Intraday Retracement Likely on These Currencies

This article was originally published on Nadex.com.

Typically, after a significant move either to the upside or downside, markets need to pullback (or retrace) to fuel another potential move.  Today, could be the day these markets retrace:

  • USDJPY
  • AUDUSD
  • EURUSD

 

USDJPY

The USDJPY 240-minute chart shows that the Stochastics was above 80 for a significant period and on the last high the ADX moved above the 70 line.  Since the ADX line is blue, this would typically indicate an overbought market.  On the last high, instead of the buying volume getting stronger, it became weaker because the volume bars were decreasing instead of increasing.  This provide three independently confirmations that the market is likely to move down to the ATR at 109.83.  The only support prior to this area will be the 60-minute ATR, which is at 110.16.  As price approaches either of these ATRs, if sellers abandon the move, then price is could likely to go back and test the prior high at 110.47.

Intraday Retracement Likely  USDJPY

AUDUSD

The AUDUSD 240-minute chart is showing that the Stochastics has been below 20 for the last few bars and the ADX is indicating a magenta dot.  Whenever the magenta dot appears, it indicates that price will likely retrace back to the ATR stop, which is currently at .7524.  Additionally, after the last low formed, the volume indicates that likely abandoned the downward move at the moment because instead of increasing in strength, sellers decreased.  On the approach to the ATR at .7524, if buyers decrease as they approach, then price will likely go back and retest the prior low at .7447.

Intraday Retracement Likely AUDUSD

EURUSD

The EURUSD 240-minute is very similar to the AUDUSD chart.  The Stochastics is below the 20 line for a signifcant period and the ADX has formed a magenta dot with a red ADX line, indicating price will likely retrace up to the ATR at 1.1922.  The volume confirms the pattern because as the last low was made, sellers decreased instead of increasing.  As price approaches the ATR at 1.1922, if buyers decrease then a retest of the prior low at 1.1813 is likely.

Intraday Retracement Likely  EURUSD

 

Get more of today’s market news & video at Nadex.com.