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Forex Elliott Wave Forex Market Analysis

NZDUSD Could Reach a New Yearly High

The NZDUSD pair continues extending its gains, testing the psychological barrier of 0.71, helped by the US Dollar weakness. The Oceanic currency outperforms over 5.4% during the current year. Also, the pair advances over 27% since it confirmed its bottom on March 22nd at 0.55862.

Technical Overview

The big picture of the NZDUSD illustrated in the following 12-hour chart shows the primary upward trend, its trendline plotted in blue, intact since March 22nd when the price confirmed its bottom at 0.55862 and began the rally that remains in progress to date. Likewise, the secondary trend and its green trendline reveal the acceleration of the price testing by the third time the psychological barrier of 0.71.

Considering that the NZDUSD pair currently re-tests the 0.71 level, the price could extend its gains, reaching a new yearly high, to find resistance in the next psychological resistance of 0.72.

Short-term Technical Outlook

The short-term Elliott wave view for the NZDUSD pair unfolded by its 4-hour chart led us to observe an incomplete impulsive sequence of Minute degree labeled in black, which began on October 22nd price found fresh buyers at 0.65529.

The previous chart illustrates the impulsive structure that continues progressing and looks to develop its fourth wave of Minute degree labeled in black. Moreover, in the chart, we should remark that the third wave, which looks like the extended wave of the incomplete impulsive sequence identified in black, has found resistance at 0.71043 on December 03rd. 

Once the price topped the yearly high at 0.71043, the pair began to develop a sideways corrective formation, still progressing. In this regard, considering both the alternation principle stated by the Elliott Wave Theory and that wave ((ii)) in black looks like a simple corrective pattern, the current wave ((iv)) of the same degree should be complex in terms of price, time, or both.

In this scenario, the price action might retrace until the demand zone bounded between 0.69462 and 0.68970, where the Kiwi could find fresh buyers expecting to boost the pair toward a new yearly high. This high could strike the potential target zone between 0.71618 and 0.7260.

In summary, the short-term Elliott wave perspective for the NZDUSD pair reveals the advance in a bullish trend that currently moves mostly sideways in an incomplete corrective formation. The fourth wave in progress could find support in the demand zone bounded between 0.69462 and 0.68970. Likewise, fresh buyers could boost the price toward 0.71618 and extend its gains until 0.7260. Finally, the invalidation level of the current bullish scenario is located at 0.68106.

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Forex Market Analysis Forex Technical Analysis

NZDJPY Fills the Gap Unfilled Since May 2019

The NZDJPY advanced 5.70% in November, consolidating the price in the extreme bullish sentiment zone. Likewise, as illustrated in the following daily chart, during December’s kickoff trading, the cross reached the yearly high of 73.831, filling the gap that opened on May 06th, 2019.

Technical Overview

The previous chart also exposes the cross advancing in a mid-term uptrend drawn in blue, which remains active since last March 18th, when the price found support at 59.490. Likewise, we distinguish an accelerated short-term bullish trend plotted in green, which began in early November. 

The 2.774 reading observed in the EMA(60) to Close Index leads us to suspect that the impulsive bull market developed in the NZDJPY cross seems to be in an exhaustion stage. Therefore, the cross is likely to develop a reversal movement in the following trading sessions.  

Nevertheless, before taking a position on the bearish side, the price action must confirm the reversal movement. 

Technical Outlook

The following 12-hour chart presents the mid-term Elliott Wave view or the NZDJPY cross. The drawings reveal the cross advancing in an incomplete fifth wave of Minuette degree, labeled in blue that belongs to the fifth wave of Minute degree, in black.

NZDJPY’s price movements reveal an impulsive five-wave sequence of Minute degree identified in black, which began last March 18th, when the cross found fresh sellers after the massive sell-off developed in the global stock market. 

Likewise, once the extended third wave (in black) ended, the cross developed a sideways movement as a flat pattern, which found fresh buyers at 68.633. In this context, considering the Elliott Wave theory and that wave ((iii)) was the extended wave, the next impulsive wave ((v)) (in black) can’t be extended and should look similar to wave ((i)), also in black. 

On the other hand, watching the fifth wave’s internal structure (in black), the wave (ii) (in blue) looks like a complex correction, and the third wave is the extended movement. In this context, the current wave (v) (in blue), which is still in development, shouldn’t be an extended rally.

Consequently, the cross could complete its fifth wave of Minute degree in the area defined by the psychological levels between 74.00 and 75.00. Finally, until the cross shows evidence of a reversal, such as a bearish engulfing candle, we should consider the cross’ trend as bullish.

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Forex Elliott Wave Forex Market Analysis

NZDUSD Reaches a Fresh 90-Day High

The NZDUSD pair ends the last trading week reaching its seventh fresh 90-day range high soaring to 0.69507. This advance brought the Oceanic currency to a close in the extreme bullish sentiment zone. 

Technical Overview

The next chart unveils the NZDUSD pair in its 8-hour timeframe, which shows the market participants’ sentiment in the 90-day high and low range. The figure illustrates the previous 90-day high and low range located at 0.67978 from September 18th. In this regard, the latest rally started on November 02nd created seven fresh 90-day highs.

On the other hand, the EMA(60)-to-Close index shows a bearish divergence that suggests both the bullish trend’s exhaustion and the price’s potential reversion to the moving average. However, a price breakdown and close below the recent lows is needed to confirm the current bullish trend’s correction.

Short-term Technical Outlook

The short-term view of the NZDUSD cross displayed under the Elliott Wave perspective reveals the intraday upward movement advancing in an incomplete Ending diagonal pattern of Minuette degree labeled in blue. Likewise, the advance of the fifth wave in blue should correspond to the ending of the fifth wave of Minute degree identified in black. Nevertheless, the Elliott Wave formation still doesn’t confirm it.

The next4-hour chart reveals the bullish sequence developed by the NZDUSD pair since October 20th when the kiwi found fresh buyers at 0.65555. Until now, the price action advanced in an incomplete upward five-wave sequence, which reached the potential target zone forecasted in a previous analysis.

According to Elliott wave theory, the Ending Diagonal pattern follows an internal sequence subdivided into 3-3-3-3-3 waves. In this context, the previous chart exposes the terminal formation of the bullish impulsive structure advancing in its fifth wave of Subminuette degree labeled in green, which provides two potential scenarios.

  • First Scenario: The price breaks below the base-line that connects the waves ii and iv, confirming the end of the Ending Diagonal pattern and starting a corrective upper degree structure.
  • Second Scenario: The price advances slightly over last Friday’s high and starts to decline below the base-line between waves ii-iv, from where the NZDUSD should begin to develop a correction of upper degree.

In both scenarios, the confirmation of the ending diagonal completion comes from the breakdown and closing below the base-line that connects the end of waves ii and iv.

Finally, the downward scenario will have its invalidation level once the ending diagonal pattern confirms its completion.

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Forex Elliott Wave Forex Market Analysis

NZDUSD: Is the Rally Over?

The NZDUSD pair continues consolidating in the extreme bullish sentiment zone, as is revealed on its 8-hour chart. The chart comprises its 90-day high and low range. Currently, the cross remains testing the psychological barrier at 0.6900.

In the previous chart, we can observe the five new highs in the 90-day range reached by the NZDUSD each trading day after the last range maximum, which stood at level 0.67978. This market context leads us to expect a euphoric bullish movement followed by an imminent retracement.

On the other hand, the bearish divergence in the MACD oscillator moves us to recognize the current uptrend’s exhaustion, although it remains in progress.

The next 4-hour chart shows the upward incomplete impulsive sequence, which corresponds to the fifth wave of Minute degree identified in blue that began on October 20th at 0.65555.


Currently, the price action reveals the advance in its fourth wave of Minuette degree labeled in blue. At the same time, we can distinguish the NZDUSD pair’s price running in the wave c of Subminuette degree identified in green. In this context, the intraday decline could lead the price to develop a new short-term rally subdivided into a five-wave sequence.

Short-term Technical Outlook

The short-term Elliott wave view for the NZDUSD pair unfolded in its 4-hour chart foresees further upsides, which could advance to the area between 0.6926 and extend its gains until 0.6972. This upward movement could complete its fifth wave of Minuette degree labeled in blue.

An alternative scenario considers the possibility that the NZDUSD pair could achieve a limited decline to the demand zone between 0.68452 and 0.68281, where the pair could find fresh buyers and complete its fourth wave of Minuette degree identified in blue.

On the other hand, the limited correction corresponding to wave (iv) in blue could advance toward the ascending channel’s base-line, where the cross could find its dynamic support. Once the price finds fresh buyers, the pair may advance on its fifth wave of Minuette degree into five internal segments.

Lastly, the bullish scenario’s invalidation level is at 0.67242, which corresponds to the end of wave (i) of Minuette degree.

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Forex Market Analysis

NZDUSD Bullish ahead of the RBNZ Meeting

Overview

The NZDUSD cross advances in the extreme bullish sentiment zone before the RBNZ monetary policy decision, to be held during the overnight trading session. The intraday Elliott Wave view reveals its progress in an incomplete five-wave sequence, which could boost the price toward a new high.

Market Sentiment

The NZDUSD cross waits for the Reserve Bank of New Zealand (RBNZ) interest rate decision, as it moves on the extreme bullish sentiment zone. Although the kiwi’s high volatility during this year made it drop over 18.7% in the first quarter of the year, the NZDUSD is still up by 1.44% (YTD).

The next chart illustrates the NZDUSD in its 8-hour timeframe. The figure unveils the price action developing a short-term rally that pushed it from the extreme bearish till the extreme bullish sentiment zone.

Moreover, the consecutive intraday higher high could make the market participants expect further upsides during the interest rate decision, which will take place in the overnight trading session.

In this context, the analysts’ consensus foresees that the RBNZ official cash rate (OCR) will remain unchanged at 0.25%. However, considering that during the latest Reserve Bank of Australia (RBA) broad meeting, the policymakers decided to cut the interest rate to 0.10%, it is possible that the RBNZ would follow the same direction.

