Tag: Technical Outlook

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Forex Signals

AUD/USD Bullish Channel Underpins – Signal Outlook!

The AUD/USD pair is trading with a bullish bias at the 0.7486 level, heading upward until the next target level of 0.7520 level. The risk-sensitive AUD experienced following Britain’s top medical expert urged people with notable allergies to not utilize the coronavirus vaccine from Pfizer and BioNtech as it will give them an unfavorable response. This information came in after two people were advised to have drastic consequences from coronavirus vaccine usage.

The AUD/USD pair is trading with a bullish bias at the 0.7486 level, heading upward until the next target level of 0.7520 level. The risk-sensitive AUD experienced following Britain’s top medical expert urged people with notable allergies to not utilize the coronavirus vaccine from Pfizer and BioNtech as it will give them an unfavorable response. This information came in after two people were advised to have drastic consequences from coronavirus vaccine usage.

The AUD/USD pair is trading with a bullish bias at the 0.7486 level, heading upward until the next target level of 0.7520 level. The risk-sensitive AUD experienced following Britain’s top medical expert urged people with notable allergies to not utilize the coronavirus vaccine from Pfizer and BioNtech as it will give them an unfavorable response. This information came in after two people were advised to have drastic consequences from coronavirus vaccine usage.

This news deteriorated the risk sentiment and weighed on risk-sensitive Aussie that made the AUD/USD pair to lose some of its early daily gains. The rising number of coronavirus cases in the US surpassed the 15M daily on average; about 200,000 people were reported as positive for coronavirus infection in the US. These pandemic developments faded hopes for quick economic recovery despite vaccine development progress and weighed on the US dollar that added gains in the AUD/USD pair.

Meanwhile, China’s macro-economic data was also released on Wednesday but failed to give a decisive move to the pair AUD/USD as the data gave mixed results. The CPI from China dropped to -0.5% against the expected 0.0% and weighed on China-proxy Aussie. The PPI from China dropped less than expectations of -1.8% at -1.5% and supported the China-proxy Aussie. The New Loans from China dropped to 1430B from the expected 1450B and weighed on China-proxy Aussie that capped further gains in the AUD/USD pair on Wednesday.


Daily Technical Levels:
Support Resistance
0.7401 0.7478
0.7366 0.7520
0.7323 0.7555
Pivot point: 0.7443

On the technical front, the AUD/USD is trading bullish at the 0.7487 level, facing next resistance near 0.7485. The bullish moves can prolong the buying trend to the next resistance area of 0.7525 level in the higher direction. On the 4 hour timeframe, the AUD/USD has developed an upward channel that holds the buying trend. Thus we have begun a buying trade in the AUD/USD pair today.

Entry Price – Buy 0.74844
Stop Loss – 0.74444
Take Profit – 0.75244
Risk to Reward – 1:1
Profit & Loss Per Standard Lot = -$400/ +$400
Profit & Loss Per Micro Lot = -$40/ +$40
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Forex Elliott Wave Forex Technical Analysis

EURJPY Consolidates Expecting the ECB Decision Ahead

The EURJPY cross consolidates in the overnight trading session expecting the ECB interest rate decision statement that will take place before the U.S. opening bell. The analysts’ consensus doesn’t expect changes both in the interest rate that remains at 0.0% and in the deposit facility rate that keeps at -0.50%.

The EURJPY cross consolidates in the overnight trading session expecting the ECB interest rate decision statement that will take place before the U.S. opening bell. The analysts’ consensus doesn’t expect changes both in the interest rate that remains at 0.0% and in the deposit facility rate that keeps at -0.50%.

The EURJPY cross consolidates in the overnight trading session expecting the ECB interest rate decision statement that will take place before the U.S. opening bell. The analysts’ consensus doesn’t expect changes both in the interest rate that remains at 0.0% and in the deposit facility rate that keeps at -0.50%.

Source: TradingEconomics.com

Technical Overview

The following 8-hour chart shows the EURJPY market participants’ sentiment, where the cross looks consolidating in the extreme bullish zone, developing a flag pattern. This chartist pattern suggests the continuation of the previous movement. In this case, the technical formation could be indicative of further upsides for the following trading sessions.

Moreover, the primary trend identified with the upward trend-line in blue remains on the bullish side. Also, the secondary trendline plotted in green reveals the bullish acceleration of the price action. This market context is confirmed by the EMA(60) to Close Index, with a reading above the level 2.000 that suggests the overbought levels and the potential correction or consolidation of the previous rally.

Short-term Technical Outlook

The EURJPY under the intraday Elliott wave perspective unfolded in its 2-hour chart illustrates the advance in an incomplete corrective rally corresponding to wave ((b)) of Minute degree labeled in black. The internal structure shows the cross advancing in its incomplete wave (c) of Minuette degree marked in blue, suggesting a further upside in the following trading sessions.

At the same time, the previous chart reveals the internal five-wave sequence of wave (c) in blue, which exposes the sideways progress of its fourth wave of Subminuette degree identified in green, which belongs to the wave (c) of Minuette degree. 

In this context, considering that the price action could develop a new upward movement, the cross could advance in its fifth wave in green to the potential target zone between 126.84 and 127.48, where the EURJPY cross could complete the wave (c) in blue, and the wave ((b)) in black. Likewise, once this corrective rally completes, the price could start to develop a downward movement identified as wave ((c)) in black.

In this regard, according to the Elliott Wave theory and considering that the mid-term structure corresponds to an incomplete corrective formation constituted by a three-wave sequence, after the completion of the wave ((b)) in black, the price should start to decline in its wave ((c)) with an internal structure subdivided into a five-wave sequence.

Summarizing, the EURJPY cross currently develops a consolidation pattern, which leads to expect a new upward movement with a potential target between 126.84 and 127.48. Once the price completed its target, the cross may start to decline in a five-wave sequence corresponding to wave ((c)) of Minute degree.

Finally, the invalidation level of the current bullish scenario can be found at 124.566.

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Forex Signals

USD/CAD Sideways Channel Remains Intact – Brace to Trade Breakout! 

The USD/CAD pair was closed at 1.28179 after placing a high of 1.28332 and a low of 1.27691. The USD/CAD pair was choppy on Wednesday as it dropped to weekly lows in the early session but recovered all of its losses in the late session. The Bank of Canada released its interest rate decision on Wednesday that drove the USD/CAD pair lower in early trading hours. Later the crude oil prices and the strength of the US dollar pushed the pair higher on board.

The USD/CAD pair was closed at 1.28179 after placing a high of 1.28332 and a low of 1.27691. The USD/CAD pair was choppy on Wednesday as it dropped to weekly lows in the early session but recovered all of its losses in the late session. The Bank of Canada released its interest rate decision on Wednesday that drove the USD/CAD pair lower in early trading hours. Later the crude oil prices and the strength of the US dollar pushed the pair higher on board.

The USD/CAD pair was closed at 1.28179 after placing a high of 1.28332 and a low of 1.27691. The USD/CAD pair was choppy on Wednesday as it dropped to weekly lows in the early session but recovered all of its losses in the late session. The Bank of Canada released its interest rate decision on Wednesday that drove the USD/CAD pair lower in early trading hours. Later the crude oil prices and the strength of the US dollar pushed the pair higher on board.

On Wednesday, the Bank of Canada held rates at 0.25% and reiterated intentions to keep interest rates at the same level until at least 2023 as the Canadian economic recovery from the coronavirus pandemic was proceeding in line with the expectations.

The Bank said that the new infections and lockdowns continue to hold back the Canadian economy. Bank also mentioned that stronger demand for energy sources had pushed oil prices to boost the Canadian dollar. As well, the looming vaccines rolling out were also helping the Canadian dollar.

The Bank of Canada said that the news on the development of effective vaccines provided reassurance that the pandemic will end and more normal activities will resume, although the pace and breadth of the global rollout of vaccinations remain uncertain. However, there were no surprises on Wednesday from the Bank of Canada that weighed on Loonie and supported the upward trend in the USD/CAD pair.

