Author: Ali B.

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Forex Market Analysis

Daily F.X. Analysis, January 12 – Top Trade Setups In Forex – Stronger Dollar In Play! 

On the fundamental side, the economic calendar is likely to offer a thin trading volume, and it may offer thin volatility to the market. However, the focus can remain on the MPC Member Broadbent Speaks due to the European session today.

On the fundamental side, the economic calendar is likely to offer a thin trading volume, and it may offer thin volatility to the market. However, the focus can remain on the MPC Member Broadbent Speaks due to the European session today.

On the fundamental side, the economic calendar is likely to offer a thin trading volume, and it may offer thin volatility to the market. However, the focus can remain on the MPC Member Broadbent Speaks due to the European session today.

Economic Events to Watch Today  

  

EUR/USD – Daily Analysis

The EUR/USD closed at 1.21499 after placing a high of 1.22258 and a low of 1.21320. The currency pair extended its losses on Monday and dropped for the third consecutive day amid the broad-based U.S. dollar strength. On Monday, the rising risk-off market mood strengthened the U.S. dollar following the news that China was intensifying coronavirus measures to limit the nation’s rising infection rate. Whereas, greenback investors were also optimistic that President-elect Joe Biden would push for a multi-trillion-dollar stimulus package.

The growing concerns over an increasing number of coronavirus cases throughout Europe and China increased the demand for safe-haven, weighing on the risk perceived EUR/USD pair on Monday. The World Health Organization (WHO) has announced on European countries to curb a new variant of coronavirus that was first detected in the U.K.

The WHO Europe director Hans Kluge has said that coronavirus’s new variant has hit almost 22 European nations, and it was an alarming situation. Many countries have imposed a full national lockdown to stop it from spreading further. However, Hans said that tougher measures were needed to flatten the steep vertical line of rising cases in some countries. These warnings by WHO also raised safe-haven appeal and added losses in the risk-sensitive EUR/USD pair on Monday.

There was no data to be released from the U.S. side on the data front, while from Europe, at 14:30 GMT, the Sentix Investor Confidence dropped to 1.3 against the forecasted 2.0 and weighed on Euro that ultimately added further losses in EUR/USD currency pair. 

On the U.S. front, the recent hike in the greenback was largely a result of higher U.S. Treasury yields that has resulted in a U.S. dollar short squeeze and pushed the greenback to higher levels. The U.S. Dollar Index continued to move higher and has climbed to 90.67, up by 0.67% on the day that added more weight on EUR/USD pair on Monday. 

The greenback was also strong on Monday amid the optimism regarding the prospects of massive stimulus packages from the president-elect Joe Biden. The incoming President has vowed to deliver two major stimulus packages in 2021. He has also said that his first order after joining the office on January 20 will be to increase the number of direct payments to $2000. This has also supported the U.S. dollar and weighed on EUR/USD pair on Monday.

Daily Technical Levels

Support   Resistance

1.2171      1.2215

1.2155      1.2243

1.2127      1.2259

Pivot Point: 1.2199

EUR/USD– Trading Tip

The EUR/USD is obtaining support at the 1.2144 level, and below this, it can dip further until the 1.2100 level. On the higher side, the pair may face resistance at the 1.2216 level. The RSI and MACD support bullish correction and may prompt a bounce off in the EUR/USD pair until the 1.2216 level. Beneath 1.2216, we can again see a dip in EUR/USD. On the hourly timeframe, the EUR/USD pair may find resistance at 1.2170, but the bullish crossover may offer us a quick buy position as the MACD supports the buying trend in the EUR/USD pair today. 

GBP/USD – Daily Analysis

The GBP/USD closed at 1.35100 after placing a high of 1.35679 and a low of 1.34507. The GBP/USD pair lost ground on Monday and dropped to a fresh 2-weeks lowest level amid the broad-based U.S. dollar strength. The pair GBP/USD witnessed some selling for the fourth consecutive session on Monday and extended its retracement slide from 33-months highs. The momentum drew the GBP/USD pair further below as the strong rally in the U.S. Treasury bond yields supported the U.S. dollar. The greenback recovered from nearly three-year lowest level after the treasury yields rally amid the hopes of additional U.S. fiscal stimulus measures. Investors started pricing in the prospects for a more aggressive U.S. fiscal spending in 2021 after the Democratic sweep in the U.S. Senate runoff elections in Georgia.

Meanwhile, the concerns about the surge in new coronavirus cases and the new tougher restrictions in Europe and China to fight against the new variant also weighed on the market sentiment as the safe-haven appeal emerged and contributed to the GBP/USD pair’s decline on Monday.

On Monday, England’s chief medical officer Chris Whitty said that the United Kingdom was enrolling its most challenging weeks since the start of the coronavirus pandemic as hospitals were overrun. He said that the U.K. was now at the worst point of the pandemic, and although they will have the vaccine in the future, the numbers were higher than they were in the previous peak. 

The U.K. has already suffered more deaths due to the new variant than any European nation and recently became the fifth nation on earth to reach the grim milestone of three million cases. Whitty said that there were currently more than 30,000 patients in the hospital than 18,000 during the first peek of the virus in April. Despite the nationwide lockdown, the rising number of coronavirus cases in the U.K. also weighed on the British Pound that ultimately added losses in the GBP/USD pair.

Moreover, the Bank of England policymaker Silvana Tenreyro announced on Monday that skipping British interest rates beneath zero could promote the economy by more than increasing bond purchases. The Bank of England was currently looking at Britain’s financial system’s negative rates’ technical feasibility. She said that she was pushing back against arguments that negative interest rates would be ineffective in boosting demand or would cause significant damage to the bank’s profitability. 

These dovish comments from Tenreyro weighed on British Pound that added losses in the GBP/USD currency pair on Monday.

Daily Technical Levels

Support   Resistance

1.3496      1.3553

1.3475      1.3589

1.3439      1.3611

Pivot Point: 1.3532

GBP/USD– Trading Tip

The GBP/USD has disrupted the sideways trading range of 1.3531- 1.3505 range on the higher side. Closing of candles above this area can trigger buying until the next resistance level of 1.3585 level. On the higher side, the resistance continues to stay at the 1.3605 mark. The 10 & 20 periods moving averages are suggesting odds of bullish trend continuation today. 

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 104.239 after placing a high of 104.396 and a low of 103.848. The currency pair USD/JPY rose for the fourth consecutive session on Monday and reached its highest level since December 10. The gains in USD/JPY were due to the stronger greenback as the U.S. Dollar Index was at weekly highs above 90.50 level on Monday. Wall Street’s main indexes were down on Monday, with Dow Jones down by 0.37% and the NASDAQ by 0.85%. The U.S. Treasury yield on a 10-year note hit the 1.136% level, which was the highest level since the March spike.

The rising treasury yields were due to the rising hopes of additional stimulus measures from the incoming Democratic President Joe Biden. He has promised to deliver two massive stimulus packages to aid the economy through the coronavirus pandemic in 2021. He also has said that his first order after joining the office on January 20 will be to increase the number of stimulus checks to $2000 from $600, which will be given to most Americans affected by the coronavirus pandemic.

Other than that, the USD/JPY pair continued to rise despite the rising risk-off market sentiment in the market. Mainland China saw its most significant daily rise in coronavirus cases in over five months. China’s health authority said on Monday that the new infections in Hebei province surrounding Beijing were continuously rising.

China saw almost 18 new imported infections from overseas, and on Monday, the country in northeastern Heilongjiang province moved into lockdown after reporting new coronavirus infections. These developments in the world’s second-largest economy added weight to risk sentiment that ultimately supported the safe-haven greenback and pushed the USD/JPY pair higher.

Meanwhile, the calls for Trump’s impeachment raised after he encouraged his supporters’ riots on Capitol Hill during the previous week that also kept the market sentiment soar. In Washington, the speaker of House of Representatives, Nancy Pelosi, called for Vice President Mike Pence and the cabinet to remove Donald Trump from office before moving to impeachment. This also helped raised the risk-off market sentiment and supported the USD/JPY pair’s upward momentum.

Furthermore, on Monday, the President and chief executive officer of the Federal Reserve Bank of Atlanta, Raphael Bostic, said that interest rates could rise sooner than anticipated as the economy was recovering more quickly than projected from the coronavirus damage. 

Fed had previously hoped that rates would remain unchanged until at least 2023, whereas Bostic believes that the Fed’s emergency measures to fight the pandemic can start to be rolled back within the next two years, if not sooner. These comments from Bostic supported the U.S. dollar and added gains in the USD/JPY pair. However, the Federal Reserve Chairman Jerome Powell will deliver a speech on Thursday and reaffirm interest rates to stay around zero through at least 2023.

Daily Technical Levels

Support   Resistance

103.90      104.17

103.74      104.26

103.64      104.43

Pivot Point: 104.00

USD/JPY – Trading Tips

On Tuesday, the safe-haven currency pair USD/JPY is trading at 104.123 level, facing resistance at 104.400. On the 4 hour timeframe, the USD/JPY pair implies bullish bias, and as the 10 and 20 EMA are in support of upward trend whereas the MACD stays over 0, suggesting a bullish trend in the safe-haven USD/JPY pair. An upward breakout of the 104.223 level can extend the buying trend until the 104.610 level today. Let’s consider taking the buying trade over the 104.223 level and selling below the same. Good luck! 

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Forex Signals

EUR/USD Downward Channel in Play – Sell Signal Update!

The strength in the U.S. dollar also dragged the EUR/USD pair lower to the 1.2175 level. For the moment, the EUR/USD is gaining support at the 1.2175 level, and below this, it can dip further until the 1.2130 level. On the higher side, the pair may face resistance at the 1.2216 level. The RSI and MACD support bullish correction, and these may cause a bounce off in the EUR/USD pair until the 1.2216 level. Below 1.2216, we can again see a dip in EUR/USD.

The strength in the U.S. dollar also dragged the EUR/USD pair lower to the 1.2175 level. For the moment, the EUR/USD is gaining support at the 1.2175 level, and below this, it can dip further until the 1.2130 level. On the higher side, the pair may face resistance at the 1.2216 level. The RSI and MACD support bullish correction, and these may cause a bounce off in the EUR/USD pair until the 1.2216 level. Below 1.2216, we can again see a dip in EUR/USD.

The strength in the U.S. dollar also dragged the EUR/USD pair lower to the 1.2175 level. For the moment, the EUR/USD is gaining support at the 1.2175 level, and below this, it can dip further until the 1.2130 level. On the higher side, the pair may face resistance at the 1.2216 level. The RSI and MACD support bullish correction, and these may cause a bounce off in the EUR/USD pair until the 1.2216 level. Below 1.2216, we can again see a dip in EUR/USD.


Entry Price – Sell1.21603
Stop Loss – 1.22003
Take Profit – 1.21103
Risk to Reward – 1:1
Profit & Loss Per Standard Lot = -$400/ +$400
Profit & Loss Per Micro Lot = -$40/ +$40
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Forex Signals

AUD/USD Violates Ascending Triangle – Double Bottom Support! 

The AUD/USD closed at 0.77665 after placing a high of 0.77984 and a low of 0.77280. The currency pair AUD/USD remained flat throughout the day on Friday and closed its day at the same level it began its day with as the risk rally pushed the pair higher and the US dollar strength dragged the pair AUD/USD lower at the same time. 

The AUD/USD closed at 0.77665 after placing a high of 0.77984 and a low of 0.77280. The currency pair AUD/USD remained flat throughout the day on Friday and closed its day at the same level it began its day with as the risk rally pushed the pair higher and the US dollar strength dragged the pair AUD/USD lower at the same time. 

The AUD/USD closed at 0.77665 after placing a high of 0.77984 and a low of 0.77280. The currency pair AUD/USD remained flat throughout the day on Friday and closed its day at the same level it began its day with as the risk rally pushed the pair higher and the US dollar strength dragged the pair AUD/USD lower at the same time. 

The risk-sensitive Aussie just went with the flow and boosted by rallying equities and persistent hopes that the economic chaos triggered by the coronavirus pandemic was on its final stage. The risk sentiment in the market was also supported by the latest announcement from the UK on Friday. The UK announced that it’s medical regulatory has approved a third vaccine for coronavirus made by Moderna for emergency use authorization. 

The rising risk sentiment was also supported by the decreasing political risk in Washington related to power transition. The US President Donald Trump has agreed to a transition of power, and this has raised the risk sentiment in the market and supported the upward momentum in AUD/USD pair in the early trading session. However, the AUD/USD pair’s gains were lost in the late trading hours on Friday after the US Dollar became strong across the board. The greenback was high on Friday, with the US Dollar Index above the 90.00 level for the first time this week. The US treasury yields on the 10-year note were also high on Friday, with 3% up for the day and 21% up for the week. All these factors added to the US dollar demand that ultimately weighed on AUD/USD pair and forced the pair to lose its early daily gains.

On the data front, from the US side, at 18:30 GMT, the Average Hourly Earnings for December raised to 0.8% against the predicted 0.2% and supported the US dollar that added further weight to AUD/USD pair. In December, the Non-Farm Employment Change plunged to -140K against the predicted 60K and weighed on the US dollar. During December, the Unemployment Rate plunged to 6.7% against the predicted 6.8% and supported the US dollar that added further AUD/USD pair losses. At 20:00 GMT, the Final Wholesales Inventories for November came in as 0.0% against the predicted -0.1% and weighed on the US dollar.

The AUD/USD pair remained flat throughout Friday amid the mixed market sentiment and left the investors to await the publication of the final reading of November Retail Sales from Australia while China will provide an update on inflation that will also remain under close observation by AUD/USD investors. 

On Thursday, China will release its December Trade Balance that may also impact AUD/USD pair. The US’s CPI data on Wednesday and Retail Sales on Thursday will also affect the AUD/USD pair’s momentum in upcoming days.


Daily Technical Levels

Support Resistance

0.7700 0.7755

0.7679 0.7789

0.7645 0.7811

Pivot point: 0.7734

The AUD/USD pair has bounced off over the 0.7690 level, forming a bullish engulfing candle on the 2-hour timeframe. It may bounce off to trade until the 0.7740 level, where 10 & 20 periods EMA are likely to extend resistance at 0.7740. On the lower side, the AUD/USD may find support at the 0.7690 level. A bearish breakout of 0.7690 level can extend the selling trend until the next support area of 0.765 level today. Good luck! 

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Forex Market Analysis

Daily F.X. Analysis, January 11 – Top Trade Setups In Forex – Stronger Dollar In Play! 

On the news side, the European Sentix Investor Confidence will be in focus, along with speeches from UK MPC Member Tenreyro, and the U.S. FOMC Member Bostic will remain in highlights. The U.S. dollar was also strong on the board, mainly because of the rising U.S. treasury yields that rose more than 3% on the day. The unemployment rate and average hourly earnings data from the U.S. support the greenback. 

On the news side, the European Sentix Investor Confidence will be in focus, along with speeches from UK MPC Member Tenreyro, and the U.S. FOMC Member Bostic will remain in highlights. The U.S. dollar was also strong on the board, mainly because of the rising U.S. treasury yields that rose more than 3% on the day. The unemployment rate and average hourly earnings data from the U.S. support the greenback. 

On the news side, the European Sentix Investor Confidence will be in focus, along with speeches from UK MPC Member Tenreyro, and the U.S. FOMC Member Bostic will remain in highlights. The U.S. dollar was also strong on the board, mainly because of the rising U.S. treasury yields that rose more than 3% on the day. The unemployment rate and average hourly earnings data from the U.S. support the greenback. 

Economic Events to Watch Today  

  

EUR/USD – Daily Analysis

The EUR/USD pair was closed at 1.22122 after placing a high of 1.22844 and a low of 1.21928. The EUR/USD pair dropped on Friday and extended its losses amid the broad-based strength of the U.S. dollar on the day amid the rising U.S. Treasury yields.

The U.S. dollar was also strong on the board, mainly because of the rising U.S. treasury yields that rose more than 3% on the day. The unemployment rate and Average Hourly earnings data from the U.S. also supported the greenback that ultimately added further losses in the currency pair EUR/USD. From the U.S. side, at 18:30 GMT, the Average Hourly Earnings for December rose to 0.8% against the forecasted 0.2% and supported the U.S. dollar and weighed on EUR/USD prices. In December, the Non-Farm Employment Change fell to -140K against the forecasted 60K and weighed on the U.S. dollar and capped further losses in EUR/USD pair. 

During December, the Unemployment Rate fell to 6.7% against the forecasted 6.8% and supported the U.S. dollar that added further EUR/USD pair losses. At 20:00 GMT, the Final Wholesales Inventories for November came in as 0.0% against the forecasted -0.1% and weighed on the U.S. dollar that limited the losses in EUR/USD pair on Friday.

Meanwhile, the fact that Democratic leader and incoming President Joe Biden will have complete control over all three legislative houses included the White House, the House of Representatives, and the Senate, also supported the U.S. dollar as it suggested a stable government ahead. The U.S. President Donald Trump also agreed to an orderly transition of power that also lifted the lingering political risk from the local currency and gave further strength to the U.S. dollar that ultimately added further pressure on the EUR/USD pair on Friday.

Daily Technical Levels

Support   Resistance

1.2228     1.2330

1.2186     1.2388

1.2127     1.2431

Pivot Point: 1.2287

EUR/USD– Trading Tip

The strength in the U.S. dollar also dragged the EUR/USD pair lower to the 1.2175 level. For the moment, the EUR/USD is gaining support at the 1.2175 level, and below this, it can dip further until the 1.2130 level. On the higher side, the pair may face resistance at the 1.2216 level. The RSI and MACD support bullish correction, and these may cause a bounce off in the EUR/USD pair until the 1.2216 level. Below 1.2216, we can again see a dip in EUR/USD.

GBP/USD – Daily Analysis

The GBP/USD pair was closed at 1.35606 after placing a high of 1.36356 and a low of 1.35382. The currency pair GBP/USD remained flat throughout Friday as it showed no movement and closed the day at the same level it started its day with. The pair GBP/USD raised during the early trading session on the day but faced some heavy pressure during the second half of the day and closed the trading week at the same level it started its day on Friday. The rise in the early trading session was caused after the U.K. announced the approval to use its third coronavirus vaccine. However, the downward pressure on the currency pair was caused by the relative strength of the U.S. dollar amid the rising U.S. Treasury yields on the day.

After the coronavirus press conference of the British Prime Minister Boris Johnson on Friday, the PM announced that the army would be brought in to help aid the vaccination rollout. On Friday, Britain’s medical regulatory approved Moderna’s coronavirus vaccine for emergency use. The U.K. also agreed to purchase an additional 10 million doses; however, the Moderna vaccine will not play a part in the first stage of Britain’s vaccine rollout.

The Health Minister of Britain, Matt Hancock, said that about 1.5 million people have already been vaccinated across the U.K. and Moderna’ ‘s vaccine will allow them to accelerate their vaccination program even further once doses become available in spring. These comments from the U.K. added optimism and supported the GBP/USD pair to rise in the early trading session on Friday.

However, the gains in GBP/USD currency pair could not live for long as the pair faced heavy pressure from the U.S. dollar’s strength and the rising number of coronavirus cases and deaths across the U.K. despite vaccine rollout. The U.S. Dollar was strong across the board after the U.S. Treasury yields rose on Friday to more than 3% amid the full sweep victory of Democrats over the Senate. The incoming President Joe Biden is expected to have full control over the White House, Senate, and House of Representatives added in the local currency as the incoming government will have more stability in rules.

In the capital, London’s mayor declared a major incident on Friday and issued a warning that hospitals in the city were close to being overrun. London’s situation was critical with the spread of the virus out of control as the city was declared to be at a crisis point. These developments in the U.K. also added pressure on British Pound and dragged the pair lower on Friday.

Daily Technical Levels

Support   Resistance

1.3496     1.3553

1.3475     1.3589

1.3439     1.3611

Pivot Point: 1.3532

GBP/USD– Trading Tip

The GBP/USD has violated the sideways trading range of 1.3625 – 1.3530 level, and closing of candles below this area can trigger selling until the next support level of 1.3452 level. On the higher side, the resistance continues to stay at the 1.3530 mark. On the hourly timeframe, the GBP/USD pair has violated the descending triangle pattern at the 1.3547 level, and now this level is likely to provide selling in the pair. Violation of the triangle pattern can extend selling bias today.

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 103.951 after placing a high of 104.090 and a low of 103.602. The USD/JPY pair raised on Friday and extended its gains as the U.S. dollar was strong across the board amid the rising U.S. Treasury bond yields. The USD/JPY pair staged an impressive rebound and rose more than 150 pips in two days as the 10-year U.S. Treasury bond yield placed almost 13% gains in these two days. Over the week, the 10-year note U.S. Treasury yield has risen by about 21% and has supported the greenback since then. 

The U.S. dollar’s strength added further gains in the USD/PY pair and extended its upward momentum on Friday to its highest since December 15. The U.S. Dollar Index was also high beyond the 90.00 level for the first time in the week and supported the USD/JPY pair’s rise. Meanwhile, another factor involved in the rising demand for the U.S. dollar was Donald Trump’s comments, who agreed on a smooth transition of power. The political risk related to transition power that rose after Thursday’s attack was lifted and supported the local currency on Friday that eventually helped the USD/JPY pair to rise further n board. It means that the incoming President Joe Biden will have control over all three legislative bodies, the White House, the House of Representatives, and the U.S. Senate, to give his Democratic Party stability in rules. 

Despite all these positive sentiments, the incoming president promised to deliver two massive stimulus packages in 2021, and his first order is expected to increase the direct payment checks to $2000 kept the local currency USD under pressure and capped further upside in the USD/JPY pair. 

On the data front, at 04:30 GMT, the Household Spending from Japan in November raised to 1.1% against the expected -1.0% and supported the Japanese Yen that capped further upside in the USD/JPY pair. At 10:00 GMT, the Leading Indicators from Japan remained flat at 96.6%. 

From the U.S. side, at 18:30 GMT, the Average Hourly Earnings for December advanced to 0.8% against the projected 0.2% and supported the U.S. dollar that pushed the USD/JPY pair higher. In December, the Non-Farm Employment Change decreased to -140K against the projected 60K and weighed on the U.S. dollar. During December, the Unemployment Rate decreased to 6.7% against the projected 6.8% and supported the U.S. dollar that added further gains in the USD/JPY pair. At 20:00 GMT, the Final Wholesales Inventories for November came in as 0.0% against the projected -0.1% and weighed on the U.S. dollar that capped further upside in the USD/JPY pair on Friday. Furthermore, the USD/JPY pair’s upward momentum was also supported by the rising risk sentiment in the market. The risk flows were encouraged after the U.K. approved another vaccine from Moderna on Friday. U.K. became the first country to approve a third coronavirus vaccine for emergency use authorization that lifted the market’s risk sentiment that ultimately added weight on the safe-haven Japanese Yen and pushed the USD/JPY pair even higher on board.

Daily Technical Levels

Support   Resistance

103.18     104.19

102.56     104.58

102.16     105.21

Pivot Point: 103.57

USD/JPY – Trading Tips

The USD/JPY is trading at 104.123 level, facing immediate resistance at 104.223. On the 4 hour timeframe, the USD/JPY pair suggests bullish bias, and as the 10 and 20 periods, EMA is in support of buying trend while the MACD holds above 0, supporting bullish bias in the USD/JPY pair. A bullish breakout of the 104.223 level can extend the buying trend until the 104.610 level today. Let’s consider taking the buying trade over the 104.223 level and selling below the same. Good luck! 

Categories
Forex Signals

AUD/USD Ascending Triangle Pattern – NFP Figures Ahead! 

The AUD/USD pair was closed at 0.77661 after placing a high of 0.78171 and a low of 0.77661. After rising for two consecutive days, the AUD/USD pair dropped on Thursday amid the US dollar’s strength and rising safe-haven demand in the market.

The AUD/USD pair was closed at 0.77661 after placing a high of 0.78171 and a low of 0.77661. After rising for two consecutive days, the AUD/USD pair dropped on Thursday amid the US dollar’s strength and rising safe-haven demand in the market.

The AUD/USD pair was closed at 0.77661 after placing a high of 0.78171 and a low of 0.77661. After rising for two consecutive days, the AUD/USD pair dropped on Thursday amid the US dollar’s strength and rising safe-haven demand in the market.

The US Dollar Index (DXY) recovered from its 2-years lowest level and reached 89.85 and supported the greenback as the US treasury yield on a 10-year note also raised from 1% for the first time since March and supported the rising demand for the US dollar. The strength of the US dollar then added weight to AUD/USD pair on Thursday.

On the data front, at 05:30 GMT, the Building Approvals from November raised to 2.6% against the expected 1.9% and supported the Australian dollar that capped further losses in AUD/USD pair. The Trade Balance from Australia showed a surplus of 5.02B against the expected 6.45B and weighed n Australian dollars that ultimately added the AUD/USD pair’s losses. From the US side, at 17:30 GMT, the Challenger Job Cuts for the year in December increased to 134.5% compared to November’s 45.4%. At 18:30 GMT, the Unemployment Claims from last week fell to 787K against the projections of 798K and supported the US dollar that added further losses in AUD/USD pair. The Trade Balance from November showed a deficit of -68.1B against the projected -66.7B and weighed on the US dollar that capped further downside in AUD/USD pair. At 20:00 GMT, the ISM Services PMI rose in December to 57.2 against the projected 54.5 and supported the US dollar that added further losses in AUD/USD pair.

Meanwhile, the safe-haven demand rose after Donald Trump’s supporters stormed the US capitol in an attack. This was done after the US Congress certified Joe Biden’s victory in the presidential election. This attack resulted in four casualties and raised the safe-haven appeal that ultimately weighed on the risk perceived Australian dollar that added losses in AUD/USD pair.

Furthermore, the FOMC member and President of the Federal Reserve of Atlanta Raphael Bostic said that the US Federal Reserve might reduce its asset purchase program sooner than expected. These hawkish comments gave strength to the US dollar that added more AUD/USD pair losses on Thursday.


Daily Technical Levels

Support Resistance

0.7722 0.7816

0.7676 0.7864

0.7628 0.7910

Pivot Point: 0.7770

The AUD/USD pair trades with a bullish bias at the 0.7782 level, having formed an ascending triangle pattern on the hourly timeframe. On the higher side, the pair is likely to face resistance at a 0.7818 level, along with a support level of 0.7737. The AUD/USD pair may continue trading bullish as 50 periods EMA is extending support to Aussie around 0.7764 level. Good luck! 

 

Categories
Forex Signals

USD/CAD Forms Descending Triangle Pattern – Brace for a Breakout Setup! 

The USD/CAD pair was closed at 1.26879 after placing a high of 1.27334 and a low of 1.26633. The USD/CAD pair rose on Thursday due to a strong rebound of the US dollar and Canada’s negative economic data.

The USD/CAD pair was closed at 1.26879 after placing a high of 1.27334 and a low of 1.26633. The USD/CAD pair rose on Thursday due to a strong rebound of the US dollar and Canada’s negative economic data.

The USD/CAD pair was closed at 1.26879 after placing a high of 1.27334 and a low of 1.26633. The USD/CAD pair rose on Thursday due to a strong rebound of the US dollar and Canada’s negative economic data.

The US Dollar Index that measures the value of the greenback against the basket of six major currencies recovered from the 2-years lowest level and came back to 89.85 level on Thursday after rising for 0.35% and gave strength to the US dollar against its Canadian counterpart that eventually lifted USD/CAD pair on board. Wall Street’s main indexes were also high on Thursday, with Dow Jones gaining about 1.7% and NASDAQ gaining about 2.25% on Thursday.

The US treasury yield on a 10-year note was also raised on Thursday above 1% for the first time since March, which also gave strength to the US dollar and raised the USD/CAD pair. Whereas the Canadian dollar was weak onboard on the day despite trading softer against its US counterpart, the Loonie was also underperforming against most of its G10 peers. 

Markets continued pricing the prospects of much more spending from the US government over the coming months and years under the Democratic leader Joe Biden. This increased the expectations of higher US economic growth and higher inflation, hence why US stocks, nominal US bond yields, and US inflation break-evens were higher on Thursday.

On the data front, at 18:30 GMT, the Trade Balance from Canada for November showed a deficit of -3.3B against the expected -3.6B and supported the Canadian dollar that capped further upside in the USD/CAD pair. At 20:00 GMT, the Ivey PMI from Canada for December declined to 46.7 against the expected 53.1 and weighed on the Canadian dollar, which ultimately added strength to the USD/CAD pair’s bullish momentum.

From the US side, at 17:30 GMT, the Challenger Job Cuts for the year in December advanced to 134.5% compared to November’s 45.4%. At 18:30 GMT, the Unemployment Claims from last week were plunged to 787K against the estimated 798K and supported the US dollar that added gains in USD/CAD pair. The Trade Balance from November showed a deficit of -68.1B against the estimated-66.7B and weighed on the US dollar that capped further upside in the USD/CAD pair. At 20:00 GMT, the ISM Services PMI advanced in December to 57.2 against the estimated 54.5 and supported the US dollar that added further gains in the USD/CAD pair on Thursday.

On the other hand, the WTI crude oil prices surpassed the $51 per barrel on Thursday and gave strength to commodity-linked currency Loonie that lost most of the gains from the USD/CAD pair on Thursday in late trading hours.


Daily Technical Levels

Support Resistance

1.2653 1.2727

1.2621 1.2767

1.2580 1.2800

Pivot Point: 1.2694

The commodity currency pair USD/CAD is trading with a neutral bias at the 1.2692 level, facing immediate resistance at the 1.2742 level. The USD/CAD pair may find resistance at the 1.2742 level on the hourly timeframe, and closing of a candle below this level may trigger selling until the 1.2640 level. The MACD and RSI are suggesting buying trends, along with 50 periods EMA. I will be looking to take a sell trade around the 1.2745 level today. Good luck! 

Categories
Forex Market Analysis

Daily F.X. Analysis, January 08 – Top Trade Setups In Forex – U.S. NFP Figures Ahead! 

The eyes will remain on the U.S. NFP data on the news side, which is expected to report a slight drop from 638K to 500K during the previous month. Besides, the U.S. Average Hourly Earnings m/m and Unemployment Rate will also remain the main highlight of the day, and these may determine the USD trend for today and next week. Let’s wait for the news.

The eyes will remain on the U.S. NFP data on the news side, which is expected to report a slight drop from 638K to 500K during the previous month. Besides, the U.S. Average Hourly Earnings m/m and Unemployment Rate will also remain the main highlight of the day, and these may determine the USD trend for today and next week. Let’s wait for the news.

The eyes will remain on the U.S. NFP data on the news side, which is expected to report a slight drop from 638K to 500K during the previous month. Besides, the U.S. Average Hourly Earnings m/m and Unemployment Rate will also remain the main highlight of the day, and these may determine the USD trend for today and next week. Let’s wait for the news.

Economic Events to Watch Today  

 

EUR/USD – Daily Analysis

The EUR/USD pair was closed at 1.22690 after placing a high of 1.23442 and a low of 1.22449. The EUR/USD pair came under renewed pressure as the U.S. dollar rebounded after an increased 10-year U.S. treasury yield and the depressing economic data from the Eurozone. The U.S. Dollar was strong onboard after falling to the multi-year lowest level this week amid the rising U.S. Treasury yield on a 10-year note that raised by 1% for the first time since March. The rising demand for the greenback ultimately added weight on EUR/USD pair that fell on Thursday.

However, the strong demand for the U.S. dollar is expected not to live for a large time as the Democratic win in the U.S. Senate elections has raised the prospects for a larger stimulus package that will ultimately weigh on the local currency. Meanwhile, the European Central Bank released the regular economic bulletin on Thursday in which it said that the Eurozone economic indicators point to an economic contraction in the final quarter of 2020. 

The ECB said that high-frequency indicators and the latest survey results were consistent with a fall in GDP in the final quarter of 2020. The survey indicators point to a renewed contraction in activity mainly affecting the services sector. The ECB also said that the stat of vaccinations supports expectations for a rapid recovery. Still, it will take time before widespread immunity could be reached and the economy could return to normal. These depressing comments from ECB also added weight on the single currency Euro that added further pressure on EUR/USD pair on Thursday.

On the data front, at 12:00 GMT, the German Factory Orders in November raised to 2.3% against the expectations of -0.6% and supported the single currency Euro that capped further downside in EUR/USD pair. At 15:00 GMT, the CPI Flash Estimate for the year for December declined to -0.3% against the expected -0.2% and weighed on Euro that added losses in EUR/USD pair. The Core CPI Flash Estimate remained flat with expectations of 0.2%. The Italian Prelim CPI also raised to 0.3%against the forecasted 0.2% and supported Euro and capped further downside in EUR/USD pair. The Retail Sales from Eurozone dropped to -6.1% against the forecasted -3.4% and weighed heavily on Euro that added further downside pressure on EUR/USD pair.

The Challenger Job Cuts for the year in December rose to 134.5% compared to November’s 45.4%. At 18:30 GMT, the Unemployment Claims from last week were dropped to 787K against the expected 798K and supported the U.S. dollar that added losses in EUR/USD pair. The Trade Balance from November showed a deficit of -68.1B against the expected -66.7B and weighed on the U.S. dollar that capped further downside in EUR/USD pair. The ISM Services PMI rose in December to 57.2 against the expected 54.5 and supported the U.S. dollar that added further losses in EUR/USD pair on Thursday.

Daily Technical Levels

Support   Resistance

1.2228      1.2330

1.2186      1.2388

1.2127      1.2431

Pivot Point: 1.2287

EUR/USD– Trading Tip

The EUR/USD continues trading with a bullish bias at 1.2367, facing resistance at the 1.2350 level. On the lower side, the support continues to hold around the 1.2278 level. Simultaneously, the bullish breakout of the 1.2350 resistance level can extend buying until the 1.2435 level. The leading indicators such as RSI and MACD support selling, but the EUR/USD 50 periods EMA is likely to support at 1.2289. 

GBP/USD – Daily Analysis

The GBP/USD pair was closed at 1.35641 after placing a high of 1.36330 and a low of 1.35324. The GBP/USD pair extended its losses on Thursday amid the broad-based U.S. dollar recovery amid the rising safe-haven demand and the British Pound’s weakness due to the rising deaths from a new coronavirus variant. Since March, the U.S. Dollar was high on board after the U.S. 10-year Treasury yield rose by more than 1% for the first time. The U.S. Dollar Index that measures the value of the greenback against the basket of six major currencies also recovered from the multi-year lowest level and supported the U.S. dollar that ultimately added weight on the GBP/USD pair on Thursday.

Moreover, the U.S. dollar gains were limited as the pressure of prospects of a larger stimulus package in 2021 from the Democratic government held the local currency down. The Democratic win in the U.S. Senate elections raised the anticipations that President-elect Joe Biden will stand true to His promises for delivering two major stimulus packages in 2021. 

However, the losses in the GBP/USD pair could also be attributed to the rising number of deaths in the U.K. from the new UK coronavirus variant. The U.K. reported a further 1041 fatalities due to coronavirus, which is the highest daily death toll since April. 

On Thursday, about 62,322 new coronavirus cases were recorded, which was also the highest daily rise since mass testing began. The rising spread of coronavirus due to its new variant and the increased number of deaths despite the nationwide lockdown and vaccine rollout raised fears for the newly independent nation Great Britain’s economy that ultimately weighed on the local currency Sterling and dragged the currency pair GBP/USD on the downside.

Furthermore, the World Health Organization (WHO) called on European countries to intensify coronavirus measures as the region deals with the new UK-detected variant. On Thursday, the WHO Europe director Hans Kluge said that further measures were needed to flatten the steep vertical line of rising cases in some countries. Moreover, the French Prime Minister Jean Castex said that France’s border with the U.K. will remain shut and that it was out of the question to lower their guard in weeks to come. These statements also weighed on British Pound and affected the GBP/USD pair’s movement on Thursday.