In consequence, although the NZDUSD moves in the extreme bullish zone, a drop below 0.67635 could be a signal the pair might start developing a downward corrective movement during the following trading sessions.

Technical Overview

The big picture of the NZDUSD cross exposed in the 2-day log-scale chart reveals its advancement in an incomplete impulsive sequence, which looks moving on its fifth wave of Minute degree labeled in black. 

According to the Elliott Wave theory, considering that the price action developed a third extended wave, the fifth wave should have a limited upside. Thus, the extension of the current upward movement could end soon.

On the other hand, the bearish divergence observed in the MACD oscillator confirms that the cross’s current 5th-wave upward sequence is in an exhaustion stage. 

Likewise, the long-term descending trendline suggests that the price action currently tests a dynamic resistance, which could be surpassed backed by increasing volatility. Nevertheless, this potential breakout could end being a fake-out

Short-term technical Outlook

The intraday outlook for NZDUSD under the Elliott wave view and illustrated in its 4-hour chart exposes its progress in the third wave of Minuette degree labeled in blue, which could retrace to the area between 0.6785 and 0.67562.

If the price confirms the bounce from the demand zone between 0.67562 and 0.67850, the kiwi could advance toward the long-term supply zone, which corresponds to a potential target area between 0.69311 and 0.69780.

Once the fifth wave of Minuette degree, which belongs to the fifth wave of Minute degree, completes, the cross could start developing a corrective sequence with length and time proportional to the structural series of Minute degree.

Lastly, the invalidation of this intraday upward scenario is a drop below 0.67242.

Categories
Forex Signals

NZDUSD Breakout Anticipation BUY

Flow Assessment

  • Price is in a daily range and showing a grind upwards with higher highs and higher lows
  • We anticipate price to get to the top of the daily range

Location Assessment

  • On the H4, price has been holding just before a historical seller’s area, supported by a strong buy push, suggesting a possible buildup area before the breakout to the upside

Momentum Assessment

  • A strong force of buyers showed themselves, breaking out of the mini-congestion from 0.6687 to 0.67100, suggesting the buyers are ready to move up
  • It is unlikely to be a trap because the origin of the buy swing push on the H4 is still very strong
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Forex Signals

NZDUSD Swing Failure SELL

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Forex Elliott Wave Forex Market Analysis

NZDUSD Short-Term Wave Analysis

Overview

The NZDUSD pair advances in a sideways corrective formation suggesting the progress in an incomplete short-term flat pattern. The completion of its move could give way to a new bearish movement of the upper degree; however, this incomplete correction could be temporary.

Market Sentiment Overview

The New Zealand Dollar moves slightly bullish this Thursday, 22nd advancing 0.13%, expecting the inflation data released by New Zealand’s Statistics, Stats NZ, in the upcoming overnight session. The data corresponds to the third quarter of 2020, and surveyed analysts expect an increase that could rise to 1.7% (YoY), being 0.2% more than the previous reading published in July.

The New Zealand Dollar futures market sentiment, presented in the following daily chart, unveils the price moving in the extreme bullish sentiment zone. In the chart, we can distinguish  0.6463 as support the level and 0.6797 as the resistance level. A level that corresponds to the 52-week high. 

On the other hand, the chart highlights the price action is moving mainly sideways, consolidating around the weighted moving average of 60 days. This context of price action suggests we can expect a corrective move before continuing its bullish trend.

Concerning the evolution of the Commitment of Traders Report, the previous chart exposes the institutional positioning on the bullish side. In consequence, although the current consolidation calls for a corrective move, the primary trend is bullish.

The next figure unveils that 73% of retail traders currently hold their positions on the bearish side, confirming a contrarian long-term upward bias to this pair.

 

Elliott Wave Outlook

The NZDUSD short-term outlook under the Elliott Wave perspective unveiled in its 3-hour chart exposes the kiwi’s sideways advance since the oceanic currency topped at 0.67978 on September 18th, where the pair started to develop a corrective structure that remains in progress.

Considering that a corrective structure is subdivided into a three-wave sequence, we can notice in the previous figure that the NZDUAD action progresses in its second wave, identified as wave B of Minor degree, and labeled in green. This segment corresponds to a flat pattern (3-3-5), which currently develops its wave ((c)) of Minute degree identified in black.

At the same time, the internal structure of the wave ((c)) reveals that the price action could be advancing in its wave (v) of the Minuette degree labeled in blue. This market context suggests the possibility of a limited upside before start developing a downward sequence, corresponding to wave C of Minor degree. 

In summary, the short-term outlook for the NZDUSD pair, under the Elliott Wave perspective, foresees a downward move, which corresponds to a wave C of Minor degree. This potential next move may subdivide into a five-wave sequence. Once this corrective formation completes, the Kiwi should begin to develop a new upward impulsive sequence of upper degree coinciding with the long-term institutional bias.

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Forex Signals

NZDUSD Develops a Three Descending Peaks Pattern

Description

The NZDUSD prices develop an incomplete corrective formation that suggests a new decline, which could complete a three-wave movement in the following trading sessions.

In its 4-hour chart, the kiwi illustrates a bearish move that the price started when topped at 0.67978, starting a corrective structure that remains in progress. The figure highlights the completion of waves A and B labeled in green. According to the Elliott wave theory, the NZDUSD pair should start to develop a downward wave C subdivided into five waves from its corrective sequence. In this context, the price could drop at least at 0.65165, which corresponds to the September 24th low.

On the other hand, from the chartist perspective, the last decline looks like a three descending peaks pattern, which suggests the continuation of the primary bearish move supporting the scenario of further falls.

The bearish scenario’s invalidation level locates above 0.6670, which coincides with the surpassing of the short-term bearish trendline identified in brown.

Chart

Trading Plan Summary

 

Check out the latest trading signals on the Forex Academy App for your mobile phone from the Android and iOS App Store.

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Forex Signals

NZDUSD Breaks an Ascending Wedge Pattern

Description

The NZDUSD pair in its 4-hour chart reveals the breakdown of an ascending wedge pattern in progress, suggesting the possibility of further declines for the following trading sessions.

The oceanic currency against the US Dollar started to develop a rally from 0.5920 on May 15th, which took a breath once topped at 0.6584 on June 10th, beginning to move mostly sideways. Once the price action tested by the third time the baseline of the consolidation sequence, the price action began to advance on a terminal pattern identified as an ascending wedge formation.

On the other hand, the RSI oscillator illustrates a bearish divergence exposing the mid-term uptrend’s exhaustion. Simultaneously, the breakdown of the ascending trendline and the perforation of the previous intraday lows at 0.6564r lead us to expect further declines in the coming trading sessions. This breakdown could drag the price at least until level 0.6444.

The invalidation level of the bearish outlook locates at 0.6614.

Chart

Trading Plan Summary

Check out the latest trading signals on the Forex Academy App for your mobile phone from the Android and iOS App Store.

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Forex Market Analysis

NZD/USD Triple Top Setup – Quick Update on Sell Trade! 

The commodity currency pair NZD/USD is trading with bearish bias around 0.6120, as investors seem to take profit despite a surge in crude oil prices. Dollar remains weaker as the reports indicate that US drug maker Moderna provided insufficient data to determine the efficiency of vaccines that came in the market lately. This report increased the doubts and weighed on the US dollar safe-haven status, which ultimately dragged the NZD/USD pair higher.

Increased tensions between the US & China also kept the US dollar under pressure on Wednesday after China showed anger towards US administration for more-warmer ties with Taiwan. On the other hand, WTI Crude Oil Prices on Wednesday showed a surge in black gold prices towards $33 per barrel amid the increased demand after easing of lockdown restrictions across the globe. 

Crude oil prices were also supported by production cuts by OPEC+ and supply cuts by other major oilfields. Furthermore, on the American data front, the Crude Oil Inventories for the past week were reported as -5.0M against 1.7M and gave support to WTI crude prices.


Everything considered, the NZD/USD pair is now in the overbought zone, and it is also testing triple top resistance at a level of 0.6150. Below this, we gave entered a selling trade as the pair can drop until 0.6105 and even lower to 0.6064 level. The pair may face a hard time breaking above 0.6150 level as the recent histograms in the NZD/USD pair are supporting selling bias in the pair. Thus we are trying to capture a correction in the market. 

Entry Price – Sell 0.61352    

Stop Loss – 0.61752    

Take Profit – 0.60902        

Risk to Reward – 1.12    

Profit & Loss Per Standard Lot = -$400/ +$450

Profit & Loss Per Micro Lot = -$40/ +$45

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Forex Options

FX option expiries for Apr 28 NY cut

FX option expiries for Apr 28 NY cut

28 April 2020, 08:35
FX option expiries for Apr 28 NY cut at 10:00 Eastern Time, via DTCC, can be found below.

EUR/USD: EUR amounts

  • 1.0820 557m
  • 1.0980 508m


USD/JPY: USD amounts

  • 107.50 3.2bn
  • 107.99 428m


GBP/USD: GBP amounts

  • 1.2400 291m


NZD/USD: NZD amounts

  • 0.6050 352m

Categories
Forex Signals

Watch this Breakout Before to Buy

Description

The NZDUSD pair in its hourly chart shows a sideways sequence that reacted mostly bullish after dropped to 0.5468, the lowest level reached since April 2009.

This Tuesday, the stock markets began to show bounces signals despite the bearish opening observed on Monday trading session. The context seen makes us suspect an increase in the traders’ interest on the risk-on side. This scenario could lead to a boost to commodity currencies such as the New Zealand Dollar.

The breakout and close above the level 0.5878 make us foresee that the price could confirm an upward which could drive to the oceanic currency until 0.6186.

The level that invalidates our bullish scenario locates at 0.5655.

Chart

Trading Plan Summary

  • Entry Level: 0.5878
  • Protective Stop: 0.5655
  • Profit Target: 0.6186
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Forex Assets

Knowing The Fundamentals Of NZD/USD Currency Pair

Introduction

New Zealand dollar versus the US dollar, in short, is referred to as NZD/USD or NZDUSD. This currency pair is classified as a major currency pair. In NZDUSD, NZD is the base currency, and USD is the quote currency. Trading the NZDUSD is as good as saying, trading the New Zealand dollar, as NZD is the base currency.