Meanwhile, the declining crude oil prices on Wednesday after the release of US Crude oil stockpiles data weighed on Loonie. For the last week, the US crude oil inventories raised to 15.2M against the expectations of -0.9M and weighed on crude oil prices that added losses in the commodity-linked currency Loonie and supported the upward momentum in the USD/CAD pair.

Moreover, the US dollar was also strong on Wednesday amid multiple reasons, including deteriorated risk sentiment from Pfizer’s vaccine adverse reaction on two people, faded hopes for quick delivery of second round of US stimulus measure, and the rising safe-haven demand after the increased number of coronavirus cases in the US. The strong US dollar also helped the USD/CAD pair’s gains to persist in the market on Wednesday.

On the data front, at 20:00 GMT, the Final Wholesale Inventories for October raised to 1.1% against the projected 0.9% and weighed on the US dollar. The JOLTS Job Opening for October also surged to 6.65M against the estimated 6.30M and supported the US dollar that added further gains in the USD/CAD pair. On the data front, at 20:00 GMT, the Final Wholesale Inventories for October raised to 1.1% against the projected 0.9% and weighed on the US dollar. The JOLTS Job Opening for October also surged to 6.65M against the estimated 6.30M and supported the US dollar that added further gains in the USD/CAD pair.


Daily Technical Levels

Support Resistance

1.2787 1.2852

1.2745 1.2875

1.2722 1.2917

Pivot point: 1.2810

The USD/CAD pair is trading sideways at the 1.2789 level due to a lack of market volatility. On the lower side, the support holds around the 1.2770 level, whereas the bullish trend continuation can extend the buying trend until the next resistance level of 1.2835. We may not see a further trend in the pair until this range gets violated. On the lower side, a bearish breakout of the 1.2770 level can extend selling bias until the 1.2720 level. It seems like investors are waiting for a solid fundamental to determine further moves in the market. Let’s look for selling below 1.2836 and buying over 1.2770 level today. Good luck! 

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Forex Signals

USD/CAD Trades Descending Triangle – Traders Loom for a Breakout!

The USD/CAD pair was closed at 1.28286 after placing a high of 1.28254 and a low of 1.27678. The USD/CAD pair was raised on Tuesday due to declining crude oil prices and improving the market’s risk sentiment. The risk sentiment in the market surged on Tuesday after a combination of supporting factors. The rising hopes for global economic recovery after the latest news that Great Britain has officially started using Pfizer coronavirus vaccine to treat coronavirus patients on Tuesday added to the market’s risk sentiment.

The USD/CAD pair was closed at 1.28286 after placing a high of 1.28254 and a low of 1.27678. The USD/CAD pair was raised on Tuesday due to declining crude oil prices and improving the market’s risk sentiment. The risk sentiment in the market surged on Tuesday after a combination of supporting factors. The rising hopes for global economic recovery after the latest news that Great Britain has officially started using Pfizer coronavirus vaccine to treat coronavirus patients on Tuesday added to the market’s risk sentiment.

The USD/CAD pair was closed at 1.28286 after placing a high of 1.28254 and a low of 1.27678. The USD/CAD pair was raised on Tuesday due to declining crude oil prices and improving the market’s risk sentiment. The risk sentiment in the market surged on Tuesday after a combination of supporting factors. The rising hopes for global economic recovery after the latest news that Great Britain has officially started using Pfizer coronavirus vaccine to treat coronavirus patients on Tuesday added to the market’s risk sentiment.

Another factor involved in the risk mood enhancement was the rising demand for a US coronavirus stimulus package. The continuous talks between Democrats and the Republicans over the stimulus package and the agreement of both sides over a bipartisan proposal of a $908 billion package also supported the market’s risk sentiment as it will enhance the US economic recovery.

Meanwhile, the latest comments from the foreign minister of China, Wang Yi, that Beijing was open to restarting its relationship with the US also added to the market’s risk flows. Wang declared that a year of escalating tensions between both countries had pushed them to a critical historical juncture. He also said the time has come that objectivity and rationality should bring back in the US policy towards China.

He stated that both sides should restart the dialogues and get back on the right track to rebuilding mutual trust in the next Sino-US relations phase. Wang blamed some Americans’ outdated Cold War mentality for the growing division between the US and China. The raised risk sentiment helped the USD/CAD pair rose for the second consecutive day.

On the data front, at 01:00 GMT, the Consumer Credit for October from the US fell to 7.2B against the estimated 17.6B and weighed on the US dollar. At 16:00 GMT, the NFIB Business Index declined to 101.4 against the anticipated 102.6 in November and weighed on the US dollar that capped further gains in the USD/CAD pair. At 18:30 GMT, the Revised Nonfarm Productivity for the quarter declined to 4.6% against the projected 4.9% and supported the US dollar and supported the USD/CAD pair’s an upward trend. The Revised Unit Labor Costs for the quarter grew in as -6.6% against the projected -8.9%, supported the US dollar and pushed the pair on the upside. At 20:00 GMT, the IBD/TIPP Economic Optimism came in as 49.0 in December compared to the previous 50.0.

Meanwhile, the USD/CAD pair’s gains were also supported by the declining Crude oil prices on Tuesday. The Crude oil prices posted losses on Tuesday and reached $45.13 on the day ahead of the American Petroleum Institute’s weekly crude oil stock data. The declining crude oil prices weighed on commodity-linked currency Loonie and ultimately added strength in the USD/CAD pair.

Furthermore, the Canadian dollar was also under pressure on Tuesday ahead of Wednesday’s Bank of Canada policy meeting. The central bank is expected to hold its interest rates at the same level, but the bank’s tone could affect the Canadian dollar as a positive message will act as a vote of confidence in the economy and support the local currency and vice versa.


Daily Technical Levels

Support Resistance

1.2777 1.2839

1.2740 1.2864

1.2715 1.2901

Pivot point: 1.2802

The USD/CAD pair is trading sideways at the 1.2789 level due to a lack of market volatility. On the lower side, the support holds around the 1.2770 level, whereas the bullish trend continuation can extend the buying trend until the next resistance level of 1.2835. We may not see a further trend in the pair until this range gets violated. On the lower side, a bearish breakout of the 1.2770 level can extend selling bias until the 1.2720 level. It seems like investors are waiting for a solid fundamental to determine further moves in the market. Let’s look for selling below 1.2836 and buying over 1.2770 level today. Good luck! 

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Forex Signals

USD/CAD Breaking Below Double Bottom Level – Selling Bias in Play! 

The USD/CAD pair was closed at 1.27993 after placing a high of 1.28328 and a low of 1.27738. After posting losses for four consecutive days, the USD/CAD pair raised on Monday amid the US dollar’s strength and declining crude oil prices. On Monday, the US dollar was strong in early European trade as the coronavirus cases continued to rise and lockdowns expanded that added weight on the hopes of the US economic recovery. The US Dollar Index that tracks the greenback against the basket of six other currencies raised by 0.3% to 90.993 and supported the USD/CAD pair’s an upward trend.

The USD/CAD pair was closed at 1.27993 after placing a high of 1.28328 and a low of 1.27738. After posting losses for four consecutive days, the USD/CAD pair raised on Monday amid the US dollar’s strength and declining crude oil prices. On Monday, the US dollar was strong in early European trade as the coronavirus cases continued to rise and lockdowns expanded that added weight on the hopes of the US economic recovery. The US Dollar Index that tracks the greenback against the basket of six other currencies raised by 0.3% to 90.993 and supported the USD/CAD pair’s an upward trend.

The USD/CAD pair was closed at 1.27993 after placing a high of 1.28328 and a low of 1.27738. After posting losses for four consecutive days, the USD/CAD pair raised on Monday amid the US dollar’s strength and declining crude oil prices. On Monday, the US dollar was strong in early European trade as the coronavirus cases continued to rise and lockdowns expanded that added weight on the hopes of the US economic recovery. The US Dollar Index that tracks the greenback against the basket of six other currencies raised by 0.3% to 90.993 and supported the USD/CAD pair’s an upward trend.