The Construction PMI for December from Great Britain came in line with the expectations of 54.6. At 14:32 GMT, the Housing Equity Withdrawal for the quarter also remained flat with the expectations of -7.0B. The Challenger Job Cuts for the year in December surged to 134.5% compared to November’s 45.4%. At 18:30 GMT, the Unemployment Claims from last week fell to 787K against the projected 798K and supported the U.S. dollar that added losses in GBP/USD pair. The Trade Balance from November showed a deficit of -68.1B against the projected -66.7B and weighed on the U.S. dollar that capped further downside in GBP/USD pair. The ISM Services PMI surged in December to 57.2 against the projected 54.5 and supported the U.S. dollar that added further GBP/USD pair losses on Thursday.

The GBP/USD pair’s losses were limited as the U.K. government was trying to increase the vaccination supply to control coronavirus spread. The health minister Matt Hancock has said on Thursday that the Britain government was working with both Pfizer and AstraZeneca to increase supplies as the pace of Britain’s rollout of coronavirus vaccines was being limited by the supply of shots. He said that the government must quickly ramp up the rate of vaccinations to meet an ambitious target to protect more than 13 million people who were elderly, vulnerable, or frontline workers by mid-February. 

Daily Technical Levels

Support   Resistance

1.3518      1.3620

1.3474      1.3678

1.3416      1.3722

Pivot Point: 1.3576

GBP/USD– Trading Tip

The GBP/USD pair continues to consolidate in a narrow trading range of 1.3625 – 1.3556. The Sterling may face immediate resistance at the 1.3625 level, and the continuation of an upward trend can lead the Cable towards the 1.3700 resistance level. On the lower side, the breakout of 1.3545 support can extend the selling trend until the 1.3468 level.

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 103.824 after placing a high of 103.955 and a low of 102.948. The USD/JPY pair rose to its highest level since mid-December on Thursday amid the broad-based strength of the U.S. dollar. The USD/JPY pair’s bullish momentum was supported by the stronger U.S. dollar driven by the rising 10-year U.S. Treasury yields. The U.S. 10-year Treasury yields rose to 1.085% on Thursday that was the highest level since March. On Wall Street, the main indexes were also at record highs as Dow Jones gained about 1.7% and NASDAQ gained about 2.25% on Thursday.

The rising risk sentiment because of the rally in the stock market and the U.S. treasury yield, along with the rising crude oil prices, added weight on the safe-haven Japanese Yen that ultimately pushed the currency pair USD/JPY higher onboard to 4 weeks highest level. The U.S. Dollar Index was also up from the multi-year lowest level on Thursday and moved near 89.85 and was up 0.35% for the day. The rising demand for the greenback pushed the currency pair USD/JPY higher on the board.

However, the U.S. dollar demand is expected not to live for a longer period as the Democratic win in U.S. Senate elections has raised the prospects for a larger stimulus package. Joe Biden, who will begin his term from January 20th, has promised to deliver about two large stimulus measures this year, ultimately hurting local currency.

On the data front, at 04:30 GMT, the Average Cash Earnings for the year from Japan dropped to -2.2% against the projection of -0.9% and weighed on the Japanese Yen that ultimately added further gains in the USD/JPY pair. From the U.S. side, at 17:30 GMT, the Challenger Job Cuts for the year in December increased to 134.5% compared to November’s 45.4%. At 18:30 GMT, the Unemployment Claims from last week were decreased to 787K against the anticipated 798K and supported the U.S. dollar that added further gains in the USD/JPY pair. The Trade Balance from November showed a deficit of -68.1B against the anticipated -66.7B and weighed on the U.S. dollar that capped further upside in the USD/JPY pair. At 20:00 GMT, the ISM Services PMI increased in December to 57.2 against the forecasted 54.5 and supported the U.S. dollar that added further gains in the USD/JPY pair.

Meanwhile, on Thursday, the Federal Reserve released its FOMC December meeting minutes that revealed that the Federal Reserve officials consistently backed, holding the pace of asset purchases stable, while some were open to future adjustments if needed. Minutes also revealed that all participants judged that it would be appropriate to continue those purchases at least at the current pace. Nearly all members favored keeping the current arrangement of purchases. The Federal Open Market Committee kept interest rates near zero. It supported its commitment to bond-buying at the meeting after vowing to maintain a $120 billion monthly pace of purchases until there will be considered further progress towards inflation goals and employment. The FOMC meeting minutes also supported the local currency U.S. dollar and added further upside in the USD/JPY pair on Thursday.

Daily Technical Levels

Support   Resistance

103.18     104.19

102.56     104.58

102.16     105.21

Pivot Point: 103.57

USD/JPY – Trading Tips

The USD/JPY consolidates below 103.950 level, after bouncing off above 103.528 support level. A bullish breakout of 103.950 can lead the USD/JPY pair to the 104.322 level. The 50 periods EMA is expected to keep the USD/JPY support at 103.355, which is very far from the current market price; thus, we can also expect some bearish correction. The market may show further movements upon the release of U.S. NFP figures today. Good luck! 

Categories
Forex Signals

USD/CAD Downward Trendline to Provide Resistance – Sell Trade in Play! 

The USD/CAD pair was closed at 1.26766 after placing a high of 1.27234 and a low of 1.26297. Despite the continuous rise in crude oil prices, the USD/CAD pair posted gains on Wednesday amid the rebound in US dollar prices. After the two-day OPEC+ meeting, Saudi Arabia announced that they would be voluntarily cutting their output in February and March that will amount to 1 million barrels per day. West Texas Intermediate (WTI) ‘s barrel gained more than 5% and preserved its bullish momentum on Wednesday. The Crude oil prices reached $50.9 per barrel on Wednesday to their highest level in more than ten months and gave strength to commodity-linked Loonie that capped further upside in the currency pair USD/CAD pair.

The USD/CAD pair was closed at 1.26766 after placing a high of 1.27234 and a low of 1.26297. Despite the continuous rise in crude oil prices, the USD/CAD pair posted gains on Wednesday amid the rebound in US dollar prices. After the two-day OPEC+ meeting, Saudi Arabia announced that they would be voluntarily cutting their output in February and March that will amount to 1 million barrels per day. West Texas Intermediate (WTI) ‘s barrel gained more than 5% and preserved its bullish momentum on Wednesday. The Crude oil prices reached $50.9 per barrel on Wednesday to their highest level in more than ten months and gave strength to commodity-linked Loonie that capped further upside in the currency pair USD/CAD pair.

The USD/CAD pair was closed at 1.26766 after placing a high of 1.27234 and a low of 1.26297. Despite the continuous rise in crude oil prices, the USD/CAD pair posted gains on Wednesday amid the rebound in US dollar prices. After the two-day OPEC+ meeting, Saudi Arabia announced that they would be voluntarily cutting their output in February and March that will amount to 1 million barrels per day. West Texas Intermediate (WTI) ‘s barrel gained more than 5% and preserved its bullish momentum on Wednesday. The Crude oil prices reached $50.9 per barrel on Wednesday to their highest level in more than ten months and gave strength to commodity-linked Loonie that capped further upside in the currency pair USD/CAD pair.

The US Dollar recovered on Wednesday across the board amid the rising US treasury yields followed by the prospects of a Democratic win in US Senate elections. The US Treasury yield on a 10-year note raised more than 1% on Wednesday to its highest level since March and supported the recovery in the US dollar that ultimately added gains in the USD/CAD pair.

On the data front, From the US side, at 18:15 GMT, the ADP Non-Farm Employment Change for December plunged to -123K against the estimated 60K and weighed on the US dollar and capped further gains in the USD/CAD pair. At 19:45 GMT, the Final Services PMI for December also plunged to 54.8 against the estimated 55.2 and weighed on the US dollar that limited the upward momentum in the USD/CAD pair. At 20:00 GMT, the Factory Orders for November advanced to 1.0% against the estimated 0.7% and supported the US dollar that added further gains in the USD/CAD pair on Wednesday.

Meanwhile, the USD/CAD pair’s gains remained consolidated as the US dollar came under pressure after the prospects of a Democratic win in the US Senate elections increased. Wining the two seats in Senate by Democrats will give them control over both chambers of Congress that means they could get their agenda passed with the majority. The market participants kept betting over the prospects of larger stimulus measure after the victory of Democrats in runoff elections in Georgia and kept the US dollar under pressure that limited the gains in the USD/CAD pair on Wednesday. Market participants now await the release of meeting minutes from FOMC and the NFP report from the US that will release on Friday and Canada’s labor data.


Daily Technical Levels

Support Resistance

1.2619 1.2758

1.2568 1.2844

1.2481 1.2896

Pivot Point: 1.2706

The USD/CAD pair is trading with a bullish bias at the 1.2725 level, facing immediate resistance at the 1.2742 level. The USD/CAD pair may find resistance at the 1.2742 level on the hourly timeframe, and closing of a candle below this level may trigger selling until the 1.2640 level. The MACD and RSI are suggesting buying trends, along with 50 periods EMA. I will be looking to take a sell trade around the 1.2745 level today. Good luck! 

 

Categories
Forex Signals

AUD/USD Breaks Below Upward Channel – Quick Update on Sell Singal! 

The AUD/USD pair was closed at 0.78063 after placing a high of 0.78199 and a low of 0.77329. The AUD/USD pair continued its bullish momentum on Wednesday and extended its gains amid the anticipated Democratic win in the US Senate runoff elections in Georgia. 

The AUD/USD pair was closed at 0.78063 after placing a high of 0.78199 and a low of 0.77329. The AUD/USD pair continued its bullish momentum on Wednesday and extended its gains amid the anticipated Democratic win in the US Senate runoff elections in Georgia. 

The AUD/USD pair was closed at 0.78063 after placing a high of 0.78199 and a low of 0.77329. The AUD/USD pair continued its bullish momentum on Wednesday and extended its gains amid the anticipated Democratic win in the US Senate runoff elections in Georgia. 

The rally on Wall Street, surging oil prices, and news Australians could receive the coronavirus vaccination as early as February saw local shares up on Wednesday. The risk sentiment was supported by the mentioned factors and supported the risk-sensitive Australian dollar that ultimately added the AUD/USD pair’s upward momentum.

The prospects of a Democratic win in the US Senate elections and the Australian Government announcement that it would begin vaccinating people against coronavirus from next month added to the risk rally that ultimately supported the AUD.USD prices on Wednesday.

The two main Indexes of Wall Street, Dow Jones, and NASDAQ, rose on Wednesday by 1.55% and 0.51%, respectively, and pushed the market’s risk sentiment higher than supported the risk-sensitive AUD/USD pair’s upward momentum. Furthermore, the risk sentiment was also supported by the rising prices of crude oil on Wednesday amid the Saudi government announcement of increasing the output cut in February and March. It also supported the risk perceived by Aussie and added further in its bullish movement for the day.

On the data front, From the US side, at 18:15 GMT, the ADP Non-Farm Employment Change for December dropped to -123K against the predicted 60K and weighed on the US dollar that added further gains in AUD/USD pair. At 19:45 GMT, the Final Services PMI for December also declined to 54.8 against the predicted 55.2 and weighed on the US dollar that pushed the pair AUD.USD is higher on board. At 20:00 GMT, the Factory Orders for November rose to 1.0% against the predicted 0.7% and supported the US dollar that capped further gains in AUD/USD pair on Wednesday.


Daily Technical Levels

Support Resistance

0.7688 0.7806

0.7615 0.7851

0.7570 0.7924

Pivot Point: 0.7733

The AUD/USD pair has violated the upward channel at the 0.7780 level, and violation of this level has triggered a selling trend until the 0.7738 level. Our position is already in profit; we need to move our stop loss into the breakeven level. Check out a trade idea below. 

Entry Price – Sell 0.77578

Stop Loss – 0.77978

Take Profit – 0.77178

Risk to Reward – 1:1

Profit & Loss Per Standard Lot = -$400/ +$400

Profit & Loss Per Micro Lot = -$40/ +$40

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Andriod Users: https://play.google.com/store/apps/details?id=academy.forex.thesignal&hl=en_US

 

Categories
Forex Market Analysis

Daily FX Analysis, January 07 – Top Trade Setups In Forex – Eyes on Series of US and European Events! 

It’s going to be a busy day from the news front, as the market will be focusing on the German Factory Orders m/m, ECB Economic Bulletin, Retail Sales, and CPI figures from the Eurozone economy that can drive price action in the Euro pairs during the UK session. On the other hand, the dollar’s movement can be influenced by Unemployment Claims and ISM Services PMI scheduled to be released during the US session.

It’s going to be a busy day from the news front, as the market will be focusing on the German Factory Orders m/m, ECB Economic Bulletin, Retail Sales, and CPI figures from the Eurozone economy that can drive price action in the Euro pairs during the UK session. On the other hand, the dollar’s movement can be influenced by Unemployment Claims and ISM Services PMI scheduled to be released during the US session.

It’s going to be a busy day from the news front, as the market will be focusing on the German Factory Orders m/m, ECB Economic Bulletin, Retail Sales, and CPI figures from the Eurozone economy that can drive price action in the Euro pairs during the UK session. On the other hand, the dollar’s movement can be influenced by Unemployment Claims and ISM Services PMI scheduled to be released during the US session.

Economic Events to Watch Today  

 

EUR/USD – Daily Analysis

The EUR/USD pair was closed at 1.23259 after placing a high of 1.23492 and a low of 1.22653. The depressed US dollar after the signs of a Democratic win in the US Senate runoff elections and the rebounded risk-on market sentiment helped EUR/USD pair to post gains on Wednesday.
The markets anticipated a Democratic win in the US Senate election in Georgia that would evacuate the track for a bigger fiscal stimulus package; the greenback came under pressure. Democrats won one US Senate race in Georgia and led in another on Wednesday, moving closer to a sweep in a Deep South state. The result will be announced on late Wednesday, and winning both seats by Democrats will give Congress control to power the President-elect Joe Biden’s policy goals.

Biden has said that he wanted two fiscal stimulus packages in 2021 to support his economy through the pandemic. His first order is expected to increase the stimulus paychecks amount to $2000 rejected by Republicans. These hopes kept the US dollar under pressure and supported the upward momentum in the EUR//USD pair.

On the data front, at 10:00 GMT, the German Prelim CPI for December dropped to 0.5% against the expected 0.6% and weighed on Euro and capped further upside in EUR/USD pair. At 12:45 GMT, the French Prelim CPI for December also dropped to 0.2% against the forecasted 0.4% and weighed on Euro. At 13:15 GMT, the Spanish Services PMI for December raised to 48.0 against the expected 44.5 and supported the single currency Euro and added further EUR/USD pair gains. At 13:45 GMT, the Italian Services PMI for December declined to 39.7 against the estimated 45.0 and weighed on the single currency Euro.

At 13:50 GMT, the French Final Services PMI came in line with the expectations of 49.1. At 13:55 GMT, the German Final Services PMI dropped to 47.0 against the anticipated 47.7 and weighed on Euro and capped further upside in EUR/USD pair. At 14:00 GMT, the Final Services PMI from Europe also fell to 46.4 against the forecasted 47.4 and weighed on Euro. At 15:00 GMT, the PPI for November from the Euro area raised to 0.4% against the expected 0.2% and supported Euro and gave strength to the EUR/USD pair’s rising prices.

From the US side, at 18:15 GMT, the ADP Non-Farm Employment Change for December declined to -123K against the forecasted 60K and weighed on the US dollar that gave further gains to EUR/USD pair. At 19:45 GMT, the Final Services PMI for December also declined to 54.8 against the forecasted 55.2 and weighed on the US dollar and helped EUR/USD to rise further. At 20:00 GMT, the Factory Orders for November rose to 1.0% against the forecasted 0.7%, supported the US dollar, and capped further gains in EUR/USD pair.

Meanwhile, the market’s risk sentiment was improved after the resurgence in global manufacturing as shown in various surveys this week despite the rising coronavirus cases, which also gave strength to the risk perceived EUR/USD pair on Wednesday.


Daily Technical Levels

Support   Resistance

1.2257      1.2318

1.2220      1.2344

1.2195      1.2380

Pivot point: 1.2282

EUR/USD– Trading Tip

The EUR/USD continues trading with a bullish bias at 1.2367, facing resistance at the 1.2350 level. On the lower side, the support continues to hold around the 1.2278 level. Simultaneously, the bullish breakout of the 1.2350 resistance level can extend buying until the 1.2435 level. The leading indicators such as RSI and MACD support selling, but the EUR/USD 50 periods EMA is likely to support at 1.2289. 

GBP/USD – Daily Analysis

The GBP/USD pair was closed at 1.36075 after placing a high of 1.36711 and a low of 1.35380. The currency pair came under pressure on Wednesday amid the rising number of coronavirus cases in the UK, depressing comments from Andrew Bailey, and the poor macroeconomic data from Great Britain.

The UK has more new coronavirus cases per capita than any other major country globally as the number of daily cases topped 60,000 for the first time this week. The latest data suggested that around one in 50 people in the UK currently have the virus. Only the US has a per capita infection rate nearly equivalent to the UK of any country with more than 1 million cases.

Since December 06, the average number of new daily cases has risen from around 15,000 to above 55,000. PM Boris Johnson said on Tuesday that about 1.3 M people have so far received a coronavirus vaccination. The rising number of coronavirus made the UK the worst-hit country in Europe in terms of cumulative cases and weighed on its local currency British Pound, which ultimately added weight to the GBP/USD pair.

Meanwhile, on Wednesday, the Governor of Bank of England Andrew Bailey risked reigniting the politically charged debate over Brexit by predicting that the trade deal struck with the European Union could end up costing the UK economy the equivalent of more than 80 billion pounds.
During his first public comments since Britain completed its withdrawal from the bloc on December 31, Bailey endorsed warnings from the Office for Budget Responsibility, the fiscal watchdog, that gross domestic product will be as much as 4% lower in the long term than it would be had the country remained in the EU.

These comments from the Bank of England governor right after the Brexit completion raised fears and added weight on Sterling that eventually dragged the GBP/USD currency pair on the downside. On the data front, at 14:30 GMT, the Final Services PMI from Great Britain for December dropped to 49.4 against the expected 499 and weighed on British Pound and added more losses on the currency pair GBP/USD.

From the US side, at 18:15 GMT, the ADP Non-Farm Employment Change for December fell to -123K against the anticipated 60K and weighed on the US dollar and capped further losses in GBP/USD pair. At 19:45 GMT, the Final Services PMI for December also fell to 54.8 against the anticipated 55.2 and weighed on the US dollar. At 20:00 GMT, the Factory Orders for November surged to 1.0% against the anticipated 0.7% and supported the US dollar that added further GBP/USD pair losses.

However, the GBP/USD pair’s losses were somewhat recovered in the late trading session over the positive sentiment that was mostly driven by the rising expectation that the Democrats will win both seats in Georgia’s Senate runoff. A clean sweep for the Democrats would hand charge of both houses of Congress to the incoming administration that would pave the way for Joe Biden to push through more stimulus. This left the US dollar under pressure and supported the GBP/USD pair in late trading hours.


Daily Technical Levels

Support   Resistance

1.3572      1.3660

1.3518     1.3696 

1.3483      1.3749

Pivot Point: 1.3607

GBP/USD– Trading Tip

The GBP/USD pair continues to consolidate in a narrow trading range of 1.3625 – 1.3556. The Sterling may face immediate resistance at the 1.3625 level, and the continuation of an upward trend can lead the Cable towards the 1.3700 resistance level. On the lower side, the breakout of 1.3545 support can extend the selling trend until the 1.3468 level.

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 103.049 after placing a high of 103.442 and a low of 102.590. The higher US yields and the market’s risk appetite boosted the USD/JPY prices on Wednesday. Since March, the currency pair bounced from the lowest levels, near 102.50, and peaked at 103.43, a one-week high.

The main driver of the pair USD/JPY remained the US yields followed by the elections to decide the US Senate’s composition. The 10-year yield reached 1.05%, its highest since March, and supported the US dollar that ultimately pushed the USD/JPY pair higher on board. The market sentiment was not affected by the weaker than expected US economic data as the Dow Jones was at record highs, up by 1.55%, and the NASDAQ gained 0.51%.

Markets were pricing the prospects of a Democratic win in the US Senate runoff elections in Georgia. The Democrats already have the House of Representatives, aka lower chamber of Congress, in their control. Winning the Senate elections will also give them control over the upper chamber that means they will have a complete majority in the US legislative assembly and the power to push forward their agenda.

The term of Joe Biden will begin on January 20. He has hinted that he wanted at least two stimulus packages in 2021 to overcome the damage caused and expected to continue from the coronavirus pandemic. Markets were also pricing their bets on the prospects of Biden’s first order that is expected to push out $2000 checks to most Americans that had been strictly opposed by the Republicans.

On the data front, at 10:00 GMT, the Consumer Confidence from Japan for December dropped to 31.8against the anticipated 32.6 and weighed on the Japanese Yen that added more gains in the USD/JPY pair.
From the US side, at 18:15 GMT, the ADP Non-Farm Employment Change for December decreased to -123K against the projected 60K and weighed on the US dollar that capped further gains in the USD/JPY pair. At 19:45 GMT, the Final Services PMI for December also decreased to 54.8 against the projected 55.2 and weighed on the US dollar that limited additional USD/JPY pair gains. At 20:00 GMT, the Factory Orders for November increased to 1.0% against the projected 0.7% and supported the US dollar that added further gains in the USD/JPY pair.

Furthermore, some of the USD/JPY pair’s gains were lost in late trading hours of Wednesday as the rising number of coronavirus cases kept the global economic recovery under pressure and safe-haven demand intact. On Wednesday, Japan’s number of coronavirus cases reached its highest level as the government faced mounting pressure from health experts to impose a strict state of emergency for Tokyo.

In Portugal, about 10,027 new cases on Wednesday were reported, which was the highest since the pandemic started. Ontario reported 3266 new coronavirus cases that brought the total number of coronavirus in the region to 200,626. All these fears kept the safe-haven Japanese yen supportive that ultimately weighed on the USD/JPY pair and lost most of its gains for the day on Wednesday.


Daily Technical Levels

Support   Resistance

102.49      103.08

102.24      103.44

101.89      103.68

Pivot Point: 102.84

USD/JPY – Trading Tips

The USD/JPY bounced off to violate the resistance level of 102.960 level, and now it’s working as a support for the USD/JPY pair. The pair may find resistance at the 103.430 level. Overall, the bullish bias seems strong as the USD/JPY pair has crossed over 50 EMA at the 103.063 level. Taking a look at the 2-hour timeframe, the USD/JPY has closed a bullish engulfing candle over 102.962 level that can drive the further bullish trend in the USD/JPY pair. Let’s consider taking a buy trade over the 102.960 level today. Good luck!

Categories
Forex Signals

AUD/USD Plunges to Complete Retracement – Quick Trade Plan! 

The AUD/USD pair was closed at 0.77604 after placing a high of 0.7773 and a low of 0.76607. Despite the positive macroeconomic data from the US and the rising demand for safe-haven, the currency pair AUD/USD rose higher onboard amid the US dollar’s weakness. The greenback weakened after the beginning of the American session, and the US Dollar Index fell to its two-year lowest level at 89.44 on Tuesday ahead of the Georgia runoff election’s result. The Senate election will decide who will control the upper chamber of the US Congress. The incoming Democratic President, Joe Biden, will need the two seats to control the US Senate. The Republican Party has been controlling the US Senate since 2014, and if the Democratic Party wins this election, it would be beneficial for them.

The AUD/USD pair was closed at 0.77604 after placing a high of 0.7773 and a low of 0.76607. Despite the positive macroeconomic data from the US and the rising demand for safe-haven, the currency pair AUD/USD rose higher onboard amid the US dollar’s weakness. The greenback weakened after the beginning of the American session, and the US Dollar Index fell to its two-year lowest level at 89.44 on Tuesday ahead of the Georgia runoff election’s result. The Senate election will decide who will control the upper chamber of the US Congress. The incoming Democratic President, Joe Biden, will need the two seats to control the US Senate. The Republican Party has been controlling the US Senate since 2014, and if the Democratic Party wins this election, it would be beneficial for them.

The AUD/USD pair was closed at 0.77604 after placing a high of 0.7773 and a low of 0.76607. Despite the positive macroeconomic data from the US and the rising demand for safe-haven, the currency pair AUD/USD rose higher onboard amid the US dollar’s weakness. The greenback weakened after the beginning of the American session, and the US Dollar Index fell to its two-year lowest level at 89.44 on Tuesday ahead of the Georgia runoff election’s result. The Senate election will decide who will control the upper chamber of the US Congress. The incoming Democratic President, Joe Biden, will need the two seats to control the US Senate. The Republican Party has been controlling the US Senate since 2014, and if the Democratic Party wins this election, it would be beneficial for them.

On the data front, at 05:30 GMT, the ANZ Job Advertisements for December dropped to 9.2% against November’s 13.5% and weighed on the Australian Dollar that ultimately capped further gains in AUD/USD pair on Tuesday. From the US side, at 20:00 GMT, the ISM Manufacturing PMI from December rose to 60.7 against the anticipated 56.6 and supported the US dollar, and capped further gains in AUD/USD pair. The ISM Manufacturing Prices also surged to 77.6 against the predicted 66.0 and supported the US dollar that limited further AUD/USD pair gains. The Wards Total Vehicle Sales raised to 16.3M against the estimated 15.8M and supported the US dollar, ultimately limiting further gains in AUD/USD pair.

Meanwhile, the market’s risk appetite was declined as the number of coronavirus cases was increasing day by day throughout the globe. Since the pandemic started has reached 21M, the US count of total coronavirus cases is equal to the count of the next three countries, India, Russia, and Brazil. The UK also reported more than 60,000 cases in a single day on Tuesday that was the highest since the pandemic started, and imposed new tougher restrictions throughout the country. Moreover, Germany also extended its lockdown till the end of the month to control the rising number of coronavirus cases. All these developments added in the safe-haven appeal and weighed on the risk-sensitive Australian Dollar that failed to reverse the AUD/USD pair’s bullish movement on Tuesday.


Daily Technical Levels

Support Resistance

0.7688 0.7806

0.7615 0.7851

0.7570 0.7924

Pivot Point: 0.7733

The AUD/USD faced resistance at 0.7811 level and has dropped now to trade at 0.7776 level. On the lower side, the pair may find support at the 0.7738 level today. The MACD and RSI support bullish bias, while the 50 periods EMA is likely to extend support at the 0.7685 level. On the higher side, bullish breakout of 0.7811 level can trigger buying trade until 0.7864 level today. I will be looking to take a buy trade over the 0.7738 level today. Good luck! 

Categories
Forex Signals

USD/CAD Descending Triangle in Play – Quick Trade Idea! 

The USD/CAD pair was closed at 1.26689 after placing a high of 1.27909 and a low of 1.26556. The currency pair USD/CAD fell to its lowest since 2018 April on rising crude oil prices and the US dollar weakness. Despite Canada’s negative economic data and positive data from the US side, the currency pair USD/CAD still moved in the downward direction on Tuesday as investors’ focus was shifted on the OPEC meeting and Georgia’s runoff elections.

The USD/CAD pair was closed at 1.26689 after placing a high of 1.27909 and a low of 1.26556. The currency pair USD/CAD fell to its lowest since 2018 April on rising crude oil prices and the US dollar weakness. Despite Canada’s negative economic data and positive data from the US side, the currency pair USD/CAD still moved in the downward direction on Tuesday as investors’ focus was shifted on the OPEC meeting and Georgia’s runoff elections.

The USD/CAD pair was closed at 1.26689 after placing a high of 1.27909 and a low of 1.26556. The currency pair USD/CAD fell to its lowest since 2018 April on rising crude oil prices and the US dollar weakness. Despite Canada’s negative economic data and positive data from the US side, the currency pair USD/CAD still moved in the downward direction on Tuesday as investors’ focus was shifted on the OPEC meeting and Georgia’s runoff elections.

On the data front, at 18:30 GMT, the IPPI for November from Canada dropped to -0.6% against the expected -0.2% and weighed on the Canadian dollar that capped further losses in the USD/CAD pair. The RMPI for November also dropped to 0.6% against the expected 0.9% and weighed on the Canadian dollar that capped further losses in the USD/CAD pair on Tuesday. From the US side, at 20:00 GMT, the ISM Manufacturing PMI from December surged to 60.7 against the predicted 56.6 and supported the US dollar, and capped further losses in the USD/CAD pair. The ISM Manufacturing Prices also rose to 77.6 against the expected 66.0 and supported the US dollar that limited further losses in the USD/CAD pair. The Wards Total Vehicle Sales rose to 16.3M against the anticipated 15.8M and supported the US dollar that ultimately limited further losses in the USD/CAD pair.

The West Texas Intermediate (WTI) crude oil prices rose above $50 per barrel on Tuesday as Russia and the Organization of Petroleum Exporting Countries remained deadlocked over how much oil to produce from February. Russia and its neighbor Kazakhstan were both pressuring for the scheduled output increase of 500,000 barrels a day to come into effect, while OPEC, with what appears to be total unanimity, wanted to kept output at its present level due to short-term weakness in demand caused by the latest surge in coronavirus and imposed lockdowns in various countries.

The rising prices of crude oil gave strength to the commodity-linked currency Loonie and added weight on the currency pair USD/CAD. Meanwhile, Georgia’s runoff elections that will decide the US Senate’s future also kept the US dollar under pressure on Tuesday. The result of the elections is expected to announce on Wednesday, and investors were cautious ahead of it, and the selling pressure surrounding the greenback increased that ultimately weighed on the USD/CAD pair.


Daily Technical Levels

Support Resistance

1.2619 1.2758

1.2568 1.2844

1.2481 1.2896

Pivot Point: 1.2706

The USD/CAD’s technical side is trading at 1.2690, disrupting the support area of 1.2725 level, which is now working as a resistance for the USD/CAD pair. On the lower side, the support stays at the 1.2647 level, and a bearish breakout of this level can extend selling trend until 1.2591. Let’s wait for opening a sell trade below the 1.2725 level today. Good luck! 

 

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Forex Market Analysis

Daily F.X. Analysis, January 06 – Top Trade Setups In Forex – ADP Non-Farm Employment Change Ahead! 

On the news front, eyes will remain on the Services PMI figures from the Eurozone, U.K., and the United States. Almost all economic figures are expected to perform better than previous months, perhaps due to a lockdown lift. Price action will depend upon any surprise changes in the PMI figures. Later today, the U.S. ADP figures will also drive some volatility in the market.

On the news front, eyes will remain on the Services PMI figures from the Eurozone, U.K., and the United States. Almost all economic figures are expected to perform better than previous months, perhaps due to a lockdown lift. Price action will depend upon any surprise changes in the PMI figures. Later today, the U.S. ADP figures will also drive some volatility in the market.

On the news front, eyes will remain on the Services PMI figures from the Eurozone, U.K., and the United States. Almost all economic figures are expected to perform better than previous months, perhaps due to a lockdown lift. Price action will depend upon any surprise changes in the PMI figures. Later today, the U.S. ADP figures will also drive some volatility in the market.

Economic Events to Watch Today  

EUR/USD – Daily Analysis

The EUR/USD pair was closed at 1.22984 after placing a high of 1.23055 and a low of 1.22419. The renewed U.S. dollar weakness and the prospects for a Democratic majority in the Senate after the runoff election in Georgia boosted the market sentiment that supported the upward trend in EUR/USD pair on Tuesday.

The U.S. Dollar Index that gauges the greenback’s value against the basket of six major currencies fell by almost 0.38% on Tuesday to an 89.53 level that ultimately added gains in EUR/USD pair. The U.S. Dollar was also under stress on Tuesday amid the US Georgia runoff elections that would decide the future of the U.S. Senate. The outcome will be crucial for incoming president Joe Biden as the Senate majority helps pass the law and confirm the cabinet appointments. The result is expected on Wednesday. It has made investors cautious about placing any strong bids in favor of the U.S. dollar, resulting in the upward momentum of EUR/USD.

On the data front, at 12:00 GMT, the German Retail Sales for November raised to 1.9% against the expected -2.0% and supported the single currency Euro and added further gains in EUR/USD pair. At 13:00 GMT, the Spanish Unemployment Change in December raised to 36.8K against the expected 30.5K and weighed on the single currency Euro that capped further EUR/USD pair gains. At 13:55 GMT, the German Unemployment Change for December declined to-37K against the expected 10K and supported the single currency Euro that added further EUR/USD pair gains. At 14:00 GMT, the M3 Money Supply for the year from Eurozone raised to 11.0% against the forecasted 10.6% and supported the single currency Euro that added additional EUR/USD pair gains. The Private Loans for the year from Eurozone dropped to 3.1% from the expected 3.3% and weighed on Euro that further capped gains in EUR/USD pair.

From the U.S. side, at 20:00 GMT, the ISM Manufacturing PMI from December rose to 60.7 against the estimated 56.6 and supported the U.S. dollar, and capped further gains in EUR/USD pair. The ISM Manufacturing Prices also raised to 77.6 against the anticipated 66.0 and supported the U.S. dollar. The Wards Total Vehicle Sales raised to 16.3M against the estimated 15.8M and supported the U.S. dollar, ultimately limiting further gains in EUR/USD pair.

On Wednesday, the HIS Markit will release the Services PMI data for Germany and the Euro area. From the U.S., the ADP Employment Change will also be featured in the economic docket that will impact EUR/USD prices. Furthermore, the investors will keep a close eye on the Georgia election results.

Daily Technical Levels

Support   Resistance

1.2257      1.2318

1.2220      1.2344

1.2195      1.2380

Pivot point: 1.2282

EUR/USD– Trading Tip

The EUR/USD is trading with a mixed bias at the 1.2272 level, having violated the upward trendline at the 1.2252 level. At the moment, the pair is likely to face resistance at the 1.2307 level along with a support area of 1.2245 and 1.2215. Bullish bias seems dominant today, so a bullish breakout of 1.2307 can extend buying until the next resistance level of 1.2345.

GBP/USD – Daily Analysis

The GBP/USD pair was closed at 1.36278 after a high of 1.36420 and a low of 1.35540. Despite the third nationwide lockdown in the U.K., the GBP/USD pair raised on Tuesday amid the broad-based U.S. dollar weakness. The U.S. Dollar Index that measures the value of the U.S. dollar against the basket of six major currencies fell by 0.38% towards the two years, the lowest level of 89.53, and weighed on the greenback that ultimately supported the gains in GBP/USD pair.

The U.S. dollar was weak across the board despite the safe-haven appeal in the market mainly because of the Georgia runoff elections in the U.S. The runoff will decide the future of the U.S. Senate. It will be essential for Joe Biden, the upcoming Democratic president of the U.S., as it holds major importance in the U.S. Congress being its upper chamber. Senate holding party could easily approve its bills, which is the main attractiveness for getting majority votes in the Georgia runoff elections. Since 2014, the Senate has been controlled by the Republican Party, and if Democrats win on Wednesday, the extra two seats will give them effective control.

On the other hand, the British Pound was under pressure on Tuesday as the number of new daily confirmed cases of coronavirus in the U.K. has topped 60,000 for the first time since the pandemic started.

According to the government figures on Tuesday, the number of people who tested positive was 60,916. It came in as England and Scotland announced new strict lockdowns with people told to stay at home. The country is entering another nationwide lockdown to control coronavirus’s new variant affected the local currency and GBP/USD pair. However, investors did not give much attention to it and continued moving with the weakness of the U.S. dollar that ultimately pushed the GBP/USD pair higher.

There was no macroeconomic data on the data front to be released from the U.K. From the U.S. side, at 20:00 GMT, the ISM Manufacturing PMI from December surged to 60.7 against the anticipated 56.6 and supported the U.S. dollar and capped further gains in GBP/USD pair. The ISM Manufacturing Prices also rose to 77.6 against the projected 66.0 and supported the U.S. dollar. The Wards Total Vehicle Sales surged to 16.3M against the expected 15.8M and supported the U.S. dollar that ultimately limited further GBP/USD pair gains.