Understanding NZD/USD

The value (currency market price) of NZDUSD represents units of USD equivalent to 1 NZD. In layman terms, it is the number of US dollars required to purchase one New Zealand dollar. For example, if the value of NZDUSD is 0.6867, then 0.6867 USD is required to buy one NZD.

NZD/USD Specification

Spread 

The algebraic difference between the bid price and the ask price is called the spread. It depends on the type of execution model provided by the broker.

Spread on ECN: 1

Spread on STP: 1.9

Fees

Similar to spreads, fees also depend on the type of execution model. Usually, there is no fee on the STP model, but there is a small fee on the ECN model. In our analysis, we shall fix the fee to 1 pip.

Slippage

Slippage is the difference between the price asked by the trader for execution and the actual price the trader was executed. Slippage occurs on market orders. It is dependent on the volatility of the market as well as the broker’s execution speed. Slippage has a decent weight on the cost of each trade. More about it shall be discussed in the coming sections.

Trading Range in NZD/USD

The volatility of a currency pair plays a vital role in trading. It is a variable that differs from timeframe to timeframe. Understanding the range (min, avg, max) is essential for a trader, as it is helpful for reducing the cost of each trade.

The volatility gives the measure of how many pips the pair has moved on a particular timeframe. This, in turn, gives the approximate profit or loss on each timeframe. For example, if the volatility of NZDUSD on the 1H timeframe is 10 pips, then one can expect to gain or lose $100 (10 pips x $10 [pip value]) within an hour or two.

Below is a table that depicts the minimum, average, and maximum volatility (pip movement) on different timeframes.

AUD/USD PIP RANGES 

Procedure to assess Pip Ranges

  1. Add the ATR indicator to your chart
  2. Set the period to 1
  3. Add a 200-period SMA to this indicator
  4. Shrink the chart so you can assess a large time period
  5. Select your desired timeframe
  6. Measure the floor level and set this value as the min
  7. Measure the level of the 200-period SMA and set this as the average
  8. Measure the peak levels and set this as Max.

NZD/USD Cost as a Percent of the Trading Range

With the volatility values obtained in the above table, the total cost of each trade is calculated on each timeframe. These values are represented in terms of a percentage. And these percentages will determine during what values of volatility it is ideal to trade with low costs.

The total cost is calculated by adding up the spread, slippage, and trading fee. As a default, we shall keep the slippage at 2 and the trading fee for the ECN model at 1.

ECN Model Account

Spread = 1 | Slippage = 2 | Trading fee = 1

Total cost = Slippage + Spread + Trading Fee = 2 + 1 + 1 = 4

STP Model Account

Spread = 1.9 | Slippage = 2 | Trading fee = 0

Total cost = Slippage + Spread + Trading Fee = 2 + 1.9 + 0 = 3.9

The Ideal Timeframe to Trade NZD/USD

The very first observation that can be made from the above two tables is that the total costs in both the model types are more or less the same. So trading on any one of the two accounts is a fine choice.

From the minimum, average, and maximum column, it can be ascertained that percentages (costs) are the highest on the minimum column of all the timeframes. In simpler terms, when the volatility of the currency pair is very low, the costs are usually on the higher side. Conversely, when the volatility is high, the costs are pretty low. Hence, it is ideal to trade during those times of the day when the volatility of the pair is at or above average. For example, a day trader can trade the 1H timeframe when the volatility of the currency pair is above 8.8 pips. This will hence assure that the costs are pretty low.

Another way to reduce the costs is by nullifying the slippage. This can be done by placing a limit order instead of executing them by a market order. This shall reduce the total costs by a significant percentage. An example of the same is given below.

Total cost = Slippage + Spread + Trading fee = 0 + 1 + 1 = 2

From the above table with nil slippage, it is evident that the costs have reduced by about 50%. Hence, to sum it up, to optimize the cost, it is ideal to trade when the volatility is above average and also enter & exit trades using limit orders rather than market orders.

Categories
Forex Elliott Wave Forex Market Analysis

NZDUSD Long Term Wave Analysis

The NZDUSD pair has shown signs of recovery in recent weeks. Have we to think in the buy-side for the coming weeks? In this article, we will review the probable next movement from the oceanic pair.

Fundamental Perspective

The Reserve Bank of New Zealand (RBNZ), realized in November its last monetary policy decision, from where the policymakers kept the Official Cash Rate unchanged at 1%.

In the decision statement, Governor Adrian Orr stated that employment remains at high levels; however, inflation remains below the 2% target. Moreover, the RBNZ projections for the coming year 2020 pointed to stable interest rates at low levels so that inflation can be ensured to reach the target level.

The next meeting of the reserve will be in February 2020. As a consequence, the fundamental traders will have to closely monitor the evolution of macroeconomic data during the following two months.

Technical Perspective

From the technical point of view, the NZDUSD in its weekly chart moves sideways in a corrective process that found the first support in August 2015 at 0.61968.

During 2019, NZDUSD approached the lowest level of 2015, developing Elliott’s ending diagonal pattern, which found support at 0.62037 in early October.

According to the Elliott Wave Principle, a diagonal ending formation is an impulsive pattern that has an internal structure that is divided into 3-3-3-3-3. In turn, this formation can be found in a wave ‘5’ or ‘C’ within a corrective structure.

Once NZDUSD touched the level 0.62037, the pair found buyers and began to realize a bullish movement in three waves. The completion of this upward sequence makes us foresee the possibility of a new decline. Probably the next move will be in three waves.

Our Forecast

The NZDUSD pair in its 4-hour range shows the possibility of a corrective move to the area between 0.64647 and 0.64078. This zone could bring us the opportunity to incorporate us in the potential long-term next rally.

The invalidation level is placed at 0.62028, which corresponds to the lowest level reached by the NZDUSD in October 2019. Our long-term target is at 0.7558 level.

Finally, depending on the retracement level of the NZDUSD, the corrective sequence will reveal to us the strength or weakness for the next path.

Categories
Forex Market Analysis

Daily-Active Day for European Assets; Heaving Data Awaits!

NZD/USD

With this kind of clear ending diagonal on the last 5th wave and daily Doji candle confirmation, retrace up was highly anticipated, as you can see in our previous analysis we suggested buying NZD/USD at 0.6530, with the stop below the previous low and the target of at least 300 pips. On H1 chart the pair very precisely has drawn 5 legs up, and it retraced to Fibo 0.38% level, which is also very usual for the second wave retrace. The direction is UP, but alternatively, we could see some flat correction again to our entry point around 0.6835, which can bring us one more opportunity to add to the buying position. In any case, we do suggest to sit tight with this long position, stay patient, and wait for solid profit.



DAX

The index does not show a very clear picture. It is drawing more complex pattern a double tree, and it’s very tricky, but in any case, this recently retraces up, should come in at least 3 legs up. So we will track the scenario of an ABC pullback up like it is shown on the chart. Cautious required.



GBP/USD

Obviously, GBP/USD rebounding up. The only thing that we should calculate is our projection for this retrace ending. We do believe that current retrace could be labelled as wave 2, so we will expect to be done anywhere from 0,38% Fibonacci retracement. Our current projection, as it is shown on the chart is short-term long, and long-term short, so the pair brings opportunity for any tastes, wheater you are a long or short-term trader.



USD/JPY

Obviously, this is a weekly chart, and this is a long-term perspective. Currently, we are tracking the triangle, which is very usual for the 4th Elliott wave. Price action in this wave often tends to range, without a clear trend move. As you can see on the chart we have perfectly labelled a,b,c,d leg and we now expect pull back down for e leg, which will represent finish of the 4th wave, and we should expect resume of an uptrend for the wave 5 up.



EUR/USD

As we already highlighted we are tracking pullback leg 3 or C from the zigzag A-B-C pattern after 5 waves down were completed all the way down from the 24.January high in EUR/USD. The area around 50% Fibonacci retracement or 1.1930, is our targeted region for this long position. The reason behind it is that wave A and wave C tend towards equality in length, and that retracement for the pullback of the second wave usually comes to 0,50 to 0,618% Fibo levels. But, this pullback down, may not be done yet, and before we test our projected profit target of 1,1930, we may see pullback down below 1,1520.



Categories
Forex Market Analysis

FOMC statement, Canadian growth, New Zealand data

 


news commentary


 

 

The meeting of the Federal Reserve’s will be the least surprising. They just raised interest rates in June; we know that the Fed probably won’t make any changes this month. However, the Fed will announce further tightening which is required because the labour market is healthy and economic activity is expanding at a solid rate. Inflation is on the rise, manufacturing and service-sector activity is accelerating so there’s no reason to postpone their plan to tighten again.

The weaker-than-expected Japan economic data are giving the bond prices a push higher. That movement has been triggered by the Bank of Japan decision to hold interest rate policy unchanged. While adding forward guidance that would maintain low-interest rates for an extended period. They also cut its inflation forecast.

 

Sources said that the White House was about to set higher tariffs on $200 billion in Chinese imports, maybe igniting a new round of trade conflicts.

Reports claim that President Donald Trump is thinking of putting tariffs of 25%, instead of 10%, in a statement that may come early on Wednesday.

 

Stronger-than-expected Canadian GDP growth led the Canadian dollar higher for the third day in a row. Besides Canada’s economy grew 0.5% in May

 

The New Zealand dollar failed to have a little breath because business confidence weakened, which followed by a decline in Q2 employment report.

 

 


chart analysis


 

 

US INDEX

On the daily chart, the price has bounced from the red resistance zone for the third time to shape the reversal triple top.

Price has recently formed another reversal pattern to assure the bearish bias with the wedge.

Followed by a break beneath an ascending trend on RSI, the index is settled down at the ascending trend line, if it’s broken, the price will have its way back to the support zone 93.2-92.6


 

 

AUD/USD

On the daily chart, the pair reached back the green support zone again to shape a double top pattern

Followed by divergence on RSI, our bullish view is still the same: if the price manages to still above the support area and the key level 0.7455, it will be heading towards the combination of levels of descending trend, ascending channel and resistance zone at 0.7655-0.774.