The rising number of coronavirus cases in the California State pushed its governor to extend the time duration of imposed restrictive measures and raised the safe-haven appeal to impact the US economic recovery. The rising demand for safe-haven added strength in the greenback that pushed the USD/CAD pair higher.

The recent sanctions and travel ban on 14 Chinese officials from the US government also added the appeal for safe-haven as it would escalate the dispute between the world’s two biggest economies. The rising safe-haven appeal added strength to the greenback and supported the USD/CAD pair’s an upward trend. Meanwhile, the WTI crude oil prices on Monday also declined to $45.34 per barrel level and weighed on Loonie’s commodity-linked currency. The declining Canadian dollar also added to the upward momentum of the USD/CAD pair.

The Canadian dollar was the second worst-performing currency among the G10 currencies on Monday, partially because of the profit-taking in the wake of last Friday’s much stronger than expected November jobs report. Besides, the risk-off market mood weighed on risk-sensitive Loonie and added strength in the USD/CAD pair. On the data front, at 20:00 GMT, the Ivey PMI from Canada raised to 52.7 against the forecasted 52.3 and supported the Canadian dollar that capped further gains in the USD/CAD pair.


Daily Technical Levels

Support Resistance

1.2773 1.2790

1.2765 1.2799

1.2756 1.2807

Pivot point: 1.2782

The USD/CAD pair is trading sideways at the 1.2789 level due to a lack of volatility in the market. On the lower side, the support holds around the 1.2770 level, whereas the bullish trend continuation can extend the buying trend until the next resistance level of 1.2835. We may not see a further trend in the pair until this range gets violated. On the lower side, a bearish breakout of the 1.2770 level can extend selling bias until the 1.2720 level. It looks like investors are waiting for a solid fundamental to determine further moves in the market. Let’s look for selling below 1.2836 and buying over 1.2770 level today. Good luck! 

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Forex Signals

AUD/USD Breaking Below Double Bottom Level – Selling Bias in Play! 

The AUD/USD pair was closed at 0.74189 after placing a high of 0.74532 and a low of 0.73722. The currency pair AUD/USD extended its bearish moves on Monday amid the rising demand for the greenback and the improving risk-off market sentiment. The risk perceived Aussie came under fresh pressure on Monday as the rising number of coronavirus cases in the US forced many state governors to expand the restrictions that ultimately diminished the hopes of the US economic recovery and raised the appeal for risk-averse market sentiment.

The AUD/USD pair was closed at 0.74189 after placing a high of 0.74532 and a low of 0.73722. The currency pair AUD/USD extended its bearish moves on Monday amid the rising demand for the greenback and the improving risk-off market sentiment. The risk perceived Aussie came under fresh pressure on Monday as the rising number of coronavirus cases in the US forced many state governors to expand the restrictions that ultimately diminished the hopes of the US economic recovery and raised the appeal for risk-averse market sentiment.

The AUD/USD pair was closed at 0.74189 after placing a high of 0.74532 and a low of 0.73722. The currency pair AUD/USD extended its bearish moves on Monday amid the rising demand for the greenback and the improving risk-off market sentiment. The risk perceived Aussie came under fresh pressure on Monday as the rising number of coronavirus cases in the US forced many state governors to expand the restrictions that ultimately diminished the hopes of the US economic recovery and raised the appeal for risk-averse market sentiment.

In the first trading session of Monday, the AUD/USD pair printed fresh multi-year highs above the 0.7450 level, but the pair started to decline after the risk-averse mode took its pace in the market.

The latest sanctions over 14 Chinese officials by the US also added in the risk-averse market sentiment and weighed on the risk perceived Aussie that dragged the AUD/USD pair on the downside. The Beijing-backed government of Hong Kong expelled four opposition members last month that ended up having the US government impose sanctions on Chinese officials and a travel ban and blocking any assets the official might have within the US.

On the data front, at 02:30 GMT, the AIG Services Index in November came in as 52.9 compared to 51.4. At 05:30 GMT, the ANZ Job Advertisements in November came in as 13.9% compared to 11.9%.

The Chinese Trade Balance showed a surplus of 75.4B US dollars in the month of November and gave strength to the China-proxy Australian dollar due to their trading relationship and capped further losses in the AUD/USD pair on Monday.

Another factor involved in the declining AUD/USD pair’s prices on Monday was the US dollar’s strength due to its safe-haven status. The greenback gained traction in the market after the risk-off mood appeared because of the rising number of coronavirus cases in the US and the increasing hospitalization rate. The strong US dollar also added pressure on AUD/USD pair on Monday.


Daily Technical Levels

Support Resistance

0.7421 0.7437

0.7413 0.7445

0.7406 0.7453

Pivot point: 0.7429

Technically, the AUD/USD pair breaks below the double bottom support level of 0.7417, and its violation of the 0.7420 level can extend the selling trend until 0.7375. The support level of 0.7372 level is extended by an upward trendline support level of 0.7372. The MACD supports selling bias, and recent bearish engulfing and closing below the 0.7415 level can extend the selling trend until the 0.7375 level today.  

Entry Price – Sell 0.74057

Stop Loss – 0.74457

Take Profit – 0.73657

Risk to Reward – 1:1

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

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

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Forex Elliott Wave Forex Technical Analysis

US Dollar Index Under Bearish Pressure. What’s next?

The US Dollar Index (DXY) consolidates on Monday’s session in the extreme bearish sentiment zone bouncing a modest 0.06% from the last Friday 04th, from 90.476 to 90.757. However, the technical perspective is mostly bearish for the DXY basket of currencies.

Technical Overview

The following 8-hour chart shows the mid-term market participants’ sentiment unfolded in its 90-day high and low range. The figure reveals the bearish pressure that carries the Greenback in the extreme bearish zone between 90.476 and 91.543. Likewise, the intraday sideways candlestick formation suggests the likelihood of a pause and the downward continuation for the following trading sessions.

Regarding the US Dollar’s trend, the primary trend plotted in the blue line reveals the bearish bias. The secondary trend identified in green suggested the downward acceleration since November 04th when the price failed its bullish advance at 94.316. Likewise, the broader distance between the primary trend-line and the price leads to a limited correction before continuing the bearish path.

Short-term Technical Outlook

The short-term Elliott Wave perspective for the US Dollar Index exposed in the next 2-hour chart suggests the incomplete downward advance of a five-wave sequence, which could be starting to consolidate in its fourth wave of Minuette degree identified in blue.

The current bearish sequence began on November 04th when the price found fresh sellers at 90.302 and began a decline that is still present to date. The previous chart suggests the completion of the third wave of Minuette degree. This Elliott wave context is supported by the broadest distance observed in the MACD oscillator.

On the other hand, considering that the second corrective wave seems simple in terms of price and time, the alternation principle suggests that the fourth wave in progress should be complex in terms of price, time, or both. In this context, the next corrective pattern could be a triangle pattern or a combination such as a double-three or a triple-three formation.

The implication of the fourth wave’s extension could be indicative of the exhaustion of the bearish trend, and the price action should reverse soon.

Finally, if the price action rises and closes above the supply zone between 91.412 and 91.580, the US Dollar Index could reveal a possible reversion of the current bearish trend.

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Forex Signals

USD/CAD Completes 23.6% Fibonacci – What’s Next? 

The USD/CAD closed at 1.27841 after placing a high of 1.28735 and a low of 1.27720. The USD/CAD pair extended its losses towards its lowest level since May 2018 amid the strength of the Canadian dollar against the US dollar and the rising crude oil prices. On Friday, the Canadian dollar outlook improved on the expectations that the currency will benefit from the domestic economic stimulus and the rollout of the coronavirus vaccine. On Monday, the Canadian Finance Minister Chrystia Freeland forecasted the budget deficit to hit a historic C$382 billion on coronavirus emergency aid. She also added that C$100 billion would be rolled out in stimulus once the virus came under control.