Daily Technical Levels

Support   Resistance

1.3572      1.3660

1.3518      1.3696

1.3483      1.3749

Pivot point: 1.3607

GBP/USD– Trading Tip

The Cable’s technical side also remains mostly unchanged as the GBP/USD pair consolidates between 1.3632 – 1.3556 after violating the support level of 1.3609 level. On the higher side, the Sterling may find resistance at 1.3632 and 1.3697 level while support at 1.3550 and 1.3473 level. Choppy trading expected. 

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 102.716 after placing a high of 103.189 and a low of 102.603. On Tuesday, the currency pair USD/JPY came under resumed bearish pressure through the American trading hours and reached its lowest level in nearly ten months at 102.60. The intensified selling pressure surrounding the U.S. dollar in the second half of the day forced the USD/JPY pair on the lower side. The U.S. Dollar Index that measures the value of the greenback against the basket of six major currencies fell to its multi-year lowest level at 89.44 by 0.47% on Tuesday and weighed heavily on the USD/JPY pair.

The U.S. Dollar was also weak across the board ahead of the results of the Georgia runoff elections. The state of Georgia held runoff elections for its two Senate seats. The results will determine who gets to control the U.S. Senate for the next two years and will consequently have a profound impact on the course of U.S. fiscal policy. The U.S. Republican Party has been controlling the U.S. Senate since 2014, and markets are betting that the Republicans will still win at least one of the seats and cement its hold on the upper chamber of the U.S. Congress.

On the data front, at 04:50 GMT, the Monetary Base for the year from Japan raised to 18.3% against the forecasted 18.0% and supported the Japanese Yen that ultimately weighed on the USD/JPY pair. From the U.S. side, at 20:00 GMT, the ISM Manufacturing PMI from December rose to 60.7 against the forecasted 56.6 and supported the U.S. dollar, and capped further losses in the USD/JPY pair. The ISM Manufacturing Prices also raised to 77.6 against the projected 66.0 and supported the U.S. dollar that limited further losses in the USD/JPY pair. The Wards Total Vehicle Sales raised to 16.3M against the estimated 15.8M and supported the U.S. dollar that ultimately limited further losses in the USD/JPY pair.

Meanwhile, the rising demand for safe-haven appeal in the market also supported the safe-haven Japanese Yen that ultimately weighed on the USD/JPY pair. The U.K. entered into a third nationwide lockdown on Monday as the daily count of new coronavirus cases surpassed 60,000 figure for the first time since the pandemic started. The PM Boris Johnson said that it was crucial to control the spread of a new variant of coronavirus that was more contagious.

Meanwhile, Germany also stretched its nationwide lockdown until the end of the month and announced tougher new restrictions to curb rising cases of coronavirus infections. New York on Monday reported its first case of a new variant of the coronavirus that has been reported in more than 30 countries so far. In the past four days, the U.S. has added about 1 million new coronavirus cases that have pushed the total number of cases beyond 21 million. This rising number of cases across the globe added fears for the recovery of the global economy and increased the appeal for safe-haven that ultimately supported the safe-haven Japanese Yen and added weight on the USD/JPY pair on Tuesday.

Daily Technical Levels

Support   Resistance

102.49      103.08

102.24      103.44

101.89      103.68

Pivot point: 102.84

USD/JPY – Trading Tips

The technical side of the USD/JPY also remains mostly unchanged as the USD/JPY is trading sharply bearish at 102.74. On the downside, the USD/JPY pair may find support at the 102.595 level along with resistance at 102.930. The USD/JPY pair has formed a downward channel on the two-hourly timeframes, which is likely to keep the pair bearish. The MACD and 50 EMA is suggesting selling bias in the USD/JPY. Let’s consider taking sell trades below the 102.850 level today. Good luck!

Categories
Forex Signals

USD/CAD Bouncing off Over 1.2728 – Do We Have a Buying Trade?

The USD/CAD currency pair failed to stop its Asian session losing streak and remain depressed around the 1.2735 level, mainly due to the U.S. dollar weakness. However, the prevalent downtrend in the greenback is mainly tied to the Federal Reserve’s expectations would keep rates low for a prolonged period. Meanwhile, the optimism over a possible coronavirus vaccine and the probability of an additional U.S. financial aid package also played its major role in weakening the greenback, which adds further burden around the currency pair. 

The USD/CAD currency pair failed to stop its Asian session losing streak and remain depressed around the 1.2735 level, mainly due to the U.S. dollar weakness. However, the prevalent downtrend in the greenback is mainly tied to the Federal Reserve’s expectations would keep rates low for a prolonged period. Meanwhile, the optimism over a possible coronavirus vaccine and the probability of an additional U.S. financial aid package also played its major role in weakening the greenback, which adds further burden around the currency pair. 

The USD/CAD currency pair failed to stop its Asian session losing streak and remain depressed around the 1.2735 level, mainly due to the U.S. dollar weakness. However, the prevalent downtrend in the greenback is mainly tied to the Federal Reserve’s expectations would keep rates low for a prolonged period. Meanwhile, the optimism over a possible coronavirus vaccine and the probability of an additional U.S. financial aid package also played its major role in weakening the greenback, which adds further burden around the currency pair. 

In contrast to this, the prevalent downticks in the crude oil prices tend to weaken the commodity-linked currency the Loonie, which becomes the key factor that helps the currency pair to limit its deeper losses. As of writing, the USD/CAD currency pair is currently trading at 1.2736 and consolidating in the range between 1.2729 – 1.2792.

Despite the intensified Sino-US tussle and coronavirus (COVID-19) woes, the market trading sentiment managed to stop its previous session’s negative performance and started to flash green during the early European session on the day, possibly due to the fresh optimism over a potential vaccine/treatment for the highly infectious coronavirus. As per the latest report, the U.S. Food and Drug Administration (FDA) showed that almost 95% success ratio of the leading coronavirus vaccines after two doses. Moreover, the market trading sentiment got an additional lift from fresh hopes of the Democratic victory in the Georgian run-off, which sparked possibilities for additional fiscal support. Thereby, the prevalent upbeat market mood undermined the safe-haven assets, including the safe-haven U.S. dollar, and contributed to the currency pair losses.

As in result, the broad-based U.S. dollar failed to halt its overnight losing streak and remained bearish on the day. Meanwhile, the probability of an additional U.S. financial aid package and speculations that the Fed will keep interest rates lower for a longer period also exerted downside pressure on the greenback. The losses in the U.S. dollar kept the currency pair lower. Meanwhile, the U.S. Dollar Index that tracks the greenback against a bucket of other currencies dropped by 0.04% to 89.812 by 8:49 PM ET (1:49 AM GMT).

On the contrary, the crude oil failed to stop its early-day losing streak and remained depressed around below the $47.50 level on the day mainly due to the renewed concerns over the global economic recovery as the number of COVID-19 cases continues to increase in Europe, the U.S., and Japan. Across the pond, the reason for the losses in the crude oil prices could also be associated with Monday’s released downbeat China’s Caixin Manufacturing PMI data, which showed that the activity slowed in December. Hence, the decline in oil prices undermined demand for the commodity-linked currency the Loonie and became the key factor that helped the currency pair limit its deeper losses. 

Looking forward, the market traders will keep their eyes on the German Unemployment Rate, which is due at 08:55 GMT, and the US ISM Manufacturing, which is due for release at 15:00 GMT. The updates about the U.S. stimulus package and the virus will not lose their importance across the ocean. 



Daily Support and Resistance

S1 1.2691

S2 1.2706

S3 1.2713

Pivot Point 1.2722

R1 1.2729

R2 1.2738

R3 1.2754

The USD/CAD pair is trading with a bullish bias at the 1.2764 level, holding above a support level of 1.2728, and it may head higher until the next target level of 1.2798 level. On the hourly timeframe, the USD/CAD is holding over 50 EMA, which is supporting bullish bias in the Loonie, whereas the MACD is staying in a selling mode. Let’s consider taking sell trade below the 1.2793 level and buying over 1.2728. Good luck! 

Categories
Forex Signals

AUD/USD Heading North to Test Triple Top – Brace for Selling! 

During Tuesday’s European trading session, the AUD/USD currency pair succeeded to extend its previous session winning streak and caught some further bids around above 0.7700 level mainly due to the fresh upticks in S&P 500 futures, which tend to underpin the perceived risk currency Australian dollar and contributes to the currency pair gains. Hence, the market trading sentiment got support from the fresh hopes of the coronavirus vaccine and the U.S. covid stimulus.

During Tuesday’s European trading session, the AUD/USD currency pair succeeded to extend its previous session winning streak and caught some further bids around above 0.7700 level mainly due to the fresh upticks in S&P 500 futures, which tend to underpin the perceived risk currency Australian dollar and contributes to the currency pair gains. Hence, the market trading sentiment got support from the fresh hopes of the coronavirus vaccine and the U.S. covid stimulus.

During Tuesday’s European trading session, the AUD/USD currency pair succeeded to extend its previous session winning streak and caught some further bids around above 0.7700 level mainly due to the fresh upticks in S&P 500 futures, which tend to underpin the perceived risk currency Australian dollar and contributes to the currency pair gains. Hence, the market trading sentiment got support from the fresh hopes of the coronavirus vaccine and the U.S. covid stimulus.

Across the pond, the broad-based U.S. dollar selling bias, triggered by multiple factors, also played its significant role in supporting the currency pair. In contrast to this, the long-lasting coronavirus woes globally keep questioning the market’s upbeat mood, which becomes the key factor that kept the lid on any additional gains in the currency pair. The AUD/USD currency pair is currently trading at 0.7716 and consolidating in the range between 0.7661 – 0.7725.

Despite the prevalent burden of the coronavirus (COVID-19) resurgence, the market trading sentiment stopped its previous session bearish moves and started to flash green amid fresh optimism over a potential vaccine/treatment for the highly infectious coronavirus. As per the latest report, the U.S. Food and Drug Administration (FDA) showed that almost 95% success ratio of the leading coronavirus vaccines after two doses. Moreover, the global markets put high hopes of the Democratic victory in the Georgian run-off, which sparked additional fiscal support possibilities. Thereby, the prevalent upbeat market mood underpinned the Australian dollar’s perceived risk currency and contributed to the currency pair gains.

On the bearish side, the intensifying worries about the continuous surge in new COVID-19 cases kept challenging the upbeat market sentiment and became one of the key factors that kept the lid on any additional currency pair gains. As per the latest report, Japan saw a record number of COVID-19 cases in recent days, which in turn, Prime Minister Yoshihide Suga said that he would consider declaring a fresh state of emergency in the Tokyo area. Across the ocean, the U.K. Prime Minister Boris Johnson also gave warnings over the possibility of tougher lockdown restrictions in the U.K.

Looking forward, the market traders will keep their eyes on the German Unemployment Rate, which is due at 08:55 GMT, and the US ISM Manufacturing, which is scheduled for release at 15:00 GMT. Meanwhile, the updates about the U.S. stimulus package will be key to watch. Furthermore, the risk catalyst like geopolitics and the virus woes, not to forget the Brexit, will not lose their importance. 


Daily Support and Resistance

S1 0.7656

S2 0.7679

S3 0.7692

Pivot Point 0.7703

R1 0.7716

R2 0.7726

R3 0.775

The AUD/USD pair is trading at the 0.7719 level, heading further higher, and it may find resistance at the 0.7740 level. The 50 periods EMA supports the pair at the 0.7695 level as the MACD also suggests a strong buying trend. On the lower side, the pair may find support at the 0.7684 level today. Let’s consider taking a buying above 0.7685 and selling below 0.7740 level today. Good luck! 

Categories
Forex Signals

EUR/JPY Crosses Below 50 Periods EMA – Sell Signal in Play!

The EUR/JPY is trading sideways at 126.564 – 126.105, having crossed below 50 periods EMA. On the higher side, the EUR/JPY may find resistance at the 126.450 level. The EUR/JPY is trading bearish amid a surge in safe-haven appeal. The reason for the bearish trend in the EUR/JPY as prices for crude oil fell, and gold surged.

One of the reasons behind increased safe-haven appeal can be linked with the dip in crude oil prices. Crude oil prices could also be associated with the previous day released downbeat China’s Caixin Manufacturing PMI data, which confirmed that the activity slowed in December. The gauge dropped to 53.00 in December from November’s 54.9, against the expected figures of 54.9. The government PMI also fell to 51.9 in December from 52.1 in November.

Despite the risk-off market sentiment, the broad-based U.S. dollar failed to gain any positive traction and edged lower on the day amid the probability of an additional U.S. financial aid package and speculations that the Fed will keep interest rates lower for a longer period. Apart from this, the optimism over a possible coronavirus vaccine urges investors towards riskier currencies and higher-yielding assets rather than the safe-haven asset, which eventually leads to further losses in the safe-haven U.S. dollar. However, the losses in the U.S. dollar kept the USD/JPY currency pair lower. As of now, the U.S. Dollar Index that tracks the greenback against a bucket of other currencies dropped by 0.04% to 89.812 by 8:49 PM ET (1:49 AM GMT).

On the contrary, the U.S. Food and Drug Administration (FDA) showed an approximately 95% success ratio of the leading coronavirus vaccines after two doses, which becomes the key factor that helps the currency pair limit its deeper losses.

The EUR/JPY is likely to find resistance at the 126.420 level; thus, we have opened a sell trade. Check out the trade setup below.



Entry Price – Sell 126.22

Stop Loss – 126.62

Take Profit – 125.82

Risk to Reward – 1:1

Profit & Loss Per Standard Lot = -$400/ +$400

Profit & Loss Per Micro Lot = -$40/ +$40

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Forex Market Analysis

Daily F.X. Analysis, January 05 – Top Trade Setups In Forex – ISM Manufacturing PMI In Focus!

On the news side, eyes will remain on European Unemployment Change and the ISM Manufacturing PMI manufacturing data from the U.S., Both of the figures, are expected to drive moves in Euro and dollar today.

Economic Events to Watch Today  


  

EUR/USD – Daily Analysis

Today in the early European trading session, the EUR/USD currency pair successfully extended its previous session winning streak and remained well bid around above the 1.2250 level as the U.S. dollar remains on the bearish track despite coronavirus concerns and weak China data. However, the losses in the U.S. dollar were triggered after the U.S. Food and Drug Administration said that 2-different mRNA vaccines now show the extraordinary result of about 95% in preventing Covid-19 infection in adults. 

Apart from this, the Federal Reserve’s expectations would keep rates low for a prolonged period also weighs on the greenback and contributes to the currency pair gains. Meanwhile, the probability of an additional U.S. financial aid package also played its major role in undermining the U.S. dollar. In that way, the U.S. dollar weakness was seen as one of the key factors that benefitted the EUR/USD currency pair.

 In contrast to this, the latest B117 strain of COVID-19 lead to the fresh lockdown restrictions on economic activity in Europe and the U.K., which keep raising doubts over the economic recovery and turned out to be one of the key factors that kept the lid on any additional gains in the currency pair. As of writing, the EUR/USD currency pair is currently trading at 1.2262 and consolidating in the range between 1.2246 – 1.2278.

The sentiment around the global equity market has been flashing red since the day started amid worries about the continuous surge in new COVID-19 cases. Also fueling the risk-off mood was the cautious sentiment ahead of the Georgia election and the Sino-American tussle. As per the latest report, Japan saw a record number of COVID-19 cases in recent days, which in turn, Prime Minister Yoshihide Suga said that he would consider declaring a fresh state of emergency in the Tokyo area. 

Across the ocean, the U.K. Prime Minister Boris Johnson also gave warnings over the possibility of tougher lockdown restrictions in the U.K., which instantly overshadowed the optimism over vaccines’ rollout for the highly contagious disease and contributed to the equity market losses. However, the intensifying concerns about rising COVID-19 cases and the intensifying lockdowns could cap further gains in the currency pair.

Daily Technical Levels

Support   Resistance

1.2179     1.2279

1.2144     1.2344

1.2078     1.2379

Pivot Point: 1.2244

EUR/USD– Trading Tip

The EUR/USD is trading with a mixed bias at the 1.2272 level, having violated the upward trendline at the 1.2252 level. At the moment, the pair is likely to face resistance at the 1.2307 level along with a support area of 1.2245 and 1.2215. Bullish bias seems dominant today as the 50 periods EMA supports the pair at 1.2245 level. However, the MACD stays in a sell mode, as histograms are being formed below 0, supporting selling bias. 

GBP/USD – Daily Analysis

During Tuesday’s European trading hours, the GBP/USD currency pair failed to extend its previous session winning streak and took some offer well below the 1.360 level mainly due to the continuous surge in new COVID-19 cases in the U.K., which raised doubts over the U.K. economic recovery and turned out to be one of the key factors that kept the currency pair down. On the contrary, the broad-based U.S. dollar weakness, triggered by multiple factors, failed to support the GBP/USD pair or ease the bearish pressure. At this particular time, the GBP/USD currency pair is currently trading at 1.3556 and consolidating in the range between 1.3556 – 1.3612.

Despite the risk-off market sentiment, the broad-based U.S. dollar failed to gain any positive traction and dropped near multi-year lows amid the probability of an additional U.S. financial aid package and speculations Fed will keep interest rates lower for a longer period. Apart from this, the optimism over a possible coronavirus vaccine pushes investors towards riskier currencies and higher-yielding assets rather than the safe-haven asset, which eventually leads to further losses in the safe-haven U.S. dollar. 

However, the U.S. dollar losses were seen as one of the key factors that benefitted the EUR/USD currency pair. As of now, the U.S. Dollar Index that tracks the greenback against a bucket of other currencies dropped by 0.04% to 89.812 by 8:49 PM ET (1:49 AM GMT).

Apart from Brexit and U.S. headlines, the currency pair came under pressure as the market’s risk sentiment was affected by the increase in the number of coronavirus cases worldwide. 

The rising number of infections from COVID-19 raised fears that countries might extend the restrictions that would have a negative impact on global economic recovery. These fears kept the risk perceived GBP/USD pair under pressure and kept its gains limited during the Asian session on Monday.

Daily Technical Levels

Support   Resistance

1.3623      1.3705

1.3573      1.3737

1.3540      1.3788

Pivot Point: 1.3655

GBP/USD– Trading Tip

The GBP/USD pair has also violated the support level of 1.3609 level extended by an upward channel, which has now been violated. On the higher side, the Sterling may find resistance at 1.3609 and 1.3698 level while support at 1.3533 level today. The Cable is crossing below 50 periods EMA, and the MACD is also forming histograms below 0, suggesting strong selling bias. We should consider taking a selling trade the Cable below 1.3607 level today. 

USD/JPY – Daily Analysis

The USD/JPY continues trading with a bearish bias at the 102.930 level, as it looks clear direction while taking rounds to 103.10/15 through the opening hour of Asian trading sessions. The yen pair descended to the new low in 10 months the prior day before closing with the Doji candlestick’s near opening levels on the daily chart. The risk-aversion stream, supported by concerns of the coronavirus (COVID-19) tension and the unadventurous spirits ahead of the Georgian elections, battles the greenback recovery and holds the USD/JPY in a compact range off-late.

The U.S. Dollar Index that includes the worth of the greenback against the basket of six major currencies was dropping by 0.25% to 89.67 on the day to insignificantly beneath the level it closed 2020 at 89.766. The U.S. dollar instability appended to the downward momentum of the USD/JPY pair. The Federal Reserve is scheduled to publish the minutes from its December conference on Wednesday. Investors will be watching for more detail on the talks about securing their forward policy guidance more specific and the chance of additional development in asset buying in 2021. 

The USD/JPY pair was also down in initial trading hours on Monday as the rising number of coronavirus cases throughout the world raised the safe-haven appeal in the market. Prime Minister Boris Johnson urged that strict lockdown stipulations would be placed in England to fight against the new variant of coronavirus that has pushed the infection rates to their highest record levels. School unions have raised called for the closure of all schools for a couple of weeks as the virus was spreading faster, but Johnson said to parents that they should send children to school as the threats to young kids from the deadly virus were very small.

 From the U.S. side, at 19:45 GMT, the Final Manufacturing PMI from the U.S. for December is projected to come as 56.3 against the previous 56.5 and weigh on the U.S. dollar add in the losses of USD/JPY pair. At 20:00 GMT, the Construction Spending for November is estimated to decrease to 1.1% against the previous 1.3% that could weigh on the U.S. dollar and USD/JPY pair as well.

Daily Technical Levels

Support Resistance

103.02     103.34

102.85     103.49

102.70     103.66

Pivot Point: 103.17

USD/JPY – Trading Tips

The USD/JPY is trading sharply bearish at 102.940, gaining support at the 102.940 level. The USD/JPY pair has formed a downward channel on the two-hourly timeframes, which may extend resistance at 103.300 as at the same level 50 periods EMA is also extending resistance. Today, we need to keep an eye on the 102.940 mark as a violation of this may offer us a sell trade until the 102.598 level. The MACD and RSI are suggesting selling bias in USD/JPY today. Good luck!

Categories
Forex Signals

Upward Channel Supporting Buying in Aussie – Get Ready for a Breakout Trade! 

The AUD/USD continues trading bullish at the 0.7740 level, heading further higher, but only if the Aussie gets to violate the 0.7740 resistance level. The dollar seems to get weaker amid a rising number of coronavirus cases despite the vaccine rollout raised fears and supported the appeal for safe-haven, but the dollar is getting weaker. Ultimately weighed on the risk-sensitive Aussie that added in the losses of the AUDUSD pair.

The AUD/USD continues trading bullish at the 0.7740 level, heading further higher, but only if the Aussie gets to violate the 0.7740 resistance level. The dollar seems to get weaker amid a rising number of coronavirus cases despite the vaccine rollout raised fears and supported the appeal for safe-haven, but the dollar is getting weaker. Ultimately weighed on the risk-sensitive Aussie that added in the losses of the AUDUSD pair.

The AUD/USD continues trading bullish at the 0.7740 level, heading further higher, but only if the Aussie gets to violate the 0.7740 resistance level. The dollar seems to get weaker amid a rising number of coronavirus cases despite the vaccine rollout raised fears and supported the appeal for safe-haven, but the dollar is getting weaker. Ultimately weighed on the risk-sensitive Aussie that added in the losses of the AUDUSD pair.

The currency pair AUD/USD posted losses for the day despite the US dollar’s weakness on Monday. The US dollar was weak across the board as the investors were cautious about putting any strong position in the market ahead of Tuesday’s Georgia’s Electoral runoff and Wednesday’s FOMC release of meeting minutes from December. Furthermore, the US caseload of coronavirus infections surpassed the 21,110,917 number and weighed on local currency as the country was worst-hit by the virus. 

Meanwhile, on the data front, at 06:45 GMT, the Caixin Manufacturing PMI from December dropped to 53.0 against the expected 54.7 and weighed on China-proxy Aussie that ultimately added losses in AUD/USD pair. 

At 10:30 GMT, the Commodity prices for the year from Australia came in as11.7% in December against the previous 2.5%. From the US side, at 19:45 GMT, the Final Manufacturing PMI from the US for December is projected to come as 56.3 against the previous 56.5 that could hurt the US dollar and limit further losses in AUD/USD pair. At 20:00 GMT, the Construction Spending for November is anticipated to fell to 1.1% against the previous 1.3% that could also hurt the US dollar and limit further losses in AUD/USD pair.

Daily Technical Levels

Support Resistance

0.7667 0.7732

0.7639 0.7771

0.7601 0.7798

Pivot Point: 07705

The AUD/USD consolidates in a narrow trading range of 0.7685 – 0.7740 level, and a bullish breakout of this range can trigger further upward trend until 0.7802 level, while on the lower side, the support continues to hold at 0.7686 level. A bearish breakout of 0.7686 level is likely to drive selling until the 0.7636 mark. Let’s brace for a breakout. Good luck! 

 

Categories
Forex Signals

Gold Breakout Ascending Triangle Pattern – Bullish Bias Dominates! 

During Monday’s Asian trading session, the precious metal managed to extend its early-day positive performance and remained bullish around above the $1,920 level as the sharp rise in global COVID-19 cases and the possibility of more countries imposing tighter restrictions tend to underpin the safe-haven yellow metal. Meanwhile, the broad-based U.S. dollar weakness, triggered by the market upbeat mood, also played its key role in underpinning the gold prices as the price of gold is inversely related to the price of the U.S. dollar. However, the market trading sentiment was being supported by the optimism surrounding the coronavirus (COVID-19) vaccine, Brexit headlines, and the U.S. covid aid package. 

During Monday’s Asian trading session, the precious metal managed to extend its early-day positive performance and remained bullish around above the $1,920 level as the sharp rise in global COVID-19 cases and the possibility of more countries imposing tighter restrictions tend to underpin the safe-haven yellow metal. Meanwhile, the broad-based U.S. dollar weakness, triggered by the market upbeat mood, also played its key role in underpinning the gold prices as the price of gold is inversely related to the price of the U.S. dollar. However, the market trading sentiment was being supported by the optimism surrounding the coronavirus (COVID-19) vaccine, Brexit headlines, and the U.S. covid aid package. 

During Monday’s Asian trading session, the precious metal managed to extend its early-day positive performance and remained bullish around above the $1,920 level as the sharp rise in global COVID-19 cases and the possibility of more countries imposing tighter restrictions tend to underpin the safe-haven yellow metal. Meanwhile, the broad-based U.S. dollar weakness, triggered by the market upbeat mood, also played its key role in underpinning the gold prices as the price of gold is inversely related to the price of the U.S. dollar. However, the market trading sentiment was being supported by the optimism surrounding the coronavirus (COVID-19) vaccine, Brexit headlines, and the U.S. covid aid package. 

In that way, the upbeat market sentiment was seen as one of the key factors that kept the lid on any additional gold gains. Furthermore, the upticks in the gold prices could also be attributed to the escalating US-China tussles, which eventually lend some support to the safe-haven yellow metal. As of writing, the yellow metal prices are currently trading at 1,923.70 and consolidating in the range between 1,893.81 – 1,925.35.

The market trading sentiment managed to extend its last week’s positive performance and stay positive on the day as the U.S. stocks futures’ bullish appearance tends to highlight the risk-on sentiment. Behind this positive performance was the optimism surrounding the coronavirus (COVID-19) vaccine, Brexit headlines, and the U.S. covid aid package. Across the ocean, the latest upbeat prints of Asian activity numbers from Japan, South Korea, Indonesia, and Taiwan for December also played its major role in underpinning the market trading sentiment. However, the positive tone around the market sentiment favors the gold buyers via U.S. dollar weakness.

As a result of the risk-on mood, the broad-based U.S. dollar failed to gain any positive traction and remained bearish on the day. Meanwhile, the losses in the U.S. dollar were further bolstered by the easy money policy of the U.S. Federal Reserve and central bankers elsewhere. It is worth mentioning that the U.S. Federal Reserve is set to release the minutes from its December meeting on Wednesday. In that way, the market players will be looking for more detail on making their forward policy guidance more explicit and the chance of a further increase in asset buying in 2021. Hence, the losses in the U.S. dollar becomes the key factor that helps the gold to stay bid as the price of gold is inversely related to the price of the U.S. dollar. 

Elsewhere, the upticks in the gold prices could also be attributed to the concerns over the coronavirus (COVID-19) and tussles between the U.S. and China. The coronavirus (COVID-19) cases continue to rise, with above 85 million COVID-19 cases as of Jan. 4, with over 20.6 million cases of them in the U.S. Apart from the U.S., Japan is also gaining attention amid the recent surge in the cases and the death toll. As per the latest report, Japan recorded more than 3,100 new cases overnight. While Tokyo reported 816 new infections, bringing the cumulative total to 62,590, the largest among the country’s 47 prefectures so far. This, in turn, the government of Japan is seeking expert advice on whether to declare a state of emergency in Tokyo and neighboring prefectures. 

Looking forward, the market traders will keep their eyes on Caixin Manufacturing PMI for December, which is expected to reprint 54.9. Meanwhile, the second readings of monthly PMIs from Europe, the U.K., and the U.S. can decorate the calendar ahead. In addition to this, the updates about the U.S. stimulus package will be key to watch. In the meantime, the risk catalyst like geopolitics and the virus woes, not to forget the Brexit, will not lose their importance. 


Daily Support and Resistance

S1 1863.1

S2 1879.13

S3 1888.81

Pivot Point 1895.17

R1 1904.84

R2 1911.2

R3 1927.24

On Monday, the gold is trading sharply bullish at the 1,925 level. Gold has disrupted the ascending triangle pattern at the 1,898 mark on the daily chart, and now gold is likely to encounter resistance at 1,933 and 1,965 marks. The buying trend can be seen in gold, but unfortunately, our trades are closed at stop loss. I will be looking to take another buying trade once gold retraces back to 1,913 level. Good luck! 

Categories
Forex Market Analysis

Daily F.X. Analysis, January 04 – Top Trade Setups In Forex – Manufacturing PMI In Focus! 

On the news front, eyes will remain on the Manufacturing PMI and Services PMI figures from the Eurozone, U.K., and the United States. Almost all economic figures are expected to perform better than previous months, perhaps due to a lift of lockdown. Price action will depend upon any surprise changes in the PMI figures.

On the news front, eyes will remain on the Manufacturing PMI and Services PMI figures from the Eurozone, U.K., and the United States. Almost all economic figures are expected to perform better than previous months, perhaps due to a lift of lockdown. Price action will depend upon any surprise changes in the PMI figures.

On the news front, eyes will remain on the Manufacturing PMI and Services PMI figures from the Eurozone, U.K., and the United States. Almost all economic figures are expected to perform better than previous months, perhaps due to a lift of lockdown. Price action will depend upon any surprise changes in the PMI figures.

Economic Events to Watch Today  

  

EUR/USD – Daily Analysis

The EUR/USD pair was opened at 1.22387, and it has placed a high of 1.22584 and a low of 1.22276 so far. The currency pair is currently moving at 1.25514 and has shown a consolidative move since the start of the day.

The U.S. dollar was weak across the board on Monday and the starting day of the week and pushed the currency pair EUR/USD higher on board. However, the EUR/USD pair’s gains remained consolidative ahead of the release of macroeconomic data from the European side.

At 13:15 GMT, the Spanish Manufacturing PMI for December is forecasted to come in as 52.6 compared to November’s 49.8, which, if met, will be supportive to the single currency Euro and will probably add gains in EUR/USD pair. At 13:45 GMT, the Italian manufacturing PMI for December is also expected to surpass the previous 51.5 and come in as 53.5 and support the single currency Euro to add further gains in EUR/USD pair. At 13:50 GMT, the French Final Manufacturing PMI is projected to remain flat at 51.1 for December. At 13:55 GMT, The German Final Manufacturing PMI for December is also projected to remain the same as November’s 58.6. At 14:00 GMT, the Final manufacturing PMI for December from the whole Eurozone is also expected to remain flat at 55.5.

From the U.S. side, at 19:45 GMT, the Final Manufacturing PMI from the U.S. for December is anticipated to release as 56.3 against the previous 56.5 and weigh on the U.S. dollar be beneficial for EUR/USD pair. At 20:00 GMT, the Construction Spending for November is estimated to decline to 1.1% compared to the previous 1.3%, and if the actual meet the expectations, then EUR/USD will gain more as the U.S. dollar will become weak.

Apart from macroeconomic data, the gains in EUR/USD pair were very limited at the start of the trading session as the rise in coronavirus cases in Europe urged the countries to get ready to extend lockdowns to control the spread of the virus. Not in Europe, but all countries across the world, including UK, Canada, India, the USA, Japan, and Mexico also have seen a rise in the number of infection cases that has prompted the need for safe-haven and resulted in the consolidative movement of EUR/USD pair on Monday.

The risk perceived EUR/USD pair faced pressure while moving upward as the risk sentiment in the market deteriorated after the rising number of coronavirus cases throughout the globe. However, the currency pair EUR/USD remained on the plus side as the European countries have started immunizing people against coronavirus in earnest, but huge discrepancies in vaccination pace exist.

Meanwhile, the U.S. dollar was also weak ahead of Tuesday’s Georgia runoff elections that will decide the control of the U.S. Senate and also the fate of President-elect Joe Biden’s legislative agenda. Whereas, Senate ended the demand for an increase in direct payments from $600 to $2000 by Donald Trump and supported by Democrats as Republicans did not approve it and weighed on the U.S. dollar that ultimately kept the EUR/USD pair higher.

Daily Technical Levels

Support   Resistance

1.2179      1.2279

1.2144      1.2344

1.2078      1.2379

Pivot Point: 1.2244

EUR/USD– Trading Tip

The EUR/USD is trading with a bearish bias today at the 1.2248 level, having violated the upward trendline at the 1.2252 level. Closing of candles below this trendline confirms a breakout, and there’s a strong odd of selling trend’s continuation until 1.2203. The next support may be found around the 1.2175 level below this, along with resistance at 1.2258 and 1.2313. The 50 periods EMA is likely to extend resistance at the 1.2262 level, and supporting selling trend in the EUR/USD today! 

GBP/USD – Daily Analysis

On January 04, the currency pair was opened at 1.36471, and it has placed a high of 1.36982 and a low of 1.36436 so far. The pair is currently moving at 136884 and is rising to place gains for the 4th consecutive session on Monday. The U.K. was enjoying its first trading session as an independent nation on Monday as the transition period for Brexit ended on Thursday when the United Kingdom finally ended its ties with the European Union, almost a year after its formal departure from the 27-nation bloc.

After four and a half years, when the majority in the U.K. voted to leave the European Union, the end of the transition period was a significant moment in the history of the U.K. Great Britain will now forge a separate path after almost five decades as part of the bloc. 

According to PM Boris Johnson, Britain will be an open, generous, outward-looking, internationalist, and free-trading country free to do things differently and, if necessary better than the E.U. On Sunday, the PM Boris Johnson said that he intended to carry on as a prime minister after Brexit.

Although the British Pound will see a selling pressure given the impact of Brexit sooner or later, the investors were favoring the currency in the beginning hours of the trading session ahead of the macroeconomic data or any major news as after a long fight between the E.U. & U.K.; the country has departure from the E.U. with a deal beneficial for both sides successfully.

At 14:30 GMT, the Final Manufacturing PMI for December is expected to remain flat at 57.3. The Mortgage Approvals from Britain in November are expected to decline to 82K from October’s 98K and weigh on British Pound that could drag the pair GBP/USD lower. The Net Lending to Individuals for November is also expected to decline to 3.0B from October’s 3.7B and weigh on British Pound and limit the GBP/USD pair’s upward trend. Furthermore, the pair was also supported in the Asian session due to the weakness of the U.S. dollar on Monday. The U.S. dollar was weak due to the broad market optimism and rallying equities. Some news from the U.S. Congress unveiled that Nancy Pelosi was re-elected as the U.S. House Speaker, which indicated an easy way for further stimulus. 

Meanwhile, Georgia’s electoral runoff will also decide the Senate majority’s fate and will be crucial to watch on Tuesday. All these developments kept the greenback under pressure and supported GBP/USD’s rising prices on Monday during the early session.

Apart from Brexit and U.S. headlines, the currency pair came under pressure as the market’s risk sentiment was affected by the increase in the number of coronavirus cases throughout the globe. 

The rising number of infections from COVID-19 raised fears that countries might extend the restrictions that would have a negative impact on global economic recovery. These fears kept the risk perceived GBP/USD pair under pressure and kept its gains limited during the Asian session on Monday.

Daily Technical Levels

Support   Resistance

1.3623      1.3705

1.3573      1.3737

1.3540      1.3788

Pivot Point: 1.3655

GBP/USD– Trading Tip

The GBP/USD pair has also violated the resistance level of 1.3617 level, and on the higher side, the next target remains at the 1.3698 level. On the lower side, the GBP/USD pair may find support at the 1.3617 level for now. We can expect a continuation of an upward trend in the Sterling today. The 50 periods EMA is supporting bullish bias at the 1.3600 level, and at the same time, the upward channel is also likely to keep Sterling bullish on Monday. Let’s consider taking buying trades over 1.3609 and selling below the 1.3698 level today. 

