.60

Alternatively, if prices are pushed higher towards the Pivot at 137.95 then after consolidation possible long positions towards the key resistance level at 137.95 and then targeting the Resistance zone at 139.85 to 140.10 and higher.

GBP/USD Daily Chart

Chart Analysis:

Directional bias: 1 Week GBP/USD

Technical Analysis of GBP/USD daily chart shows that prices are now consolidating around the 200 Day EMA line and quite under the 50 Day EMA line indicating a Bearish trend. There are more indications that the prices will continue to move in a downtrend that was started in July this year. If the prices move upwards towards the Pivot point at 137.95 this might prove to be the first resistance.  Then 138.80 could work as the key resistance before we might see any breakthrough towards the Resistance zone at 139.85 to 140.10. This level has proven quite strong, and prices fell sharply in the recent past from here to touch the Support Cluster at 136.00. The range of this cluster appears to be between 136.00 to 135.70. The Key support at 136.70 seems the point where prices might hold before moving towards the support zone if Bears continue to control the prices.  

Fundamental summary: Since Nov 2020 the Dollar has for the first time broken through the resistance level at 93.20 briefly and prices are now consolidating just under this crucial level. Due to the risk of the Delta variant, there are reduced chances of tapering in 2021 and markets have also downgraded the likelihood that a tapper announcement is imminent. This has reflected in various asset classes including Gold which has recovered strongly after the false bearish move. The main event that may bring some volatility or speculations in next couple of sessions is the Jackson Hole Symposium on Aug 27th where Fed Reserve Chairman Jerome Powell is due to speak.

AUD/CAD

  • Resistance Zone: 93.20 to 93.40
  • Key Resistance: 92.50
  • Major Pivot Point: 91.70
  • Key Support: 91.38
  • Support Zone: 90.30 to 90.00
  • 200 Day EMA – Green Line
  • 50 Day EMA – Red Line

Trade Insights – Viable Long Positions above the Pivot Point of 91.70, first targeting the Key resistance at 92.50 and then the Resistance zone at 93.20 to 93.40.

Alternatively, as the downtrend remains intact, possible Short positions below the Key support level at 91.38 targeting the support zone at 90.30 to 90.00 and then if selling pressure continues prices could further move down to test the next support at 89.40.

AUD/CAD Daily Chart

Chart Analysis: 

Directional bias: 2 Weeks AUD/CAD

Since our last analysis on the AUD/CAD the pair has broken the previous support zone and currently consolidating just around the Key Support level at 91.38. The pair continues to be in the down trend forming lower highs and lower lows. The prices are now sitting midway through the downward parallel channel. If the prices move up the Pivot at 91.70 then the Key resistance the pair could face is at 92.50 and that is also the ceiling of the Channel. Once this level is broken this could be a confirmation of recovery and forming of upward trend to first test the Resistance sone at 93.20 to 93.40 then the next resistance is at around 95.00 level.

Prices are trading well below the 200 Day EMA and the 50 Day EMA which have turned negative and are indicating a Bearish trend. It needs a strong catalyst to move the prices upwards from here. But if the Downtrend must continue then after the key support is broken the next support zone is at 90.30 to 90.00 level. The prices might inflection point at the support zone if not at the current prices of 91.40.

Fundamental summary: In the AUD/CAD pair the base currency is AUD, and the counter currency is CAD.  The AUD/CAD chart is sensitive to broader commodity price trends including the prices of Oil, Iron ore, Coal, and other commodities as the economies of both countries are tied to natural resources. At this stage a strong catalyst is needed to move the AUD/CAD or CAD in a specific direction – possibly Oil prices.    

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Disclaimer

The information provided is of a general nature and is not intended to be personalised financial advice. The information provided is not intended to be a substitute for professional advice. You may seek appropriate personalised financial advice from a qualified professional to suit your individual circumstances.

Trading in Rockfort Markets derivative products may not be suitable for everyone as derivative products may be considered as high risk. Please ensure that you understand the risks involved. A Product Disclosure Statement can be obtained here and should be considered before trading with us.

Vishal Rathod

August 26, 2021

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