The USD/CAD closed at 1.27841 after placing a high of 1.28735 and a low of 1.27720. The USD/CAD pair extended its losses towards its lowest level since May 2018 amid the strength of the Canadian dollar against the US dollar and the rising crude oil prices. On Friday, the Canadian dollar outlook improved on the expectations that the currency will benefit from the domestic economic stimulus and the rollout of the coronavirus vaccine. On Monday, the Canadian Finance Minister Chrystia Freeland forecasted the budget deficit to hit a historic C$382 billion on coronavirus emergency aid. She also added that C$100 billion would be rolled out in stimulus once the virus came under control.

The USD/CAD closed at 1.27841 after placing a high of 1.28735 and a low of 1.27720. The USD/CAD pair extended its losses towards its lowest level since May 2018 amid the strength of the Canadian dollar against the US dollar and the rising crude oil prices. On Friday, the Canadian dollar outlook improved on the expectations that the currency will benefit from the domestic economic stimulus and the rollout of the coronavirus vaccine. On Monday, the Canadian Finance Minister Chrystia Freeland forecasted the budget deficit to hit a historic C$382 billion on coronavirus emergency aid. She also added that C$100 billion would be rolled out in stimulus once the virus came under control.

These statements from the Canadian Finance Minister added strength to the Canadian dollar as the hopes for Canadian economic recovery increased. The strong Canadian dollar added heavy pressure on the USD/CAD pair on Friday and dragged the pair on the downside.

Meanwhile, the Canadian dollar was also strong because of the positive macroeconomic data on Friday. At 18:30 GMT, the Employment Change from Canada raised to 62.1K against the forecasted 22.0K and supported the Canadian dollar and added losses in USD/CAD pair. 

The Unemployment Rate from Canada dropped to 8.5% against the forecasted 9.0% and supported the Canadian dollar and supported the USD/CAD pair’s downward trend. The Trade Balance from Canada came in as -3.8B against the forecasted -3.2B and weighed on the Canadian dollar.

From the US side, at 18:30 GMT, the Average Hourly Earnings raised to 0.3% against the estimated 0.1% and supported the US dollar, and capped further losses in the USD/CAD pair. The Non-Farm Employment Change declined to 245K against the estimated 480K and weighed on the US dollar and supported the USD/CAD pair’s losses. The Unemployment Rate dropped to 6.7% against the estimated 6.8% and supported the US dollar. The Trade Balance from the US came in as -63.1B against the estimated -64.7B and supported the US dollar. 

At 20:00 GMT, the Factory Orders for November raised to 1.0% against the estimated 0.8%, supported the US Dollar, and capped further USD/CAD pair losses. Most of the US dollar economic data came in favor of the US dollar, but the NFP employment change or the job creation by the US economy fell short of expectations and weighed on the US dollar that added losses in the USD/CAD pair.

Another important factor involved in the USD/CAD pair’s losses on Friday was the rising crude oil prices. The price of crude oil, one of Canada’s major export, rose on Friday above $46 per barrel after the coronavirus vaccine’s speedy approval that would boost the global economic recovery and ultimately increase the energy demand. The higher crude oil prices supported the commodity-linked currency Loonie and added pressure on the currency pair USD/CAD on Friday.


Daily Technical Levels

Support Resistance

1.2825 1.2918

1.2791 1.2977

1.2733 1.3011

Pivot point: 1.2884

The USD/CAD slipped to trade at a 1.2811 level, holding above an immediate support level of 1.2775. Above this level, the commodity currency pair has formed a Doji candle, suggesting odds of selling bias until the 1.2770 level. Taking a look at the 4-hour timeframe, the USD/CAD pair has closed a bullish engulfing pattern at the 1.2811 level, and it may head upward until the 38.2% Fibonacci retracement level of 1.2837 level. Bullish trend continuation can lead to its prices further higher until the next resistance level of the 1.2904 level marks a 61.8% Fibonacci level. Good luck! 

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Forex Signals

USD/CHF Heading North to Complete 38.2% Fibonacci Level – Brace for Buying! 

The USD/CHF trade is sharply bearish to drop until the 0.8885 level, holding above a support level of 0.8880 amid a stronger U.S. dollar. The tussle between China and the U.S. kept gaining market attention and challenged the market risk tone. As per the latest report, the Trump administration was preparing sanctions on at least a dozen Chinese officials in the wake of their alleged role in China’s disqualification of elected opposition legislators in Hong Kong.

The USD/CHF trade is sharply bearish to drop until the 0.8885 level, holding above a support level of 0.8880 amid a stronger U.S. dollar. The tussle between China and the U.S. kept gaining market attention and challenged the market risk tone. As per the latest report, the Trump administration was preparing sanctions on at least a dozen Chinese officials in the wake of their alleged role in China’s disqualification of elected opposition legislators in Hong Kong.

The USD/CHF trade is sharply bearish to drop until the 0.8885 level, holding above a support level of 0.8880 amid a stronger U.S. dollar. The tussle between China and the U.S. kept gaining market attention and challenged the market risk tone. As per the latest report, the Trump administration was preparing sanctions on at least a dozen Chinese officials in the wake of their alleged role in China’s disqualification of elected opposition legislators in Hong Kong.

As in result, the broad-based U.S. dollar managed to stop its early day losses and picked some bids during the early European session as the traders started to cheering the risk-off marker mood. However, the U.S. dollar bullish bias was rather unaffected by the worsening coronavirus (COVID-19) conditions in the U.S., or the disappointing U.S. jobs data, which raised expectations of fresh economic stimulus measures. However, the gains in the U.S. dollar turned out to be one of the leading factors that help the currency pair to limit its deeper losses. Meanwhile, the U.S. Dollar Index that tracks the greenback against a bucket of other currencies rose to 90.850.

On the other hand, the optimism over treatment for the highly infectious coronavirus becomes the key factor that helps the market trading sentiment stop its bearish rally, which might support the currency pair. The hopes of vaccine fueled further after the reports suggesting that the U.K.is set to become the 1st-country to roll out BNT162b2, the COVID-19 vaccine developed by Pfizer Inc (NYSE: PFE) and BioNTech SE (F:22UAy), this week.

In the absence of the key data/events on the day, the market traders will keep their eyes on RBA Gov Lowe Speaks. In addition to this, the updates about the U.S. stimulus package will also be key to watch. In the meantime, the risk catalyst like geopolitics and the virus woes, not to forget the Brexit, will not lose their importance.


Daily Support and Resistance   

S1 0.8833

S2 0.8871

S3 0.8895

Pivot Point 0.8909

R1 0.8933

R2 0.8947

R3 0.8985

Technically, the USD/CHF pair is gaining support above the 0.8886 mark, and it’s triggered an upward wave to achieve a 23.6% Fibonacci retracement mark of 0.8935. On the further higher front, an upward movement and violation of 0.8933 mark can drive more buying trend unto next Fibo level of 61.8% at 0.8965. Check out a trading plan below. 

Entry Price – Buy 0.89342

Stop Loss – 0.88942

Take Profit – 0.89942

Risk to Reward – 1:1

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

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

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

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

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

Categories
Forex Market Analysis

Daily F.X. Analysis, December 07 – Top Trade Setups In Forex – Eyes on European Events! 

The calendar is a bit muted today, and the market can exabit thin trading volume on the news front. However, the focus can stay on German Industrial Production m/m and Sentix Investor Confidence from the Eurozone, which are expected to perform better than the previous month and may underpin the Euro currency. Besides, the U.K. Halifax HPI m/m will also play a slight role in determining the GBP trend, while economists expect HPI to improve from 0.3% to 0.6% this month.

The calendar is a bit muted today, and the market can exabit thin trading volume on the news front. However, the focus can stay on German Industrial Production m/m and Sentix Investor Confidence from the Eurozone, which are expected to perform better than the previous month and may underpin the Euro currency. Besides, the U.K. Halifax HPI m/m will also play a slight role in determining the GBP trend, while economists expect HPI to improve from 0.3% to 0.6% this month.