USD/JPY – Daily Analysis

On January 04, the USD/JPY opened at 103.096, and it has placed a high of 103.314 and a low of 102.932 since then. The pair USD/JPY was currently moving at 103.023 and was placing losses for the day.

In the Asian trading session, the U.S. dollar was down on Monday, with investors continuing to put pressure on the safe-haven assets on the first trading day of 2021. The rising expectations that the U.S. interest rates will remain low and hopes for an eventual global economic recovery from coronavirus will likely continue to slow the dollar down against other major currencies.

The U.S. Dollar Index that measures the value of the U.S. dollar against the basket of six major currencies was down by 0.25% to 89.67 on the day to slightly below the level it ended 2020 at 89.766. The U.S. dollar weakness added to the downward momentum of the USD/JPY pair on Monday.

The Federal Reserve is due to release the minutes from its December meeting on Wednesday. Investors will be looking for more detail on the discussions about making their forward policy guidance more explicit and the chance of a further increase in asset buying in 2021. Meanwhile, the USD/JPY pair was also down in early trading hours on Monday as the rising number of coronavirus cases throughout the world raised the safe-haven appeal in the market. 

On Sunday, Prime Minister Boris Johnson warned that severe lockdown restrictions would be installed in England to fight against the new variant of coronavirus that has pushed the infection rates to their highest record levels. Whereas, School unions have raised called for the closure of all schools for a couple of weeks as the virus was spreading faster, but Johnson said to parents that they should send children to school as the threats to young kids from the deadly virus were very small.

Meanwhile, on Saturday, Canada reported an estimated 4800 more cases of the deadly coronavirus that added to the country’s total caseload and made it 586,425. Canada said that the rise in the number of coronaviruses was seen after the holiday season. In India, 16,660 fresh cases were reported in a single day that sent the total number of infections to 10,341,291. 

Americans have been reported to flee to Mexico to avoid the lockdown restrictions back at home. According to Times, about half a million Americans traveled to Mexico in November, whereas Mexico has reported an increase in the number of coronavirus cases in November and December.

The global sum of coronavirus cases reached 85,489,058, out of which 60,443,211 have recovered, and 1,850,202 have died so far. The U.S. cases reached a total of 21,110,917 number and remained the worst-hit county by the world’s coronavirus. Despite the vaccine rollout, the rising number of coronavirus cases throughout the globe added to the fears that countries will enter new lockdown restrictions and affect global economic recovery. These fears raised the market’s safe-haven appeal and supported the safe-haven Japanese Yen that ultimately weighed on the USD/JPY pair. 

On the data front, at 05:30 GMT, the Final Manufacturing PMI in December came in as 50.0 against the expected 49.7 and supported the Japanese Yen that added in the losses of the USD/JPY pair on Monday. From the U.S. side, at 19:45 GMT, the Final Manufacturing PMI from the U.S. for December is projected to come as 56.3 against the previous 56.5 and weigh on the U.S. dollar add in the losses of USD/JPY pair. At 20:00 GMT, the Construction Spending for November is estimated to decrease to 1.1% against the previous 1.3% that could weigh on the U.S. dollar and USD/JPY pair as well.

Daily Technical Levels

Support   Resistance

103.02      103.34

102.85      103.49

102.70      103.66

Pivot Point: 103.17

USD/JPY – Trading Tips

The USD/JPY is trading sharply bearish at 102.940, gaining support at the 102.940 level. The USD/JPY pair has formed a downward channel on the two-hourly timeframes, which may extend resistance at 103.300 as at the same level 50 periods EMA is also extending resistance. Today, we need to keep an eye on the 102.940 mark as a violation of this may offer us a sell trade until the 102.598 level. The MACD and RSI are suggesting selling bias in USD/JPY today. Good luck!

Categories
Forex Signals

USD/CAD Supported Over Triple Bottom – Brace for a Trade Here! 

The USD/CAD pair was opened at 1.27142, and it has placed a high of 1.27358 and a low of 1.26950 since then. The pair was currently moving at 1.27035 and was posting losses on Monday for the 5th consecutive session. The losses in the USD/CAD pair during the Asian session on Monday could be attributed to the US dollar’s weakness along with the rising crude oil prices on the day. The deteriorated risk-sentiment could also be a factor behind the USD/CAD pair’s declining prices on Monday. 

The USD/CAD pair was opened at 1.27142, and it has placed a high of 1.27358 and a low of 1.26950 since then. The pair was currently moving at 1.27035 and was posting losses on Monday for the 5th consecutive session. The losses in the USD/CAD pair during the Asian session on Monday could be attributed to the US dollar’s weakness along with the rising crude oil prices on the day. The deteriorated risk-sentiment could also be a factor behind the USD/CAD pair’s declining prices on Monday. 

The USD/CAD pair was opened at 1.27142, and it has placed a high of 1.27358 and a low of 1.26950 since then. The pair was currently moving at 1.27035 and was posting losses on Monday for the 5th consecutive session. The losses in the USD/CAD pair during the Asian session on Monday could be attributed to the US dollar’s weakness along with the rising crude oil prices on the day. The deteriorated risk-sentiment could also be a factor behind the USD/CAD pair’s declining prices on Monday. 

The US Dollar was weak across the board on Monday as the US saw a massive increase in the number of coronavirus cases as the total count of infection cases reached 21,110,917 in the country and made it the worst-hit country by the COVID-19. The US Dollar Index was also down on Monday by 0.25% at the 89.67 level.

The US dollar weakness could also be attributed to the latest rejection of an increase in direct payments by the US Senate. Lately, the US President called to increase the direct payments to Americans to $2000 from $600 that was also supported by Democrats; however, these efforts have come to an end after Republicans refused to increase them. Furthermore, the US billions were also hesitant to place strong moves in the market ahead of Tuesday’s Georgia’s electoral runoff and Wednesday’s December meeting minutes release from FOMC.

On the other hand, the West Texas Intermediate (WTI) Crude Oil prices on Monday have reached $49.27 per barrel so far and were moving upward continuously. The crude oil has posted gains for four consecutive sessions, and the outlook remained positive, which means it could increase further. The rising crude oil prices added support to the commodity-linked currency Loonie that ultimately added more pressure on the USD/CAD pair’s prices on Monday.

On the data front, Manufacturing PMI from Canada is expected to release at 19:30 GMT, November’s PMI was 55.8, and anything above it in December could be beneficial for the Canadian dollar, and anything less than it could be against the local currency. From the US side, at 19:45 GMT, the Final Manufacturing PMI from the US for December is predicted to come as 56.3 against the previous 56.5 that could hurt the US dollar and add further losses in the USD/CAD pair. At 20:00 GMT, the Construction Spending for November is forecasted to drop to 1.1% against the previous 1.3% that could also add more losses in the USD/CAD pair.


Daily Technical Levels

Support Resistance

1.2704 1.2762

1.2679 1.2795

1.2647 1.2820

Pivot point: 1.2737

The USD/CAD is trading at 1.2684, and violation of this level can extend the selling trend until the 1.2637 level. On the 2 hour timeframe, the USD/CAD is supported due to the triple bottom, but the RSI and MACD are suggesting a selling trend in USD/CAD. However, we can’t take a sell trade unless the 1.2685 level is violated. Let’s wait for a breakout elsewhere; we can take a buy trade over 1.2685 tp target 1.2760. Good luck!

Categories
Forex Signals

EUR/USD Completes Retracement – Brace for a Bullish Correction! 

The EUR/USD is trading with a bearish bias today at the 1.2248 level, having violated the upward trendline at the 1.2252 level. Closing of candles below this trendline confirms a breakout, and there’s a strong odd of selling trend’s continuation until 1.2203. The next support may be found around the 1.2175 level below this, along with resistance at 1.2258 and 1.2313. The 50 periods EMA is likely to extend resistance at the 1.2262 level, and supporting the selling trend in the EUR/USD today; however, we are taking a buying trade as the pair is forming Doji, and it may bounce off to continue trading bullish. 

The EUR/USD is trading with a bearish bias today at the 1.2248 level, having violated the upward trendline at the 1.2252 level. Closing of candles below this trendline confirms a breakout, and there’s a strong odd of selling trend’s continuation until 1.2203. The next support may be found around the 1.2175 level below this, along with resistance at 1.2258 and 1.2313. The 50 periods EMA is likely to extend resistance at the 1.2262 level, and supporting the selling trend in the EUR/USD today; however, we are taking a buying trade as the pair is forming Doji, and it may bounce off to continue trading bullish. 

The EUR/USD is trading with a bearish bias today at the 1.2248 level, having violated the upward trendline at the 1.2252 level. Closing of candles below this trendline confirms a breakout, and there’s a strong odd of selling trend’s continuation until 1.2203. The next support may be found around the 1.2175 level below this, along with resistance at 1.2258 and 1.2313. The 50 periods EMA is likely to extend resistance at the 1.2262 level, and supporting the selling trend in the EUR/USD today; however, we are taking a buying trade as the pair is forming Doji, and it may bounce off to continue trading bullish. 


Entry Price – Buy 1.226

Stop Loss – 1.222

Take Profit – 1.23

Risk to Reward – 1:1

Profit & Loss Per Standard Lot = -$400/ +$400

Profit & Loss Per Micro Lot = -$40/ +$40

Fellas, now you can check out forex trading signals via Forex Academy mobile app. Follow the links below.

iPhone Users: https://apps.apple.com/es/app/fasignals/id1521281368

Andriod Users: https://play.google.com/store/apps/details?id=academy.forex.thesignal&hl=en_US

 

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Forex Signals

USD/CAD Bearish Bias Continues – Traders Brace for Selling Trade! 

The USD/CAD pair was closed at 1.27513 after placing a high of 1.28269 and a low of 1.27493. The currency pair USD/CAD extended its losses on Wednesday for the 3rd consecutive day amid the US dollar’s weakness and rising crude oil prices. The bearish momentum surrounding the currency pair USD/CAD remained intact due to the unbeatable selling pressure around the greenback and a stronger Canadian dollar on the back of rising crude oil prices amid the improved risk sentiment in the market.

The USD/CAD pair was closed at 1.27513 after placing a high of 1.28269 and a low of 1.27493. The currency pair USD/CAD extended its losses on Wednesday for the 3rd consecutive day amid the US dollar’s weakness and rising crude oil prices. The bearish momentum surrounding the currency pair USD/CAD remained intact due to the unbeatable selling pressure around the greenback and a stronger Canadian dollar on the back of rising crude oil prices amid the improved risk sentiment in the market.

The USD/CAD pair was closed at 1.27513 after placing a high of 1.28269 and a low of 1.27493. The currency pair USD/CAD extended its losses on Wednesday for the 3rd consecutive day amid the US dollar’s weakness and rising crude oil prices. The bearish momentum surrounding the currency pair USD/CAD remained intact due to the unbeatable selling pressure around the greenback and a stronger Canadian dollar on the back of rising crude oil prices amid the improved risk sentiment in the market.

The rising optimism surrounding the vaccine rollouts after the UK regulatory approved the emergency use authorization of the vaccine prepared by AstraZeneca and Oxford University helped recover the market’s energy demand. The rising energy demand added to the crude oil prices that lift the per barrel price of West Texas Intermediate (WTI) to $48.63 on Wednesday.

Another reason behind the rising crude oil prices was the weekly report from EIA about the US crude oil stocks. At 20:30 GMT, the Crude Oil Inventories from last week were declined to -6.1M against the forecasted -3.0M and supported the crude oil prices. The surge in WTI prices gave strength to the commodity-linked currency Loonie that ultimately added losses in the USD/CAD pair on Wednesday.

On the data front, from the US side, at 18:30 GMT, the Goods Trade Balance from November dropped to -84.8B against the predicted -81.5B and weighed on the US dollar that added losses in the currency pair USD/CAD. The Prelim Wholesale Inventories from November also dropped to -0.1% against the predicted 0.7% and supported the US dollar. At 19:45 GMT, Chicago PMI in December raised to 59.5 against the predicted 56.6 and supported the US dollar. At 20:00 GMT, the Pending Home Sales from November fell to -2.6% against the predicted 0.1% and weighed on the US dollar that ultimately added further losses in the USD/CAD pair.

Apart from Crude oil prices and macroeconomic data, the USD/CAD pair was dropped to its fresh weekly lowest level amid the US dollar’s weakness driven by the hopes that Senate will approve US stimulus checks to increase to $2000 from $600. These hopes dragged the US Dollar Index to its lowest level since April 2018 and reached below 89.52 level that added further losses in the USD/CAD pair.


Daily Technical Levels

Support Resistance

1.2776 1.2859

1.2734 1.2902

1.2692 1.2943

Pivot point: 1.2818

The USD/CAD is trading bearish at the 1.2737 level, disrupting the support level of 1.2763. This same level is now working as resistance for USD/CAD. On the lower side, a continuation of a selling trend can extend a bearish move until the 1.2697 level. Since today is the last trading day of the year 2020, we are trying not to open unnecessary trades considering lack of volatility and trading volume. Let’s consider taking a sell trade below 1.2763 today. Good luck!  

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Forex Signals

GBP/USD Bounces off Support – Quick Buy Signal Update!

The GBP/USD pair was closed at 1.36245 after placing a high of 1.36255 and a low of 1.34888. The British Pound to U.S. Dollar exchange rate climbed to weekly highs as the U.K. Parliament voted for the Brexit trade deal. Barely 24 hours before the U.K.’s final split from the European Union, Prime Minister Boris Johnson’s post-Brexit trade deal won approval from the U.K. Parliament. The agreement earlier crossed the House of Commons with 521 votes in favor of 73 opposing it. The Scottish National Party (SNP) was against the bills while stating that it will harm Scotland’s fishing industry and told PM Johnson that it would bolster the case for independence.

The GBP/USD pair was closed at 1.36245 after placing a high of 1.36255 and a low of 1.34888. The British Pound to U.S. Dollar exchange rate climbed to weekly highs as the U.K. Parliament voted for the Brexit trade deal. Barely 24 hours before the U.K.’s final split from the European Union, Prime Minister Boris Johnson’s post-Brexit trade deal won approval from the U.K. Parliament. The agreement earlier crossed the House of Commons with 521 votes in favor of 73 opposing it. The Scottish National Party (SNP) was against the bills while stating that it will harm Scotland’s fishing industry and told PM Johnson that it would bolster the case for independence.

The GBP/USD pair was closed at 1.36245 after placing a high of 1.36255 and a low of 1.34888. The British Pound to U.S. Dollar exchange rate climbed to weekly highs as the U.K. Parliament voted for the Brexit trade deal. Barely 24 hours before the U.K.’s final split from the European Union, Prime Minister Boris Johnson’s post-Brexit trade deal won approval from the U.K. Parliament. The agreement earlier crossed the House of Commons with 521 votes in favor of 73 opposing it. The Scottish National Party (SNP) was against the bills while stating that it will harm Scotland’s fishing industry and told PM Johnson that it would bolster the case for independence.

The GBP/USD pair has also violated the resistance level of 1.3617 level, and on the higher side, the next target remains at the 1.3698 level. On the lower side, the GBP/USD pair may find support at the 1.3617 level for now. We can expect a continuation of an upward trend in the Sterling today.

Daily Technical Levels

Support Resistance

1.3456 1.3533

1.3413 1.3567

1.3379 1.3611

Pivot Point: 1.3490


Entry Price – Buy 1.3662

Stop Loss – 1.3622

Take Profit – 1.3702

Risk to Reward – 1:1

Profit & Loss Per Standard Lot = -$400/ +$400

Profit & Loss Per Micro Lot = -$40/ +$40

Fellas, now you can check out forex trading signals via Forex Academy mobile app. Follow the links below.

iPhone Users: https://apps.apple.com/es/app/fasignals/id1521281368

Andriod Users: https://play.google.com/store/apps/details?id=academy.forex.thesignal&hl=en_US

 

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Forex Market Analysis

Daily F.X. Analysis, December 31 – Top Trade Setups In Forex – U.S. Jobless Claims Ahead

On Thursday, the German banks will be closed in observance of New Year’s Eve since banks aid most foreign exchange volume. When they are closed, the market is less liquid, and speculators become a more dominant market influence. This can lead to both abnormally weak and abnormally huge volatility. Later throughout the U.S. session, the U.S. unemployment claims will remain in highlights.

On Thursday, the German banks will be closed in observance of New Year’s Eve since banks aid most foreign exchange volume. When they are closed, the market is less liquid, and speculators become a more dominant market influence. This can lead to both abnormally weak and abnormally huge volatility. Later throughout the U.S. session, the U.S. unemployment claims will remain in highlights.

On Thursday, the German banks will be closed in observance of New Year’s Eve since banks aid most foreign exchange volume. When they are closed, the market is less liquid, and speculators become a more dominant market influence. This can lead to both abnormally weak and abnormally huge volatility. Later throughout the U.S. session, the U.S. unemployment claims will remain in highlights.

Economic Events to Watch Today  

 

EUR/USD – Daily Analysis

The EUR/USD pair was closed at 1.22998 after placing a high of 1.23099 and a low of 1.22454. EUR/USD pair rose for the 5th consecutive day on Wednesday and reached above 1.23000 level, its highest since April 2018 amid the broad-based U.S. dollar weakness. The reports that the U.S. Senate has delayed a decision on increasing the coronavirus relief checks added pressure on the U.S. dollar. The Republican Senator Mitch McConnell blocked a move by colleague Bernie Sanders to allow a vote on increasing stimulus checks from $600 to $2000. However, Treasury Secretary Steve Mnuchin announced that direct payments of $600 would be out as soon as this week.

Despite a delay in the vote on the increase in the stimulus checks, the greenback dropped as investors were hopeful that the Senate would approve the rise in stimulus checks. The declining U.S. dollar added strength to the rising EUR/USD pair. On the data front, at 13:00 GMT, Spanish Flash CPI for the year dropped to -0.5% against the expected -0.6% and supported Euro that added additional gains in EUR/USD pair. From the U.S. side, at 18:30 GMT, the Goods Trade Balance from November fell to -84.8B against the projected -81.5B and weighed on the U.S. dollar that added further gains in EUR/USD pair. The Prelim Wholesale Inventories from November also fell to -0.1% against the projected 0.7% and supported the U.S. dollar. At 19:45 GMT, Chicago PMI in December surged to 59.5 against the projected 56.6 and supported the U.S. dollar. At 20:00 GMT, the Pending Home Sales from November fell to -2.6% against the projected 0.1% and weighed on the U.S. dollar that ultimately added gains in EUR/USD pair.

Furthermore, the risk-sensitive EUR/USD pair was also supported by the rising risk sentiment in the market after Britain approved another vaccine made by AstraZeneca and Oxford University. On Wednesday, Britain became the first country to approve the emergency use authorization of a vaccine developed by AstraZeneca and the University of Oxford that offers a 90% efficacy rate with the second vaccine shot.

The news about another vaccine available for use to control the coronavirus’s spread and in cheap amounts gave hopes that the global economic recovery process will speed up. These hopes raised the risk sentiment in the market and supported the currency pair EUR/USD on Wednesday.

Meanwhile, the optimism surrounding the Brexit deal also kept the EUR/USD pair on the upside on Wednesday. However, the EUR/USD pair’s gains remain limited throughout the day as the new variant of coronavirus that was originally discovered in the U.K. reached almost eight European Union nations. This urged E.U. nations to start mass vaccination to control the spread of the virus whereas, Spain was set to register people who refuse to be vaccinated against coronavirus and share it with European Union nations.

Daily Technical Levels

Support Resistance

1.2210    1.2279

1.2175    1.2311

1.2142    1.2347

Pivot point: 1.2243

EUR/USD– Trading Tip

The EURUSD continues to trade with a bullish bias after violating the ascending triangle pattern, extending resistance at the 1.2265 level. Above this, the odds of bullish trend continuation remains pretty solid. On the higher side, the pair may find resistance at 1.2308, and a bullish breakout of 1.2308 can lead its price towards the 1.2340 level. Bullish bias dominates today.

GBP/USD – Daily Analysis

The GBP/USD pair was closed at 1.36245 after a high of 1.36255 and a low of 1.34888. The British Pound to U.S. Dollar exchange rate climbed to weekly highs as the U.K. Parliament voted for the Brexit trade deal. Barely 24 hours before the U.K.’s final split from the European Union, Prime Minister Boris Johnson’s post-Brexit trade deal won approval from the U.K. Parliament. The agreement earlier crossed the House of Commons with 521 votes in favor of 73 opposing it. The Scottish National Party (SNP) was against the bills while stating that it will harm Scotland’s fishing industry and told PM Johnson that it would bolster the case for independence.

The Sterling got support from the Brexit deal’s approval in the U.K. Parliament and supported the GBP/USD currency pair on Wednesday. At the same time, the U.K. has ordered 100 million doses of the new vaccine that will be enough to vaccinate most of the population. On Wednesday, the U.K. regulatory approved the emergency use authorization to the vaccine of AstraZeneca and Oxford University that is said to offer 90% efficacy against coronavirus with the second vaccine shot. 

On Tuesday, the U.K. reported a record increase in new infections of over 50,000, the largest daily increase since the pandemic began. THE British Prime Minister Boris Johnson has approved placing more parts of the country into tier-4 restrictions as the country was fighting against the new variant of coronavirus, which scientists have warned that could spread more rapidly.

In parts of Southwest England and Cumbria, the ministers were considering imposing the toughest measures to control the spread of a new variant of coronavirus. Johnson announced that a further 20 million people in England will join the toughest tier of coronavirus restrictions from Thursday. These negative developments could not reverse the GBP/USD pair’s movement on Wednesday, and the pair continued increasing for the second consecutive day.

On the data front, at 11:57 GMT, the Nationwide HPI in December came in as 0.8% against the expected 0.4% and supported British Pound, and pushed the pair GBP/USD higher. From the U.S. side, at 18:30 GMT, the Goods Trade Balance from November decreased to -84.8B against the anticipated -81.5B and weighed on the U.S. dollar that added gains in GBP/USD pair. The Prelim Wholesale Inventories from November also decreased to -0.1% against the anticipated 0.7% and supported the U.S. dollar. At 19:45 GMT, Chicago PMI in December surged to 59.5 against the anticipated 56.6 and supported the U.S. dollar. At 20:00 GMT, the Pending Home Sales from November decreased to -2.6% against the anticipated0.1% and weighed on the U.S. dollar that ultimately added further gains in GBP/USD pair.

The U.S. dollar weakness was driven by the hopes that the increase in stimulus checks will be passed in the Senate even though they have delayed the decision. This weakness of the U.S. dollar kept the GBP/USD pair higher on board on Wednesday.

Daily Technical Levels

Support Resistance

1.3456    1.3533

1.3413    1.3567

1.3379    1.3611

Pivot Point: 1.3490

GBP/USD– Trading Tip

The GBP/USD pair has also violated the resistance level of 1.3617 level, and on the higher side, the next target remains at the 1.3698 level. On the lower side, the GBP/USD pair may find support at the 1.3617 level for now. We can expect a continuation of an upward trend in the Sterling today.

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 103.207 after placing a high of 103.591 and a low of 102.959. USD/JPY pair extended its losses on Wednesday amid the declining U.S. dollar despite the market’s rising risk sentiment. The USD/JPY pair fell to its fresh weekly lowest level below 103.00 level on Wednesday as the greenback was very weak across the board against its rival currencies. The U.S. Dollar Index that measures the value of the U.S. dollar against the basket of six major currencies fell to its lowest level for almost three years below 89.52 on Wednesday.

The U.S. Senate delayed its decision on increasing the number of stimulus checks from$600 to $2000 as the Republican Senator Mitch McConnell blocked a move by colleague Bernie Sanders to allow a vote on increasing stimulus checks. Treasury Secretary Steve Mnuchin has announced that direct payments of $600 would be out as soon as this week. Investors were hopeful that the rise in stimulus checks will be accepted by Senate and continued selling the U.S. dollar on Wednesday that ultimately weighed on the currency pair USD/JPY and dragged the pair towards fresh weekly lowest level.

On the data front, at 18:30 GMT, the Goods Trade Balance from November declined to -84.8B against the estimated-81.5B and weighed on the U.S. dollar that dragged the currency pair USD/JPY on the downside. The Prelim Wholesale Inventories from November also dropped to -0.1% against the estimated 0.7% and supported the U.S. dollar. At 19:45 GMT, Chicago PMI in December raised to 59.5 against the estimated 56.6 and supported the U.S. dollar. At 20:00 GMT, the Pending Home Sales from November dropped to -2.6% against the estimated 0.1% and weighed on the U.S. dollar, increasing the USD/JPY pair’s losses.

Furthermore, the market’s risk sentiment was also improved after Great Britain became the first country to approve the vaccine by AstraZeneca and the University of Oxford for emergency use. This vaccine is said to provide 625 efficacy against coronavirus in the first shot that could be increased to 90% in the second shot. After this news, the hopes for economic recovery took their pace as a cheaper vaccine will be wildly available and help control the loss caused by the coronavirus pandemic. This news raised the market’s risk sentiment and added weight on the safe-haven Japanese Yen that ultimately capped further losses in the USD/JPY pair on Wednesday.

The main driver of the currency pair USD/JPY remained the sell-off in the U.S. dollar amid the rising hopes for an increase in stimulus checks the amount, and it will remain at the mercy of the U.S. dollar for a while as there will be no macroeconomic release from Japanese side until next week.

Daily Technical Levels

Support Resistance

103.39    103.78

103.23    104.01

103.01    104.17

Pivot point: 103.62

USD/JPY – Trading Tips

The USD/JPY violates the sideways range at the 103.500 level. It was a support level extended by an ascending triangle pattern that has already been violated. On the 2 hour timeframe, the USD/JPY pair is gaining support at 103.003 and 102.750 levels along with a resistance level of 103.575, which is extended by a triangle pattern that got violated. The pair is now closing a doji candle over 103.260 support level that suggests odds of bullish correction. On the higher side, the pair can lead towards the 103.575 level and then offer us a sell trade. Let’s brace for it. Good luck!

Categories
Forex Signals

GBP/USD Ascending Triangle Breakout – Brace for Buying! 

Today in the early European trading session, the GBP/USD currency pair managed to maintain its bullish bias through the first half of the Asian session and remained bullish around above the mid-1.3500 level. However, the bullish trend was mainly sponsored by the selling tone surrounding the US dollar, which fell to fresh multi-year lows amid increasing bets about the possibility of additional financial aid in the US. Apart from this, the losses in the greenback were further bolstered after the US registered the first case of the covid variant, which instantly put doubt over the US economic recovery and undermined the US dollar. 

Today in the early European trading session, the GBP/USD currency pair managed to maintain its bullish bias through the first half of the Asian session and remained bullish around above the mid-1.3500 level. However, the bullish trend was mainly sponsored by the selling tone surrounding the US dollar, which fell to fresh multi-year lows amid increasing bets about the possibility of additional financial aid in the US. Apart from this, the losses in the greenback were further bolstered after the US registered the first case of the covid variant, which instantly put doubt over the US economic recovery and undermined the US dollar. 

Today in the early European trading session, the GBP/USD currency pair managed to maintain its bullish bias through the first half of the Asian session and remained bullish around above the mid-1.3500 level. However, the bullish trend was mainly sponsored by the selling tone surrounding the US dollar, which fell to fresh multi-year lows amid increasing bets about the possibility of additional financial aid in the US. Apart from this, the losses in the greenback were further bolstered after the US registered the first case of the covid variant, which instantly put doubt over the US economic recovery and undermined the US dollar. 

Meanwhile, the Federal Reserve showed readiness to maintain low-interest rates for a too long period. This, in turn, put additional pressure on the greenback and was seen as one of the key factors that benefitted the GBP/USD currency pair. Across the ocean, the currency pair got an additional lift after the UK health department announced that the government had accepted the proposal by the MHRA to approve the vaccine for use in the UK. On the contrary, the escalating market concerns about the continuous surge in new coronavirus cases and the imposition of new restrictions in the UK keep fueling the doubts over the UK economic recovery, which could cap the gains for the GBP/USD currency pair. At a particular time, the GBP/USD currency pair is currently trading at 1.3573 and consolidating in the range between 1.3494 – 1.3579.

As per the latest report, the UK said that regulators had authorized the use of the AstraZeneca/Oxford coronavirus vaccine. The UK health department declared that the government had accepted the recommendation by the MHRA to authorize the vaccine for use in the UK. This progress remained supportive of the already upbeat market mood, which continued weakening the US dollar’s safe-haven demand and contributing to the currency pair gains.

Apart from this, the bearish trend around the US dollar was also sponsored by the rising bets about the likelihood of additional financial aid in the US. It is worth reporting that US Congress members keep struggling to deliver $2,000 paychecks after Senate Majority Republican Leader Mitch McConnell showed a willingness to block the payments earlier in the day. Despite this, the policymaker put forward the bill as a part of the procedure. Meanwhile, the US Treasury Secretary Steve Mnuchin’s announced that the qualified US residents could start receiving the direct stimulus payment of $600 soon, which boosted the market trading sentiment. The market trading sentiment got an additional lift after the President-elect Joe Biden showed readiness for more support measures, which puts additional pressure on the US dollar. 


The GBP/USD pair has also violated the resistance level of 1.3520 level, and on the higher side, the next target remains at the 1.3580 level. On the lower side, the GBP/USD pair may find support at the 1.3520 level now. We can expect a continuation of an upward trend in the Sterling today as the MACD and RSI suggest a bullish trend. Alongside, the GBP/USD pair may soar until the 1.3620 level today as the 50 EMA also extending bullish bias for the Cable.

Categories
Forex Market Analysis

Daily F.X. Analysis, December 30 – Top Trade Setups In Forex – U.S. Trade Balance Ahead! 

The eyes will remain on the Spanish Flash CPI y/y, the U.S. Chicago PMI, and Pending Home Sales m/m figures on the news side. However, these are low impact events and may not drive sharp moves in the market.

The eyes will remain on the Spanish Flash CPI y/y, the U.S. Chicago PMI, and Pending Home Sales m/m figures on the news side. However, these are low impact events and may not drive sharp moves in the market.

The eyes will remain on the Spanish Flash CPI y/y, the U.S. Chicago PMI, and Pending Home Sales m/m figures on the news side. However, these are low impact events and may not drive sharp moves in the market.

Economic Events to Watch Today  

EUR/USD – Daily Analysis

The EUR/USD pair was closed at 1.22489 after placing a high of 1.22748 and a low of 1.22066. EUR/USD currency pair raised on Tuesday for the 4th consecutive day as the U.S. dollar was weak across the board and risk sentiment was high. The European stocks closed higher on Tuesday following a rally on Wall Street in the previous session. The pan-European Stoxx600 indexes ended up 0.76%, with most sectors in the positive territory. The rally has improved the European sentiment in U.S. stocks on Monday that came in after President Donald Trump signed a $900 billion coronavirus relief package into law; the measure will include direct payment to most Americans by $600.

Previously, Trump has demanded a $2000 direct payment days before the signing. On Monday, the House of Representatives voted to increase the second round of direct federal payments to $2000 and left it up to the GOP-controlled Senate. After this, the U.S. stocks rallied and continued rising till Tuesday morning. This pressured on the U.S. dollar ultimately added in the EUR/USD pair’s upward direction on Tuesday.

However, the positive sentiment in Europe came after the Brexit trade deal was secured between the E.U. and U.K. on Christmas Eve. Following this, London’s FTSE100 index rose by 2% on Tuesday. On Monday, the 27 ambassadors from the European Union member nations formally accepted the deal implemented on January 1. This news also supported the upward momentum in the currency pair EUR/USD pair on Tuesday.

Meanwhile, on Tuesday, the European Commission President Ursula von der Leyen said that the European Union would buy an extra 100 million doses of Pfizer and BioNTech’s coronavirus vaccine to bring the total from the two firms to 300 million doses.

She tweeted that they had decided to take an additional 100 million doses of the Pfizer/BionTech vaccine that has already being used to vaccinate people across the E.U. After some of the vaccine contestants organized by the E.U, this plan came in after some of the vaccine candidates faced unexpected delays in clinical trials that forced the bloc and other wealthy nations to rely on shots from fewer manufacturers than initially planned.

The E.U. officials said that the two firms have committed to rapidly deliver 200 million doses after regulatory approval for 15.5 euros per piece. The extra 100 million will be delivered at the same price, but the timetable will be negotiated as they will be delivered in 2021. The E.U.’s goal to roll out vaccine at the mass level also supported the local currency Euro and supported the upward momentum in EUR/USD pair.

The risk sentiment in the market driven by the vaccine rollout, U.S. stimulus, and the Brexit optimism also kept pushing the pair EUR.USD even higher on the board on Tuesday. Moreover, on the data front, at 19:00 GMT, the S&P/CS Composite -20 HPI for the year from the U.S. rose to 7.9% in October from the expected 7.0% and supported the U.S. dollar that capped further upside in the EUR/USD prices.

Daily Technical Levels

Support   Resistance

1.2210     1.2279

1.2175     1.2311

1.2142     1.2347

Pivot point: 1.2243

EUR/USD– Trading Tip

The EURUSD has violated the ascending triangle pattern, which was extending resistance at 1.2265 level, and above this, the odds of bullish trend continuation remain pretty stable. On the lower side, the support stays at the 1.2266 level, and the continuation of an upward trend can lead the pair towards the next resistance level of 1.2317. A slight downward retracement can be expected before a further upward trend.

GBP/USD – Daily Analysis

The GBP/USD pair was closed at 1.35009 after placing a high of 1.35225 and a low of 1.34405. The GBP/USD pair raised on Tuesday despite the rising number of coronavirus cases in the U.K. amid the Brexit development and improved risk sentiment.

The GBP/USD pair was supported on Tuesday from the rising risk sentiment in the market due to more optimistic news from the vaccine front. The U.K. has covered the way for widespread vaccinations with a homegrown shot that will be less expensive and easier to transport and store than other vaccines. For this purpose, the vaccines developed by the University of Oxford and AstraZeneca were set to get approval from the U.K. for emergency use authorization.

The U.K. drug regulator, the Medicines and Health products Regulatory Agency, will imminently authorize the AstraZeneca and Oxford University vaccine for emergency use within days to control the spread of coronavirus in the country. The vaccine’s efficacy rate is 90% after taking two doses, as one dose will provide only 62% efficacy against the coronavirus. Approving another vaccine will help the U.K. government battle against the coronavirus pandemic and lift the severe social distancing restrictions put in place before Christmas.

The new coronavirus cases in the U.K. on Tuesday were recorded as 53,135, and a health regulator of the country has said that the rise in coronavirus cases in the U.K. was of extreme concern. The Health Secretary has announced that the NHS was facing unprecedented pressures as hospitals in England and Wales were treating more coronavirus patients than at the peak of the first wave in April.

On the Brexit front, four days after sealing a free trade agreement with the European Union, the British government warned businesses to get ready for disruptions and bumpy moments when the new rules affect Thursday night. On Monday, the Businesses were scrambling to digest the details and implications of the 1240 page deal sealed between the U.K. and the E.U. on Christmas Eve. Meanwhile, E.U. ambassadors gave their unanimous approval on Monday to the Brexit trade deal with the U.K. However, the deal still needs approval from the E.U. legislature that is expected to come in February. At the same time, the U.K.’s House of Commons is expected to approve it on Wednesday.

After its approval by 27 E.U. ambassadors, the Brexit trade deal’s optimism gave support to British Pound that ultimately pushed the currency pair GBP/USD higher on the board despite the rising number of coronavirus cases in the country. Furthermore, the U.S. dollar was also weak across the board, which also helped the GBP/USD pair keep posting gains on Tuesday. Trump signed the second stimulus bill on Sunday that weighed heavily on local currency. Whereas, on the data front, at 19:00 GMT, the S&P/CS Composite -20 HPI for the year from the U.S. surged to 7.9% in October from the predicted 7.0% and supported the U.S. dollar that capped further gains in the GBP/USD prices on Tuesday.