 

 

NZD/USD

On the daily chart, the price retested the green support zone 0.675-0.6695, followed by divergence in RSI.

An AB=CD harmonic pattern has been shaped to reinforce the bounce.

If the price could break above the key level at 0.6845, the price will be supposed to head back to the top of the descending channel with the resistance zone at 0.697-0.703 only if it manages to hold above the green zone


 

 

USD/CAD

On the daily chart,  the price has broken main support areas, as it closed beneath the key support 1.309, and beneath the ascending trend line

A wedge has been shaped and successfully confirmed after breaking it, besides a GARTLEY harmonic pattern to assure the bearish momentum

Followed by divergence on RSI, the price is expected to reach the next support 1.289


 

 

USD/JPY

On the daily chart, the price is located at a good long-buy position according to the support of 111.3, the retest of the broken descending trend, 23.6% Fibonacci level and the ascending channel.

Followed by engulfing candle, the price is expected to go further  back to the level 113.15


Categories
Forex Market Analysis

Central Banks meetings, China conditions to negotiate

 


news commentary


 

At the beginning of the week, investors have something of the calm before the storm as they brace for monetary events risk.

The Bank of Japan is expected to hold rates unchanged on Tuesday, the BoJ may carry the most influence when it announces its latest monetary policy decision. This is because several reports have indicated that the central bank is considering a decrease in its stimulus program.  a shift in this policy will not only lead to a spike in Japanese bond yields but it will also have a global effect that will lead to further tightening in credit conditions. However, the latest inflation report indicates that the BoJ might not make any significant changes on this front and will instead try to calm markets.

The Federal Reserve is also likely to leave rates unmoved when it announces its decision on Wednesday, with economists saying that recent comments from President Donald Trump will have no impact on policy and the Fed will continue sending the message that more rate hikes are on the way.

On Thursday, the Bank of England is expected to raise rates for the first time since November, But according to the recent fall in inflation and continued Brexit uncertainty, they might deliver a hike and hint that it’s the only one expected for 2018.

 

On another hand, Chinese Foreign Minister Wang Yi said his country would be willing to resume trade negotiations with the U.S. if the Trump administration “took a less combative” approach to talks.

President Trump said on Twitter yesterday that he would be willing to ‘shut down’ the government if Democrats do not support funding plans for his wall along the border with Mexico. The tweet came after a meeting last week in the White House between Trump, House Speaker Paul Ryan and Senate Majority Leader Mitch McConnell to discuss how to avoid an Oct. 1 shutdown, a month before elections that will determine control of Congress.

 

 


chart analysis


 

 

US INDEX

On the daily chart, the price has bounced from the red resistance zone for the third time to shape the reversal triple top.

Price has recently formed another reversal pattern to assure the bearish bias with the wedge.

Followed by a break beneath an ascending trend on RSI, the index is settled down at the ascending trend line, if it’s broken, the price will have its way back to the support zone 93.2-92.6



 

 

AUD/USD

On the daily chart, the pair reached back the green support zone again to shape a double top pattern

Followed by divergence on RSI, our bullish view is still the same: if the price manages to still above the support area and the key level 0.7455, it will be heading towards the combination of levels of descending trend, ascending channel and resistance zone at 0.7655-0.774.



 

 

NZD/USD

On the daily chart, the price retested the green support zone 0.675-0.6695, followed by divergence in RSI.

An AB=CD harmonic pattern has been shaped to reinforce the bounce.

If the price could break above the key level at 0.6845, the price will be supposed to head back to the top of the descending channel with the resistance zone at 0.697-0.703 only if it manages to hold above the green zone



 

 

USD/CAD

On the daily chart,  the price has broken main support areas, as it closed beneath the key support 1.309, and beneath the ascending trend line

A wedge has been shaped and successfully confirmed after breaking it, besides a GARTLEY harmonic pattern to assure the bearish momentum

Followed by divergence on RSI, the price is expected to reach the next support 1.289



 

USD/JPY

On the daily chart, the price is located at a good long-buy position according to the support of 111.3, the retest of the broken descending trend, 23.6% Fibonacci level and the ascending channel.

All these factors may boost the price further to go back to the level 113.15 and more if the price witnesses a suitable price action from these levels.



 

Categories
Forex Market Analysis

Daily Market Update: EU Data Remains Stable, PBoC Efforts to Support Yuan

 


 News Commentary


 

European data was still steady even after sentiment remained cautious with flash services PMI data easing slightly with 54.4, less than expected of 55.0. Meanwhile flash manufacturing PMI came positive with 55.1, more than expected of 54.7.

 

The Japanese yen cut most of its gains frustrating expectations about the Bank of Japan starting a fresh round of stimulus at its scheduled policy meeting next week.

Japan’s central bank is discussing changes to its interest-rate targets and stock-buying techniques, sending bond yields and the yen rocketing higher on Monday.

 

Risk appetite was mostly stable across markets after Beijing vowed to pursue a more ‘vigorous’ financial policy, stepping up efforts to support growth among growing economic struggle conditions.

 

 


 Chart Analysis


 

 

US INDEX

On the daily chart, the price has bounced from the red resistance zone for the third time to shape the reversal triple top.

Price has recently formed another reversal pattern to assure the bearish bias with the wedge.

Followed by a break beneath an ascending trend on RSI, the index is settled down at the ascending trend line, if it’s broken, the price will move its way back to the support zone 93.2-92.6.

 


 

USD/JPY

The pair had broken before the key level at 111.3 along with a descending trend line from the high of 2015, to reach the resistance of 113.15 to then bounce from there as a retracement.

Now, the price is located at a good long-buy position according to;- the support of 111.3, the retest of the broken descending trend, 23.6% Fibonacci level and the ascending channel.

All these factors may boost the price further to go back to the level 113.15 and more if the price witnesses a suitable price action from these levels.

 


 

AUD/USD

On the daily chart, the pair reached back the green support zone again to shape a double top pattern.

Followed by divergence on RSI, our bullish view is still the same: if the price manages to stay above the support area and the key level 0.7455, it will be heading towards the combination of levels of descending trend, ascending channel and resistance zone at 0.7655-0.774.

 


 

NZD/USD

On the daily chart, the price retested the green support zone 0.675-0.6695, followed by divergence in RSI.

An AB=CD harmonic pattern has been shaped to reinforce the bounce.

If the price could break above the key level at 0.6845, the price will be supposed to head back to the top of the descending channel with the resistance zone at 0.697-0.703 only if it manages to hold above the green zone.

 


 

AUD/JPY

On the daily chart, as we expected, the price has bounced from the red resistance zone at 83.9-85.95 with an engulfing bar.

The price is expected to continue its reversal to keep going in its sideways movement to the support zone 81.2-80.5.

 


 

CHF/JPY

On the daily chart, as we expected, the price has bounced according to the key levels that the price has recently reached the resistance zone at 112.85-113.05, reversal wedge, moving average 200 and 50% Fibonacci.

Followed by AB=CD harmonic pattern, if the price could break beneath the key level 111.9, the price is expected to go down to 111.9 then 110.3.


 

Categories
Forex Market Analysis

Daily Market Update: Trump Comments on Rate Hikes, Japan & Canada CPI

 


News Commentary


 

The dollar reversed against the currency basket on Thursday after U.S. President Trump said he was “not happy” about the Federal Reserve rate hikes but the downside was limited amid optimism over the U.S. economy.

“I’m not happy about it,” President Donald Trump said about interest-rate increases during an interview with CNBC Thursday, claiming that “higher rates put the United States at a disadvantage.” Trump insisted, but, he also sees that “Fed do what they feel is best.”

However, Powell earlier this week said gradual interest rate hikes would be “the best way forward” for the economy, citing stronger labour markets, and inflation that had met the Fed’s 2% objective.

 

The US and China are continuing a full-blown trade war. The People’s Bank of China (PBOC) is increasingly favouring a weaker Yuan after setting the Yuan reference rate at 6.7671 versus previous day’s fix of 6.7066.

 

The Japanese Yen started Friday’s trading session slightly affected by the release of local inflation data. June’s national CPI was 0.7%, lower than forecasts of 0.8% and in line with May’s result. However, the Yen may rise as trade war tensions may increase risk aversion.

 

All eyes will be on Canadian CPI at 12:30 GMT with a forecast of 0.1% such as with June’s reading. Traders will follow the result to get any conclusion about soon rates hike.

 


 Chart Analysis


 

 

US INDEX

On the daily chart, the price has bounced from the red resistance zone for the third time to shape the reversal triple top.

The price has recently formed another reversal pattern to assure the bearish bias with the wedge.

Followed by a break beneath an ascending trend on RSI, the index is supposed to move its way back to the support zone of 93.2-92.6.



 

AUD/USD

On the daily chart, the pair went back to the green support zone again to shape a double top pattern.

Followed by divergence in RSI, our bullish view is still the same: if the price manages to still be above the support area, it will be heading towards the combination of levels of the descending trend, ascending channel and resistance zone at 0.7655-0.774.



 

NZD/USD

On the daily chart, the price retested the green support zone 0.675-0.6695, followed by divergence in RSI.

An AB=CD harmonic pattern has been shaped to reinforce the bounce.

The price is supposed to head back to the top of the descending channel with the resistance zone at 0.697-0.703, but only if it manages to hold above the green zone.



 

AUD/JPY

On the daily chart, as we expected, the price has bounced from the red resistance zone at 83.9-85.95 with engulfing bar.

The price is expected to continue its reverse to keep going in its sideways movement to the support zone 81.2-80.5.



 

CHF/JPY

On the daily chart, it’s obvious to recognise by the key levels that the price has recently reached the resistance zone at 112.85-113.05, reversal wedge, moving average 200 and 50% Fibonacci.

