CAD, Aussie, Gold: January 2011 Overview - Weekly update

CANADA, AUSTRALIA AND GOLD

TABLE OF SUPPORTS AND RESISTANCES

at market close - December 31, 2010

USD/CAD

MONTHLY

The Loonie has been continuing its descent on monthly charts, after a rejection from the middle line of Bollinger Bands and SMA34. First target to the downside would be expected for this pair to reach the lows of 2007 at around 0.9080 with a further fall to psychological level 0.8000 if that support breaks. The risk-to-reward ratio shows a better outcome on the bullish side, but in my opinion the trend is still very bearish, though we might have an attempt to test the SMA100 should the momentum change to the upside.

 

 

WEEKLY

Weekly charts for USD/CAD show a steady and slightly bearish consolidation all throughout last half of year 2009 and all 2010. Price seems about to break to the downside and I would expect a fall to 0.9710 as first target, then if the bearish move continues, psychological level 0.9600 as a second target.

 

 

 

 

 

DAILY UPDATE AT CLOSE, FRIDAY 7, JANUARY 2011

Daily prices barely pierced the support at the december close and have kept on consolidating along the first week of this year. It seems that this pair keeps on advancing by little steps on its bearish trend, and I would expect a further fall towards the 127% Fibonacci extension of last swing low, at psychological level 0.9800. My views are definitely bearish on this pair and prices have drifted away from all moving averages after two retests in October and November.

 

 

 

AUD/USD

MONTHLY

The Aussie ended 2010 at the top line of an ascending wedge with a strong bullish momentum, reaching also the upper line of the Bollinger Bands. Although the views remain quite bullish on this carry pair, I would expect a retracement to retest the break at around 0.9850 on a relatively longer term. Should it continue up first, I would be initially targeting psychological level 1.0800/10.

 

 

 

 

WEEKLY

Weekly charts are also showing an ascending wedge, where I would expect the price to reach the upper line at around 1.0500 and then come back down to the current break area (1.0190/1.0200). On a medium term view, I expect prices to fall down for a retest of the previous strong support area between 0.9400/0.9350 (triple top from November 2009 to April 2010).

 

 

 

 

 

DAILY UPDATE AT CLOSE, FRIDAY 7, JANUARY 2011

The AUD/USD started 2011 with a steady retracement below parity, as expected on longer term charts. Price ended this first week of January below the middle line of the Bollinger Bands but holding above SMA34. I would expect a bounce back up to retest parity but I then favor a continuation down to the SMA100 and a further fall to retest the lows at 0.9550. Should 1.0000 be broken again to the upside, first bullish target would be the recent highs, and if broken we could go to the 127% Fibonacci extension from last swing high, at 1.0450 and maybe psychological level 1.0500.

 

XAU/USD (GOLD)

MONTHLY

Gold reached the upper line of the ascending channel in December 2010. Strong psychological level at 1500.00 is really very near and I sustain the bullish view up to that target, however the present pattern and the fact that price went very close of a 161.8% extension from previous swing high, makes me expect a retracement before continuing the steady ascension of this metal since late 2008. I expect a retracement to previous month lows around 1350.00 down to 1320.00 (November lows).

 

 

 

WEEKLY

Price action on the last week of 2010 ended at the middle line of the ascending channel where it could either bounce back down or continue the ascension towards 1500.00. We have a lower high and the downside would be the most probable direction, with 1360.00 and 1330.00 as possible first bearish targets (27% and 38.2% Fibonacci retracements).  If effectively the price goes down, we might test the psychological level 1300.00 which is near the 50% retracement, and even continue to the next Fibonacci at around 1260.00.

 

 

DAILY UPDATE AT CLOSE, FRIDAY 7, JANUARY 2011

Daily prices have been ranging between the Bollinger Bands and we got the expected retracement, however the week has ended in a pinbar and rejection of the lower band, which will have to be confirmed on next Monday close to expect a bullish continuation to the upper band and further. We also have a triple top formation (November and December 2010, and this month’s highs). If prices were to head down and test the SMA100, next target will be the SMA200 if that level is broken. I think however that prices might continue ranging for a while before attempting a new push to the highs. We are now trading below the middle line of the Bollinger Bands and also below the SMA34, thus if 1380.00 resistance holds we are headed south for a while. Targets on the bearish side: 1350.00, 1320.00, 1300.00; on the bullish side I don’t think it will surpass 1400.00 before making a good correction of the recent ascension.