Daily Technical Levels

Support   Resistance

1.3456     1.3533

1.3413     1.3567

1.3379     1.3611

Pivot point: 1.3490

GBP/USD– Trading Tip

The GBP/USD pair has also violated the resistance level of 1.3520 level, and on the higher side, the next target remains at the 1.3580 level. On the lower side, the GBP/USD pair may find support at the 1.3520 level now. We can expect a continuation of an upward trend in the Sterling today as the MACD and RSI suggest a bullish trend. Alongside, the GBP/USD pair may soar until the 1.3620 level today as the 50 EMA also extending bullish bias for the Cable.

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 103.530 after placing a high of 103.824 and a low of 103.461. After posting gains for two consecutive days, USD/JPY dropped and posted losses on Tuesday amid the broad-based U.S. dollar weakness despite the risk sentiment. The U.S. Dollar was weak on Tuesday as investors were hopeful that Senate would pass the additional $1400 in stimulus paychecks. The greenback that measures the value of the U.S. dollar against the basket of six currencies was down by 0.24% on Tuesday and weighed on the USD/JPY pair.

The House of Representatives approved the rise in the amount of the stimulus checks from $600 to $2000 earlier in the week. Now the eyes have turned to Senate, where the Majority Leader Mitch McConnell moved to block the rise in the amount on Tuesday. Whereas, U.S. President Donald Trump has urged him to approve the increase in the number of stimulus paychecks.

The greenback has seen steady losses since U.S. President Donald Trump has signed the $2.3 trillion coronaviruses and spending bill on Sunday. Investors shifted from the U.S. dollar immediately after as more stimulus prospects reduced the demand for safe-haven assets. The country’s economic recovery was under threat as the U.S. continuously saw a large number of coronavirus cases, and it has increased the hopes for more fiscal stimulus measures from Congress. Hence, investors kept selling the U.S. dollar in hopes that the Senate could pass the increase in the number of stimulus checks at the last minute.

Furthermore, another reason behind the weakness of the U.S. dollar was that some investors warned that the dollar would fall further in 2021 as President-elect Joe Biden will roll out further stimulus measures. Biden and his administration will come into power on January 20. Despite the weakness of the U.S. dollar, the USD/JPY pair was also falling on the back of increasing figures of coronavirus cases in the U.S. There were also reports suggesting that the new variant of coronavirus first discovered in the U.K. has reached the U.S. The health officials in Colorado confirmed that the infected individual was held in isolation in Elbert Country and that the person was in his 20s and had no travel history.

This also raised the fears for global economic recovery and raised the safe-haven appeal that ultimately supported the safe-haven Japanese yen, and added the USD/JPY pair’s downward momentum on Tuesday.

Meanwhile, on the data front, at 19:00 GMT, the S&P/CS Composite -20 HPI for the year from the U.S. advanced to 7.9% in October from the anticipated 7.0% and supported the U.S. dollar that capped further losses in the USD/JPY prices on Tuesday.

On the other hand, the losses in USD/JPY pair were also capped by the reports that AstraZeneca and University of Oxford’s vaccine were set to receive approval from the U.K.’s regulatory for emergency use authorization. This resulted in improved risk sentiment and weighed on the Japanese Yen due to its safe-haven status and capped further losses in the USD/JPY pair on Tuesday.

Daily Technical Levels

Support   Resistance

103.39     103.78

103.23     104.01

103.01     104.17

Pivot point: 103.62

USD/JPY – Trading Tips

The USD/JPY violates the sideways range at the 103.500 level. It was a support level extended by an ascending triangle pattern that has already been violated. On the 2 hour timeframe, the USD/JPY pair is gaining support at 103.250 and 102.980 levels along with a resistance level of 103.575, which is extended by a triangle pattern that got violated. The pair is now closing a doji candle over 103.260 support level that suggests odds of bullish correction. On the higher side, the pair can lead towards the 103.575 level and then offer us a sell trade. Let’s brace for it. Good luck!

Categories
Forex Signals

AUD/USD Soars Higher – Upward Channel Supports! 

The AUD/USD closed at 0.75809 after placing a high of 0.76223 and a low of 0.75570. After placing bullish moves for two consecutive days, the AUD/USD pair fell after a long weekend despite the rising risk-on market sentiment amid the rebound in the greenback. The US President Donald Trump raised the global markets on Monday after signing the coronavirus stimulus bill that was long-awaited and has been under negotiations since May. Though his demand for $2000 paychecks and removal of section 230 was currently under debate in the Senate, the US Treasury has already said to disburse $600 weekly paychecks.

The AUD/USD closed at 0.75809 after placing a high of 0.76223 and a low of 0.75570. After placing bullish moves for two consecutive days, the AUD/USD pair fell after a long weekend despite the rising risk-on market sentiment amid the rebound in the greenback. The US President Donald Trump raised the global markets on Monday after signing the coronavirus stimulus bill that was long-awaited and has been under negotiations since May. Though his demand for $2000 paychecks and removal of section 230 was currently under debate in the Senate, the US Treasury has already said to disburse $600 weekly paychecks.

The AUD/USD closed at 0.75809 after placing a high of 0.76223 and a low of 0.75570. After placing bullish moves for two consecutive days, the AUD/USD pair fell after a long weekend despite the rising risk-on market sentiment amid the rebound in the greenback. The US President Donald Trump raised the global markets on Monday after signing the coronavirus stimulus bill that was long-awaited and has been under negotiations since May. Though his demand for $2000 paychecks and removal of section 230 was currently under debate in the Senate, the US Treasury has already said to disburse $600 weekly paychecks.

Meanwhile, House Speaker Nancy Pelosi showed readiness to get the $2000 passed in Congress. This raised the risk sentiment in the already high market because of the vaccine rollout and Brexit optimism. However, the Aussie-China tussle and the fear of a new variant of coronavirus kept the pair AUD/USD under pressure.

According to the data released by the General Administration of Customs, China’s import of Australian copper concentrate fell by 34% to 26,717 tonnes in November, the lowest level since January 2017. On the other hand, Australia insisted the World Health Organization (WHO) inquiry into coronavirus origin must be robust, despite China’s tensions.

Looking forward, a lack of major data requires the pair of traders to watch risk catalysts for immediate direction. Among them, the US stimulus passage and any developments on the Canberra-Beijing tension will be the key. 

Meanwhile, the US dollar was weak across the board due to the stimulus bill turned into legislation after Trump signed it. The US Dollar Index that tracks the greenback against a basket of other currencies edged down 0.15% to 90.112 that capped further downside in AUD/USD pair. In the absence of any macroeconomic data and holiday-thinned trading, the currency pair AUD/USD remained depressed on Monday.


Daily Technical Levels

Support Resistance

0.7548 0.7616 

0.7519 0.7653

0.7481 0.7683

Pivot point: 0.7586

The AUD/USD is trading bullish at the 0.76050 level, forming an upward channel on the two-hourly timeframes. The AUD/USD pair may find resistance at the 0.7625 level, and a bullish breakout of this level can extend the buying trend until the 0.7680 level. On the lower side, the support stays at the 0.7560 mark. Bullish crossover of AUD/USD pair is likely to drive the further upward trend in Aussie; however, taking a bullish trade can be risky at this movement, especially when the market volatility is at its lowest. Good luck! 

Categories
Forex Market Analysis

Daily F.X. Analysis, December 29 – Top Trade Setups In Forex – Technical Levels in Play! 

On Tuesday, the market’s fundamental side is mostly muted as we don’t have any significant economic data scheduled from any economy. The S&P/CS Composite-20 HPI y/y will be released during the U.S. session; however, it’s low-impact and may not drive any major movement in the market today.

On Tuesday, the market’s fundamental side is mostly muted as we don’t have any significant economic data scheduled from any economy. The S&P/CS Composite-20 HPI y/y will be released during the U.S. session; however, it’s low-impact and may not drive any major movement in the market today.

On Tuesday, the market’s fundamental side is mostly muted as we don’t have any significant economic data scheduled from any economy. The S&P/CS Composite-20 HPI y/y will be released during the U.S. session; however, it’s low-impact and may not drive any major movement in the market today.

Economic Events to Watch Today  

 

EUR/USD – Daily Analysis

The EUR/USD pair was closed at 1.22142 after placing a high of 1.22501 and a low of 1.21809. EUR/USD pair posted gains on Monday; however, some of the gains were lost in the late trading session. On the first day of the new trading week, the EUR/USD pair moved on the upside on the back of a weak U.S. dollar and the rising risk sentiment in the market. The global risk sentiment remained well supported by the latest optimism over a last0-minute Brexit deal and got an additional boost after the U.S. President Donald Trump finally signed the $2.3 trillion pandemic aid and spending package.

On Sunday, U.S. President Donald Trump signed the bipartisan bill of $2.3 trillion packages, including $900 billion for stimulus checks and $1.4 trillion for government funding. Trump, who first called this bill a disgrace, signed the bill and made it legislation as the government was near to shut down. However, he urged the U.S. Congress to increase the stimulus check amount to $2000 from $600. Given his calls, the House of Representatives led by Democratic leaders approved the CASH Act on Monday. The Act was designed to support Trump’s decision to increase the stimulus checks. The House voted 275-134 on Monday to increase the proposed $600 payments to more than triple $2000 and send it to Senate.

All these developments in the U.S. stimulus measure raised the market’s risk sentiment that ultimately added strength in the risk perceived EUR/USD pair. Meanwhile, another reason behind the EUR/USD pair’s upward momentum was the sharp rise in European markets on Monday. At the start of the last trading week of 2020, the Brexit developments and the U.S. stimulus measure raised the risk sentiment that supported the European stocks to move higher levels added in the EUR/USD pair. France’s CAC40 rose by 1.3%, the Swiss SMI surged by 1.8%, and Germany’s DAX index finished up by 1.5% on Monday.

However, some of the EUR/USD pair gains in the late trading session on Monday were lost after the news of a new variant of coronavirus reaching eight European countries emerged. The more contagious variant of coronavirus identified in the U.K. has been confirmed to be reported in Spain, Switzerland, Sweden, and France. This spread of a new variant of coronavirus affected EUR/USD’s upward momentum by weighing on the local currency Euro, as fears for economic slowdown emerged again in the European countries.

Daily Technical Levels

Support   Resistance

1.2179     1.2249

1.2144     1.2286

1.2108     1.2320

Pivot Point: 1.2215

EUR/USD– Trading Tip

On Tuesday, the EUR/USD consolidating in a narrow trading range of 1.2259 – 1.2205. On the 2 hour timeframe, the EUR/USD has formed an ascending triangle pattern supporting the pair around 1.2204 and a resistance at 1.2259. The MACD and RSI have now shifted to the bullish zone, supporting a bullish trend in the EUR/USD pair. Additionally, the 50 periods EMA supports the pair at 1.2204, and it’s also expending bullish sentiment for the EUR/USD pair today. 

GBP/USD – Daily Analysis

The GBP/USD pair was closed at 1.34574 after a high of 1.35760 and a low of 1.34289. On Monday, the currency pair GBP/USD fell sharply as market participants showed concerns that the post-Brexit trade agreement will slow the trade after the crucial services sector was largely excluded from the deal. The mayor of French fishing port has warned that Thursday’s historic Brexit trade deal between the U.K. and E.U. still left the fishing sector with many key questions unanswered. The mayor of Boulogne-sur-Mer, Frederic Cuvillier, said that the agreement left French fishermen wondering how it will impact them once the festive season was over. 

The long-awaited agreement between the two parties was resolved after granting a five-year transition period over fisheries, after which E.U. fish captures ought to be reduced by 25%. The concession was given from the U.K., who has initially demanded 60% at the start of the negotiations. Furthermore, on financial services, the Brexit deal is said to go in favor of the E.U. According to Boris Johnson, the agreement on financial services has fallen short of U.K. hopes. He said that perhaps the financial sector did not go as far as the U.K. would like. After these comments, Rishi Sunak offered financial services firms the prospect of closer access to E.U. markets than outlined in the Brexit trade deal.

Sunak said that he hoped that a planned memorandum of understanding on this issue between the U.K. and E.U. would smooth over many obstacles in the next few months. However, all these tensions weighed on the local currency British Pound and dragged the GBP/USD pair to the downside.

Meanwhile, the U.K. reported its highest day of new coronavirus infections on Monday with 41,385 new COVID-19 cases. The surge was driven by the new variant of the virus that is more transmissible and has forced the hospitals to cancel non-urgent procedures and scramble to find the space. Even though the new variant does not appear to make people sicker, it is believed to be up to 70% more contagious, resulting in an increased number of coronavirus infections in the U.K.

The rising number of coronavirus in the country and its faster rate affected the local currency, as hopes for an economic recovery dampened and weighed on the GBP/USD pair. It was another reason behind the downward momentum of the GBP/USD pair on Monday. However, the pair’s losses were limited on Monday due to the weakness of the U.S. dollar. The greenback was weak across the board as the U.S. President Donald Trump has signed the new coronavirus relief bill, turning it into law on Sunday. 

Whereas, the House of Representatives, which is led by Democrats, held a vote on the CASH Act on Monday, approved the Act, and passed it to the Senate. According to CASH Act, the number of stimulus checks in the bipartisan bill of $600 will be increased to $2000 as demanded by U.S. President Donald Trump and supported by the House of Democrats.

All the U.S. stimulus relief bill developments weighed on the U.S. dollar and capped further losses in the GBP/USD pair on Monday in the absence of any macroeconomic data release.

Daily Technical Levels

Support   Resistance

1.3393     1.3541

1.3337     1.3633

1.3245     1.3689

Pivot point: 1.3485

GBP/USD– Trading Tip

The GBP/USD is trading at 1.3485, having supported over 1.3443 level. The support level is extended by an upward trendline on the two-hourly timeframes. The GBP/USD pair is likely to face resistance at the 1.3525 level, and a bullish crossover of 1.3525 level can drive Sterling’s price towards 1.3620. The bullish trendline is likely to support the pair today at the 1.3443 level, and violation of this can extend the selling trend until the 1.3343 level.     

USD/JPY – Daily Analysis

The USD/JPY pair closed at 103.778 after placing a high of 103.896 and a low of 103.402. The currency pair USD/JPY extended its gains on Monday and raised for the second consecutive day as the market’s risk sentiment increased. The risk-on market sentiment was driven by the latest decision of Donald Trump to sign the bipartisan stimulus bill of $2.3 trillion that he had initially refused to pass. 

The U.S. President Donald Trump turned the bill of $2.3 trillion, including $900 billion for pandemic aid and $1.4 trillion for spending package on Sunday as the government was near to shut down in less than 30 days. However, despite signing the bill, Donald Trump continued urging Congress to increase the number of stimulus checks from $600 per person to $2000. Followed by his calls, the House of Representatives with a Democratic majority approved the CASH Act on Monday to allow the rise in payment of stimulus checks demanded by Donald Trump. The CASH Act was approved by Democrats and sent to Senate for further proceedings.

This added in to the risk sentiment as it raised hopes for economic recovery in a depressing environment and weighed on the safe-haven Japanese Yen that ultimately added in the USD/JPY pair’s upward momentum on Monday. Furthermore, the Bank of Japan released the summary of opinions at the December rate review that showed that the B.O. policymakers were divided on how far to go in changing its stimulus program, with some calling for an overhaul of its strategy achieving 2% inflation. 

The Governor of the Bank of Japan, Haruhiko Kuroda, said that the policy review would not lead to big changes to yield curve control (YCC) instead of focusing on fine-tuning the framework to make it more sustainable. However, some BOJ board members called for a more ambitious review as the hit to grow from coronavirus stokes fears of a return to deflation. 

On the data front, at 04:50 GMT, the Prelim Industrial Production reduced to 0.0% against the forecasted 1.4% and weighed on the Japanese Yen that added gains in the USD/JPY pair. Meanwhile, the USD/JPY pair’s gains were limited on Monday as the U.S. dollar was weak across the board due to the second round of stimulus relief package issuance. The bill will restore unemployment benefits to millions of Americans and averted a partial federal government shutdown that would have begun on Thursday. It raised the risk sentiment and weighed on the U.S. dollar that ultimately capped further upside in the USD/JPY pair on Monday.

Daily Technical Levels

Support   Resistance

103.47     104.02

103.25     104.37

102.91     104.58

Pivot point: 103.81

USD/JPY – Trading Tips

The USD/JPY is trading sideways at the 103.700 level, supported by an ascending triangle pattern. On the 2 hour timeframe, the USD/JPY pair is gaining support at 103.600 and 103.400 levels along with a resistance level of 103.860, which is extended by a triple top pattern. The pair is now closing a series of doji and spinning top candles, suggesting neutral bias among investors. It’s common during such a timeframe of December as most of the traders are on holiday. Let’s consider taking a buy trade over 103.860 level and selling below the same as this level is of major importance today. Good luck! 

Categories
Forex Signals

USD/CAD Sideways Trading Continues – Brace to Capture Breakout! 

A day before, the USD/CAD opened at 1.28497, and it has placed a high of 1.28602 and a low of 1.28277 so far. The USD/CAD pair dropped on Monday amid the US dollar’s weakness and the rising crude oil prices. The USD/CAD pair dropped on Monday on the first day of the new trading week as the market’s risk sentiment was improved and supported the risk perceived Canadian Dollar. The risk sentiment in the market was high due to the latest Brexit trade-deal optimism and was further supported by the news of the US stimulus bill.

A day before, the USD/CAD opened at 1.28497, and it has placed a high of 1.28602 and a low of 1.28277 so far. The USD/CAD pair dropped on Monday amid the US dollar’s weakness and the rising crude oil prices. The USD/CAD pair dropped on Monday on the first day of the new trading week as the market’s risk sentiment was improved and supported the risk perceived Canadian Dollar. The risk sentiment in the market was high due to the latest Brexit trade-deal optimism and was further supported by the news of the US stimulus bill.

A day before, the USD/CAD opened at 1.28497, and it has placed a high of 1.28602 and a low of 1.28277 so far. The USD/CAD pair dropped on Monday amid the US dollar’s weakness and the rising crude oil prices. The USD/CAD pair dropped on Monday on the first day of the new trading week as the market’s risk sentiment was improved and supported the risk perceived Canadian Dollar. The risk sentiment in the market was high due to the latest Brexit trade-deal optimism and was further supported by the news of the US stimulus bill.

On Sunday, the US President Donald Trump signed a $2.3 trillion coronavirus relief and government funding bill that added optimism over a last-minute Brexit trade deal and supported the risk perceived Canadian Dollar. The strong Loonie added pressure on the USD/CAD pair that started to decline on Monday.

The US President Donald Trump, who initially called the bipartisan coronavirus bill a disgrace and threatened to reject the bill, backed down from his decision and signed the bill to make it legislation. The bill will include $900 billion in coronavirus relief bill and $1.4 trillion in government funding that would expire after 24 hours. The passing of the second round of the coronavirus relief bill before the US government shutdown soared the risk sentiment and pressured on the US dollar that ultimately added further to the USD/CAD pair’s losses. The greenback was lower in early trading hours on Monday as USD bulls were largely unimpressed by a goodish pickup in the US Treasury bond yields. 

Meanwhile, on the WTI Crude oil front, the energy source prices rose on Monday as they hit $48.25 due to increased risk sentiment in the market and lower US dollar prices. The rising crude oil prices supported the commodity-linked currency Loonie that ultimately added further pressure on the USD/CAD pair on Monday. Another reason behind the declining USD/CAD pair and the Canadian Dollardollar’s strength against the greenback could also be the last-minute Brexit deal. On the last trading session on Thursday, the Canadian Dollar was strong against its counterpart US dollar as Britain secured a long-awaited Brexit deal with the EU. 

The US dollar was already lower because of the Brexit deal against the basket of major six currencies, and Trump’s decision to pass the US stimulus bill added further in it that pushed the US Dollar Index lower on Monday and supported the bearish momentum in USD/CAD pair.

In the absence of any major macroeconomic release from the Canadian or US side, the pair USD/CAD continued declining on the back of the rising Canadian Dollar, improved risk sentiment amid the Brexit deal and US stimulus package, and the declining US dollar and rising Crude oil prices on Monday.


Daily Technical Levels

Support Resistance

1.2826 1.2856

1.2814 1.2874

1.2796 1.2886

Pivot Point: 1.2844

The USD/CAD consolidates in a narrow trading range of 1.2860 – 1.2812 level. The market isn’t moving a lot as the global banks are closed due to the boxing day holiday. The 50 EMA and MACD are suggesting odds of neutral bias in the market. However, we can expect to take a buying trade over the 1.2860 level to target the 1.2930 level. On the lower side, the violation of the 1.2810 level can extend the selling trend until the 1.2760 level. Let’s wait for a breakout to capture a quick buy or a sell trade. Good luck! 

Categories
Forex Signals

AUD/USD Upward Channel In-Play – Daily Outlook! 

The AUD/USD opened at 0.75996, and it has placed a high of 0.76185 and a low of 0.75824 so far. AUD/USD pair seemed to extend its previous gains after moving in a bullish trend for two consecutive sessions on Monday. The upward momentum in the AUD/USD pair could be attributed to the US dollar weakness and rising risk sentiment in the market after a long weekend. The main reason behind the improved risk sentiment and the US dollar weakness was the news that US President Donald Trump has signed the second stimulus relief bill on Sunday.

The AUD/USD opened at 0.75996, and it has placed a high of 0.76185 and a low of 0.75824 so far. AUD/USD pair seemed to extend its previous gains after moving in a bullish trend for two consecutive sessions on Monday. The upward momentum in the AUD/USD pair could be attributed to the US dollar weakness and rising risk sentiment in the market after a long weekend. The main reason behind the improved risk sentiment and the US dollar weakness was the news that US President Donald Trump has signed the second stimulus relief bill on Sunday.

The AUD/USD opened at 0.75996, and it has placed a high of 0.76185 and a low of 0.75824 so far. AUD/USD pair seemed to extend its previous gains after moving in a bullish trend for two consecutive sessions on Monday. The upward momentum in the AUD/USD pair could be attributed to the US dollar weakness and rising risk sentiment in the market after a long weekend. The main reason behind the improved risk sentiment and the US dollar weakness was the news that US President Donald Trump has signed the second stimulus relief bill on Sunday.

Over the weekend, US President Donald Trump signed a $2.3 trillion stimulus package that would incude$900 billion for coronavirus relief and $1.4 trillion for government funding through next September. Initially, Trump called the package a “disgrace” and rejected to sign it into legislation and demanded to increase the stimulus checks to $2000; however, he backed down from his decision as the current government funding level was close to run out. The $900 billion coronavirus relief bill will provide $600 per person who makes less than $75000. 

As the US government shutdown was near, the second round of the US stimulus bill provided hope to the investors that the economy will start recovering soon, raising the risk sentiment in the market. 

This market sentiment supported the risk perceived Australian dollar, and the pair AUD/USD continued moving in the upward direction on Monday. Meanwhile, the US dollar also came under pressure after Donald Trump passed the second stimulus bill of $2.3 trillion as it would hurt the local currency. The AUD/USD pair got more strength from the US dollar’s weakness and raised its gains on Monday. Furthermore, the AUD/USD pair’s gains remained limited on Monday due to the latest pessimistic comments from the leading experts of China. The Tsinghua University’s Yan Xuetong said that though President-elect Joe Biden’s diplomatic strategy will be largely different from Trump’s strategy, it does not mean that US-China relations will improve. He added that Biden might seek to use the damage caused by Trump as a bargaining chip to get what he wants from Beijing. 

These comments from top experts from China added to the tension lingering between the world’s two largest economies and weighed on the China-proxy Australian dollar that ultimately limited the AUD/USD pair’s upward momentum on Monday. However, the holiday-thinned trading condition and the absence of any macroeconomic data from either side, the currency pair AUD/USD continued following the market’s risk sentiment and remained on the upside on Monday. 


Daily Technical Levels

Support Resistance

 0.7597 0.7619

0.7583 0.7627

0.7575 0.7641

Pivot point: 0.7605

The AUD/USD is trading at 0.7584 level, supported by an upward channel on the 2-hour timeframe. The 50 periods EMA is also supporting the pair at the 0.7580 level, and the MACD is closing histograms below 0, suggesting strong chances of selling. Since there’s a conflict between leading and lagging indicators, we may need to wait for either a bearish breakout below the 0.7580 level to take a sell trade or take a buying trade over 0.7580 once the MACD starts closing histograms over 0. Let’s keep an eye on the pair. Good luck! 

Categories
Forex Market Analysis

Daily F.X. Analysis, December 28 – Top Trade Setups In Forex – Boxing Day Holiday! 

Welcome back to a fresh week after a long weekend. I hope you had a fantastic Christmas. The global banks will be closed in observance of Boxing Day today; therefore, we may have thin volatility and trading volume today in the market. Let’s check out the technical side of the market. 

Welcome back to a fresh week after a long weekend. I hope you had a fantastic Christmas. The global banks will be closed in observance of Boxing Day today; therefore, we may have thin volatility and trading volume today in the market. Let’s check out the technical side of the market. 

Welcome back to a fresh week after a long weekend. I hope you had a fantastic Christmas. The global banks will be closed in observance of Boxing Day today; therefore, we may have thin volatility and trading volume today in the market. Let’s check out the technical side of the market. 

 

Economic Events to Watch Today  


 

EUR/USD – Daily Analysis

The EUR/USD succeeded in maintaining its overnight bullish bias and remained well bid around above the 1.2200 level. However, the currency pair’s sentiment was being supported by the latest progress over the massive U.S. government spending bill and COVID-19 relief measures, which undermined the safe-haven U.S. dollar and contributed to the currency pair gains. 

Moreover, the S&P 500 Futures sentiment was further bolstered by the recent passage of the Brexit deal and upbeat comments from the covid vaccine producers, which in turn, added further weakness to the greenback and contributed to the currency pair gains. In contrast to this, the intensifying concerns about increasing COVID-19 deaths and the possibility of economically-painful hard lockdowns keep questioning the pair’s upside momentum. As of writing, the EUR/USD currency pair is currently trading at 1.2226 and consolidating in the range between 1.2181 – 1.2227.

The S&P 500 Futures enter the 3,700 marks and refreshed intraday high near 3,710 during early Monday. The market trading sentiment recently gained bids after U.S. President Donald Trump signed the much-awaited coronavirus (COVID-19) aid package, which instantly boosted the investor’s confidence. As per the New York Post, President Trump has signed a $2.3 trillion COVID-19 relief and government funding bill that includes $600 stimulus checks for most Americans. The funding bill authorizes direct checks of $600 for people earning up to $75,000 per year. In addition to this, the bill creates a new $300 weekly unemployment supplement and replenishes a forgivable loan program for small businesses, while there’s an additional $600 per child stimulus payment. This latest optimism put a bid under risk assets and weighed over the safe-haven U.S. dollar. 

Elsewhere, the gains in the currency pair were further bolstered after the passage of the Brexit deal and upbeat remarks from the covid vaccine makers. As per the latest report, the U.K.’s Foreign Secretary Dominic Raab said that the United Kingdom is now seeking trade deals with Australia, the United States, and countries in the Indo-Pacific region.” Across the pond, the AstraZeneca CEO Pascal Soriot said that their covid vaccine is effective against the new strain, which in turn exerted an additional positive impact on the market trading sentiment and contributed to the currency pair gains.

Looking ahead, the market traders will keep their eyes only on updates surrounding the virus, vaccine, and the U.S. stimulus package. However, the global markets may witness a dull trading session amid the year-end celebration mood and off at major bourses. 

Daily Technical Levels

Support Resistance

1.2143 1.2231

1.2090 1.2266

1.2055 1.2320

Pivot point: 1.2178

EUR/USD– Trading Tip

The EUR/USD is trading with a bullish bias at the 1.2224 area, having crossed over the triple top resistance level of 1.2200, now working as a support for the EUR/USD. Continuation of an upward trend can extend the buying trend until the 1.2250 level. The EUR/USD pair violates the symmetric triangle pattern, which is likely to drive further upward movement in the market. Bullish bias seems dominant today.

GBP/USD – Daily Analysis

The GBP/USD currency pair managed to maintain its bullish bias through the first half of the Asian session and remained bullish around above the mid-1.3500 level due to the prevalent risk-on market sentiment, which tends to undermine the safe-haven U.S. dollar and contributes to the currency pair gains. Hence the market trading sentiment was supported by the hopes of coronavirus vaccine and progress toward a massive U.S. government spending bill and COVID-19 relief measures. 

On the contrary, the currency pair trimmed some of its sharp gains during Monday’s European session as the renewed uncertainties over the future of the recently signed Brexit deal tend to undermine the British Pound even as markets are off in the U.K. Furthermore, the currency pair’s gains were also capped by the growing market concerns about the continuous rise in new coronavirus cases and the enforcement of fresh restrictions in the U.K. As of writing, the GBP/USD currency pair is currently trading at 1.3561 and consolidating in the range between 1.3530 – 1.3576.

Despite the recent passage of the Brexit deal, the doubts over the key issues like the level Playing Field, Finance, and Gibraltar remain on the cards as the U.K. Prime Minister Boris Johnson has admitted it is an agreement which does not have as much as he would have liked about the financial services sector and regulatory equivalence. He further added that this agreement would give the people hope that we will remain in close dialogue with our European partners regarding things like equivalence decisions. In that way, the uncertainties over the recently signed Brexit deal’s future exerted downside pressure on the GBP/USD currency pair.

Despite this, the S&P 500 Futures managed to extend its previous session’s positive performance and refreshed intraday high near 3,710 during the early European session on the day. The market trading sentiment recently gained bids after U.S. President Donald Trump signed the much-awaited coronavirus (COVID-19) aid package, which instantly boosted the investor’s confidence. As per the New York Post, President Trump has signed a $2.3 trillion COVID-19 relief and government funding bill that includes $600 stimulus checks for most Americans. The funding bill authorizes direct reviews of $600 for people earning up to $75,000 per year. 

In addition to this, the bill creates a new $300 weekly unemployment supplement and replenishes a forgivable loan program for small businesses, while there’s an additional $600 per child stimulus payment. This latest optimism put a bid under risk assets and weighed over the safe-haven U.S. dollar. 

Looking ahead, the market traders will keep their eyes only on updates surrounding the virus, vaccine, and the U.S. stimulus package as the global markets witnessing a dull trading session amid the year-end celebration mood and off at significant bourses. 

Daily Technical Levels

Support Resistance

1.3442 1.3562

1.3378 1.3618 

1.3322 1.3683

Pivot point: 1.3498

GBP/USD– Trading Tip

The Sterling is trading with a bullish bias at 1.376 level, heading further higher towards the next resistance level of 1.3650 level. Support stays at 1.3495 level today. This support level is extended by an upward trendline, which can be seen in the 4-hour timeframe. On the higher side, the GBP/USD pair can prolong the buying trend unto the 1.3622 level, and the bullish trend continuation can lead the GBP/USD pair towards the 1.3706 mark. 

USD/JPY – Daily Analysis

The USD/JPY failed to stop its previous-session bearish bias and remained depressed around below the 103.50 level, mainly due to the broad-based U.S. dollar weakness. The fresh optimism was pressuring the U.S. dollar that the U.S. President Donald Trump signed a $2.3 trillion COVID-19 relief and government funding bill, urging investors to retreat from the safe-haven investment riskier assets. Apart from this, the losses in the U.S. dollar could also be attributed to the lingering doubts over the U.S. economic recovery from COVID-1, which adds further burden around the U.S. dollar and contributes to the currency pair losses. 

The upbeat market sentiment, backed by the hopes of coronavirus vaccine and the U.S. covid stimulus, boosted investors’ confidence and undermined the safe-haven Japanese yen, which, in turn, was seen as one of the leading factors that helped the USD/JPY currency pair to limit its deeper losses.

Despite the worries over the coronavirus pandemic’s resurgence, the optimism over a possible vaccine for the highly infectious coronavirus disease has remained supportive of the market risk tone. Also favoring the optimism could be the recent comments from the covid vaccine producers. As per the keywords, AstraZeneca CEO Pascal Soriot said that their covid vaccine is effective against the new strain. Thus, the risk-on market mood tends to undermine the safe-haven Japanese yen, which becomes the key factor that lends some support to the currency pair to ease the intraday bearish pressure surrounding the USD/JPY currency pair.

In addition to this, the sentiment around the equity market was improved further after U.S. President Donald Trump signed a $2.3 trillion COVID-19 relief and government funding bill. It is worth noted that U.S. President Trump had signed a $2.3 trillion COVID-19 relief and government funding bill that includes $600 stimulus checks for most Americans. The funding bill authorizes direct reviews of $600 for people earning up to $75,000 per year. Furthermore, the bill creates a new $300 weekly unemployment supplement and provides a forgivable loan program for small businesses. Besides this, there’s an additional $600 per child stimulus payment. 

This, in turn, the broad-based U.S. dollar failed to stop its bearish trend and remained depressed on the day. Apart from this, doubts over the U.S. economic recovery remains on the cards amid rising COVID-19 deaths, which adds further burden around the greenback. However, the losses in the U.S. dollar becomes the key factor that kept the currency pair lower. Meanwhile, the U.S. dollar index, which measures the greenback against a bucket of currencies, dropped by 0.15% to 90.112 by 12:09 AM ET (5:09 AM GMT).

In contrast to this, the optimism around the equity market was slightly unaffected by the intensifying market worries regarding the continuous rise in new coronavirus cases in the U.S. and Europe, which keep sparking the worries over the global economic recovery through imposing new lockdown restrictions on economic and social activity. Furthermore, the equity market gains were also capped by the renewed uncertainty over the Brexit deal and intensified China-US tussles.

There isn’t any major market-moving economic data due for release on the day, which in turn, the market traders will keep their eyes only on updates surrounding the virus, vaccine, and the U.S. stimulus package as the global markets seeing a dull trading session amid the year-end celebration mood and off at major bourses.

Daily Technical Levels

Support Resistance

103.47 104.02

103.25 104.37

102.91 104.58

Pivot point: 103.81

USD/JPY – Trading Tips

The USD/JPY trades choppy in between a narrow trading range of 103.750 – 103.360 level. The safe-haven USD/JPY pair faces immediate support of 103.360, and the formation of candles above this level can drive the buying trend until 103.746. Whereas, bullish trend continuation can extend further buying trend until 104.090 level. The MACD and RSI are suggesting selling bias as it’s forming histograms below 0 level. While the 50 EMA also supports the selling trend. Let’s consider taking a selling trade until the 102.990 level today. Good luck!

Categories
Forex Signals

Gold Trade Choppy – Can Upward Channel Underpin? 

During Friday’s Asian trading session, the yellow metal prices failed to extend their overnight winning streak. They edged lower around the $1,880 level mainly due to the upbeat market sentiment, which tends to undermine the yellow-metal prices as investors continuing a retreat from the safe-haven asset after progress in U.S. stimulus measures and Brexit talks. Elsewhere, the reason behind the risk-on market sentiment could also be associated with the expectations for global economic recovery on potential coronavirus vaccines. 

During Friday’s Asian trading session, the yellow metal prices failed to extend their overnight winning streak. They edged lower around the $1,880 level mainly due to the upbeat market sentiment, which tends to undermine the yellow-metal prices as investors continuing a retreat from the safe-haven asset after progress in U.S. stimulus measures and Brexit talks. Elsewhere, the reason behind the risk-on market sentiment could also be associated with the expectations for global economic recovery on potential coronavirus vaccines. 

During Friday’s Asian trading session, the yellow metal prices failed to extend their overnight winning streak. They edged lower around the $1,880 level mainly due to the upbeat market sentiment, which tends to undermine the yellow-metal prices as investors continuing a retreat from the safe-haven asset after progress in U.S. stimulus measures and Brexit talks. Elsewhere, the reason behind the risk-on market sentiment could also be associated with the expectations for global economic recovery on potential coronavirus vaccines. 