Followed by AB=CD harmonic pattern, the price is expected to go down to 111.9 then 110.3



 

Categories
Forex Market Analysis

Daily Market Update: Upbeat Data From Australia, UK CPI, Powell Set To Be Hawkish Again

 


 News Commentary


 

Fed Chairman Jerome Powell supported the Dollar by bullish comments, which affirmed expectations about the central bank’s possible interest rate moves this year.

In Congressional testimony on Tuesday and Wednesday, Powell said he believed the United States was in steady growth for years, and carefully played down the risks to the U.S. economy of an escalating trade conflict.

U.S. President Donald Trump’s top economic advisor, Larry Kudlow, said that he believed Chinese President Xi Jinping has blocked any progress on a deal to end the duelling in U.S. and Chinese tariffs.

“China could end U.S. tariffs by providing a more satisfactory approach” and “taking steps that other countries are also calling for”, Kudlow said.

 

The U.K. was pulled down yesterday on weak inflation data, with the CPI reading 2.4%, less than the expectation of 2.6%, causing market expectations for a BoE August rate hike to ease slightly from 77% to 68%

 

Earlier, the Australian economy added 50.9K jobs in June, better than the estimated forecast of 16.7K
More importantly, the full-time jobs rose by 41.2 K following a 20.6K drop registered in May. Meanwhile, the jobless rate came in at a seasonally adjusted rate of 5.4% as expected.

 

 


 Chart Analysis


 

 

US INDEX

On the daily chart, the price has returned to the red resistance zone with shaping before the reversal double top.

The price has formed another reversal pattern to assure the bearish bias with the wedge.

Followed by a break beneath an ascending trend on RSI, the index is supposed to make its way back to the support zone 93.2-92.6



 

AUD/USD

On the daily chart, the pair bounced back from the resistance 0.7455 to retest the green support zone again.

Followed by divergence on RSI, our bullish view is still the same: Heading towards the combination of levels of descending trend, ascending channel and resistance zone at 0.7655-0.774.



 

NZD/USD

On the daily chart, the price retested the green support zone 0.682-0.6775, followed by divergence in RSI.

An AB=CD harmonic pattern has been shaped to reinforce the bounce.

The price is supposed to head back to the top of the descending channel with the resistance zone at 0.697-0.703.



 

USD/CAD

On the daily chart, the price reached the support of 1.3085 with the ascending trend line from the low of April.

On the other hand, the price has shaped a GARTLEY harmonic pattern with a reversal wedge, bouncing from the 78.6% Fibonacci level, followed by a divergence in RSI.

So, If the price breaks above the resistance 1.3225, it would head back to 1.34.

If it breaks beneath the wedge and the support of 1.3085, it would head back to 1.289.



AUD/JPY

On the daily chart, as we expected before, the price has reached the red resistance zone at 83.9-85.95.

It’s a crucial area that if the price bounces back from, it will continue its sideways movement to the support zone 81.2-80.5.

If the price breaks above it, it will head new levels to the next resistance zone 85.5-85.95.



 

Categories
Forex Market Analysis

Daily Market Update: Fed Chair Powel To Testify, New Zealand CPI

 


 News Commentary


 

 

The dollar eased on Tuesday due to congressional testimony by Federal Reserve Chairman Jerome Powell which traders will examine for clues on the pace of U.S. interest rate rises and risks emanating from trade conflicts.

Powell will testify on the economy and monetary policy before the U.S. Senate Banking Committee at 14:00 GMT

He is expected to deliver an optimistic message on the outlook for growth and reassure the FED’s gradual monetary tightening policy but could face tough questions on how the FED would deal with an escalation in the global trade war.

Powell is supposed to begin two days of testimony on the economy and monetary policy later Tuesday when he appears before the U.S. Senate Banking Committee in Washington.

 

The NZ Q2 CPI data arrived at 0.4%, slightly lower than the 0.5% expected. The year on year data arrived as 1.5 % vs the expected 1.6%

Also, the UK average earning index came in as expected at 2.5%, the unemployment rate was stable with previous reading at 4.2%

 

 


 Chart Analysis


 

 

US INDEX

On the daily chart, the price has returned to the red resistance zone with shaping before the reversal double top.

The price has formed another reversal pattern to assure the bearish bias with the wedge.

Followed by a break beneath an ascending trend on RSI, the index is supposed to have its way back to the support zone 93.2-92.6.



 

AUD/USD

On the daily chart, the pair bounced back from the resistance 0.7455, to retest the green support zone again.

Followed by divergence on RSI, our bullish view is still the same: Heading towards the combination of levels of descending trend, ascending channel and resistance zone at 0.7655-0.774.



 

NZD/USD

On the daily chart, the price retested the green support zone 0.682-0.6775, followed by divergence in RSI.

An AB=CD harmonic pattern has been shaped to reinforce the bounce.

The price is supposed to head back to the top of the descending channel with the resistance zone at 0.697-0.703.



 

AUD/JPY

On the daily chart, as we expected before, the price has reached the red resistance zone at 83.9-85.95.

It’s a crucial area that if the price bounces back from, it will continue its sideways movement to the support zone 81.2-80.5.

If the price breaks above it, it will head new levels to the next resistance zone 85.5-85.95.



 

Categories
Forex Market Analysis

U.S CPI, NATO Meeting

 


News Commentary


 

Markets rose as investors pushed back trade concerns and looked ahead to earnings results.

Unemployment claims fell to a nine-week low of 214,000, while While U.S. consumer prices advanced less than expected in June among falling utility prices and a record drop in hotel costs, the gauge excluding food and energy costs rose 0.2%.

But the annual consumer inflation rate rose to 2.9% in June. To support the argument for a faster pace of monetary tightening by the Federal Reserve.

President Donald Trump claimed a personal victory at the NATO summit on Thursday after telling European allies to increase spending or lose Washington’s support, which forced leaders huddle in a crisis session with the U.S. president.

Trump declared his commitment to a Western alliance built on U.S. military might that has stood up to Moscow since World War Two.

 

 


Chart Analysis


 

US INDEX

On the daily chart, the price has returned to the red resistance zone with shaping before the reversal double top.

Price has formed another reversal pattern to assure the bearish bias with the wedge.

Followed by a break beneath an ascending trend on RSI, the index is supposed to have its way back to the support zone 93.2-92.6.


 

AUD/USD

On the daily chart, the pair bounced back from the resistance 0.7455, to retest the green support zone again.

Followed by divergence on RSI, our bullish view is still the same: Heading towards the combination of levels of descending trend, ascending channel and resistance zone at 0.7655-0.774.

 


 

CAD/JPY

On 4-hour chart, as we expected before, the price broke the resistance and the neckline of the head & shoulders pattern at 84.35, to assure the bullish momentum also powered by wedge & Gartley harmonic patterns.

The price is expected to target the resistance 87.

 


 

NZD/USD

On the daily chart, the price retested the green support zone 0.682-0.6775, followed by divergence in RSI.

An AB=CD harmonic pattern has been shaped to reinforce the bounce.

The price is supposed to head back to the top of the descending channel with the resistance zone at 0.697-0.703.

 


 

Categories
Forex Market Analysis

Daily Market Update: RBNZ to Announce Official Cash Rate, Low ANZ Business Confidence

 


News Commentary


 

Trade tensions still weigh on the markets to cut the traders appetite to risk, to boost the safe havens like the Yen and the Swiss Franc.

However, following the trade adviser Peter Navarro, Trump signalled he may take a less confrontational approach, and that any measures would not just target China, to calm down concerns about the administration’s plans to hit Chinese investment in U.S. tech.

 

Jonathan Haskel, the Bank of England policymaker said there may be more slack in the UK economy, which would weaken the case for interest rate hikes.

He added that the central bank has scope to cut rates slightly in case of an economic downturn.

 

Disappointing data came from New Zealand after low ANZ business confidence index came in at -39. The last reading was -27.2.

A big move is awaiting for the NZD as the RBNZ will announce its official cash rate at 09:00 GMT. They are widely expected to not change the rate, to remain stable at 1.75%.

All eyes will be on rate statement with any clue to possible rate hike soon, any dovish sentiment will put more pressure on the currency.

 


Chart Analysis


 

USD INDEX

As we expected on the daily chart, the price had reached the key resistance at 95.5 and bounced back from it, powered by divergence on RSI.

The price also had shaped a reversal double top pattern.

So, the index is supposed to get back down to the support zone again of 93.2-92.6, then start its journey to the C wave.

 


 

AUD/USD

On the daily chart, the price has reached the support zone of 0.7325-0.7365.

The pair is supposed to find some breath powered by divergence on RSI to reach the key resistance of 0.7515, where the descending trend from the high of February is located.

 


 

USD/JPY

On the daily chart, as we expected, the pair bounced from the descending trend from the high of 2017 and the key resistance of 111.1.

As you can see on the chart, the price is moving according to Elliot waves. By forming the A & B waves, we are waiting for the next move down to hit the C level which is located at the support of 106.9 and also to meet the ascending trend from the low of 2016.

So, a possible bounce has started and on its way.



 

USD/CAD

As we expected before, the price has reached the key resistance level of 1.334.

As we can see the price has reversed from very strong selling area according to many factors, including key resistance level, 78.6% Fibonacci, the upper level of the reversal wedge, forming the Gartley harmonic pattern, and overbought in RSI.

So, the price is expected to go down to the support zone at 1.309-1.299.

 


 

NZD/USD

On the daily chart, the price has reached the crucial support zone of 0.682-0.6785, with bearish momentum.

Followed by divergence, if we see a price action there, then the price is expected to get back up again to retest the resistance zone at 0.698-0.703.

If the price breaks this zone, we could see a 0.667 level.



 

AUD/JPY

As we expected before, the price has reached the support zone 81.2-80.5 as the price is moving sideways.

So, the price is expected to retest the head of the pattern to again reach the levels of 84-84.4.