The calendar is a bit muted today, and the market can exabit thin trading volume on the news front. However, the focus can stay on German Industrial Production m/m and Sentix Investor Confidence from the Eurozone, which are expected to perform better than the previous month and may underpin the Euro currency. Besides, the U.K. Halifax HPI m/m will also play a slight role in determining the GBP trend, while economists expect HPI to improve from 0.3% to 0.6% this month.

Economic Events to Watch Today  

 

EUR/USD – Daily Analysis

The EUR/USD pair was closed at 1.21185 after placing a high of 1.21772 and a low of 1.21101. After rising for three consecutive days, the EUR/USD pair dropped on Friday after the initial rally. The downfall in EUR/USD pair on the day came in after U.S. job figures’ release.

In the trading session on Friday, the EUR/USD pair rallied slightly on the back of improved risk sentiment and the U.S. dollar’s weakness. The risk perceived EUR/USD followed the optimism regarding the coronavirus vaccine and moved higher in the early trading session on Friday. Besides, the U.S. dollar’s weakness due to the increased spread of coronavirus and hospitalization rate in the U.S. also added strength to the rising EUR/USD pair.

The U.S. dollar was also weak due to increased hopes for the next round of U.S. stimulus package after the CARES Act passed in March. Democrats and Republicans have agreed over a $908 billion stimulus package, and the expectations have increased that a big stimulus will also be delivered soon. The weak U.S. dollar gave a Pushto EUR/USD pair on Friday and raised its prices above the 1.21700 level.

However, the EUR/USD pair’s gains started to reverse and converted into losses after the release of macroeconomic data from the U.S.

At 12:00 GMT, the German Factory Orders for November raised to 2.9% against the expected 1.4% and supported Euro. At 12:45 GMT, the French Gov Budget Balance came in as -159.9B. At 14:00 GMT, the Italian Retail Sales raised to 0.6% against the forecasted 0.2% and supported Euro.

At 18:30 GMT, the Average Hourly Earnings rose to 0.3% against the anticipated 0.1% and supported the U.S. dollar and added pressure on EUR/USD. The Non-Farm Employment Change declined to 245K against the anticipated 480K and weighed on the U.S. dollar. 

The Unemployment Rate declined to 6.7% against the anticipated 6.8% and supported the U.S. dollar and dragged the EUR/USD pair. The Trade Balance from the U.S. came in as -63.1B against the anticipated -64.7B and supported the U.S. dollar and weighed on EUR/USD pair. At 20:00 GMT, the Factory Orders for November raised to 1.0% against the anticipated 0.8% and supported U.S. Dollar. Most of the U.S. data came in support of the U.S. dollar that resulted in the EUR/USD pair’s downfall on Friday in the late trading session.

Daily Technical Levels

Support  Resistance

1.2101        1.2178

1.2063       1.2215

1.2025       1.2254

Pivot point: 1.2139

EUR/USD– Trading Tip

On Monday, the EUR/USD continues to trade sideways amid mixed NFP figures released on Friday. On the higher side, the EUR/USD may find an immediate resistance at 1.2160 and 1.2196 level. While the closing of candles below the 1.2103 level can send the EUR/USD pair further lower until 1.2080 and 1.2040 level. The MACD is strongly bearish; therefore, the idea will be to open a sell trade below the 1.2175 level today to capture quick green pips. 

GBP/USD – Daily Analysis

The GBP/USD pair was closed at 1.3413 after a high of 1.35390 and a low of 1.34096. The GBP/USD pair rose to its highest level since May 2018 in the early trading session on Friday over the combined factor of Brexit optimism and the weakness of the U.S. dollar. However, the British Pound cut its gains after the E.U.’s Brexit negotiator Michel Barnier paused the talks.

During the early trading session on Friday, the GBP/USD pair rose and started to post gains following the Brexit optimism triggered after the agreement was reached over the Fisheries between the U.K. and the E.U. Another factor involved in the GBP/USD pair’s upward momentum was the U.S. dollar’s weakness.

The U.S. dollar index (DXY) that measures the value of the U.S. dollar against the basket of six currencies fell to its six years, the lowest level of 90.47 on Friday. The losses in DXY were due to a combination of factors, including the rising number of coronavirus in the nation and the rising expectations of the U.S. stimulus package.

The number of new coronavirus cases in the past five days in the U.S. reached about 1 million. The hospitalization rate also increased to an alarming level and hit a record high after 101,487 patients were reported to be hospitalized in a single day. This negative news from the U.S. added further pressure on the U.S. dollar and supported the upward trend in the GBP/USD pair in the early trading session on Friday.

British Pound was under demand on Thursday after the U.K. and E.U. reported that they had reached an agreement over one key sticking issue of Fisheries. Investors started to buy GBP/USD in the early trading session on Friday as they continued following the previous trend.

However, the currency pair GBP/USD pair started to decline on Friday after the release of U.S. macroeconomic data and the announcement from Michel Barnier. The E.U. Brexit negotiator, Michel Barnier, said that he had paused the trade talks with the U.K. and added that the conditions for a deal had not yet been met.

After one week of intensive negotiations in London, the U.K. and E.U. agreed to pause talks because the post-Brexit deal conditions were not met. Barnier said that E.U. Commission president Ursula von der Leyen and PM Boris Johson would try to make progress on a deal in the next meeting that will take place on Saturday.

After these comments by the E.U. top negotiator, the earlier optimism that the deal was imminent could be reached before the end of the week. These updates suggested that talks have reached a very critical stage, and anything could happen. It raised the market’s uncertainty and supported the safe-haven greenback that exerted pressure on GBP/USD pair.

On the data front, at 14:30 GMT, the Construction PMI from Great Britain raised to 54.7 against the projected 52.3 and supported British Pound and limited the losses in GBP/USD pair.

From the U.S. side, at 18:30 GMT, the Average Hourly Earnings surged to 0.3% against the projected 0.1% and supported the U.S. dollar and added losses in GBP/USD pair. The Non-Farm Employment Change fell to 245K against the projected 480K and weighed on the U.S. dollar. The Unemployment Rate fell to 6.7% against the projected 6.8%, supported the U.S. dollar, and dragged GBP/USD pair. The Trade Balance from the U.S. came in as -63.1B against the projected -64.7B and supported the U.S. dollar. At 20:00 GMT, the Factory Orders for November surged to 1.0% against the projected 0.8% and supported U.S. Dollar and added losses in the GBP/USD pair on Friday.

Daily Technical Levels

Support   Resistance

1.3286       1.3441

1.3209       1.3519

1.3131       1.3596

Pivot Point: 1.3364

GBP/USD– Trading Tip

The GBP/USD is falling dramatically from 1.3450 to 1.3230 level by the time of covering this report. On the 4 hour timeframe, the GBP/USD pair has dipped sharply and has already violated the upward channel, which supported the pair around the 1.3350 level. The Cable may find the next support at 1.3204 level, and below this, the next support can also be found around 1.3100 level today. On the higher side, the resistance hold around the 1.3300 mark. The MACD and RSI are suggesting selling bais in the pair, we should look for selling trades below 1.3350 and buying over 1.3185 level today. 

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 104.186 after placing a high of 104.242 and a low of 103.736. The currency pair USD/JPY rose on Friday amid the supportive U.S. macroeconomic data and the increased U.S. yields.

On Friday, the U.S. Bureau of Labour reported that only 245K jobs were added to the economy while the unemployment rate fell by 0.2% in November and supported the U.S. dollar.

On the data front, at 18:30 GMT, the Average Hourly Earnings advanced to 0.3% against the anticipated 0.1% and supported the U.S. dollar and added gains in the USD/JPY pair. The Non-Farm Employment Change declined to 245K against the anticipated 480K and weighed on the U.S. dollar capped further gains in the USD/JPY pair. The Unemployment Rate declined to 6.7% against the anticipated 6.8% and supported the U.S. dollar.

