FxNews—The American currency is experiencing a downtrend against the Hong Kong dollar. Interestingly, the Gartley pattern predicted this robust bear market. In addition to the Gartley pattern, the MACD indicator signaled divergence, which resulted in the price breaking below the July 25 low at 7.803.
As of this writing, the price is correcting at about 7.788 after testing the 2022 all-time low at approximately 7.769. The USD/HKD chart below demonstrates the price of the Gartley pattern and its bearish signal.
USDHKD Technical Analysis – 14-August-2024
We zoom into the 4-hour chart to examine the price action, technical indicators, and candlestick patterns more closely. As depicted in the USD/HKD chart above, the price is below the 50- and 100-period simple moving averages, which indicates the primary bearish trend.
- The awesome oscillator bars are below the signal line, but the recent bars changed their color to green, meaning the downtrend is cooling down.
- The relative strength index is below the median line, moving horizontally, suggesting low momentum and a sideways market but mildly bearish.
- The stochastic oscillator hovers in the oversold territory, signifying an oversold market. This means the USD/HKD price might consolidate near the upper resistance levels.
Interestingly, the 1-hour chart formed an inverted hammer, meaning the downtrend could resume.
In summary, the technical indicators suggest the primary trend is bearish. However, the downtrend eased after the price reached the 2022 all-time low, which is a significant barrier for the sellers. Therefore, the market could enter a consolidation phase.
USDHKD Forecast – 14-August-2024
The primary trend is bearish, and the currency pair’s price is currently below the descending trendline. From a technical perspective, the downtrend should be resumed, initially targeting the August 8 low at 7.78, backed by the 23.6% Fibonacci retracement level.
Furthermore, if the selling pressure exceeds the next supply zone will be the August 5 low at 7.769, which is supported by the 2022 all-time low.
Please note that the primary resistance is the August high, backed by the 61.8% Fibonacci. The bearish scenario should be invalidated if the price exceeds 7.799.
- Also read: USDSGD Forecast – 13-August-2024
USDHKD Bullish Scenario – 14-August-2024
The primary resistance rests in peace at 7.799. If the bulls (buyers) cross above 7.799, the uptick momentum that began since the August 5 low at 7.769 will likely extend to the August 1 high at 7.816.
Please note, in case the bullish scenario comes into play, the primary support will be the August 13 high at 7.792.
USDHKD Key Support and Resistance Levels – 14-August-2024
Traders and investors should closely monitor the key levels below to make informed decisions and adjust their strategies accordingly as market conditions shift.
- Support: 7.780 / 7.769
- Resistance: 7.792 / 7.799 / 7.716
Disclaimer: This technical analysis is for informational purposes only. Past performance is not necessarily indicative of future results. Foreign exchange trading carries significant risks and may not be suitable for all investors. Always conduct your research before making any investment decisions.