Categories
Forex Market Analysis

Daily Market Update: Trade Tensions Continue, OPEC Meeting

 


News Commentary


 

 

 

Tensions between the U.S. and its allies continue, as India joined China and the European Union in retaliation against steel and aluminium tariffs. As the biggest buyer of almonds, India raised its tariff on U.S. almonds by 20%

The European Union imposed tariffs on about $3.4 billion of U.S. imports on Friday, including motorcycles, orange juice and cranberry sauce. The tariffs have added to tensions as investors fear an outright global trade war between the U.S.and other major countries.

On the other hand, French and German business activity in June came in higher than expected, easing concerns of a slowdown in the Eurozone.
Good news for Greece is that the Eurozone creditors finally agreed a debt relief deal that will help Greece exit its bailout program.
Following late-night talks in Luxembourg, the Eurogroup agreed to hand Greece a final loan tranche of €15 billion.

The Organisation of the Petroleum Exporting Countries (OPEC) is gathering in Vienna amid calls from the United States, China and India to cool down the price of crude and prevent an oil deficit that would hurt the global economy.

Saudi Arabia and non-OPEC Russia have said a production increase of about 1 million barrels per day (bpd) or around 1 per cent of global supply had become a near-consensus proposal for the group and its allies.

Although a final decision may not arrive until Saturday when OPEC officials are scheduled to meet with their non-member allies who formed part of the 18-month accord to curb production by 1.8 million barrels per day.

 

 


Chart Analysis


 

 

NZD/USD

On the daily chart, the price has reached a combination of support levels, with a support zone of 0.682-0.6785, an ascending trend line from the low of 2007, and finally with a BAT harmonic pattern.

The price is expected to get back up again to retest the resistance zone at 0.698-0.703.



 

AUD/JPY

As we expected before, the price has reached the support zone 81.2-80.5 as it is moving sideways now.

So, with this engulfing candle, we expect the price to retest the head of the pattern to reach the levels of 84-84.4 again.

 


 

USD/JPY

On the daily chart, as we expected the pair had broken the ascending channel followed by bouncing from the descending trend from the high of 2017 and the key resistance of 111.1.

The price also broke the support of 110.05 to reach the next support 108.15, to then get back up again from this level to retest the level at 110.05.

As you can see on the chart, the price is moving according to Elliot waves. By forming the A & B waves, we are waiting for the next move down to hit the C level which is located at the support of 106 and also to meet the ascending trend from the low of 2016.

So, a bounce has started and on its way.

 


 

AUD/NZD

On the daily chart, as we expected before, the price had made its way up to targets at the resistance zone 1.0815-1.0865, boosted by a BAT harmonic pattern.

The price has already made its retracement as we expected it to.

Reaching the support zone and shaping the Gartley harmonic pattern, the price is supposed to continue its bullish movement up to the 1.1045 level after forming hammer & engulfing candles respectively.

 


 

USD/CAD

As we expected before, the price has reached the key resistance level 1.334.

As we can see the price is located at very strong selling area according to;- key resistance level, 78.6% Fibonacci, the upper level of the reversal wedge, forming the “Gartley” harmonic pattern, and overbought in RSI.

So, any bounce there will lead the price down to the support zone at 1.309-1.299.

 


 

Categories
Forex Market Analysis

Daily Market Update: Market Is Waiting For FOMC and ECB Meeting

 


News Commentary


 

 

Trading is hesitant early on Wednesday as investors awaited further guidance from the Federal Reserve on future U.S. rate rises to shed some light on how many times interest rates may go up this year.

Investors have shifted their focus to the two-day Federal Open Market Committee (FOMC) meeting that starts Wednesday. With a rate hike almost fully priced in, markets are focusing on whether the Fed will signal hiking rates four times this year, rather than the three times as indicated earlier in the year.

 

The Euro rose to three-week highs against the dollar last week after hawkish ECB comments fueled speculation that the bank could signal its intention to start unwinding its bond purchasing program.

Tomorrow’s meeting will hold some extra news about when the ECB cuts its quantitative easing program.

 

The Bank of Japan will also review its monetary policy at a two-day meeting that ends on Friday, but will likely keep its policy intact.

 

 


Chart Analysis


 

 

AUD/JPY

On the daily chart, we can see that the price is moving sideways between the resistance zone 84.4-84.15 and the support zone 81.2-80.5.

The price has now entered the red resistance area with a possible bounce.

Also, watch the ascending channel which has formed to be considered as a flag pattern. The pattern boosts the original trend which is a down one.

So, any bounce now with price action will push the price to fall.

 


 

AUD/NZD

On the daily chart, as we expected before, the price had made its way up to targets at the resistance zone 1.0815-1.0865, boosted by a BAT harmonic pattern.

The price has already made its retracement as we expected it to.

Bouncing from the support zone and the broken descending trend from the high of 2017, the price is supposed to continue its bullish movement up to the 1.1045 level.

But the price may correct to the level 1.0755 to find support by the Gartley harmonic pattern.



 

USD/CAD

On the daily chart, as expected, the price made its way into the resistance zone of 1.289-1.298, almost reaching the key resistance at 1.309, with an approach from the descending trend line starting from the high of 2015, and the upper edge of the horn pattern.

The price is near the key resistance level 1.309, any bounce back from there would take the price firstly to the support level at 1.274.



 

AUD/USD

On the daily chart, the pair had a correction to the 0.758 level supported by the resistance level 0.766 and the descending line from the high of 2018.

The price has bounced from the 0.758 level near the edge of the ascending channel.

So if the price could break the resistance 0.766 and the descending line, it may reach 0.774 which is a level with a combination of the upper edge of the channel and the broken uptrend.



 

Categories
Forex Market Analysis

Daily Market Update: Market’s Reaction to US-North Korea Summit and Central Banks Meetings

 


News Commentary


 

 

 

U.S. President Donald Trump and North Korean leader Kim Jong Un signed a ‘comprehensive’ deal at a historic summit aimed at the denuclearisation of the Korean peninsula.

Trump said the meeting in Singapore had gone “better than anybody could have expected” and he anticipated that the denuclearisation process would start “very, very quickly”, adding he had formed a “special bond” with Kim and the relationship with North Korea would be very different.

 

On the other hand, Trump upset the Group of Seven’s efforts to show a united front, choosing to back out of a previous joint communique. The action drew criticism from Germany and France, and Trump called Canadian Prime Minister Justin Trudeau “very dishonest and weak.”

However, “markets are generally shrugging off the G7 trainwreck,” said Ray Attrill, head of Forex strategy at the National Australia Bank.

Instead, markets are looking ahead to a busy week.

Policy meetings of the U.S. Federal Reserve and the European Central Bank, as well as a Brexit bill vote in the British parliament, have the whole show.

The U.S. Federal Reserve is widely expected to raise interest rates this week while investors are focused on whether the central bank will hint at raising rates a total of four times in 2018.

All eyes will be also on the U.S. CPI at 12:30 GMT with expectations to remain steady at 0.2%.

 

The European Central Bank also meets to decide whether it could signal intentions to start unwinding its massive bond purchasing program.

Helping calm markets were comments from Italy’s new coalition government that it had no intention of leaving the Eurozone and planned to cut debt.

 

 


Chart Analysis


 

US INDEX

On the daily chart, the price had successfully broken the ascending trend from the high of 2017, along with the resistance level to eventually reach the key resistance of 95.15 to bounce back from there. The price shaped a reversal pattern (wedge) which closed with a break beneath it.

With divergence in RSI, the price is expected to have a correction to the key support at 92.6 which is located at the broken trend too, only if it breaks the support of 93.4.

 


 

USD/JPY

On the daily chart, the pair had broken the ascending channel followed by bouncing from the descending trend from the high of 2017 and the key resistance of 111.1.

The price also broke the support 110.05 to reach the next support 108.15 to get back up again from this level to retest the level at 110.05.

As you can see on the chart, the price is moving according to Elliot waves. By forming the A & B waves, we are waiting for the next move down to hit the C level which is located at the support 106.9.

So, any bounce now with price action will enhance the down run.

 


 

AUD/JPY

On the daily chart, we can see that the price is moving sideways between the resistance zone 84.4-84.15 and the support zone 81.2-80.5.

The price now has entered the red resistance area with a possible bounce.

Also, watch the ascending channel which has formed to be considered as a flag pattern. The pattern boosts the original trend which is a down one.

So, any bounce now with price action will push the price to fall.

 


 

AUD/NZD

On the daily chart, as we expected before, the price had made its way up to targets at the resistance zone 1.0815-1.0865, boosted by a BAT harmonic pattern.

The price has already made its retracement as we expected it to.

Bouncing from the support zone and the broken descending trend from the high of 2017, the price is supposed to continue its bullish movement up to the 1.1045 level.

But the price may correct to the level 1.0755 to find support by the Gartley harmonic pattern.

 


 

USD/CAD

On the daily chart, as expected, the price made its way into the resistance zone of 1.289-1.298, almost reaching the key resistance at 1.309, with an approach from the descending trend line starting from the high of 2015, and the upper edge of the horn pattern.

The price has already bounced beneath the key resistance and the resistance zone and got back above it again, but it couldn’t go much further to form a pinbar, to take the price firstly to the support level at 1.274.

 


AUD/USD

On the daily chart, the pair had a correction to the 0.758 level supported by the resistance level 0.766 and the descending line from the high of 2018.

The price has bounced from the 0.758 level near the edge of the ascending channel.

So if the price could break the resistance 0.766 and the descending line, it may reach 0.774 which is a level with a combination of the upper edge of the channel and the broken uptrend.

 


 

NZD/USD

On the daily chart, as we expected before, the pair had bounced from the ascending trend, along with breaking a descending trend, to reach our target at the resistance zone at 0.697-0.702.

According to the BAT-shaped harmonic pattern we expected, the price has already reached our first target and is expected to reach the B point at the next resistance zone of 0.7155-0.7185.

The price may have a little retracement before hitting this target.

 


Categories
Forex Market Analysis

Weekly Market Update: G7 & US-North Korea Summit, Central Banks Meetings

 


News Commentary


 

We have a busy week coming up. What will follow the consequences of the G7 summit, and what news will be released regarding the US-North Korea summit. We also have the Federal Central Bank meeting (FOMC), the European Central Bank meeting, and the Bank of Japan meeting who all have to decide their rates and give hints about the economic polices.