In contrast to this, the widespread rise in the COVID-19 cases from the U.K., U.S., and Europe keeps challenging the market risk-on mood, helping the bullion prices limit their deeper losses. Apart from this, the US-China long-lasting tussle is also questioning the market upside momentum, which also caps further downside for the gold. Besides this, the broad-based U.S. dollar weakness has also played its major role in supporting the gold prices as the price of gold is inversely related to the price of the U.S. dollar. The yellow metal is currently trading at 1,883.14 and consolidating in the range between 1,878.60 – 1,886.06.

The news about vaccine rollouts was supporting the market trading sentiment. In the meantime, the progress on both Brexit trade talks and the latest U.S. stimulus measures also boosted the market trading sentiment, which tends to undermine the safe-haven metal prices. As per the latest report, House Speaker Nancy Pelosi said she hopes to receive the final legislative text on the deal later on Thursday. Whereas, President Donald Trump said by a tweet that stimulus talks were looking good. However, the lawmakers are now confident to approve the stimulus before the year-end. Additionally, the market trading sentiment was supported by the on-going hopes of the coronavirus vaccine. Thus the positive tone surrounding the market trading sentiment was seen as one of the key factors that kept the gold prices under pressure. 

At the USD front, the broad-based U.S. dollar failed to stop its long bearish bias and dropped towards its worst week in a month as demand for the safe-haven assets declined amid progress toward agreeing U.S. fiscal stimulus. It is worth mentioning that the U.S. dollar was down 1.2% for the week so far and has dropped by 12.7% from a 3-year peak in March, falling to 89.862, just above a 2-and-a-half-year low seen on the previous day. Besides, the U.S. dollar losses could also be associated with Powell’s dovish comments on inflation. The U.S. Federal Reserve’s promised to keep interest rates low until an economic recovery is secure. However, the U.S. dollar losses helped the yellow-metal prices limit its deeper losses as the price of gold is inversely related to the U.S. dollar price.

In contrast to this, the growing worries over the resurgence of the coronavirus pandemic have been destroying the hopes of the global economic recovery, which keeps challenging the market trading sentiment and help the yellow-metal prices to limit their deeper losses. On the other hand, the long-lasting tussle between the United States and China remains on the cards as the U.S. continuously imposing sanctions on Beijing. This, in turn, added further questions around the market trading sentiment and became the key factor that kept the lid on any additional losses in the safe-haven metal prices.

Looking ahead, the market traders will keep their eyes on U.K. Retail Sales m/m, which are scheduled for publicity later in the day. Meanwhile, the German PPI m/m data will also be key to watch. Apart from this, the updates surrounding the Brexit, virus, and U.S. stimulus package will not lose their importance. 



Daily Support and Resistance

S1 1807.17

S2 1827.65

S3 1840.79

Pivot Point 1848.13

R1 1861.27

R2 1868.61

R3 1889.09

The yellow metal gold is trading in between a tight range of 1,884 – 1,880 mark. Gold retraced downward to complete 38.2% Fibonacci level of 1,876. On the daily timeframe, gold has formed an upward channel supporting gold around 1,874 level along with a resistance level of 1,894 and 1,910 level. The 50 periods EMA holds around 1,864, suggesting an upward trend in gold; however, we are not opening a buying trade yet as the MACD forms histograms below 0, supporting a selling trend. Let’s consider taking a buying trade over the 1,874 level today. Good luck! 

 

Categories
Forex Signals

USD/CAD Faces Double Top Resistance – A Trade Plan to Follow!  

The USD/CAD pair was closed at 1.27217 after placing a high of 1.27504 and a low of 1.26884. The currency pair USD/CAD dropped on Thursday amid the rising crude oil prices and the US dollar weakness. The USD/CAD pair came back to declining momentum after reversing from Wednesday’s high above 1.2790. The Canadian dollar benefited from a weaker US dollar and rising crude oil prices on Thursday that dragged the currency pair USD/CAD on the downside. On Thursday, the US dollar was weak across the board amid the combination of rising hopes for US stimulus, a rising number of coronavirus cases, increased bond purchases by Fed, and the disappointing jobs report from the US labor department.

The USD/CAD pair was closed at 1.27217 after placing a high of 1.27504 and a low of 1.26884. The currency pair USD/CAD dropped on Thursday amid the rising crude oil prices and the US dollar weakness. The USD/CAD pair came back to declining momentum after reversing from Wednesday’s high above 1.2790. The Canadian dollar benefited from a weaker US dollar and rising crude oil prices on Thursday that dragged the currency pair USD/CAD on the downside. On Thursday, the US dollar was weak across the board amid the combination of rising hopes for US stimulus, a rising number of coronavirus cases, increased bond purchases by Fed, and the disappointing jobs report from the US labor department.

The USD/CAD pair was closed at 1.27217 after placing a high of 1.27504 and a low of 1.26884. The currency pair USD/CAD dropped on Thursday amid the rising crude oil prices and the US dollar weakness. The USD/CAD pair came back to declining momentum after reversing from Wednesday’s high above 1.2790. The Canadian dollar benefited from a weaker US dollar and rising crude oil prices on Thursday that dragged the currency pair USD/CAD on the downside. On Thursday, the US dollar was weak across the board amid the combination of rising hopes for US stimulus, a rising number of coronavirus cases, increased bond purchases by Fed, and the disappointing jobs report from the US labor department.

The ADP Non-Farm Employment Change in November came in as 40.8K and supported the Canadian dollar that resulted in the declining USD/CAD prices on Thursday. From the US side, at 18:29 GMT, the Philly Fed Manufacturing Index in December dropped to 11.1 against the expected 20.1 and weighed on the US dollar and added further losses in the USD/CAD pair. At 18:30 GMT, the Unemployment Claims from last week advanced to 885K against the expected 817K and weighed on the US dollar, and supported the USD/CAD pair’s downside momentum. For November, the Building Permits advanced to 1.64M against the expected 1.55M and supported the US dollar, and capped further downside in the USD/CAD pair. The Housing Starts in November remained flat as expected 1.55M.

Meanwhile, the greenback was weak across the board as the total number of coronavirus cases surpassed about 17M in the US and weighed on the local currency. The rising hopes for the US stimulus also added in the US dollar pressure as the Democrats and Republicans were moving closer to reach a deal by the end of this week. Furthermore, the Federal Reserve’s latest decision to increase its bond purchases to support the economy through the second wave of the pandemic also added pressure on the US dollar and dragged the USD/CAD prices on the downside.

Furthermore, the WTI crude oil prices also increased on Thursday and reached $48.58 per barrel, supporting the commodity-linked currency Loonie. The strong Loonie then ultimately added further losses in the USD/CAD pair.


Daily Technical Levels

Support Resistance

1.2694 1.2790

1.2646 1.2838

1.2597 1.2886

Pivot Point: 1.2742

The USD/CAD pair’s technical side is extending double top resistance at 1.2766 area, and bullish crossover of this can lead USD/CAD price further higher until the next resistance level of 1.2789 level. On the lower side, the support holds around 1.2740 and 1.2709 level. The 50 periods EMA is supporting buying trend. Thus it may extend upward movement until 1.2790 level upon the breakout of 1.2766 support. Overall, the market is lacking volatility as we are heading towards the holiday session. Let’s consider staying bullish over 1.2766 resistance and selling below the 1.2740 support level. Good luck! 

Categories
Forex Signals

AUD/USD Ascending Triangle Pattern Support – Buying Setup Looms! 

The AUD/USD closed at 0.76263 after placing a high of 0.76393 and a low of 0.75668. The AUD/USD rose above the 0.76300 level on Thursday to its highest level since June 2018 amid the broad-based weakness of the US dollar and the rising risk sentiment in the market. The risk-sensitive Aussie benefited from the market’s broadly positive risk appetite that raised the Wall streets’ main indexes added in the gains of AUD/USD pair. The S&P 500 and Nasdaq Composite indices hit an all-time high on Thursday and added in the risk sentiment that gave strength to risk perceived Aussie.

The AUD/USD closed at 0.76263 after placing a high of 0.76393 and a low of 0.75668. The AUD/USD rose above the 0.76300 level on Thursday to its highest level since June 2018 amid the broad-based weakness of the US dollar and the rising risk sentiment in the market. The risk-sensitive Aussie benefited from the market’s broadly positive risk appetite that raised the Wall streets’ main indexes added in the gains of AUD/USD pair. The S&P 500 and Nasdaq Composite indices hit an all-time high on Thursday and added in the risk sentiment that gave strength to risk perceived Aussie.

The AUD/USD closed at 0.76263 after placing a high of 0.76393 and a low of 0.75668. The AUD/USD rose above the 0.76300 level on Thursday to its highest level since June 2018 amid the broad-based weakness of the US dollar and the rising risk sentiment in the market. The risk-sensitive Aussie benefited from the market’s broadly positive risk appetite that raised the Wall streets’ main indexes added in the gains of AUD/USD pair. The S&P 500 and Nasdaq Composite indices hit an all-time high on Thursday and added in the risk sentiment that gave strength to risk perceived Aussie.

The dovish comments from Chairman of Federal Reserve Jerome Powell reassured market participants that the Fed’s ultra-accommodative monetary policy stance was not going anywhere anytime soon. This news also added in the risk sentiment, supported the risk-sensitive Australian dollar, and pushed the AUD/USD pair higher.

Furthermore, the UK and EU prospects reaching a deal before the end of the year as the EU parliament had given the deadline to get an agreement before 20th December also increased and supported the risk perceived Aussie and added in the upward trend of the AUD/USD pair.

On the data front, at 05:30 GMT, the Employment Change in November raised to 90.0K against the expected 40.9K and supported Aussie and added in the gains of AUD/USD pair. In November, the Unemployment Rate also decreased to 6.8% against the forecasted 7.0% and supported the Australian dollar and supported the upward momentum of the AUD/USD pair.

From the US side, at 18:29 GMT, the Philly Fed Manufacturing Index in December fell to 11.1 against the projected 20.1 and weighed on the US dollar and added AUD/USD pair gains. At 18:30 GMT, the Unemployment Claims from last week raised to 885K against the estimated 817K and weighed on the US dollar and supported the AUD/USD pair’s an upward trend. For November, the Building Permits surged to 1.64M against the forecasted 1.55M and supported the US dollar that capped further gains in AUD/USD pair. The Housing Starts in November remained flat as anticipated 1.55M.

The greenback was weak across the board on Thursday as the US Dollar Index (DXY) fell to its lowest since April 2018, below 90 levels to 89.7. The US dollar weakness was due to many factors, including the rising prospects of reaching a deal between Democrats and Republicans over the second round of the US stimulus bill. 

The US dollar was also weak because of the rising number of coronavirus cases in many US states despite the vaccine rollout and lockdown. The reports suggested that the total number of coronavirus cases in the US reached 17M and made the country the hardest-hit country in the world by the pandemic. Furthermore, the Federal Reserve’s latest decision to extend its bond purchases program also added pressure on the greenback that ultimately affected the movement of the AUD/USD pair. All these factors combined and weighed on the US dollar on Thursday that added strength in the currency pair AUD/USD pair.


Daily Technical Levels

Support Resistance

0.7550 0.7592

0.7542 0.7606

0.7509 0.7633

Pivot point: 0.7565

On the technical front, the AUD/USD is trading slightly bullish at 0.7590, facing immediate resistance at the 0.7640 level. Bullish crossover of this level can extend upward trend until the next target level of 0.7680. However, failure to break above the 0.7680 level can extend selling moves until the support area of the 0.7580 AND 0.7545 level. The 50 periods EMA is suggesting a buying trend, but the MACD is suggesting a buying scenario. Thus, we should look for buying trades over the 0.7580 level. Good luck! 

Categories
Forex Market Analysis

Daily F.X. Analysis, December 18 – Top Trade Setups In Forex – German IFO Business Climate in Focus! 

On Friday, the fundamental side-eyes will remain on the German Ifo Business Climate figures, which are expected to drop from 90.7 to 90.2 along with the current account data, which is likely to drop from 25.2 B to 22.6B. Both of these figures extend bearish pressure on the Euro. Later, the Canadian retail sales will be in focus as it may drive some price action in the Canadian pairs.

On Friday, the fundamental side-eyes will remain on the German Ifo Business Climate figures, which are expected to drop from 90.7 to 90.2 along with the current account data, which is likely to drop from 25.2 B to 22.6B. Both of these figures extend bearish pressure on the Euro. Later, the Canadian retail sales will be in focus as it may drive some price action in the Canadian pairs.

On Friday, the fundamental side-eyes will remain on the German Ifo Business Climate figures, which are expected to drop from 90.7 to 90.2 along with the current account data, which is likely to drop from 25.2 B to 22.6B. Both of these figures extend bearish pressure on the Euro. Later, the Canadian retail sales will be in focus as it may drive some price action in the Canadian pairs.


 

Economic Events to Watch Today  

 

EUR/USD – Daily Analysis

The EUR/USD pair was closed at 1.22679 after placing a high of 1.22725 and a low of 1.21897. EUR/USD pair extended its gains on Thursday and peaked in April 2018, amid the broad-based U.S. dollar weakness and the rebound of the Eurozone economy. The U.S. dollar weakness was derived from various factors, including rising hopes that the coronavirus relief bill will release soon, the dovish comments from Powell post-meeting, and the soft U.S. labor market data on Thursday. 

The Democrats and Republicans were close to reaching a deal over a new $900 billion proposal, including $600-$700 in paychecks and unemployment benefits. The U.S. House Speaker Nancy Pelosi has even said that it might be possible that U.S. lawmakers will have the agreement in writing by the end of Thursday. These rising hopes for the U.S. stimulus bill added pressure on the U.S. dollar that ultimately supported the EUR/USD pair’s upward movement.

Powell emphasized that the Fed was following outcomes-based policies, which means if progress slows toward achieving those outcomes, then-Fed could step up its asset purchases. Powell’s dovish comments weighed on the U.S. dollar and supported rising EUR/USD prices on Thursday. Furthermore, on Thursday, the soft labor market data weighed on the U.S. dollar as the Unemployment Claims from last week surged to 885K. The weak U.S. dollar because of rising unemployment claims also supported the upward momentum in EUR/USD pair on Thursday.

On the data front, at 15:00 GMT, the Final CPI for the year in November remained flat at -0.3%. The Final Core CPI from Eurozone in November also remained as expected at 0.2%. From the U.S. side, at 18:29 GMT, the Philly Fed Manufacturing Index in December declined to 11.1 against the projected 20.1 and weighed on the U.S. dollar and supported EUR/USD prices. At 18:30 GMT, the Unemployment Claims from last week surged to 885K against the projected 817K and weighed on the U.S. dollar. For November, the Building Permits surged to 1.64M against the projected 1.55M and supported the U.S. dollar. The Housing Starts in November remained flat as projected 1.55M.

The Eurozone economy was rebounded as suggested by the December Eurozone’s Composite PMI that rose above 49 levels compared to expected 45.3 and supported the single currency. However, the Eurozone market confidence was tempered by the news that Germany, the largest Eurozone economy, would re-enter lockdown in January to curb coronavirus spread.

Meanwhile, the global economic outlook continued to improve following the news that Europe will be rolling out coronavirus vaccines. The E.U. Commission chief Ursula von der Leyen said that the coronavirus vaccination would start from December 27 in Austria, Germany, and Italy. The Health Minister Jens Spahn said that if the approval comes as planned, Germany will start vaccination on December 27. The potential vaccine rollout in Europe raised the Eurozone economy’s outlook and supported the single currency Euro and added the EUR/USD pair’s gains.

Daily Technical Levels

Support   Resistance

1.2143      1.2231

1.2090      1.2266

1.2055      1.2320

Pivot point: 1.2178

EUR/USD– Trading Tip

The EUR/USD bullish bias continues to drive an upward movement at 1.2245, and continuing an upward trend is likely to be continued. On the 4 hour timeframe, the EURUSD has entered the overbought zone, and it has completed 23.6% Fibonacci retracement at the 1.2240 level. A bearish breakout of 1.2240 can send the EUR/USD pair towards a 38.2% Fibo level of 1.2214. The odds of buying seems strong over the 1.2214 level today.

GBP/USD – Daily Analysis

 The GBP/USD pair was closed at 1.35833 after placing a high of 1.36244 and a low of 1.34950. GBP/USD pair extended its gains for the third consecutive day on Thursday and peaked since May 2018 due to broad-based U.S. dollar weakness. The British Pound pared some gains on Thursday after the U.K. Prime Minister Boris Johnson said that it was likely that a deal would not be reached until the European Union eased its stance over key sticking issues, including fishing rights.

Johnson poured cold water on the deal’s hopes, saying that it looked very likely that the agreement will not be finalized until the European Union shifts its position substantially. This update came in the right after the positive comments from European Commission President Ursula von der Leyen, who said that the progress in trade negotiations was seen.


Despite the hints of possible progress on a post-Brexit trade deal, PM Johnson has not shied away from his views that the possible outcome for the U.K. to leave the E.U. was without a deal. In this scenario, the U.K. and E.U. will follow the terms and conditions under the World Trade Organization that would not be good for both nations. The European Parliament has given Brexit negotiators until December 20 to strike a deal to allow enough time to ratify a potential agreement before the end of the U.K.’s transition period to leave the E.U.

Furthermore, on Thursday, the Bank of England kept interest rates at the lowest level on record after warning that rapid growth in coronavirus infections will deliver a bigger hit to the U.K. economy than expected in the final months of 2020. The official interest rate was kept unchanged at 0.1% by BoE, while the bank also left the Q.E. bond-buying program unchanged at 895 billion pounds after pumping an additional 150 billion pounds into the economy last month.

The bank acknowledged that against a backdrop of soaring coronavirus infections amid the second wave of the pandemic has forced the government to launch tier-3 restrictions in England and tighter control over Scotland, Wales, and Northern Ireland that has put the economy under pressure. The bank projected that the GDP of the U.K. in the final three months of 2020 would contract by a little over 1%, which means that national output for 2020 will be 11% below 2019, and it will be the biggest recession in 300 years. These dovish comments from the Bank of England removed some of the GBP/USD pair’s daily gain on Thursday.

On the data front, at 17:00 GMT, the Asset Purchase Facility from Great Britain in December remained flat at 895B. 

From the U.S. side, at 18:29 GMT, the Philly Fed Manufacturing Index in December fell to 11.1 against the anticipated 20.1 and weighed on the U.S. dollar and supported the GBP/USD pair. At 18:30 GMT, the Unemployment Claims from last week rose to 885K against the anticipated 817K and weighed on the U.S. dollar, and added further gains in GBP/USD pair. For November, the Building Permits rose to 1.64M against the anticipated 1.55M and supported the U.S. dollar. The Housing Starts in November remained flat as anticipated 1.55M.  The U.S. dollar was weak across the board as the hopes for the second round of stimulus bills raised as the Democrats and Republicans were coming closer to reach a $900 billion proposal that would include $600 to $700 paychecks and unemployment benefits. The rising hopes that U.S. stimulus will reach an agreement soon weighed on the U.S. dollar and added in the gains of GBP/USD.

The U.S. dollar was also weak because of the rising number of coronavirus cases in the U.S. despite the vaccine rollout. According to Johns Hopkins University, the U.S. confirmed 247,403 new coronavirus cases on Wednesday, and the number of Americans’ deaths was recorded as 3656 in a single day. Meanwhile, the risk perceived the latest improvement in risk sentiment also supported British Pound after the hopes of another vaccine approval rose. A vaccine by Moderna that will offer about 94% protection against the coronavirus was set to get emergency authorization as early as this week by US FDA. On Thursday, a panel of 22 members of experts met to discuss the efficacy and potential side effects of Moderna’s vaccine. However, the American public will start receiving vaccine shots possibly after months, and in the meantime, the hospitals across the country will be caring for the coronavirus patients. These rising optimism raised the hopes that global economic recovery will reach soon and supported the risk sentiment that added strength in Sterling and helped GBP/USD pair to continue its upward movement.

Daily Technical Levels

Support   Resistance

1.3442      1.3562

1.3378      1.3618 

1.3322      1.3683

Pivot point: 1.3498

GBP/USD– Trading Tip

The GBP/USD is trading at 1.3550 level, facing an immediate support level of 1.3518 level. This support level is extended by an upward trendline, which can be seen in the 4-hour timeframe. On the higher side, the pair can extend the buying trend until the 1.3588 level, and the continuation of the buying trend can also lead Sterling towards the 1.3625 level. Support holds around the 1.3518 level, and a breakout can lead the pair towards the 1.3495 area. Bullish bias dominates today.

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 103.074 after placing a high of 103.560 and a low of 102.872. The currency pair USD/JPY fell for the third consecutive day on Thursday amid the U.S. dollar’s broad-based weakness. The U.S. dollar fell significantly against the Japanese Yen, and the USD/JPY pair reached 102 level on Thursday as the U.S. dollar index fell below 90 levels for the first time since April 2018. The U.S. Dollar Index that measures the value of the U.S. dollar against the basket of six currencies fell to 89.7 level on Thursday and dragged the USD/JPY pair further on the downside towards its lowest since March.

On Thursday, the Wall Street main indexes rose modestly, with Dow Jones up by 0.39% and the NASDAQ by 0.42%. Meanwhile, the Japanese Yen performed well against its rivals across the board despite the risk appetite and kept the USD/JPY pair under pressure. The hopes for the second round of U.S. stimulus bill from Congress rose and weighed on the U.S. dollar as the Democrats and Republicans reached a consensus over the proposal of $900 billion stimulus aid that will include $600-$700 in the paychecks and unemployment benefits. Furthermore, the rising number of coronavirus cases in the U.S. were also weighing on the local currency as the cases in total reached about 17M in the U.S. Despite the vaccine rollout in the U.S., the rising number of coronavirus causes added pressure on the U.S. dollar and added further downside on the USD/JPY pair.

The USD/JPY pair’s downward momentum was the disappointing U.S. jobless claims on Thursday. On the data front, at 18:29 GMT, the Philly Fed Manufacturing Index in December decreased to 11.1 against the estimated 20.1 and weighed on the U.S. dollar that added pressure over the USD/JPY pair. At 18:30 GMT, the Unemployment Claims from last week increased to 885K against the estimated 817K and weighed on the U.S. dollar and dragged the pair USD/JPY further on the downside. Building Permits for November increased to 1.64M against the estimated 1.55M and supported the U.S. dollar. The Housing Starts in November remained flat as estimated at 1.55M.

Since September, the rising number of unemployment claims to the highest level suggested the effect of increasingly restrictive measures in many states due to increased coronavirus cases and people’s loss of confidence. Meanwhile, in Japan, the main upcoming event was the central bank meeting on Friday. The most likely scenario was a no change in the monetary policy setting and keeping the rates at -10bps and the 10-year JGB yield target at 0.00%. The emergency lending facilities are expected to extend beyond the current run-off date of March 31, 2021. There were no macroeconomic figures to be released from Japan on Thursday, so the pair USD/JPY kept following the U.S. dollar movements that were weak across the board on the day.


Daily Technical Levels

Support   Resistance

103.47      104.02

103.25      104.37

102.91      104.58

Pivot point: 103.81

USD/JPY – Trading Tips

The USD/JPY has reversed the selling bias to trade at the 103.550 level. The safe-haven currency pair is trading beneath an immediate support mark of 103.750, and the formation of candles beneath this level will reinforce the bearish breakout. If this happens, we may have an opportunity to short the USD/JPY pair today. Bearish bias looks firm as the MACD is creating histograms underneath 0, and the 50 periods EMA is operating around 103.800 level, suggesting strong probabilities of selling. On the lower side, the USD/JPY pair may find subsequent support at the 102.900 level. It can be a good idea to take a selling position below 103.750 today. Good luck!

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Forex Signals

Gold Trades Dramatically Bullish Over Risk-off Sentiment – Quick Intraday Outlook! 

The yellow metal gold price continued to extend their previous day’s bullish bias and took some modest offers around the $1,888.93 level—the bullion prices battle Wednesday’s high despite a U-turn from $1,844 post-Fed. However, the modest downtrend in the yellow-metal prices was mainly tied to the optimism surrounding U.S. coronavirus (COVID-19) stimulus and the upbeat Brexit headlines, which kept the market trading sentiment positive and undermined the safe-haven metal prices. 

The yellow metal gold price continued to extend their previous day’s bullish bias and took some modest offers around the $1,888.93 level—the bullion prices battle Wednesday’s high despite a U-turn from $1,844 post-Fed. However, the modest downtrend in the yellow-metal prices was mainly tied to the optimism surrounding U.S. coronavirus (COVID-19) stimulus and the upbeat Brexit headlines, which kept the market trading sentiment positive and undermined the safe-haven metal prices. 

The yellow metal gold price continued to extend their previous day’s bullish bias and took some modest offers around the $1,888.93 level—the bullion prices battle Wednesday’s high despite a U-turn from $1,844 post-Fed. However, the modest downtrend in the yellow-metal prices was mainly tied to the optimism surrounding U.S. coronavirus (COVID-19) stimulus and the upbeat Brexit headlines, which kept the market trading sentiment positive and undermined the safe-haven metal prices. 

Furthermore, the upbeat trading sentiment could also be associated with the optimism over a potential vaccine/treatment for the highly infectious coronavirus, which adds further burden around the safe-haven metal. Conversely, the long-lasting coronavirus (COVID-19) woes and the tussle between US-China keep questioning the market risk-on mood, which might give some support to the bullion prices to limit its deeper losses. Elsewhere, the broad-based U.S. dollar weakness could also be considered as one of the key factors that help the bullion prices to limit its deeper losses. The yellow metal prices are currently trading at the 1,888 level and still heading upward. 

Despite the widespread doubts over the global economic recovery from coronavirus (COVID-19), the market trading sentiment remained supportive by optimism over the rollout of vaccines for the highly infectious coronavirus disease. In addition to this, the growing hopes for additional U.S. fiscal stimulus measures also exerted a positive impact on the market trading sentiment, which undermined demand for the safest assets such as the U.S. dollar.

Across the pond, the reason for the risk-on market sentiment could also be attributed to the fresh reports suggesting that the U.S. Congress inched closer to the covid stimulus. It is worth mentioning that the Republicans and Democrats in Congress were reportedly “closing in on” approving a $900 billion stimulus bill on Wednesday, the most positive sign seen in months. Moreover, they are also working to pass a $1.4 trillion spending bill for the fiscal year starting on Oct. 1. by Friday to prevent a government shutdown.

At the USD front, the broad-based U.S. dollar failed to stop its previous day bearish bias. It drew further offers on the day as Fed Chair Jerome Powell passed cautious statements, indicating disinflation pressure while expecting the economy to strengthen in the second half of 2021. Apart from this, the Federal Reserve policymakers conveyed their dovish outlook for the long-term while showing a willingness to supporting the economy until they see “further progress” in employment and inflation. Meanwhile, the risk-on market sentiment also weighed on the U.S. currency. However, the U.S. dollar losses helped the gold prices to deeper its losses as the price of gold is inversely related to the price of the U.S. dollar. The U.S. Dollar Index that tracks the greenback against a basket of other currencies dropped by 0.04% to 90.102 by 9:12 PM ET (2:12 AM GMT).

In contrast to this, the escalating market concerns regarding the continuous rise in new coronavirus cases in the U.S. and Europe keep fueling the doubts over the global economic recovery through imposing new lockdown restrictions on economic and social activity, which keep probing the upbeat market performance and lend some support to the safe-haven yellow metal. Apart from this, the fears of a full-fledged trade/political war between the U.S. and China also challenging the market risk-on mood, which also might help the yellow-metal prices to limit their losses.


Daily Support and Resistance

S1 1827.65

S2 1840.68

S3 1848.13

Pivot Point 1861.27

R1 1868.61

R2 1889.09

R3 1909.10

On the technical side, the precious metal has entered the overbought zone as it’s hitting the resistance level of 1,893 level. Closing of candle below this level is suggesting chances of a selling correction in gold; therefore, we can expect gold to drop until 1,875 level. The MACD and RSI are suggesting strong buying trend in gold, and we should look for buying trades actually, but the metal is overbought, and it should come down a bit before giving us further buying trades. Let’s consider taking buy over 1,880 level today and selling below 1,893 level. Good luck! 

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Forex Signals

EUR/USD Violates Ascending Triangle Pattern – Bullish Signal In Play! 

The EUR/USD bullish bias continues to dominate the market as it’s trading at 1.2225. On the higher side, the EUR/USD may target the 1.2250 level and 1.2282 resistance areas. The direct currency pair may find support at 1.2175, which is extended by a double top resistance, which now is working as a support. The MACD and RSI are supporting bullish bias along with the 50 periods EMA. We can expect a continuation of a bullish trend in the EUR/USD today.

The EUR/USD bullish bias continues to dominate the market as it’s trading at 1.2225. On the higher side, the EUR/USD may target the 1.2250 level and 1.2282 resistance areas. The direct currency pair may find support at 1.2175, which is extended by a double top resistance, which now is working as a support. The MACD and RSI are supporting bullish bias along with the 50 periods EMA. We can expect a continuation of a bullish trend in the EUR/USD today.

The EUR/USD bullish bias continues to dominate the market as it’s trading at 1.2225. On the higher side, the EUR/USD may target the 1.2250 level and 1.2282 resistance areas. The direct currency pair may find support at 1.2175, which is extended by a double top resistance, which now is working as a support. The MACD and RSI are supporting bullish bias along with the 50 periods EMA. We can expect a continuation of a bullish trend in the EUR/USD today.


Entry Price – Buy 1.22338

Stop Loss – 1.21938

Take Profit – 1.22738

Risk to Reward – 1:1

Profit & Loss Per Standard Lot = -$400/ +$400

Profit & Loss Per Micro Lot = -$40/ +$40

Fellas, now you can check out forex trading signals via Forex Academy mobile app. Follow the links below.

iPhone Users: https://apps.apple.com/es/app/fasignals/id1521281368

Andriod Users: https://play.google.com/store/apps/details?id=academy.forex.thesignal&hl=en_US

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Forex Market Analysis

Daily F.X. Analysis, December 17 – Top Trade Setups In Forex – BOE Policy In Limelight! 

On the news front, the eyes will remain on the U.K. Monetary Policy reports due during the late European hours. BOE isn’t expected to change the rates, and it may keep them at 0.10%. However, it will be essential to see MPC Official Bank Rate Votes. Besides, the European Final CPI data will remain in focus today. During the U.S. session, the Unemployment Claims and Philly Fed Manufacturing Index will be the main highlight to drive further market movement.

On the news front, the eyes will remain on the U.K. Monetary Policy reports due during the late European hours. BOE isn’t expected to change the rates, and it may keep them at 0.10%. However, it will be essential to see MPC Official Bank Rate Votes. Besides, the European Final CPI data will remain in focus today. During the U.S. session, the Unemployment Claims and Philly Fed Manufacturing Index will be the main highlight to drive further market movement.

On the news front, the eyes will remain on the U.K. Monetary Policy reports due during the late European hours. BOE isn’t expected to change the rates, and it may keep them at 0.10%. However, it will be essential to see MPC Official Bank Rate Votes. Besides, the European Final CPI data will remain in focus today. During the U.S. session, the Unemployment Claims and Philly Fed Manufacturing Index will be the main highlight to drive further market movement.

 

Economic Events to Watch Today  

 

EUR/USD – Daily Analysis

The EUR/USD pair was closed at 1.21988 after placing a high of 1.22121 and a low of 1.21450. EUR/USD pair extended its gains and rose for 3rd consecutive day on Wednesday to reach its highest since April 2018.

EUR/USD pair broke above 1.22 level mainly because of the strong PMIs on Wednesday and the U.S. dollar weakness. On the data front, at 13:15 GMT, the French Flash Services PMI for December raised to 49.2 against the expected 39.9 and supported Euro. The French Flash Manufacturing PMI in December also raised to 51.1 against the estimated 50.0 and supported Euro. 

At 13:30 GMT, the German Flash Manufacturing PMI in December surged to 58.6 against the forecasted 56.4 and supported Euro. The German Flash Services PMI also advanced to 47.7 against the expected 44.1 and supported Euro. At 14:00 GMT, the Flash manufacturing PMI from Eurozone raised to 55.5 against the forecasted 53.0 and supported Euro. The Flash Services PMI in December from the whole bloc also raised to 47.3 from the expected 41.9 and supported Euro. At 15:00 GMT, the Trade Balance from Eurozone for October came in greater than expected 22.1B as 25,9B and supported Euro.

The manufacturing and services sector in Eurozone advanced and showed growth in December that supported the single currency Euro and added in the daily gains of the EUR/USD pair. From the U.S. side, at 18:30 GMT, the Core Retail Sales for November declined to -0.9% against the projected 0.1% and weighed on the U.S. dollar and supported EUR/USD gains. For November, the Retail Sales also declined to -1.1% against the projected -0.3% and weighed on the U.S. dollar and added in the EUR/USD pair. AT 19:45 GMT, the Flash manufacturing PMI for December rose to56.5 against the projected 55.9 and supported the U.S. dollar, and capped further gains in EUR/USD pair. 

The Flash Services PMI for December declined to 55.3 against the projected 55.7 and weighed on the U.S. dollar and supported momentum upward in EUR/USD pair. At 20:00 GMT, the Business Inventories for October rose to 0.7% against the projected 0.6%and weighed on the U.S. dollar. The NAHB Housing Market Index also declined to 86 against the projected 88 and weighed on the U.S. dollar, and added additional EUR/USD pair gains.

Apart from strong PMI figures, the latest news that Moderna’s vaccine was also up to getting emergency use authorization from the US FDA by the end of this week. This vaccine will be the second vaccine after Pfizer’s drug was approved last week and is currently being used on people. This news added in the risk sentiment and supported the risk perceived EUR/USD pair.

Furthermore, the Brexit hopes also raised on Wednesday and supported the single currency Euro after E.U.’s chief negotiator explained that she could not say if there will be a trade deal with Britain, but there had been progressing. The next few days would be critical. These developments also added to the upward trend of the EUR/USD pair on Wednesday.

Moreover, the Federal Reserve concluded its two-day meeting on Wednesday and decided to keep its interest rates at the same level until the inflation reaches its target. However, it decided to extend its Q.E. program that weighed on the U.S. dollar and supported the EUR/USD pair’s upward trend.


Daily Technical Levels

Support   Resistance

1.2126      1.2175

1.2077      1.2197

1.2099      1.2224

Pivot point: 1.2148

EUR/USD– Trading Tip

The EUR/USD bullish bias continues to dominate the market as it’s trading at 1.2225. On the higher side, the EUR/USD may target the 1.2250 level and 1.2282 resistance areas. The direct currency pair may find support at 1.2175, which is extended by a double top resistance, which now is working as a support. The MACD and RSI are supporting bullish bias along with the 50 periods EMA. We can expect a continuation of a bullish trend in the EUR/USD today.

GBP/USD – Daily Analysis

 The GBP/USD pair was closed at 1.35083 after placing a high of 1.35543 and a low of 1.34340. GBP/USD pair extended its gains on Wednesday and rose to its highest level since May 2018. The British Pound pared gains on Wednesday against the U.S. dollar as reports suggested that U.K. and E.U. were close to a breakthrough on a key sticking point amid the ongoing talks. The President of European Commission Ursula von der Leyen said that there was a narrow path to an agreement on a post-Brexit trade deal with the U.K.

The U.K. acknowledged that some progress had been made but continued to suggest a no-deal was most likely outcome as significant differences remain. Reports suggested that progress has been made over the level playing rules, but differences remain over the fisheries issue, as fishing quotas remain a challenge in negotiations.

However, the U.K. has softened its tone on fisheries in a bid to get a deal over the line. Britain ditched the demands for fishing vessels operating under the U.K. flag to be majority British-owned in the post Brexit era. Whereas PM Boris Johnson remained harsh in his speech on Wednesday and said that the E.U. should realize that the U.K. has a right to take control over its land and waters like every other country.