The Trade Balance from the U.S. came in as -63.1B against the anticipated -64.7B and supported the U.S. dollar and pushed the pair USD/JPY higher. At 20:00 GMT, the Factory Orders for November advanced to 1.0% against the anticipated 0.8% and supported the U.S. Dollar, and added further gains in the USD/JPY pair.

The U.S.’s supportive data proved good news for the market that pushed the S&P 500 to an all-time high and raised the U.S. 10-year yield by 5bps to 0.97%. The rise in U.S. yields also added strength in the U.S. dollar and added gains in the USD/JPY pair. The less than expected job creation by the U.S. Labor Department made the near-term U.S. fiscal stimulus more likely and exerted pressure on Congress to swiftly avert the labor market’s slowdown.

However, the risk sentiment was also strong in the market after the vaccine optimism escalated and supported the hopes that the economic activities will return to pre-pandemic levels. These hopes, along with the rising expectations that the world’s largest economy will also recover soon as the stimulus package was near to be delivered, added to the risk-sentiment. These risk flows added weight on the safe-haven Japanese Yen that supported the USD/JPY pair and pushed it higher.

Meanwhile, the gains in the USD/JPY pair were also limited because of the rising number of coronavirus cases in the U.S. Over the period of 5 days, the U.S. has recorded about 1 million new coronavirus cases, and the hospitalization rate in the U.S. also hit its highest record by reaching more than 104,000 patients in a single day.

The USD/JPY pair rose on Friday due to supportive U.S. macroeconomic data, higher U.S. yields, and the rising risk sentiment in the market due to global economic recovery hopes.

Daily Technical Levels

Support   Resistance

103.48       104.35

103.13       104.89

102.60       105.23

Pivot point: 104.01

USD/JPY – Trading Tips

The USD/JPY is trading within a symmetric triangle pattern seen in the 4-hour timeframe. The pair lately violated the sideways trading range of 104.600 – 104.200, and now it’s trading at 104.300 level, especially after bouncing off over 103.700 level on the lower side, supporting the pair around 103.700 level. On the downside, the USD/JPY may find support at the 103.200 level upon a bearish breakout of the 103.750 support level. While resistance stays at 104.350 and 104.700 today. Good luck

Categories
Forex Elliott Wave Forex Market Analysis

AUDUSD Consolidates its Gains Expecting the US Employment Data Ahead

The price of AUDUSD reached a fresh yearly high at 0.74496 on the Thursday trading session expecting the last employment data release of the year for the US labor market corresponding to November. 

(Source: tradingeconomics.com)

Technical Overview

This year, as illustrated in the previous chart, Australia’s unemployment rate peaked at a record high of 14.7% in April, mainly boosted by the coronavirus lockdown. In this context, the analysts’ consensus expects the unemployment to drop to 6.8% for November, from 6.9% reported last October.

The mid-term Elliott wave perspective displayed in the 12-hour chart below reveals the upward progression in an incomplete five-wave sequence of Minor degree labeled in green. This bullish impulsive move began on March 18th when the Aussie found fresh buyers at 0.55063.

The previous chart also shows the Aussie’s advance in a third extended wave, suggesting that the price action could be moving in its fourth wave in green, still in development. 

This scenario considers that the Aussie moves in its internal wave (c) of Minuette degree labeled in blue, developing an ending diagonal pattern. Likewise, the wave of the upper degree corresponding to wave ((b)) of Minute degree identified in black should correspond to an expanded flat pattern, and the price should realize a new decline,

The alternative count considers the advance in the fifth wave of Minor degree in green is developing an internal ending diagonal pattern. In this case, the Aussie should start a decline corresponding to wave A in green.

Technical Outlook

The short-term Elliott wave for AUDUSD exposed in its 4-hour chart shows the advance in an ending diagonal pattern, which looks developing its fifth wave of Subminuette degree labeled in green.

Although the ending diagonal pattern suggests completing the fifth wave or wave (c), the Aussie must confirm its completion through the breakdown of its base-line that connects the waves ii and iv, in green. Also, the price should confirm the close below the intraday demand zone between 0.73492 and 0.73571.

Finally, if the price confirms its downward correction, the potential target area for this movement is from 0.7265 and 0.7144. If the area fails to hold, and the bearish pressure extends this downward movement, the Aussie could visit the base of its sideways channel on the psychologically key level of 0.70.

Categories
Forex Signals

USD/CAD Bearish Bias Seems to Halt – Eyes on U.S. NFP Figures! 

The USD/CAD pair was closed at 1.28619 after placing a high of 1.29411 and a low of 1.28519. The USD/CAD pair extended its losses for the 3rd consecutive day on Thursday due to broad-based U.S. dollar weakness and the rising crude oil prices.

The USD/CAD pair was closed at 1.28619 after placing a high of 1.29411 and a low of 1.28519. The USD/CAD pair extended its losses for the 3rd consecutive day on Thursday due to broad-based U.S. dollar weakness and the rising crude oil prices.

The USD/CAD pair was closed at 1.28619 after placing a high of 1.29411 and a low of 1.28519. The USD/CAD pair extended its losses for the 3rd consecutive day on Thursday due to broad-based U.S. dollar weakness and the rising crude oil prices.

The USD/CAD fell to its lowest since October 2018 on Thursday as the U.S. Dollar Index (DXY) reached 90.50 level, its lowest for 31 months. The U.S. dollar weakness could be attributed to the latest progress made in the talks of stimulus relief package in the U.S.

The Top Democrats officials, including President-elect Joe Biden, House Speaker Nancy Pelosi, and the Senate Minority Leader Chuck Schumer, have said that they favored a $908 billion worth bipartisan bill for now as it was the starting step towards the stimulus package. These comments from Democrats raised hopes that a deal might be reached between Republicans and Democrats. Both parties have a shared view that there was a need for a 2020 stimulus package in the economy and that a deal should be reached soon.

This progress raised the hopes and optimism in the market related to the U.S.’s stimulus package and weighed heavily on the U.S. dollar that ultimately added in the losses of the USD/CAD pair. Meanwhile, the WTI crude oil prices increased on Thursday as producers, including Saudi Arabia and Russia, resumed discussion to agree on how much crude to pump in 2021 after earlier talks failed to compromise how to tackle the weak oil demand coronavirus pandemic.

In late Thursday, OPEC+ announced after three days of discussion that they have agreed to increase the production by 500,000 barrels per day beginning in January. This will bring the total production cuts at the start of next year to 7.2 million BPD. On Thursday, the rising crude oil prices added strength in the commodity-linked Loonie that added further pressure on the USD/CAD pair.

On the data front, at 17:30 GMT, the Challenger Job Cuts for the year in November came in as 45.4%against the previous 60.4%. At 18:30 GMT, the Unemployment Claims from last week fell to 712K against the expected 775K and supported the U.S. dollar. At 19:45 GMT, the Final Services PMI for November rose to 58.4 against the forecasted 57.5 and supported the U.S. dollar. At 20:00 GMT, the ISM Services PMI stayed as forecasted 55.9.


Daily Technical Levels

Support Resistance

1.2898 1.2950

1.2877 1.2981

1.2847 1.3002

Pivot point: 1.2929

The USD/CAD traded in a selling mode, falling below the 1.2885 level to test the support area of the 1.2845 level. Bearish crossover of 1.2845 level can extend selling bias until 1.289 level. We opened a selling trade during the European open, but it seems to consolidate sideways ahead of the NFP figures. Here’s a trading plan for now…

Entry Price – Sell 1.28485

Stop Loss – 1.28885

Take Profit – 1.28085

Risk to Reward – 1:1

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

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

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

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

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

Categories
Forex Market Analysis

Daily F.X. Analysis, December 04 – Top Trade Setups In Forex – NFP in Highlights! 

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

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

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

Economic Events to Watch Today  

 

EUR/USD – Daily Analysis

The EUR/USD pair was closed at 1.21474 after placing a high of 1.21744 and a low of 1.21008. EUR/USD pair extended its gains for the 3rd consecutive day on Thursday due to the U.S. dollar’s weakness amid the rising hopes for the next round of U.S. stimulus package from Congress.