 

US

U.S. President Donald Trump threatened to stop trading with countries that do not reduce barriers to American exports.

Trump said on Saturday that he had instructed his representatives not to endorse the G7 communique and that his administration was considering imposing tariffs on automobiles, further raising the spectre of a trade war that has unnerved Washington’s top allies.

U.S. President Donald Trump and North Korean leader Kim Jong Un are expected to land in Singapore on Sunday within hours of each other in advance of a historic summit over the reclusive country’s arsenal of nuclear weapons.

The unprecedented meeting comes after weeks of sometimes-contentious discussions and was briefly cancelled amid North Korean outrage over messaging from some U.S. advisers.

The Federal Reserve is almost certain to raise interest rates by a quarter point for a second time this year at the conclusion of its two-day policy meeting at 18:00 GMT on Wednesday.

 

EUR

The Euro strengthened on rising bets that the European Central Bank (ECB) may soon announce it will start shooting off its massive bond purchase program.

The central bank’s chief economist Peter Praet, a close ally of President Mario Draghi, said the ECB would discuss next week whether to end bond purchases later this year.

Some reports said that at its next policy meeting this week, the ECB could declare on when its quantitative easing program would end.

“The market will start to focus on the ECB from now on. Politics in Italy and Spain will play second fiddle as we now have new governments in both countries,” said Kazushige Kaida, head of foreign exchange at State Street Bank.

 

AUD

The RBA Board decided to leave the cash rate unchanged at 1.50%.

“The recent data on the Australian economy has been consistent with the Bank’s central forecast for GDP growth to pick up, to average a bit above 3% in 2018 and 2019. Business conditions are positive and non-mining business investment is increasing. Higher levels of public infrastructure investment are also supporting the economy. Stronger growth in exports is expected. One continuing source of uncertainty is the outlook for household consumption. Household income has been growing slowly, and debt levels are high” declared media section of the RBA.

The Australian dollar was supported by GDP growth numbers, which rose 1% in the first quarter of 2018, beating the estimated 0.8%. On an annualised basis, growth was 3.1%, above both the expected 2.8% and the previous quarter’s 2.4% gain.

 

JPY

The Bank of Japan (BoJ) is seen keeping policy on hold at the conclusion of its two-day rate review on Friday, including a pledge to keep short-term interest rates at minus 0.1%.

BoJ Governor Haruhiko Kuroda will hold a press conference afterwards to discuss the decision.

Kuroda has previously said the central bank will telegraph to markets how it plans to exit from ultra-easy policy when conditions for hitting its price goal become robust.

 

 


Chart Analysis


 

US INDEX

On the daily chart, the price had successfully broken the ascending trend from the high of 2017, along with the resistance level to eventually reach the key resistance 95.15 to bounce back from there. The price shaped a reversal pattern (wedge) which closed with a break beneath it.

With divergence in RSI, the price is expected to have a correction to the key support at 92.6 which is located at the broken trend too.



 

USD/JPY

On the daily chart, the pair had broken the ascending channel followed by bouncing from the descending trend from the high of 2017 and the key resistance of 111.1.

The price also broke the support 110.05 to reach the next support 108.15 to get back up again from this level to retest the level at 110.05.

As you can see on the chart, the price is moving according to Elliot waves. By forming the A & B waves, we are waiting for the next move down to hit the C level which is located at the support 106.9.

So, any bounce now with price action will enhance the down run.



 

AUD/JPY

On the daily chart, we can see that the price is moving sideways between the resistance zone 84.4-84.15 and the support zone 81.2-80.5.

The price has now entered the red resistance area with a possible bounce.

Also, watch the ascending channel which has formed to be considered as a flag pattern. The pattern boosts the original trend which is a down one

So, any bounce now with price action will push the price to fall.

 


 

AUD/NZD

On the daily chart, as we expected before, the price had made its way up to targets at the resistance zone 1.0815-1.0865, boosted by a BAT harmonic pattern.

The price has already made its retracement as we expected it too.

Bouncing from the support zone and the uptrend from the low of April, and the broken descending trend from the high of 2017, the price is supposed to continue its bullish movement up to the 1.1045 level.



 

USD/CAD

On the daily chart, as expected, the price made its way into the resistance zone of 1.289-1.298, almost reaching the key resistance at 1.309, with an approach from the descending trend line starting from the high of 2015, and the upper edge of the horn pattern.

The price has already bounced beneath the key resistance and the resistance zone and got back above it again, but it couldn’t go much further to form a pinbar, to take the price firstly to the support level at 1.274.



AUD/USD

On the daily chart, the price had a false break beneath the support zone 0.75-0.7535 with a pin bar. That enhances the AB=CD harmonic pattern, with breaking a descending channel. The pair rose with an engulfing candle above the support zone.

Along with divergence in RSI, the price is ready for the next move up to 0.774 which is a level with a combination of the lower trend line from the high of 2018 and the broken uptrend.

The price may have a little retracement before heading this target.



 

NZD/USD

On the daily chart, as we expected before, the pair had bounced from the ascending trend with an engulfing candle, along with breaking a descending trend, to reach our target at the resistance zone at 0.697-0.702.

According to the BAT-shaped harmonic pattern we expected, the price has already reached our first target and is expected to reach the B point at the next resistance zone of 0.7155-0.7185.

The price may have a little retracement before heading this target.



Categories
Forex Market Analysis

Daily Market Update: G7 Summit

 


News Commentary


 

All eyes will be on the upcoming G-7 meeting in Quebec as the summit comes at a time of escalating trade tensions between the U.S and some of its major trading partners. Last week, all finance ministers from six members of the G-7 criticised the US Treasury Secretary Steve Mnuchin. The trouble started last week, when the Trump administration imposed tariffs on Canada, Mexico and the European Union. Mexico and Canada are hugely dependent on American demand for their products, which is why over the last few months they’ve shown willingness to grant the US more favourable conditions within the North America Free Trade Area (Nafta). The trade tension is sure to dominate the summit, if these leaders cannot reach an equivalent point, investors could dump their risks to head for safe-haven assets.

 

On the other hand, there’s a release of big date for Canada, at 12:30 GMT. There’s  Employment Change with a forecast of 19.1K, and Unemployment Rate with a forecast of 5.8%. These figures could give the Canadian some fresh air.

 


Chart Analysis


 

 

US INDEX

On the daily chart, the price had successfully broken the ascending trend from the high of 2017, along with the resistance level to eventually reach the key resistance 95.15 to bounce back from there. The price shaped a reversal pattern (wedge) which closed with a break beneath it.

With divergence in RSI, the price is expected to have a correction to the key support at 92.6 which is located at the broken trend too.



 

 

USD/JPY

On the daily chart, the pair had broken the ascending channel followed by bouncing from the descending trend from the high of 2017 and the key resistance of 111.1.

The price also broke the support 110.05 to reach the next support 108.15 to get back up again from this level to retest the level at 110.05.

As you can see on the chart, the price is moving according to Elliot waves. By forming the A & B waves, we are waiting for the next move down to hit the C level which is located at the support 106.9.

So, any bounce now with price action will enhance the down run.



 

 

AUD/JPY

On the daily chart, we can see that the price is moving sideways between the resistance zone 84.4-84.15 and the support zone 81.2-80.5.

The price now has entered the red resistance area with a possible bounce.

Also, watch the ascending channel which has formed to be considered as a flag pattern. The pattern boosts the original trend which is a down one

So, any bounce now with price action will push the price to fall



 

 

AUD/NZD

On the daily chart, as we expected before, the price had made its way up to targets at the resistance zone 1.0815-1.0865, boosted by a BAT harmonic pattern.

The price has already made its retracement as we expected it too.

Bouncing from the support zone and the uptrend from the low of April, and the broken descending trend from the high of 2017, the price is supposed to continue its bullish movement up to the 1.1045 level.

 



 

 

USD/CAD

On the daily chart, as expected, the price made its way into the resistance zone of 1.289-1.298, almost reaching the key resistance at 1.309, with an approach from the descending trend line starting from the high of 2015, and the upper edge of the horn pattern.

The price has already bounced beneath the key resistance and the resistance zone and got back above it again, but it couldn’t go much further to form a pinbar, to take the price firstly to the support level at 1.274.



 

 

AUD/USD

On the daily chart, the price had a false break beneath the support zone 0.75-0.7535 with a pin bar. That enhances the AB=CD harmonic pattern, with breaking a descending channel. The pair rose with an engulfing candle above the support zone.

Along with divergence in RSI, the price is ready for the next move up to 0.774 which is a level with a combination of the lower trend line from the high of 2018 and the broken uptrend.

The price may have a little retracement before hitting this target



 

NZD/USD

On the daily chart, as we expected before, the pair had bounced from the ascending trend with an engulfing candle, along with breaking a descending trend, to reach our target at the resistance zone at 0.697-0.702.

According to the BAT-shaped harmonic pattern we expected, the price has already reached our first target and is expected to reach the B point at the next resistance zone of 0.7155-0.7185.

The price may have a little retracement before hitting this target



 

Categories
Forex Market Analysis

Daily Market Update: Positive Data for the Australian Dollar and Sterling

 


News Commentary


 

The Australian dollar opens the week higher as it has risen by stronger than expected retail sales today. The reading came in at 0.4% which was higher than the expected 0.3%.

 

Sterling also was helped by Construction PMI which released with 52.5. That was more than the forecasted 52, to give the pound a little breath.

 

The euro pushed higher as concerns over the political situation in Italy calmed after the anti-establishment parties reached a deal on a proposed coalition government, which deactivate fears that repeat elections could give a mandate for the country to exit the eurozone.

 

Trade tensions are on fire again after finance ministers from the world’s leading economies criticised America’s new tariffs on steel and aluminium imports at a G7 meeting in Canada over the weekend.

 

Also, trade talks between the U.S. and China on trade ended without a breakthrough, raising the danger that negotiations could collapse.