The hopes for the Brexit trade deal increased as the recent progress on talks came as both sides were coming under increasing pressure to secure a deal before the transition period on December 31. These hopes kept the British Pound supported and GBP/USD pair higher.

On the data front, at 12:00 GMT, the Consumer Price Index from the U.K. for November fell short of expectations of 0.6% and came in as 0.3% that weighed on the British Pound. In November, the Core CPI also fell to 1.1% against the expectations of 1.4% and weighed on Sterling. The RPI of the year from the U.K. for November also declined to 0.9% against the forecasted 1.3% and weighed heavily on GBP. At 12:02 GMT, the PPI Input from the U.K. declined to 0.2% from the expected 0.4% in November and weighed on the British Pound. The PPI Output, however, remained flat with the expectations of 0.2%. At 14:30 GMT, the Flash manufacturing PMI in December from Great Britain raised to 57.3 against the projected 55.9 and supported British Pound and added GBP/USD pair gains. The Flash Services PMI, however, declined to 49.9 against the forecasted 50.5 in December and weighed on Sterling. The Housing Price Index for October advanced to 5.4% against the estimated 5.1% and supported British Pound. 

Most of the data came in against the British Pound; however, the currency pair GBP/USD remains on the upside over the latest Brexit optimism.

From the U.S. side, at 18:30 GMT, the Core Retail Sales for November fell to -0.9% against the anticipated 0.1% and weighed on the U.S. dollar and supported GBP/USD pair. The Retail Sales for November also fell to -1.1% against the anticipated -0.3% and weighed on the U.S. dollar and added gains in GBP/USD pair. 

At 19:45 GMT, the Flash manufacturing PMI for December surged to56.5 against the anticipated 55.9 and supported the U.S. dollar. The Flash Services PMI for December fell to 55.3 against the anticipated 55.7 and weighed on the U.S. dollar. At 20:00 GMT, the Business Inventories for October surged to 0.7% against the anticipated 0.6%and weighed on the U.S. dollar. The NAHB Housing Market Index also fell to 86 against the anticipated 88 and weighed on the U.S. dollar and added further gains in GBP/USD pair.

Daily Technical Levels

Support   Resistance

1.3338      1.3258

1.3213      1.3595

1.3147      1.3719

Pivot point: 1.3404

GBP/USD– Trading Tip

Since the Cable is also a direct currency pair and the dollar is getting weaker, we can expect a continuation of an upward trend in the GBP/USD pair. The GBP/USD pair may find resistance at 1.3600 and 1.3706 level, while the support level stays at 1.3470 marks. The MACD and EMA are supporting the bullish trend in the Cable. On the 4 hour timeframe, the GBP/USD pair has formed an upward channel, which may keep pushing the Sterling further higher today. The buying trend can be seen over 1.3470 level until 1.3600 and 1.3706 level.

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 103.419 after placing a high of 103.915 and a low of 103.259. The USD/JPY pair extended its losses on Wednesday and reached its lowest since November 9. The USD/JPY pair dropped on Wednesday amid the U.S. dollar weakness due to rising stimulus hopes and growing vaccine optimism. The U.S. lawmakers made progress toward a coronavirus relief package that added weight on the U.S. dollar and dragged the USD/JPY pair on the downside. The U.S. Dollar Index that tracks the greenback against a basket of six other currencies was down on Wednesday to 0.1% at 90.317. 

The bipartisan group had originally proposed a $908 billion stimulus bill, but it has now been split into two bills. The first bill includes a $748 billion proposal, including aid for vaccine distribution and unemployment benefits. This bill has gained traction and is expected to pass by Congress by the end of the week. The second bill that is worth $160 billion for local and state government support along with the temporary coronavirus liability protection that appears to be having more difficulty in gathering the necessary support from Congress.

On the data front, at 04:50 GMT, the Trade Balance from Japan for November surged to 0.57T against the forecasted 0.54T and supported the Japanese Yen that added further losses in the USD/JPY pair. At 05:30 GMT, the Flash Manufacturing PMI from Japan in December also raised to 49.7 against the forecasted 48.9 and supported the Japanese Yen that added additional losses in USD/JPY pair.

Meanwhile, the Federal Reserve kept its interest rates unchanged on Wednesday and said that they would remain the same until the inflation reaches 2-3%. However, Federal Reserve also announces to purchase at least $120 Billion of U.S. treasuries and mortgage-backed securities each month until employment gets better. This way to support the U.S. economy by increasing bond purchases also weighed on the U.S. dollar and dragged the USD/JPY pair on the downside.

From the U.S. side, at 02:00 GMT, the TIC Long-Term Purchases dropped to 51.9B against the forecasted 75.5 B and weighed on the U.S. dollar, and supported the downside movement in the USD/JPY pair. At 18:30 GMT, the Core Retail Sales for November decreased to -0.9% against the estimated 0.1% and weighed on the U.S. dollar and weighed on the USD/JPY pair. The Retail Sales for November also decreased to -1.1% against the estimated -0.3% and weighed on the U.S. dollar. AT 19:45 GMT, the Flash manufacturing PMI for December advanced to56.5 against the estimated 55.9 and supported the U.S. dollar. 

The Flash Services PMI for December decreased to 55.3 against the estimated 55.7 and weighed on the U.S. dollar and dragged the USD/JPY pair on the downside. At 20:00 GMT, the Business Inventories for October advanced to 0.7% against the estimated 0.6%and weighed on the U.S. dollar. The NAHB Housing Market Index also decreased to 86 against the estimated 88 and weighed on the U.S. dollar and added further losses in the USD/JPY pair.

Another factor included in the losses of the USD/JPY pair was the increasing risk sentiment of the market from another coronavirus vaccine. Moderna has also applied for emergency use authorization of its vaccine from the U.S. regulatory FDA that is expected to approve within a week. Moderna will become the second company to get authorization from the U.S. regulator after Pfizer got approval last week and is currently being roll-out. This latest news added in the risk sentiment and weighed on the safe-haven Japanese Yen that ultimately weighed on the USD/JPY pair.

Daily Technical Levels

Support   Resistance

103.47      104.02

103.25      104.37

102.91      104.58

Pivot point: 103.81

USD/JPY – Trading Tips

The USD/JPY extends it’s selling trend as the pair trades at 103.250. The safe-haven currency pair is trading below an immediate support level of 103.250, and the closing of candles below this level will confirm the bearish breakout. If this happens, we may have an opportunity to short the USD/JPY pair today. Bearish bias seems solid as the MACD is forming histograms below 0, and the 50 periods EMA is holding around 103.860 level, suggesting strong odds of selling. On the lower side, the USD/JPY pair may find next support at the 102.900 level. Let’s consider taking a selling trade below 103.650 today. Good luck! 

Categories
Forex Signals

USD/CAD Selling Bias Dominates – Sell Signal Update! 

The USD/CAD pair was closed at 1.27392 after placing a high of 1.27892 and a low of 1.26931. The currency pair USD/CAD raised on Wednesday despite the weakness of the US dollar and rising crude oil prices amid the dovish comments from Governor of Bank of Canada Tiff Macklem.

The USD/CAD pair was closed at 1.27392 after placing a high of 1.27892 and a low of 1.26931. The currency pair USD/CAD raised on Wednesday despite the weakness of the US dollar and rising crude oil prices amid the dovish comments from Governor of Bank of Canada Tiff Macklem.

The USD/CAD pair was closed at 1.27392 after placing a high of 1.27892 and a low of 1.26931. The currency pair USD/CAD raised on Wednesday despite the weakness of the US dollar and rising crude oil prices amid the dovish comments from Governor of Bank of Canada Tiff Macklem.

On Wednesday, the US dollar was weak across the board due to the rising hopes for a further stimulus package from Congress and the dovish comments from the Federal Reserve Open Market Committee in its meeting. The bipartisan proposed that originally worth $908 billion was divided into two bills of $748 billion and $160 billion, was closer to reach a deal and get pass by Congress by the end of this week and weighed on the US dollar.

On the other hand, the WTI crude oil prices raised above $47 per barrel on Wednesday amid the declining crude oil inventories in the US over the last week. The US crude oil inventories dropped last week to -3.1M against the forecasted -2.8M and supported the crude oil prices that gave strength to the Canadian dollar that ultimately weighed on the USD/CAD pair on Wednesday.

Meanwhile, on Wednesday, the Governor of Bank of Canada Tiff Macklem warned the nation’s economy that could temporarily shrink again amid the second wave of virus cases and lightened the positive mode of the market that was lifted by the vaccine news. In his last speech of the year on Tuesday, Macklem said that uncertainty persisted and new restrictions could trigger a small contraction at the start of 2021. Sometime later next year the normal activities could resume because of the rollout of vaccines.

On the data front, at 18:30 GMT, the Consumer Price Index (CPI) for November from Canada was increased to 0.1% from the forecasted 0.0% and supported the Canadian dollar. The Common CPI declined to 1.5% against the expected 1.6% and weighed on the Canadian dollar and added gains in the USD/CAD pair. The Median CPI, however, came in line with the expectations of 1.9%. The Trimmed CPI declined to 1.7% against the estimated 1.8%and weighed on the Canadian dollar and supported an upward trend in the USD/CAD pair. 

The Foreign Securities Purchases during October in Canada were declined to 6.92B against the forecasted 10.05B and weighed heavily on the Canadian dollar and supported the gains in the USD/CAD pair. The Wholesale Sales in October surged to 1.0% against the expected 0.7% and supported the Canadian dollar. At 18:32 GMT, the Core CPI from Canada for November came in as 0.2%. The poor macroeconomic data from Canada weighed on local currency and ultimately added strength to the USD/CAD pair.

From the US side, at 18:30 GMT, the Core Retail Sales for November dropped to -0.9% against the expected 0.1% and weighed on the US dollar. The Retail Sales for November also dropped to -1.1% against the expected -0.3% and weighed on the US dollar. At 19:45 GMT, the Flash manufacturing PMI for December increased to56.5 against the expected 55.9 and supported the US dollar and added gains in the USD/CAD pair.

 The Flash Services PMI for December dropped to 55.3 against the expected 55.7 and weighed on the US dollar. At 20:00 GMT, the Business Inventories for October increased to 0.7% against the expected 0.6%and weighed on the US dollar. The NAHB Housing Market Index also dropped to 86 against the expected 88 and weighed on the US dollar and capped further upside in the USD/CAD pair.



Daily Technical Levels

Support Resistance

1.2665 1.2752

1.2632 1.2806 

1.2578 1.2839

Pivot point: 1.2719

The technical side of the USD/CAD is trading at 1.2708 level, holding below an immediate resistance level of 1.2743 mark which is extended by a downward trendline. On the lower side, the next support holds around 1.2693 level and violation of this level can extend further selling until the next support area of 1.2650 level. The MACD and RSI are in support of selling while the 50 periods EMA is dispensing a strong selling bias in the Loonie. let’s consider taking a selling trade below 1.2743 level until 1.2695 level.

Entry Price – Sell 1.27107

Stop Loss – 1.27507

Take Profit – 1.26607

Risk to Reward – 1:1.25

Profit & Loss Per Standard Lot = -$400/ +$400

Profit & Loss Per Micro Lot = -$40/ +$40

Fellas, now you can check out forex trading signals via Forex Academy mobile app. Follow the links below.

iPhone Users: https://apps.apple.com/es/app/fasignals/id1521281368

Andriod Users: https://play.google.com/store/apps/details?id=academy.forex.thesignal&hl=en_US

Categories
Forex Signals

Overbought Gold Retraces Back – Is It Worth Buying?

During Wednesday’s Asian trading session, the yellow metal prices extended their bullish overnight rally and remained well bids around above the $1,850 level. Let me remind you that the bullion prices surged more than $20 an ounce for their biggest one-day gain in a week. However, the bullish sentiment around the gold prices was being supported by the weaker U.S. dollar as the price of gold is inversely related to the price of the U.S. dollar. 

During Wednesday’s Asian trading session, the yellow metal prices extended their bullish overnight rally and remained well bids around above the $1,850 level. Let me remind you that the bullion prices surged more than $20 an ounce for their biggest one-day gain in a week. However, the bullish sentiment around the gold prices was being supported by the weaker U.S. dollar as the price of gold is inversely related to the price of the U.S. dollar. 

During Wednesday’s Asian trading session, the yellow metal prices extended their bullish overnight rally and remained well bids around above the $1,850 level. Let me remind you that the bullion prices surged more than $20 an ounce for their biggest one-day gain in a week. However, the bullish sentiment around the gold prices was being supported by the weaker U.S. dollar as the price of gold is inversely related to the price of the U.S. dollar. 

The losses in the U.S. dollar was mainly tied to the progress toward a massive U.S. government spending bill and COVID-19 relief measures, which undermined demand for the safest assets such as the U.S. dollar. In the meantime, the optimism over the potential vaccine for the highly contagious coronavirus disease is also favouring the market trading sentiment, which also weakening demand for the safe-haven assets. Across the ocean, the intensifying US-China tussle and on-going Brexit uncertainty keep challenging the market’s upbeat mood and provides an additional boost to the safe-haven metal prices. 

Apart from this, the growing market concerns about the continuous surge in new coronavirus cases and the imposition of new restrictions also favouring the yellow-metal bulls. At this time, the yellow metal prices are currently trading at 1,857.76 and consolidating in the range between 1,850.94 – 1,858.37.

Despite the intensified Sino-US tussle, Brexit uncertainty, and worries over the coronavirus (COVID-19) cases, the market trading sentiment keeps its previous-session positive performance and remained well-supportive by the combination of factors. However, the reason could be associated with the latest reports suggesting that the lawmakers stepped again to try and get Covid-19 relief through Congress after several failed attempts. 

As per the latest report, House of Representatives Speaker Nancy Pelosi, a Democrat, hosted Senate Majority Leader Mitch McConnell, a Republican, as well as Senate Democratic leader Chuck Schumer and House Republican leader Kevin McCarthy, gathered to end the long-standing deadlock on the coronavirus relief package at the 7:30 p.m. E.T. (0030 GMT). Wherein, McConnell said that lawmakers would not leave the rooms without a fiscal stimulus deal, which could be attached to the government funding bill.

Apart from this, the reason for the gains in equity markets could be attributed to the optimism over the rollout of vaccines for the highly contagious disease. This, in turn, was seen as one of the key factors that exerted selling pressure on the yellow metal prices. It should be noted that the Moderna is set for getting approval by the U.S. Food and Drug Administration (FDA). Chatters that the FDA approved first fully at-home virus test also favoured the market trading sentiment.

At the USD front, the broad-based U.S. dollar dropped to near two 1/2-year lows as progress toward the massive U.S. government spending bill, and COVID-19 relief measures undermined demand for the safest assets. The U.S. dollar will likely face further losses as the fiscal stimulus has a more substantial trickle-down effect than monetary policy, which usually lifts inflation expectations. Conversely, if the lawmakers fail again to reach an agreement, investors could turn risk-averse, which will be seen as bullish for the USD currency. Moreover, the losses in the U.S. dollar could also be associated with lingering doubts over the U.S. economic recovery from COVID-19. However, the losses in the U.S. dollar kept the gold prices higher as the price of gold is inversely related to the price of the U.S. dollar. Meanwhile, the U.S. dollar index, which measures the greenback against a bucket of currencies, was last at 90.477, after falling as low as 90.419 on Monday.

In contrast to this, the fears of rising COVID-19 cases in the U.S., Europe, and some of the notable Asian nations continually fueling the fears of renewed lockdowns in several countries. In the meantime, the U.S. new travel restriction over the Chinese Communist Party members and their families and a ban on Xinjiang cotton imports keep challenging the market risk-on mood. The tension between Sino-US further escalated after MSCI showed readiness for delisting 10 Chinese companies from its global investable markets indexes. These negative factors keep challenging the market risk-on tone and become the key factor that helps the gold prices to stay bid.


Daily Support and Resistance

S1 1807.17

S2 1827.65

S3 1840.79

Pivot Point 1848.13

R1 1861.27

R2 1868.61

R3 1889.09

Gold prices traded bullish at 1,860 level, supported over 1,848. It’s the same level that worked as resistance in the past, and now it’s working as a support for gold. On the lower side, the precious metal gold is likely to bounce off over 1,848 level as the 50 EMA is also expected to extend support here. For now, the MACD histograms are smaller but staying in buying zone. Let’s consider taking buying position over 1,848 level today with a stop below 1,845 level. Good luck! 

Categories
Forex Signals

AUD/USD Ascending Triangle Pattern – Brace for Buying! 

The AUD/USD pair was closed at 0.75571 after placing a high of 0.75712 and a low of 0.75070. The currency pair AUD/USD rose on Tuesday amid the broad-based US dollar weakness and the RBA meeting minutes from the December meeting.

The AUD/USD pair was closed at 0.75571 after placing a high of 0.75712 and a low of 0.75070. The currency pair AUD/USD rose on Tuesday amid the broad-based US dollar weakness and the RBA meeting minutes from the December meeting.

The AUD/USD pair was closed at 0.75571 after placing a high of 0.75712 and a low of 0.75070. The currency pair AUD/USD rose on Tuesday amid the broad-based US dollar weakness and the RBA meeting minutes from the December meeting.

The renewed selling pressure surrounding the greenback was helpful to AUD/USD pair for pushing it higher as the US Dollar Index (DXY) was down by 0.2% on the day towards the 90.51 level. The US dollar was weak across the board because of the renewed hopes for US stimulus measure and the rising number of coronavirus cases in the region.

Meanwhile, the rising risk sentiment of the market also helped the AUD/USD pair to gain traction in the market. The risk-sensitive Aussie gained strength after the US Food and Drug Administration reported that Moderna’s coronavirus vaccine would be approved for emergency use later this week. The rising Australian dollar helped the AUD/USD pair to post gains on Tuesday.

On the data front, from the US side, at 18:30 GMT, the Empire State Manufacturing Index for December dropped to 4.9 against the expected 6.3 and weighed on the US dollar that added gains in AUD/USD pair. The US Import Prices in November also declined to 0.1% against the expected 0.3% and weighed on the US dollar that ultimately added further gains in AUD/USD pair. At 19:15 GMT, the Capacity Utilization Rate from the US for November increased to 73.3% against the expected 73.1% and supported the US dollar. The Industrial Production in November also raised to 0.4% against the expected 0.3% and supported the US dollar. From the Australian side, the CB Leading Index for October came in as 0.8%.

Furthermore, the Reserve Bank of Australia released its minutes from the December meeting in which the Bank said that it was prepared to do more if needed, and its focus will be on the bond-buying program. RBA did not expect to raise interest rates for at least three years and until the inflation reaches the bank target of 2-3%.

Bank said that the recovery in the labour market was more advanced than expected, and substantial tightening in the labour market was needed to lift wage growth and inflation. Bank acknowledged that China’s restrictions on Australian imports had some effect, but the demand for iron-ore was still firm. Last, the Bank suggested that the delivery of vaccines in the US and Europe would reduce downside risks for global growth. These positive statements from the Reserve Bank of Australia lifted the AUD/USD pair on Tuesday.

However, the gains in AUD/USD pair on Tuesday remained limited as the latest news about the new variant of coronavirus raised fears as it spread faster and raised the safe-haven appeal, and weighed on the risk perceived Aussie that ultimately capped further upside in the AUD/USD pair.


Daily Technical Levels

Support Resistance

0.7517 0.7584

0.7479 0.7611

0.7451 0.7650

Pivot Point: 0.7545

On the technical front, the AUD/USD is trading slightly bullish at 0.7560, facing immediate resistance at 0.7580 level. Bullish crossover of this level can extend upward trend until the next target level of 0.7615. However, failure to break above 0.7580 level can extend selling moves until the support area of 0.7545 level. The 50 periods EMA is suggesting buying trend, but the MACD is suggesting overbought scenario. Thus, we should look for bearish correction before entering another buying trade in the AUD/USD pair. The bullish bias remains dominant. Good luck! 

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Forex Signals

USD/CAD Bearish Bias Dominates – Descending Triangle Pattern in Play! 

The USD/CAD pair was closed at 1.26982 after placing a high of 1.27713 and a low of 1.26878. After placing gains for two consecutive days, the USD/CAD pair dropped on Tuesday amid the broad-based US dollar weakness and the rising crude oil prices.

The USD/CAD pair was closed at 1.26982 after placing a high of 1.27713 and a low of 1.26878. After placing gains for two consecutive days, the USD/CAD pair dropped on Tuesday amid the broad-based US dollar weakness and the rising crude oil prices.

The USD/CAD pair was closed at 1.26982 after placing a high of 1.27713 and a low of 1.26878. After placing gains for two consecutive days, the USD/CAD pair dropped on Tuesday amid the broad-based US dollar weakness and the rising crude oil prices.

The US dollar was weak across the board on Tuesday as the hopes for further stimulus measures from the US Congress increased. The House Speaker Nancy Pelosi called a meeting of Senate Majority Leader Mitch McConnell, Senate Minority Leader Chuck Schumer, and House Majority Leader Kevin McCarthy to discuss the final government funding and coronavirus relief bill.

The optimism that Republicans and Democrats will reach a deal over the bipartisan package of coronavirus added weight on the US dollar and dragged the USD/CAD pair on the downside. Furthermore, the rising risk sentiment in the market and the increasing hopes that vaccine rollouts will help in global economic recovery raised the demand for WTI crude oil prices that gave strength to the commodity-linked Loonie and ultimately added weight on the USD/CAD pair.

On the data front, at 18:13 GMT, the Housing Starts raised to 246K against the forecasted 220K and supported the Canadian dollar that added pressure on the USD/CAD pair, and added in its losses on Tuesday. At 18:30 GMT, the Manufacturing Sales from Canada dropped to 0.3% against the forecasted 0.5% and weighed on the Canadian dollar. 

From the US front, at 18:30 GMT, the Empire State Manufacturing Index for December declined to 4.9 against the forecasted 6.3 and weighed on the US dollar that added losses in USD/CAD pair. The US Import Prices in November also fell to 0.1% against the forecasted 0.3% and weighed on the US dollar that ultimately added further losses in the USD/CAD pair. At 19:15 GMT, the Capacity Utilization Rate from the US for November rose to 73.3% against the forecasted 73.1% and supported the US dollar. The Industrial Production in November also increased to 0.4% against the forecasted 0.3% and supported the US dollar that limited the downward momentum in the USD/CAD pair on Tuesday.

Furthermore, the US dollar was also weak across the board on Tuesday because of the rising number of coronavirus cases in the region. The hospitalization rate in the US also increased as a record of 109,331 people were in the hospitals for coronavirus in the US in a single day over the weekend. The death toll has also surpassed 300,000 levels in the US, and this has feared the nation despite the vaccine rollout. These fears added weight on the local currency US dollar that ultimately added in the downward momentum of the USD/CAD pair.


Daily Technical Levels

Support Resistance

1.2665 1.2752

1.2632 1.2806

1.2578 1.2839

Pivot Point: 1.2719

The technical side of the USD/CAD is trading at 1.2728 level, holding below an immediate resistance level of 1.2743 mark which is extended by a downward trendline. On the lower side, the next support holds around 1.2693 level and violation of this level can extend further selling until the next support area of 1.2650 level. The MACD and RSI are in support of selling while the 50 periods EMA is dispensing a strong selling bias in the Loonie. let’s consider taking a selling trade below 1.2743 level until 1.2695 level. Good luck! 

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Forex Market Analysis

Daily F.X. Analysis, December 16 – Top Trade Setups In Forex – U.K.Manufacturing PMI Figures Ahead! 

On the news front, eyes will remain on the series of Manufacturing PMI figures from the Eurozone, U.K., and the U.S. Although it’s a low impact event, it may help determine the market sentiment today.

On the news front, eyes will remain on the series of Manufacturing PMI figures from the Eurozone, U.K., and the U.S. Although it’s a low impact event, it may help determine the market sentiment today.

On the news front, eyes will remain on the series of Manufacturing PMI figures from the Eurozone, U.K., and the U.S. Although it’s a low impact event, it may help determine the market sentiment today.

 

Economic Events to Watch Today  

 

EUR/USD – Daily Analysis

The EUR/USD pair closed at 1.21522 after placing a high of 1.21687 and a low of 1.21210. Despite the coronavirus related lockdowns, the EUR/USD pair moved higher on Tuesday as the European stock markets traded higher amid the optimism over the ongoing Brexit trade negotiations.

The European Union negotiator Michel Barnier said that securing a trade deal with Britain was still possible. In contrast, European Commission Ursula von der Leyen said that there was some movement over the sticking points.

According to the Times of London, the two sides had made progress on the level playing field, and only the biggest obstacle to a deal has left of differences over fishing rights. However, the hopes increased that some form of a deal could be reached with just days to go before the U.K. leaves the E.U. trading bloc. This optimism kept the single currency Euro higher and supported the upward momentum in EUR/USD pair.

On the data front, at 12:45 GMT, the French Final CPI for November came in line with the expectations of 0.2%. At 15:00 GMT, the Italian Trade Balance for October raised to 7.57B against the forecasted 5.40B and supported Euro and added gains in the EUR/USD pair.

On the U.S. front, at 18:30 GMT, the Empire State Manufacturing Index for December declined to 4.9 against the projected 6.3 and weighed on the U.S. dollar that added further gains in EUR/USD pair. The U.S. Import Prices in November fell to 0.1% against the projected 0.3% and weighed on the U.S. dollar and supported the upward momentum in EUR/USD pair. At 19:15 GMT, the Capacity Utilization Rate from the U.S. for November rose to 73.3% against the projected 73.1% and supported the U.S. dollar. The Industrial Production in November also surged to 0.4%against the projected 0.3% and supported the U.S. dollar and capped further gains in EUR/USD pair.

Meanwhile, the lockdown restrictions increased in Europe, given the region’s rising number of coronavirus cases. On late Monday, the U.K. government imposed tighter restrictions on London amid the increased infection rates. It cited that these may be partly linked to a new variant of the coronavirus. From Wednesday, Germany will also enter a lockdown that will include the closure of non-essential stores. Netherland also announced a new five-week lockdown, while Italy was considering more restrictions over the Christmas holidays.

Throughout the region, these lockdown restrictions added pressure on the single currency Euro and capped further gains in the EUR/USD pair on Tuesday.

Daily Technical Levels

Support   Resistance

1.2126       1.2175

1.2099       1.2197

1.2077       1.2224

Pivot point: 1.2148

EUR/USD– Trading Tip

The precious metal gold continues to trade bullish at 1,857, having crossed over double top resistance level of 1,857 level. On the higher side, the metal opens up further room for buying until the next target level of 1,865 and 1,875 level. On the lower side, the precious metal gold may find support at 1,848, and below this level, the metal may drop until the 1,832 level. Let’s consider staying bullish over 1,848 today. The 50 periods EMA supports a bullish bias, keeping the EUR/USD pair in a little bit of buying mode. Simultaneously, the MACD and RSI are also supporting a buying trend; thus, we should look for a buying trade over the 1.2175 level to target the 1.2265 level today. 

GBP/USD – Daily Analysis

 The GBP/USD pair closed at 1.34635 after placing a high of 1.34688 and a low of 1.32800. The GBP/USD pair was among the best performer on the day amid the speculation regarding the prospect of an imminent Brexit deal.

There were speculations mostly amongst Conservative M.P.s that a Brexit deal was close and might be voted in the House of Commons next Monday and Tuesday. This optimism led the GBP/USD pair higher in the market to post gains for the day.

After posting losses for three consecutive days, the currency pair GBP/USD pair rose by nearly 1% on Tuesday after the speculation that there had been progressing on the issue of a level playing field. The European Union negotiator Michel Barnier said that reaching a trade pact with Britain was still possible. At the same time, European Commission Ursula von der Leyen noted that there was some progress made over the sticking points.

British Pound is highly sensitive to Brexit progress, and any news showing optimism regarding the post-Brexit trade deal with the E.U. will have a great impact on the GBP/USD pair. This was the reason behind the sudden surge in GBP/USD currency pair on Tuesday despite the renewed lockdown restrictions by the U.K. government over London.

The Health Secretary of the UK, Matt Hancock, said on Monday that this week London would return to a strict lockdown as the coronavirus cases have soared in the British capital. Hancock said London would move from England’s Tier 2 – high alert local restrictions to Tier 3 – very high alert on Wednesday noon. 

Under the highest restriction level, all hospitality venues, including pubs, restaurants, and cafes, will close except for takeout and delivery. People will avoid unnecessary traveling and reduce the number of journeys. Residents in London will be restricted from meeting in private gardens or outdoor venues.

Meanwhile, on the data front, at 12:00 GMT, the Average Earnings Index from Great Britain raised to 2.7% against the forecasted 2.2% and supported the British Pound that added gains in the GBP/USD pair. The Claimant Count Change from the U.K. raised to 64.3K against the expected 10.5K and weighed on British Pound. The Unemployment Rate from the U.K. dropped to 4.9% from the expected 5.1% and supported the Sterling that added strength to the GBP/USD pair.

From the U.S. side, at 18:30 GMT, the Empire State Manufacturing Index for December fell to 4.9 against the estimated 6.3 and weighed on the U.S. dollar that added further gains in GBP/USD pair. The U.S. Import Prices in November dropped to 0.1% against the estimated 0.3% and weighed on the U.S. dollar and supported the upward momentum in GBP/USD pair. At 19:15 GMT, the Capacity Utilization Rate from the U.S. for November surged to 73.3% against the estimated 73.1% and supported the U.S. dollar. The Industrial Production in November also rose to 0.4% against the estimated 0.3% and supported the U.S. dollar.

Daily Technical Levels

Support   Resistance

1.3338       1.3528

1.3218       1.3595

1.3147       1.3719

Pivot point: 1.3404

GBP/USD– Trading Tip

The GBP/USD pair is trading at 1.3460 level, facing immediate resistance at 1.3475 and 1.3538 level. While the support stays at 1.3430 and 1.3401 level. The RSI and MACD support the buying trend in the market, while Cable has the potential to stay bullish over 1.3400 today. A choppy session can be expected until the pair violates the 1.3345 – 1.3309 range.

USD/JPY – Daily Analysis

The USD/JPY pair closed at 103.647 after placing a high of 104.150 and a low of 103.604. The USD/JPY pair failed to capitalize on its previous daily gains and dropped on Tuesday over the fears of a new variant of coronavirus and the increased lockdown restrictions over the globe.

The safe-haven appeal in the market returned after the U.K. Health Minister Matt Hancock told parliament that a new variant of the coronavirus associated with faster spread had been identified in southeast England. This led to widespread concern as headlines in the newspaper called this new variant “Super covid” and “mutant covid.”

Matt Hancock added that about 60 different local authorities had recorded coronavirus infections caused by the new variant. He also said that the World Health Organization had been notified, and a detailed study by U.K. scientists has started.

The fear of new and improved disease raised the market’s safe-haven appeal as London went into renewed lockdown restriction of Tier-3 level. Along with London, Germany and Netherland also extended their lockdown restrictions. The rising demand for safe-haven assets added strength to the Japanese Yen that ultimately weighed on the USD/JPY pair.

Meanwhile, on the data front, at 18:30 GMT, the Empire State Manufacturing Index for December declined to 4.9 against the anticipated 6.3. It weighed on the U.S. dollar that added further losses in the USD/JPY pair. The U.S. Import Prices in November fell to 0.1% against the anticipated 0.3% and weighed on the U.S. dollar and added further in the losses of the USD/JPY pair. At 19:15 GMT, the Capacity Utilization Rate from the U.S. for November rose to 73.3% against the anticipated 73.1% and supported the U.S. dollar. The Industrial Production in November also surged to 0.4% against the anticipated 0.3% and supported the U.S. dollar and capped further losses in the USD/JPY pair.

Furthermore, on Tuesday, Dr. Anthony Fauci, the U.S. senior official for infectious diseases, predicted that the U.S. could begin to achieve early stages of herd immunity against the deadly coronavirus by late Spring or Summer. 

Fauci said that to see an impact of the vaccine over the coronavirus spread, almost 50% of people would have to get vaccinated. To achieve herd immunity, 75 to 85% of people would have to get vaccinated. 

Herd immunity occurs when enough people become immune to the disease that the spread of the virus from one person to another person becomes unlikely. Fauci pointed to polio and measles as examples of herd immunity. Despite these positive statements from the top health official from the U.S., the USD/JPY pair failed to reverse its direction upward because of traders’ focus on the new variant of coronavirus.

Daily Technical Levels

Support   Resistance

103.47       104.02

103.25       104.37

102.91       104.58

Pivot Point: 103.81

USD/JPY – Trading Tips

The USD/JPY is trading dramatically bearish, falling below 103.700. This resistance area is extended by a double bottom pattern, which later was violated on the 2-hour timeframe. Below this level, the USD/JPY pair has odds of extending a sell trade until the next support level of 103.211. The 50 EMA and MACD are supporting selling bias. Thus we can expect to sell below 103.700, to target the 103.200 mark. Good luck! 

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Forex Signals

AUD/USD Supported Over 0.7515 Level – Is It Good Time to Buy? 

The AUD/USD pair was closed at 0.75324 after placing a high of 0.75779 and a low of 0.75243. After placing gains for three consecutive days, the AUD/USD pair dropped on Monday despite the market’s risk flows. After rising above the highest level since June 2018, the AUD/USD pair saw heavy technical selling in the market. The pair reached above the 0.75700 level and faced heavy selling pressure as the investors started to take profits from their trades. The profit-taking overshadowed the market’s risk flows, and the pair AUD/USD continued falling on Monday. 

The AUD/USD pair was closed at 0.75324 after placing a high of 0.75779 and a low of 0.75243. After placing gains for three consecutive days, the AUD/USD pair dropped on Monday despite the market’s risk flows. After rising above the highest level since June 2018, the AUD/USD pair saw heavy technical selling in the market. The pair reached above the 0.75700 level and faced heavy selling pressure as the investors started to take profits from their trades. The profit-taking overshadowed the market’s risk flows, and the pair AUD/USD continued falling on Monday. 

The AUD/USD pair was closed at 0.75324 after placing a high of 0.75779 and a low of 0.75243. After placing gains for three consecutive days, the AUD/USD pair dropped on Monday despite the market’s risk flows. After rising above the highest level since June 2018, the AUD/USD pair saw heavy technical selling in the market. The pair reached above the 0.75700 level and faced heavy selling pressure as the investors started to take profits from their trades. The profit-taking overshadowed the market’s risk flows, and the pair AUD/USD continued falling on Monday. 

The risk sentiment was improved on Monday due to the latest vaccine rollout in the US and Canada after the UK. The US started giving Pfizer and BioNtech vaccine doses to nurses and health officials on Monday as it provides a 95% efficacy rate against the coronavirus.

The vaccine rolls out raised hopes that the global economic recovery will soon begin as the coronavirus will become less of a threat. This optimism raised the risk sentiment in the market but failed to impress the risk-sensitive Aussie buyers.

The risk sentiment was also supported by the latest hopes that the US coronavirus stimulus bill will be released soon to support the US economy from the coronavirus impact. The US dollar also came under pressure as the coronavirus cases, and the death toll from COVID-19 surpassed 300,000 number. The US dollar weakness could not impress the AUD/USD buyers, and the pair continued its bearish movement on Monday.

Meanwhile, the AUD/USD pair was under pressure on Monday as Biden has said that he will not remove the tariffs on Chinese products by Trump immediately. The President-elect nominated Katherine Tail for the role of US trade representative said on Friday that she was the trade enforcer against China’s unfair trade practices that will be a key priority in the Biden-Harris administration. It was a sign that Donald trump’s trade war will continue, which weighed on the China-Proxy Australian dollar and added losses in the AUD/USD pair on Monday.