The Top Democrats, Joe Biden, and Nancy Pelosi backed the bipartisan $908 billion stimulus plan on the previous day. They urged the Senate Majority Leader Mitch McConnell to drop his plan to bring a more modest package. All top Democrats, including the President-elect Joe Biden, Nancy Pelosi, and the Senate Minority Leader Chuck Schumer, said that the bill would be acceptable as a starting point. 

The need for more stimulus relief packages to support the economy was increasingly evident, with both the ADP Non-Farm Payrolls and the ISM manufacturing survey below the expectations. Meanwhile, Car and Truck sales in November also fell from October level. On the coronavirus front, the U.S. had its deadliest day since the start of the pandemic on Thursday, with over 2700 recorded deaths due to coronavirus. Over the past 2-days alone, the death toll has reached 5000. The number of hospitalized people also reached for the first time, an alarming level of 100,000. All these developments weighed heavily on the U.S. dollar on Thursday and added strength to the EUR/USD pair.

The Spanish Services PMI for November raised to 39.5 against the expected 36.5 and supported Euro and added further gains in EUR/USD pair. At 13:45 GMT, the Italian Services PMI declined to 39.4 against the forecasted 40.9 and weighed on Euro. At 13:50 GMT, the French Final Services PMI fell to 38.8 against the anticipated 49.1 and weighed on Euro. AT 13:55 GMT, the German Final Services PMI came in line with the expectations of 46.2. At 14:00 GMT, the Final Services PMI from Eurozone raised to 41.7 against the expected 41.3 and supported Euro and the EUR/USD pair raised further. At 15:00 GMT, the Retail Sales for October also surged to 1.5% against the anticipated 0.7% and supported Euro and helped the EUR/USD pair to continue its bullish momentum.

From the U.S. side, at 17:30 GMT, the Challenger Job Cuts for the year in November came in as 45.4%against the previous 60.4%. At 18:30 GMT, the Unemployment Claims from last week fell to 712K against the anticipated 775K and supported the U.S. dollar. At 19:45 GMT, the Final Services PMI for November surged to 58.4 against the anticipated 57.5 and supported the U.S. dollar. At 20:00 GMT, the ISM Services PMI stayed as anticipated 55.9.

Daily Technical Levels

Support   Resistance

1.1971       1.2122

1.1873       1.2175

1.1819       1.2273

Pivot point: 1.2024

EUR/USD– Trading Tip

On Friday, the EUR/USD pair continues to trade sideways ahead of the NFP figures, which may drive sharp movements during the U.S. session.

On the higher side, the EUR/USD may find an immediate resistance at 1.2160 and 1.2196 level. Simultaneously, the closing of candles below the 1.2103 level can send the EUR/USD pair further lower until 1.2080. Trend depends upon the NFP data.

GBP/USD – Daily Analysis

The GBP/USD closed at 1.34525 after placing a high of 1.34998 and a low of 1.33288. The GBP/USD pair rose and reached above one year’s highest level over the bullish Brexit bets and the U.S. dollar’s weakness. On Thursday, the latest news raised the British Pound over the board that suggested that the Brexit trade deal could be reached by the weekend after the two sides showed hints of compromise over fish quotas. The positive news made the British Pound the best performer on the day in the G10 currencies. 

In an attempt to break the deadlock, Mr. Barnier and Boris Johnson lowered their demands by asking to get back only 60% of the fish that E.U. boats currently catch in British waters, down from 80%. Under the reported proposal, the U.K. would hold onto increased stocks of fish that are sold in the U.K. while the E.U. will keep the similar quotas of stock that are popular in the E.U. but not in the U.K.

The compromise was reported less than a week after E.U. Brexit negotiator Michel Barnier proposed to return about 15-18% of the fish caught by European fleets in British waters to the U.K. under a free trade agreement; however, at that time, the U.K. rejected this proposal.

The progress on fisheries is progress after a months-long stalemate; however, other key sticking points, including the level-playing field and governance, need to be solved to reach a deal. The time for the end of the Brexit transition period is near, and both sides have shown hints that a deal might reach by this weekend.

All these optimistic Brexit progress reports gave the local currency British Pound strength and supported the GBP/USD pair’s upward momentum that led the pair to its one-year highest level near 1.35000 on Thursday.

On the data front, at 14:30 GMT, the Final Services PMI from Britain raised to 47.6 against the expected 45.8 and supported British Pound and added further gains in GBP/USD pair.

From the U.S. front, at 17:30 GMT, the Challenger Job Cuts for the year in November came in as 45.4%against the previous 60.4%. At 18:30 GMT, the Unemployment Claims from last week declined to 712K against the projected 775K and supported the U.S. dollar. At 19:45 GMT, the Final Services PMI for November rose to 58.4 against the projected 57.5 and supported the U.S. dollar. At 20:00 GMT, the ISM Services PMI stayed as projected 55.9.

Furthermore, the gains in GBP/USD pair on Thursday were also because of the U.S. dollar’s weakness due to the progress in talks to reach a consensus between Republicans & Democrats over the second round of stimulus talks. Joe Biden, Nancy Pelosi, and Chuck Schumer have shown their consent for the bipartisan bill of $908 billion. This progress raised the hopes for a stimulus bill and weighed on the U.S. dollar that added strength to the GBP/USD pair.

Daily Technical Levels

Support   Resistance

1.3286       1.3441

1.3209       1.3519

1.3131       1.3596

Pivot Point: 1.3364

GBP/USD– Trading Tip

The GBP/USD is trading sideways in between a fresh trading range of 1.3305 – 1.3445. Breakout of this range can lead the Cable price towards the 1.3517 level. The volatility seems low ahead of the Christmas holidays. However, the European session can trigger a buying trend until the 1.3515 level, while support continues to stay at the 1.3305 level. A bearish breakout of the 1.3305 level can trigger selling until the 1.3212 level. The MACD and RSI are suggesting a bullish bias in the market. Let’s consider taking buying trades over 1.3305 and 1.3447 level today.

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 103.841 after placing a high of 104.534 and a low of 103.669. The USD /JPY pair dropped to its lowest since November 18 on Thursday due to broad-based U.S. dollar weakness.

The U.S. Dollar Index extended its losses for 3rd consecutive day on Thursday and fell to a 31-month lowest level below 91.10 after the hopes for the next round of stimulus raised in the market. The top three Democratic Leaders, President-elect Joe Biden, House Speaker Nancy Pelosi, and Senate Minority Leader Chuck Schumer, backed the bipartisan proposal for a coronavirus relief package worth $908 billion. They all urged the Senate Majority Leader Mitch McConnell to drop his plans of bringing a more modest package back to the floor of the upper chamber.

Both parties agree that more relief aid should be delivered to Americans to curb the coronavirus pandemic’s effects but have differences over the size, method, and healthcare system. The renewed efforts to strike a deal followed a months-long deadlock over the second stimulus relief package and weighed heavily on the greenback that added losses in the USD/JPY pair.

On the data front at 17:30 GMT, the Challenger Job Cuts for the year in November came in as 45.4%against the previous 60.4%. At 18:30 GMT, the Unemployment Claims from last week dropped to 712K against the estimated 775K and supported the U.S. dollar, and capped further losses in the USD/JPY pair. At 19:45 GMT, the Final Services PMI for November rose to 58.4 against the estimated 57.5 and supported the U.S. dollar. At 20:00 GMT, the ISM Services PMI stayed as estimated at 55.9.

Furthermore, the U.S. dollar was also weak because of the rising cases of coronavirus in the U.S. The U.S. saw its deadliest day since the start of the pandemic on Thursday after 2,700 deaths were reported in a single day. Over the past two days only, the death toll has reached 5,000 in the U.S. from the coronavirus, and the hospitalization rate has also increased, with more than 100,000 cases reported to be hospitalized in a single day.