 

 


Chart Analysis


 

 

US INDEX

On the daily chart, the price had successfully broken the ascending trend from the high of 2017, along with the resistance level to eventually reach the key resistance of 95.15 to bounce back from there.

The price shaped a reversal pattern (wedge) which closed with a break beneath it.

With forming divergence in RSI, the price is expected to have a correction to the key support at 92.6 which is located the broken trend too.



 

NZD/USD

On the daily chart, as we expected before, the pair had bounced from the ascending trend with an engulfing candle, along with breaking a descending trend, to reach our target at the resistance zone at 0.697-0.702.

According to the BAT-shaped harmonic pattern we expected, the price has already reached our first target and is expected to reach the B point at the next resistance zone of 0.7155-0.7185.



 

USD/CAD

On the daily chart, as we expected the price had made its way into the resistance zone of 1.289-1.298, almost reaching the key resistance at 1.309, with an approach from the descending trend line starting from the high of 2015, and the upper edge of the horn pattern.

The price has already bounced beneath the key resistance and the resistance zone and got back above it again, but it couldn’t go much further to form a pinbar, to take the price firstly to the support level at 1.274.



 

AUD/USD

On the daily chart, the price had a false break beneath the support zone 0.75-0.7535 with a pin bar.

That enhances the AB=CD harmonic pattern, with breaking a descending channel.

The pair rose with an engulfing candle above the support zone.

Along with divergence in RSI, the price is ready for the next move up to 0.774 which is a level with a combination of the lower trend line from the high of 2018 and the broken uptrend.



Categories
Forex Market Analysis

Weekly Market Update: RBA Rate Statement, EU Politics, US-China Conflict


News Commentary


US

Investors have been watching the May jobs report closely on Friday for any clues on future monetary policy as maximum employment is one of the Federal Reserve’s key objectives.

All data came positive as Non-Farm Employment Change released with 223K, higher than the expected 189K, and Unemployment Rate decreased by 3.8%. ISM Manufacturing PMI came in at 58.7, better than the forecasted 58.3.

The news has featured that the U.S.-North Korea summit is back on track. North Korea and the US are starting the preparations for the June 12 summit between Kim Jong-un and Donald Trump.

Separately, Trump contacted the Japanese prime minister, Shinzo Abe. He “affirmed the shared imperative of achieving the complete and permanent dismantlement of North Korea’s nuclear, chemical, and biological weapons and ballistic missile programs,” The White House claimed. And they would meet before the Kim-Trump summit.

China warned the United States on Sunday that any agreements reached on trade and business between the two countries will be void if Washington implements tariffs and other trade measures, as the two ended their latest round of talks in Beijing.

That came after U.S. Commerce Secretary Wilbur Ross met Chinese Vice Premier Liu He in Beijing over the weekend.

The world’s two largest economies have threatened each other with tens of billions of dollars’ worth of tariffs in recent months, leading to worries that Washington and Beijing may engage in a full-scale trade war that could damage global growth and oil markets.

 

EUR

The Euro gained on Thursday as Italian parties renewed attempts to form a government, to calm down the concerns about the wider impact of a political crisis in Europe’s third-largest economy.

The two anti-establishment parties have made many efforts to form a coalition government, rather than force Italy into holding elections for the second time this year in September.

The CPI flash estimate enhanced the regains of the Euro after a reading of 1.9%, which was more than the forecast of 1.6%, along with the core reading of 1.1 %, which was more than the forecast of 1.0%.

Besides, economists have concluded that the ECB will begin hiking rates in the middle of next year.

All eyes will be on the Draghi speech on Tuesday to note any views for the economy and the growth.

 

CAD

The Bank of Canada Governor, Stephen Poloz, left rates on hold for a third straight decision on Wednesday at 1.25%, but gave a hawkish statement for the economy and removed some cautious language.

The central bank also clarified that recent economic data bolsters its April outlook for a 2% growth in the first half of 2018.

GDP rose to 0.3%, which was higher than the expected 0.2%. That would reinforce the optimism bias for the BOC.

Canada is waiting for some big data this week. Firstly with the trade balance on Wednesday, the last reading was -4.1B, and the unemployment rate on Friday, the last release was 5.8%.

 

AUD

Australia reported worse than expected Capex data. Private capital expenditures rose only 0.4% in the first quarter against 1.0% estimated and 0.2% from the fourth quarter of last year.

The Australian dollar is also waiting for many events this week. Retail sales on Monday, GDP on Wednesday, and trade balance on Thursday to give an outlook to the economic growth.

All eyes will be on the RBA statement rate on Tuesday, which the RBA is expected to keep rates stable at 1.5%

 

 


Chart Analysis


 

 

US INDEX

On the daily chart, the price had successfully broken the ascending trend from the high of 2017, along with the resistance level to eventually reach the key resistance 95.15 to bounce back from there.

The price shaped a reversal pattern (wedge) which closed with a break beneath it.

With forming divergence in RSI, the price is expected to have a correction to the key support at 92.6 which is located the broken trend too.



 

NZD/USD

On the daily chart, as we expected before, the pair had bounced from the ascending trend with an engulfing candle, along with breaking a descending one, to reach our target at the resistance zone at 0.697-0.702.

According to the Bat-shaped harmonic pattern, the price is expected to reach the B point at the next resistance zone 0.7155-0.7185.

The price may face a little retracement before going up to the mentioned targets.



 

USD/CAD

On the daily chart, as we expected the price had made its way into the resistance zone of 1.289-1.298, almost reaching the key resistance at 1.309, with an approach from the descending trend line starting from the high of 2015, and the upper edge of the horn pattern.

The price has already bounced beneath the key resistance and the resistance zone and got back again above it, but it couldn’t go much further to form a pinbar, to take the price firstly to the support level at 1.274.



 

AUD/USD

On the daily chart, the price had a false break beneath the support zone 0.75-0.7535 with a pin bar.

That enhances the AB=CD harmonic pattern, with breaking a descending channel.

The pair rose with an engulfing candle from the support zone.

Along with divergence in RSI, the price is ready for the next move up to 0.774 which is a level with a combination of the lower trend line from the high of 2018 and the broken uptrend.



 

AUD/JPY

On the daily chart, as we expected, the price reached the resistance zone at 84-84.35.

The price couldn’t break through this area to bounce back.

It reached the support levels at 81.25-80.5 (as we expected) to pull back up again boosted by the ascending trend from the low of March.

As the pair is currently moving sideways. The price is expected to retest the resistance zone again.



 

AUD/NZD

On the daily chart, as we expected before, the price had made its way up to targets at the resistance zone 1.0815-1.0865, boosted by a BAT harmonic pattern.

The price is going to have a little retracement at these levels to continue its bullish movement up to the 1.1045 level.



 

Categories
Forex Market Analysis

Daily Market Update: US Jobs Report

 


News Commentary


 

Investors will be watching the May jobs report closely today at 12:30 GMT, for any clues on future monetary policy as maximum employment is one the Federal Reserve’s key objectives.

Nonfarm payrolls are expected to show the U.S. economy created 189,000 jobs in May, while economists forecast the jobless rate to remain steady at 3.9%

The main focus will be on average hourly earnings as the Fed keeps an eye on wage inflation. On an annualised basis, the increase in average hourly earnings is expected to accelerate to 2.7% in May, from the prior 2.6%.

Also on Friday’s economic calendar, traders will watch the Institute of Supply Management’s manufacturing purchasing managers’ index for May, scheduled for release 14:00GMT, with a forecast of 58.3%.

 

 


Chart Analysis


 

US INDEX

On the daily chart, the price had successfully broken the ascending trend from the high of 2017 along with the resistance level to eventually reach the key resistance 95.15 to bounce back from there.

The price shaped a reversal pattern (wedge) which closed with a break beneath it.

With forming divergence in RSI, the price is expected to have a correction to the key support at 92.6 which is located the broken trend too.



 

 

NZD/USD

On the daily chart, as we expected before, the pair had bounced from the ascending trend with an engulfing candle, along with breaking a descending one, to reach our target at the resistance zone at 0.697-0.702.

According to the Bat shaped harmonic pattern (bat), the price is expected to reach the B point at the next resistance zone 0.7155-0.7185.

The price may face a little retracement before going up to the mentioned targets.



 

Categories
Forex Market Analysis

Daily Market Update: Release of US Prelim GDP, and Big Day for the Canadian Dollar

 


News Commentary


 

Italian President Sergio Mattarella assigned a former-IMF economist as a temporary Prime Minister.

Now the eurozone’s third-largest economy, Italy will hold new elections in September 2018. Investors may consider whether these elections will strengthen or weaken Italian populist forces.

Besides, economists have concluded that the ECB will begin hiking rates in the middle of next year.

German retail sales & preliminary CPI will be released today with a forecast of 0.5% & 0.3% respectively, followed by Spanish flash CPI with an expectation of 1.7%.

Two big releases for the US are the ADP Non-Farm Employment Change with a forecast of 191K after a previous reading of 204K, and preliminary GDP of 2.3%.

The big announcement today goes for the Bank of Canada with their overnight rate to be stable at the last level of 1.25%, followed by the rate statement which may catch any notes about rate hikes.

 

 


Chart Analysis


AUD/NZD

On the daily chart, as we expected before, the price had made its way up to targets at the resistance zone 1.0815-1.0865, boosted by a BAT  harmonic pattern.

The price is going to have a little retracement at these levels to continue its bullish movement up to the 1.1045 level.



 

 

CHF/JPY

On the daily chart, the price reversed from the support zone of 107.6-108.4, then broke the descending channel up to reach the key resistance at 112.1.

The price had made a pullback from this level to retest the channel & the zone.

So, the price is expected to revisit these level before approaching the 38.2% Fibonacci at 112.1-112.6.



 

 

 NZD/USD

On the daily chart, the pair is still being traded above the ascending trend and the support of 0.6875, with oversold on RSI.

We can also notice that there’s a descending channel that the price has already broken, along with a BAT harmonic pattern which is already shaped. So, we can conclude that the last break beneath the upward trend line was a false break and the pair is about to restart its bullish momentum towards the resistance zone of 0.697-0.702.