Daily Technical Levels

Support Resistance

0.7514 0.7570

0.7492 0.7602

0.7459 0.7625

Pivot point: 0.7547

The AUD/USD is trading sideways at 0.7515, but it’s supported by an upward trendline that can be seen in the 2-hour timeframe. On the higher side, the AUD/USD is forming a double top level at 0.7527, which is now extending resistance. The leading technical indicators such as MACD and RSI support the buying trend, while the 50 periods EMA is also supporting the AUD/USD pair at 0.7515. Let’s consider buying over 0.7515 level to capture quick 40 pips. Good luck! 

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Forex Signals

GBP/USD Violates Double Bottom – Sell Trade in Play! 

The GBP/USD is trading at the 1.3330 level, maintaining a narrow trading range of 1.3345 – 1.3309. A lack of high-impact economic data drives the choppy session; however, the market will be offering us labor market figures, which are expected to be worse than before, and it may drive selling in the Sterling. Technically, the bearish breakout of the 1.3309 level can extend the selling trend until the 1.3265 level, whereas a bullish breakout can lead it towards the 1.3409 mark. A choppy session can be expected until the pair violates the 1.3345 – 1.3309 range.

The GBP/USD is trading at the 1.3330 level, maintaining a narrow trading range of 1.3345 – 1.3309. A lack of high-impact economic data drives the choppy session; however, the market will be offering us labor market figures, which are expected to be worse than before, and it may drive selling in the Sterling. Technically, the bearish breakout of the 1.3309 level can extend the selling trend until the 1.3265 level, whereas a bullish breakout can lead it towards the 1.3409 mark. A choppy session can be expected until the pair violates the 1.3345 – 1.3309 range.

The GBP/USD is trading at the 1.3330 level, maintaining a narrow trading range of 1.3345 – 1.3309. A lack of high-impact economic data drives the choppy session; however, the market will be offering us labor market figures, which are expected to be worse than before, and it may drive selling in the Sterling. Technically, the bearish breakout of the 1.3309 level can extend the selling trend until the 1.3265 level, whereas a bullish breakout can lead it towards the 1.3409 mark. A choppy session can be expected until the pair violates the 1.3345 – 1.3309 range.


Entry Price – Sell 1.33045

Stop Loss – 1.33445

Take Profit – 1.32645

Risk to Reward – 1:1

Profit & Loss Per Standard Lot = -$400/ +$400

Profit & Loss Per Micro Lot = -$40/ +$40

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Forex Market Analysis

Daily F.X. Analysis, December 15 – Top Trade Setups In Forex – U.K. Labor Market Figures! 

Investor’s eyes will stay on the French Final CPI and Italian Trade Balance due from the European Economy. Economists are expecting no major changes in these inflation and trade balance data. Thus it may go muted. However, the Claimant Count Change and Unemployment Rate data from the U.K. is likely to drive market movements. Let’s keep an eye on U.K. labor market figures today.

Investor’s eyes will stay on the French Final CPI and Italian Trade Balance due from the European Economy. Economists are expecting no major changes in these inflation and trade balance data. Thus it may go muted. However, the Claimant Count Change and Unemployment Rate data from the U.K. is likely to drive market movements. Let’s keep an eye on U.K. labor market figures today.

Investor’s eyes will stay on the French Final CPI and Italian Trade Balance due from the European Economy. Economists are expecting no major changes in these inflation and trade balance data. Thus it may go muted. However, the Claimant Count Change and Unemployment Rate data from the U.K. is likely to drive market movements. Let’s keep an eye on U.K. labor market figures today.

Economic Events to Watch Today  

 

EUR/USD – Daily Analysis

During Tuesday’s Asian trading session, the EUR/USD currency pair managed to extend its overnight winning streak and sidelined near above the 1.2150 level mainly due to the risk-on market sentiment. That was supported by the upbeat China data and optimism over treatment for the highly infectious coronavirus, which weakens the safe-haven U.S. dollar and contributes to the currency pair gains. Moreover, the upbeat market tone was further boosted by the further U.S. stimulus package’s rising expectations, which add further burden around the U.S. dollar and boost the currency pair. 

On the contrary, the ongoing concerns about increasing COVID-19 deaths and the possibility of economically-painful hard lockdowns become the key factor that kept the lid on any additional gains in the currency pair. As of writing, the EUR/USD currency pair is currently trading at 1.2149 and consolidating in the range between 1.2143 – 1.2165.

As we already mentioned, the market trading sentiment succeeded in extending its previous day bullish bias and still representing positive performance on the day as the bullish appearance of Asia-Pacific stocks and the gains of the U.S. stocks futures tends to highlight the risk-on mood. However, the risk-on market sentiment could be attributed to the vaccine optimism and upbeat China data, which showed the economic recovery increased in November. On the data front, China’s Retail Sales increased by 5.0% year-on-year in November, marking the 4th-successive month of growth. Industrial Production, a gauge of manufacturing, mining, and utility output, rose 7% year-on-year versus October’s 5.9% growth. 

On the other hand, the renewed optimism over a possible vaccine for the highly infectious coronavirus disease also keeps supporting the market trading sentiment. It is worth recalling that the U.S. Food and Drug Administration (FDA) granted permission for emergency use to BNT162b2, the COVID-19 vaccine co-developed by Pfizer (NYSE: PFE) and BioNTech SE (F:22UAy) on December 11. The approval will see the first U.S. deliveries of BNT162b2 later in the day, which lifted hopes that the world’s largest economy will likely see a reduction in the COVID-19 cases. However, the positive developments over the covid vaccine keep favoring the market risk-on mood and undermine the safe-haven U.S. dollar.

As in result, the broad-based U.S. dollar failed to stop its previous day bearish bias and drew further offers on the day as demand for the safe-haven assets decreased amid progress toward agreeing on U.S. fiscal stimulus and optimism for a Brexit deal. On the other hand, the U.S. dollar losses were further bolstered by the Fed’s expectations to keep interest rates low for an extended period at its last policy meeting of 2020. However, the U.S. dollar losses helped the gold prices to deeper its losses as the gold price is inversely related to the U.S. dollar price. The U.S. Dollar Index Futures that tracks the greenback against a bucket of other currencies dropped to 90.642.

On the contrary, the concerns about rising COVID-19 deaths and the possibility of economically-painful hard lockdowns keep challenging the upbeat market performance, which becomes the key factor that kept the lid on any additional gains currency pair. As per the latest report, the growing virus cases recall the local lockdowns in the U.K. and the U.S. After New York, that was witnessed readiness to enter a second full lockdown as the number of COVID-19 cases surge. In addition to this, Germany also extended national activity restrictions. Across the ocean, the fears of a full-fledged trade/political war between the West and China also challenge the market’s upbeat mood. The tension between the two biggest economies in the world was fueled after the U.S. imposed back to back travel restrictions over the Chinese Communist Party members and their families.

In the absence of the major data/events on the day, the market traders will keep their eyes on the continuous drama surrounding the U.S. stimulus package. In the meantime, the risk catalyst like geopolitics and the virus woes, not to forget the Brexit, will also be key to watch for a fresh direction. 

Daily Technical Levels

Support   Resistance

1.2044       1.2133

1.2006       1.2186

1.1954       1.2223

Pivot point: 1.2096

EUR/USD– Trading Tip

The technical side of the EUR/USD is still unchanged as it trades at the 1.2131 level, facing immediate resistance at 1.2160 and 1.2196 level along with a support level of 1.2085. Closing of candles below the 1.2103 level can send the EUR/USD pair further lower until 1.2080 and 1.2040. The 50 periods EMA supports a bullish bias, keeping the EUR/USD pair in a little bit of buying mode. Simultaneously, the MACD and RSI are also in support of a buying trend; thus, we should look for a buying trade over the 1.2175 level to target the 1.2265 level today. 

GBP/USD – Daily Analysis

During Tuesday’s Asian trading session, the GBP/USD currency pair maintained its strong bid tone through the first half of the Asian session and remained positive around the 1.3335 level mainly due to the reports suggesting that the U.K. and the E.U. agreed to extend Brexit talks. Furthermore, the bid tone surrounding the British pound was further bolstered after the E.U.’s chief Brexit negotiator, Michel Barnier, said that they could face every hurdle to reach a post-Brexit trade deal. 

Across the ocean, the broad-based U.S. dollar fresh weakness, backed by the market risk-on mood, also played its major role in underpinning the currency pair. At a particular time, the GBP/USD currency pair is currently trading at 1.3333 and consolidating in the range between 1.3312 – 1.3348. Moving on, the traders seem cautious to place any strong position ahead of the U.K. jobs data, which is due to release later in the day.

It is worth recalling that the U.K. Prime Minister Boris Johnson and European Commission President announced that they discussed the key issues and decided to go for another round of discussions to reach a historic trade deal, which in turn, raised expectations for a free trade agreement before the end of Brexit transition period on December 31. However, these hopes were further fueled after the E.U.’s chief Brexit negotiator, Michel Barnier, told them to use every way to reach a post-Brexit trade deal.

Despite the prevalent doubts over the global economic recovery from coronavirus (COVID-19), the market trading sentiment managed to extend its previous day’s positive performance. It remained supportive by optimism over a potential vaccine/treatment for the highly infectious coronavirus. Let me remind you that the U.S. Food and Drug Administration (FDA) granted permission for emergency use to BNT162b2, the COVID-19 vaccine co-developed by Pfizer (NYSE: PFE) and BioNTech SE (F:22UAy) on December 11. However, the positive developments over the covid vaccine keep favoring the market risk-on mood and undermine the safe-haven U.S. dollar.

As in result, the broad-based U.S. dollar failed to stop its previous day bearish bias and drew further offers on the day as demand for the safe-haven assets decreased amid progress toward agreeing on U.S. fiscal stimulus and optimism for a Brexit deal. On the other hand, the U.S. dollar losses were further bolstered by the Fed’s expectations to keep interest rates low for an extended period at its last policy meeting of 2020. However, the U.S. dollar losses provided an additional boost to the GBP/USD currency pair and remained supportive of the strong intraday positive move. The U.S. Dollar Index Futures that tracks the greenback against a bucket of other currencies dropped to 90.642.

On the bearish side, the concerns about rising COVID-19 deaths and the possibilities of the economically-painful hard lockdowns keep challenging the upbeat market performance, which becomes the key factor that kept the lid on any additional gains in the currency pair. As per the latest report, the growing virus cases recall the local lockdowns in the U.K. and the U.S. After New York, that was witnessed readiness to enter a second full lockdown as the number of COVID-19 cases surge. In addition to this, Germany also extended national activity restrictions. 

Moving on, the traders seem cautious to place any strong position ahead of the U.K. jobs data, which is due to release later in the day. From the projected view, the U.K. labor market report is anticipated to show that the average weekly earnings, including bonuses, in the 3-months to October, to increase from the previous 1.3% to 2.2%, while ex-bonuses, the wages are seen improving from 1.9% to 2.6% during the stated period. 

In addition to this, the number of people asking for jobless benefits is expected to rise from -29.8K previous to +50K in November. Moreover, the ILO Unemployment Rate may rise from 4.8% to 5.1% during the 3- months ending in October. However, the positive earnings growth tends to underpin the GBP; conversely, the low figures would be seen as negative for the GBP currency.

In the absence of the major data/events on the day, the market traders will keep their eyes on the continuous drama surrounding the U.S. stimulus package. In the meantime, the risk catalyst like geopolitics and the virus woes, not to forget the Brexit, will also be key to watch for a fresh direction. 

Daily Technical Levels

Support   Resistance

1.3338       1.3466

1.3280       1.3536

1.3209       1.3594

Pivot point: 1.3408

GBP/USD– Trading Tip

The GBP/USD is trading at the 1.3330 level, maintaining a narrow trading range of 1.3345 – 1.3309. A lack of high-impact economic data drives the choppy session; however, the market will be offering us labor market figures, which are expected to be worse than before, and it may drive selling in the Sterling. Technically, the bearish breakout of the 1.3309 level can extend the selling trend until the 1.3265 level, whereas a bullish breakout can lead it towards the 1.3409 mark. A choppy session can be expected until the pair violates the 1.3345 – 1.3309 range.

USD/JPY – Daily Analysis

During Tuesday’s Asian trading session, the USD/JPY currency pair managed to stop its previous day losing streak and drew some modest bids around well above the 104.00 level. However, the bullish sentiment around the currency pair was supported by the upbeat market mood, which undermined the safe-haven Japanese yen and contributed to the currency pair gains. Apart from this, the latest local lockdowns in the northern hemispheres and the surge in Tokyo’s virus figures added further pressure on the Japanese yen and boosted the currency pair. On the contrary, the broad-based U.S. dollar, triggered by the upbeat market mood, has become the key factor that capped further upside momentum for the currency pair. Currently, the USD/JPY currency pair is currently trading at 104.09 and consolidating in the range between 103.98 – 104.15. 

As we already mentioned, market trading sentiment has been gaining positive traction since the day started and supported by the optimism over the U.S. President-elect Joe Biden’s victory in the Electoral College. As per the latest report, the U.S. President-elect Joe Biden recently won Electoral College and claimed his victory over President Donald Trump by achieving over 270 votes needed. In addition to this, the intensifying hopes of the U.S. covid stimulus also positively impacted the market trading sentiment. These hopes were triggered after Treasury Secretary Steve Mnuchin and House Speaker Nancy Pelosi urged policymakers toward an early aid package while also indicating good progress in the discussions. 

Across the ocean, the reason behind the risk-on market sentiment could also be attributed to the upbeat China data, which showed the economic recovery improved in November. On the data front, China’s Retail Sales increased by 5.0% year-on-year in November, marking the 4th-successive month of growth. Industrial Production, a gauge of manufacturing, mining, and utility output, rose 7% year-on-year versus October’s 5.9% growth. 

On the other hand, the renewed optimism over a possible vaccine for the highly infectious coronavirus disease also keeps supporting the market trading sentiment. It is worth recalling that the U.S. Food and Drug Administration (FDA) granted permission for emergency use to BNT162b2, the COVID-19 vaccine co-developed by Pfizer (NYSE: PFE) and BioNTech SE (F:22UAy) on December 11. The approval will see the first U.S. deliveries of BNT162b2 later in the day, which lifted hopes that the world’s largest economy will likely see a reduction in the COVID-19 cases. However, the positive developments over the covid vaccine keep favoring the market risk-on mood and undermined the safe-haven assets like the Japanese yen and U.S. dollar.

At the USD front, the broad-based U.S. dollar extended its previous session bearish bias. It failed to gain any positive traction during the Asian trading hours amid risk-on market sentiment. Apart from this, the greenback losses could also be associated with the Fed’s expectations to keep interest rates low for an extended period at its last policy meeting of 2020. However, the U.S. dollar losses might stop bulls from placing any strong position and keep a lid on any further gains for the USD/JPY currency pair. The U.S. Dollar Index Futures that tracks the greenback against a bucket of other currencies dropped to 90.642.

However, the market trading sentiment was rather unaffected by the fresh lockdown restrictions in Britain and Europe. As per the latest report, the growing virus numbers recall the local lockdowns in the U.K. and the U.S. After New York, a willingness to enter a second full lockdown as the number of COVID-19 cases surge. In addition to this, Germany also extended national activity restrictions. 

In the absence of the major data/events on the day, the market traders will keep their eyes on the ongoing drama surrounding the U.S. stimulus package. In the meantime, the risk catalyst like geopolitics and the virus woes, not to forget the Brexit, will also be key to watch for a fresh direction. 

Daily Technical Levels

Support   Resistance

104.04       104.41

103.86       104.60

103.67       104.78

Pivot Point: 104.23

USD/JPY – Trading Tips

The USD/JPY is hardly moving as it continues to trade sideways below the 104.150 resistance area. This resistance area is extended by a double top level on the 2-hour timeframe. Bullish crossover of 104.156 level can open buying until 104.590 level. Conversely, the support holds around 103.910 level. A bearish breakout of this support can drive the selling trend until the next support area of 103.700 and 103.500. Let’s keep an eye on a breakout before placing any bullish or bearish bets. Good luck! 

Categories
Forex Signals

USD/CAD Violates Descending Triangle Pattern – Signal Update! 

During Monday’s Asian trading session, the USD/CAD currency pair failed to stop its overnight losses and remain depressed around below the 1.2750 level due to the broad-based U.S. dollar weakness. The prevalent downtrend in the greenback was mainly tied to the fresh optimism over a potential vaccine for the highly contagious coronavirus disease, which kept the market trading sentiment positive and undermined the safe-haven USD dollar. Furthermore, the U.S. dollar losses were further bolstered by the renewed probabilities that the Fed will keep interest rates low for an extended period at its last policy meeting of 2020. 

During Monday’s Asian trading session, the USD/CAD currency pair failed to stop its overnight losses and remain depressed around below the 1.2750 level due to the broad-based U.S. dollar weakness. The prevalent downtrend in the greenback was mainly tied to the fresh optimism over a potential vaccine for the highly contagious coronavirus disease, which kept the market trading sentiment positive and undermined the safe-haven USD dollar. Furthermore, the U.S. dollar losses were further bolstered by the renewed probabilities that the Fed will keep interest rates low for an extended period at its last policy meeting of 2020. 

During Monday’s Asian trading session, the USD/CAD currency pair failed to stop its overnight losses and remain depressed around below the 1.2750 level due to the broad-based U.S. dollar weakness. The prevalent downtrend in the greenback was mainly tied to the fresh optimism over a potential vaccine for the highly contagious coronavirus disease, which kept the market trading sentiment positive and undermined the safe-haven USD dollar. Furthermore, the U.S. dollar losses were further bolstered by the renewed probabilities that the Fed will keep interest rates low for an extended period at its last policy meeting of 2020. 

Across the pond, the reason for the declines in the currency pair could also be attributed to the fresh upticks in the crude oil prices, which tend to underpin the commodity-linked currency the Loonie and contributes to the currency pair’s losses. However, the crude oil prices were supported by prevalent optimism over a potential vaccine for the highly infectious coronavirus disease, which ultimately fueled hopes for a recovery in fuel demand and contributed to the crude oil price gains. As of writing, the USD/CAD currency pair is currently trading at 1.2755 and consolidating in the range between 1.2745 – 1.2764.

As we already mentioned, the market trading sentiment represented positive performance on the day as the bullish appearance of Asia-Pacific stocks and upticks of the U.S. 10-year Treasury yields tend to highlight the risk-on mood being supportive by optimism over a potential vaccine/treatment for the highly infectious coronavirus. It is worth recalling that the U.S. Food and Drug Administration (FDA) provided emergency use permission to BNT162b2, the COVID-19 vaccine co-developed by Pfizer (NYSE: PFE) and BioNTech SE (F:22UAy) on Dec. 11. The approval will see the first U.S. deliveries of BNT162b2 later in the day, which lifted hopes that the world’s largest economy will likely see a reduction in the COVID-19 cases.

At the USD front, the broad-based U.S. dollar failed to erase its overnight losses and remained under pressure on the day mainly due to the market risk-on tone. Apart from this, coronavirus’s resurgence keeps fueling the fears that the U.S. economic recovery could be halt, which also keeps the greenback under pressure. On the other hand, the U.S. dollar losses were further bolstered by the expectations that the Fed will keep interest rates low for an extended period at its last policy meeting of 2020. However, the U.S. dollar losses could be considered the major factor that kept the currency pair lower. Meantime, the U.S. Dollar Index, which tracks the greenback against a bucket of other currencies, dropped by 0.03% to 92.487 by 10:02 PM ET (2:02 AM GMT).

At the crude oil front, WTI crude oil prices remained well bid around closer to $47.00 on the day, backed by the prevalent optimism over a potential vaccine for the highly infectious coronavirus disease, which ultimately fueled hopes for a recovery in fuel demand and contributed to the crude oil price gains. Apart from this, the reason for the crude oil gains could also be associated with fresh, positive reports suggesting an extension of Brexit talks between the U.K. and the European Union (E.U.), which eased global fuel demand worries and contributed to the crude oil price gains. Thus, the crude oil prices’ upticks underpinned the commodity-linked currency the Loonie and exerted some downside pressure on the currency pair. 

In the absence of significant data/events on the day, the market traders will keep their eyes on the continuous drama surrounding the U.S. stimulus package. In the meantime, the risk catalyst like geopolitics and the virus woes, not to forget the Brexit, will also be key to watch for a fresh direction. 


Daily Support and Resistance

S1 1.2613

S2 1.2687

S3 1.2727

Pivot Point 1.276

R1 1.28

R2 1.2833

R3 1.2907

Entry Price – Sell 1.274

Stop Loss – 1.2733

Take Profit – 1.27

Risk to Reward – 1:1

Profit & Loss Per Standard Lot = -$400/ +$400

Profit & Loss Per Micro Lot = -$40/ +$40

Fellas, now you can check out forex trading signals via Forex Academy mobile app. Follow the links below.

iPhone Users: https://apps.apple.com/es/app/fasignals/id1521281368

Andriod Users: https://play.google.com/store/apps/details?id=academy.forex.thesignal&hl=en_US

Categories
Forex Market Analysis

Daily F.X. Analysis, December 14 – Top Trade Setups In Forex – European Events in Highlights!  

On the news side, the market is expected to report a low impact on economic events, which may have a very slight or no effect on the market. The German WPI m/m, Industrial Production, and German Buba Monthly Report will be released from the European economy. Still, I suspect there’s not going to be any significant movement in the market.

On the news side, the market is expected to report a low impact on economic events, which may have a very slight or no effect on the market. The German WPI m/m, Industrial Production, and German Buba Monthly Report will be released from the European economy. Still, I suspect there’s not going to be any significant movement in the market.

On the news side, the market is expected to report a low impact on economic events, which may have a very slight or no effect on the market. The German WPI m/m, Industrial Production, and German Buba Monthly Report will be released from the European economy. Still, I suspect there’s not going to be any significant movement in the market.

Economic Events to Watch Today  

  

EUR/USD – Daily Analysis

During Monday’s Asian trading session, the EUR/USD currency pair succeeded in extending its overnight winning streak and remained well bid around the 1.2140 level mainly due to the risk-on market sentiment. That was supported by the optimism over treatment for the highly infectious coronavirus, which tends to weaken the safe-haven U.S. dollar and contributes to the currency pair gains. 

Moreover, the upbeat market tone was further boosted by the increasing expectations of a further U.S. stimulus package, which boosted the currency pair. On the contrary, the fresh jump in infections and death toll in Europe keeps fueling the doubts over the Eurozone economic recovery, which becomes the key factor that kept the lid on any additional currency pair gains. The EUR/USD is trading at 1.2134 and consolidating between 1.2116 and 1.2145.

The global equity market has been flashing green since the day started and is supported by the further stimulus package’s renewed possibilities. As per the latest report, the U.S. Congress members are still progressing over the much-awaited stimulus talks. In that way, the latest talks suggest the partition of over $900 billion of aid package with $748 billion and $160 billion likely figures for each bill. Across the pond, the optimism over treatment for the highly infectious coronavirus has also been favoring the market trading sentiment. These hopes were sparked after the U.S. Food and Drug Administration’s (FDA) officially authorized the Pfizer-BioNTech covid vaccine for emergency use. Thereby, the upbeat market mood has been playing its major role in underpinning the currency pair.

The broad-based U.S. dollar declined to obtain any positive traction and drew an offer on the day as doubts persist over the global economic recovery from COVID-19. That was witnessed by the U.S. previous week’s downbeat U.S. data. Meanwhile, the risk-on market sentiment also weighed on the U.S. currency. On the other hand, the U.S. dollar losses were further bolstered by the Fed’s expectations to keep interest rates low for an extended period at its last policy meeting of 2020. However, the losses in the U.S. dollar becomes the key factor that kept the currency pair higher. The U.S. Dollar Index Futures that tracks the greenback against a bucket of other currencies dropped by 0.17% to 90.773 by 9:48 PM ET (1:48 AM GMT).

On the contrary, the intensifying coronavirus woes across the globe and intensifying lockdowns restrictions in Europe and the U.S. keep challenging the upbeat market performance and become the key factor that kept the lid on any additional gains in the currency pair. As per the latest report, the growing virus cases recall the local lockdowns in the U.K. and the U.S. In the meantime, Germany also extended national activity restrictions. Meanwhile, the fears of a full-fledged trade/political war between the West and China also challenge the market’s upbeat mood. The tension between the two largest markets in the world was fueled after the U.S. imposed back to back travel restrictions over the Chinese Communist Party members and their families.

Looking forward, the traders will keep their eyes on the U.S. employment data for November along with Euro German Factory Orders data, which will likely entertain market players amid a light calendar. All in all, the updates surrounding the Brexit, virus, and U.S. stimulus package will not lose their importance. 

Daily Technical Levels

Support   Resistance

1.2044       1.2133

1.2006       1.2186

1.1954       1.2223

Pivot point: 1.2096

EUR/USD– Trading Tip

The technical side of the EUR/USD is trading choppy at the 1.2131 mark, meeting immediate resistance at 1.2160 and 1.2196 marks along with a support mark of 1.2085. Formation of candles beneath the 1.2103 level can send the EUR/USD pair further lower until 1.2080 and 1.2040. Industrial Production and German Buba Monthly Report will remain in highlights. Let’s wait to trade a breakout setup during the European or the U.S. session today. 

GBP/USD – Daily Analysis

During Monday’s Asian trading session, the GBP/USD currency pair managed to stop its previous week’s bearish bias and refresh the intra-day high around above the mid-1.3300 level, mainly due to reports suggesting that the UK PM. Boris Johnson and the European Commission (E.C.) President Ursula von der Leyen agreed to extend the Brexit talks for one more week, which eased fears of a no-deal Brexit and contributed to the currency pair gains. On the other hand, the broad-based U.S. dollar fresh weakness, backed by the market risk-on mood, also played its major role in underpinning the currency pair. At a particular time, the GBP/USD currency pair is currently trading at 1.3325 and consolidating in the range between 1.3291 – 1.3354.

It is worth recalling that the U.K. Prime Minister Boris Johnson and European Commission President announced that they discussed the key issues and decided to go for another round of discussions to reach a historic trade deal, which in turn, boosted the sentiment around the British Pound and contributed to the currency pair gans. In contrast, the British PM Johnson repeats, “I’m afraid we’re still very far apart on some issues.” However, this negative statement failed to leave any meaningful impact on the Pound. 

Despite the lingering doubts about global economic recovery and the intensifying tension between the world’s two biggest economies, the market players continue to cheering the optimism over a possible vaccine for the highly infectious coronavirus disease. These hopes were fueled after the U.S. Food and Drug Administration’s (FDA) officially approved the Pfizer-BioNTech covid vaccine for emergency use. However, the positive developments over the covid vaccine keep favoring the market risk-on mood. Apart from this, the global equity market was further supported by the further stimulus package’s renewed possibilities. As per the latest report, the U.S. Congress members keep working to give the much-awaited stimulus package ahead of this Friday’s deadline. In that way, the latest talks suggest the partition of over $900 billion of aid package with $748 billion and $160 billion likely figures for each bill. 

As in result, the broad-based U.S. dollar failed to stop its bearish bias and remained depressed on the day. Moreover, the doubts over the global economic recovery from COVID-19 remains on the card. That was witnessed by the U.S. previous week’s downbeat U.S. data. On the other hand, the U.S. dollar losses were further bolstered by the Fed’s expectations to keep interest rates low for an extended period at its last policy meeting of 2020. However, the losses in the U.S. dollar becomes the key factor that kept the currency pair higher. The U.S. Dollar Index Futures that tracks the greenback against a bucket of other currencies dropped by 0.17% to 90.773 by 9:48 PM ET (1:48 AM GMT).

Conversely, the intensifying coronavirus woes in the U.K. and the U.S. and intensifying lockdown restrictions keep challenging the upbeat market performance and become the key factor that kept the lid on any additional gains in the currency pair. As per the latest report, the U.S. and U.K. policymakers were forced to impose the local lockdowns once again. In the meantime, Germany also extended national activity restrictions. 

Looking forward, the market traders will keep their eyes on the developments surrounding the Brexit story for some significant direction in the pair. Furthermore, the updates covering the virus and the US-China tussle will also be key to watch.

Daily Technical Levels

Support   Resistance

1.3338       1.3466

1.3280       1.3536

1.3209       1.3594

Pivot point: 1.3408

GBP/USD– Trading Tip

The GBP/USD is trading at the 1.3313 level, holding below an immediate resistance level of 1.3322. On the upper side, the GBP/USD pair can lead to a 1.3390 level, and support stays at 1.3269, which is extended by a double bottom level. Selling bias seems dominant; therefore, we should be looking for a sell trade only upon the violation of the 1.3265 level. The lagging technical indicators like 50 EMA suggest selling bias. Thus we should look for selling trades below 1.3400 and upon breakout 1.3265 level too.   

USD/JPY – Daily Analysis

During Monday’s Asian trading session, the USD/JPY currency pair failed to gain any positive traction. They witnessed some modest selling moves near below the 104.00 level, mainly due to the upbeat market sentiment, which tends to undermine the safe-haven U.S. dollar and contributes to the currency pair losses. However, the market trading sentiment was supported by the optimism about the coronavirus treatment and progress in the U.S. stimulus talks. Simultaneously, the market’s upbeat mood weakens the safe-haven Japanese yen, which could be considered one of the key factors that help the currency pair limit its deeper losses. In contrast, Japan’s Tankan data for the 4th-quarter (Q4) marked upbeat figures, which boosted the Japanese yen’s sentiment and contributed to the currency pair losses.  

At the data front, Tankan Large Manufacturing Index for Q4 grew from -27 to -10, against expectations of -15, while the Non-Manufacturing Index increased from -6 market consensus to -5 during the stated period. Moreover, Tankan Large Manufacturing Outlook and Non-Manufacturing Outlook also recorded upbeat numbers of -8 and -6 respectively, against -11 and -7 forecasts in that order.

Despite the lingering doubts over the U.S. economic recovery and the escalating tension between the world’s two biggest economies, the market players continue to cheer the optimism over a potential vaccine for the highly dangerous coronavirus infection. These hopes were fueled after the U.S. Food and Drug Administration’s (FDA) officially approved the Pfizer-BioNTech covid vaccine for emergency use. In turn, the New York Times got help to say that the White House staff members will be among the first to be vaccinated. However, the positive developments over the covid vaccine keep favoring the market risk-on mood and contributed to the currency losses by undermining the safe-haven U.S. dollar.

Apart from this, the global equity market upticks were further fueled by the further stimulus package’s renewed possibilities. As per the latest report, the U.S. Congress members keep working to give the much-awaited stimulus package ahead of this Friday’s deadline. In that way, the latest talks suggest the partition of over $900 billion of aid package with $748 billion and $160 billion likely figures for each bill. 

This, in turn, the broad-based U.S. dollar failed to stop its bearish traction and edged lower on the day. Moreover, the doubts over the U.S. economic recovery from COVID-19 remains on the card, as witnessed by the U.S. previous week’s downbeat U.S. data. On the other hand, the U.S. dollar losses were further bolstered by the Fed’s expectations to keep interest rates low for an extended period at its last policy meeting of 2020. However, the losses in the U.S. dollar becomes the key factor that kept the currency pair lower. The U.S. Dollar Index Futures that tracks the greenback against a bucket of other currencies dropped by 0.17% to 90.773 by 9:48 PM ET (1:48 AM GMT).

The rising tensions between the United States and China keep challenging the market risk-on tone and might suffer the currency pair into deeper losses. It’s also questioning the market risk-on mood could be the intensifying coronavirus woes in the U.K. and U.S., which leads to the intensifying lockdown restrictions. 

Daily Technical Levels

Support   Resistance

104.04       104.41

103.86       104.60

103.67       104.78

Pivot Point: 104.23

USD/JPY – Trading Tips

During the previous week, the USD/JPY violation of the symmetric triangle pattern at 104.346 faked out as the safe-haven currency pair reversed trade within the same triangle pattern. The current trading range of the USD/JPY pair remains 104.375 – 103.650, and violation of this range can extend the selling trend until the next support area of 103.200 level. Typically, such a triangle pattern can breakout on either side; this, we should be careful before opening any trade. The market is neutral as investors seem to wind up their positions ahead of the December holidays. Good luck

Categories
Forex Signals

AUD/USD Violates Upward Channel – Brace for a Buying Trade 

The AUD/USD pair was closed at 0.75350 after placing a high of 0.75296 and a low of 0.74254. The Australian Dollar rose to its highest level in two and a half year as investors started to bet on a successful vaccine roll-out and improving global growth. The risk-sensitive Aussie gained as much as 0.8% on Thursday and rose to its highest since June 2018 as the market’s risk sentiment improved. The pair AUD/USD has gained about 6.8% this year as a rebound in China’s economy has boosted China-proxy Australian Dollar demand.

The AUD/USD pair was closed at 0.75350 after placing a high of 0.75296 and a low of 0.74254. The Australian Dollar rose to its highest level in two and a half year as investors started to bet on a successful vaccine roll-out and improving global growth. The risk-sensitive Aussie gained as much as 0.8% on Thursday and rose to its highest since June 2018 as the market’s risk sentiment improved. The pair AUD/USD has gained about 6.8% this year as a rebound in China’s economy has boosted China-proxy Australian Dollar demand.

The AUD/USD pair was closed at 0.75350 after placing a high of 0.75296 and a low of 0.74254. The Australian Dollar rose to its highest level in two and a half year as investors started to bet on a successful vaccine roll-out and improving global growth. The risk-sensitive Aussie gained as much as 0.8% on Thursday and rose to its highest since June 2018 as the market’s risk sentiment improved. The pair AUD/USD has gained about 6.8% this year as a rebound in China’s economy has boosted China-proxy Australian Dollar demand.

The risk sentiment in the market was supported by the combination of multiple factors on Thursday and supported the upward trend in the Australian Dollar. The rising hopes for the US stimulus bill after the US Treasury Secretary Steven Mnuchin that a lot of progress has been made regarding the stimulus talks added in the risk sentiment. Meanwhile, the US House Speaker Nancy Pelosi also said that bipartisan negotiations on the coronavirus relief bill were making great progress. These comments reflected the upbeat market mood and supported the risk perceived Australian Dollar.

On the other hand, the US dollar was also weak on Thursday that also supported the upside momentum in AUD/USD pair. The US dollar weakness was driven by the increased unemployment claims and additional stimulus from ECB on Thursday. 

At 05:00 GMT, the MI Inflation Expectations for November remain flat at 3.5% on the data front. From the US side, at 18:30 GMT, the CPI for November rose to 0.2% against the projected 0.1% and supported the US dollar. The Core CPI for November also increased to 0.2% against the forecasted 0.1% and supported the US dollar. The Unemployment Claims from last week raised to 853K against the anticipated 723K and weighed on the US dollar that added gains in AUD/USD pair. Furthermore, the hopes that the US FDA will approve within days using Pfizer’s vaccine also supported the risk sentiment in the market and gave strength to the risk perceived Aussie that ultimately added in the gains of AUD/USD pair.

The rising hopes for quick global economic growth also supported the market’s risk flows after the ECB announced on Thursday that it would expand its bond-buying program by nine months. It also raised the stimulus measure by 500 billion euros that will provide support to the Eurozone economy through the coronavirus pandemic. These updates also supported the risk-sensitive Aussie and helped the pair reach its multi-years highest level on Thursday above 0.7500.


Daily Technical Levels

Support Resistance

0.7403 0.7486

0.7362 0.7528

0.7320 0.7569

Pivot point: 0.7445

Entry Price – Buy 0.75374

Stop Loss – 0.74974

Take Profit – 0.75774

Risk to Reward – 1:1

Profit & Loss Per Standard Lot = -$400/ +$400

Profit & Loss Per Micro Lot = -$40/ +$40

Fellas, now you can check out forex trading signals via Forex Academy mobile app. Follow the links below.

iPhone Users: https://apps.apple.com/es/app/fasignals/id1521281368

Andriod Users: https://play.google.com/store/apps/details?id=academy.forex.thesignal&hl=en_US