These raised concerns for the U.S. economy as many states were still under strict restrictive measures, and the economic activities there were still affected. The rising number of deaths might weigh more on the local currency. The U.S. dollar came under pressure and dragged the USD/JPY pair further on the downside.

Daily Technical Levels

Support   Resistance

104.13       104.54

103.95       104.77

103.72       104.95

Pivot point: 104.36

USD/JPY – Trading Tips

The USD/JPY has violated the sideways trading range of 104.600 – 104.200, and now it’s trading at 103.876 level. On the lower side, the pair has formed a triple bottom level, supporting the pair around 103.700 level. Investors seem to wait for the U.S. NFP and unemployment rate figures to determine further U.S. dollar trends. On the lower side, the USD/JPY may head towards the 103.200 level upon a bearish breakout of the 103.750 support level. While resistance stays at 104.350 today. Good luck

Categories
Forex Market Analysis

Daily F.X. Analysis, December 03 – Top Trade Setups In Forex – Services PMI under Spotlight! 

The focus will remain on the range of services PMI numbers from the Eurozone and U.K. on the data front. Most of the data is anticipated to be neutral; nevertheless, the U.S. Unemployment Claims and ISM Services PMI will be the main highlight of the day.

The focus will remain on the range of services PMI numbers from the Eurozone and U.K. on the data front. Most of the data is anticipated to be neutral; nevertheless, the U.S. Unemployment Claims and ISM Services PMI will be the main highlight of the day.

The focus will remain on the range of services PMI numbers from the Eurozone and U.K. on the data front. Most of the data is anticipated to be neutral; nevertheless, the U.S. Unemployment Claims and ISM Services PMI will be the main highlight of the day.

Economic Events to Watch Today  

 

EUR/USD – Daily Analysis

The EUR/USD closed at 1.21150 after placing a high of 1.21182 and a low of 1.20398. The EUR/USD pair rose to its highest since April 2018 on Wednesday amid rising optimism from the vaccine front and the fiscal stimulus hopes.

On Wednesday, the U.K. regulator approved Pfizer and BioNtech’s vaccine for emergency use to fight against the coronavirus. This news added further support to the already improved risk sentiment in the market and helped the EUR/USD pair to rise as it is a riskier asset.

On the data front, at 12:00 GMT, the German Retail Sales for October raised to 2.6% against the projected 1.3% and supported Euro that added further gains in EUR/USD pair. At 13:00 GMT, the Spanish Unemployment Change dropped to 25.3K against the estimated 54.5K and supported Euro and added further gains in EUR/USD pair. At 14:00 GMT, Italian Monthly Unemployment Rate for October declined to 9.8% against the forecasted 9.9% and supported Euro and helped EUR/USD rise. At 15:00 GMT, the PPI for October raised to0.4% against the forecasted 0.2% and kept the single currency Euro and gave additional support to EUR/USD pair. The Unemployment Rate in Eurozone remained flat at 8.4%.

At 18:15 GMT, the ADP Non-Farm Employment Change for November fell to 307K against the anticipated 433K and weighed on the U.S. dollar and added further in EUR/USD pair. After the release of macroeconomic data on Wednesday, the currency pair EUR/USD raised sharply and surpassed the 1.2100 level as all the data was in favor of it. Meanwhile, the lawmakers in Washington continued their negotiations related to a fiscal stimulus deal to support the U.S. economy. The negotiations weighed on local currency and made the U.S. dollar weak across the board. Furthermore, the optimism about a $908 billion package also boosted the market’s risk sentiment and weighed on the U.S. dollar that added additional gains in EUR/USD pair.

The U.S. dollar was also weak because of the rising number of coronavirus cases in the U.S. On Wednesday, the total number of deaths from coronavirus set a new record in a single day, and hospitalizations also reached an all-time high. On Wednesday, about 100,200 patients of coronavirus were hospitalized in the U.S. The U.S. Dollar Index on Wednesday slumped to its lowest level in more than 30 months at 91.10 and supported the upward momentum of the EUR/USD pair.

Daily Technical Levels

Support   Resistance

1.1971       1.2122

1.1873       1.2175

1.1819       1.2273

Pivot point: 1.2024

EUR/USD– Trading Tip

The bullish bias of the EUR/USD continues to dominate the market as the pair surged further higher until the 1.2117 level. On the higher side, the EUR/USD may find an immediate resistance at 1.2150 and 1.2196 level. Simultaneously, the closing of candles below the 1.2153 level can send the EUR/USD pair further lower until 1.2080. On the 4 hour timeframe, the EUR/USD has formed an upward channel, which is suggesting odds of further buying trend in the pair. The MACD is forming histograms above 0, suggesting odds of an upward trend in the market. Let’s consider the buying trend until the 1.2200 level today. 

GBP/USD – Daily Analysis

The GBP/USD closed at 1.33651 after placing a high of 1.34410 and a low of 1.32875. The British Pound erased gains and slipped to a 3-week lowest level on Wednesday after the E.U.’s chief Brexit negotiator said that progress in talks had stalled and cooled the expectations that a deal was near.

Michel Barnier said that a deal was not guaranteed and signaled that differences over key issues, including access to the U.K. fishing waters and level playing field rules, were still there. A day before this news, reports suggested that post-Brexit trade talks had reached the so-called tunnel. Tunnel refers to a situation where both parties don’t leave until a consensus is reached.

Ahead of the update, there were signs the ongoing impasse was starting to frighten some members, who have called on the E.U. to start preparation for a no-deal scenario. There likely could be another twist to come in Brexit talks in the days ahead with the U.K.’s proposal for a new finance bill. This bill undermines some parts of the original Brexit Withdrawal agreement, and it could dent the little progress in negotiations seen so far.

Whereas, Barnier said that if the U.K. government moved ahead next week with draft clauses in the Finance Bill that were inconsistent with the Withdrawal Agreement, then the talks will come under crisis.

All these negative reports depressed Brexit’s expectations and started to weigh on British Pound that added losses in GBP/USD pair. The time for an end of Brexit transition period on December 31 has come near, and if a deal has not been reached by then, U.K. will have to follow WTO rules and regulations while trading with the E.U.

Meanwhile, on the data front, at 05:01 GMT, the BRC Shop Price Index for the year dropped to -1.8% against the forecasted -1.3% and weighed on British Pound and added pressure on GBP/USD pair. On the U.S. front, at 18:15 GMT, the ADP Non-Farm Employment Change for November dropped to 307K against the anticipated 433K and weighed on the U.S. dollar, and capped further losses in the GBP/USD pair.

Daily Technical Levels

Support   Resistance

1.3340       1.3468

1.3263       1.3519

1.3212       1.3595

Pivot point: 1.3391

GBP/USD– Trading Tip

The GBP/USD is trading sideways in between a fresh trading range of 1.3305 – 1.3445. Breakout of this range can lead the Cable price towards the 1.3517 level. The volatility seems low ahead of the Christmas holidays. However, the European session can trigger a buying trend until the 1.3515 level, while support continues to stay at the 1.3305 level. A bearish breakout of the 1.3305 level can trigger selling until the 1.3212 level. The MACD and RSI are suggesting a bullish bias in the market. Let’s consider taking buying trades over 1.3305 and 1.3447 level today.

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 104.410 after placing a high of 104.749 and a low of 104.223. The USD/JPY pair raised for the third consecutive day on Wednesday amid the market’s optimism. However, most of USD/JPY’s daily gains were lost during the late trading session as U.S. stimulus raised.

The risk sentiment in the market was improved after the successful vaccine development from famous drug companies. Pfizer and BioNtech even received approval from the U.K. administration for emergency use authorization of their vaccine on Wednesday. Pfizer & BioNtech became the first in the world to get approval for the widespread use of their vaccine. It means that their vaccine can now be used to prevent the coronavirus officially, and it raised the risk sentiment in the market that ultimately added weight on the Japanese Yen due to its safe-haven nature; thus, it supported the upward momentum of the USD/JPY pair.

The Monetary Base for the year dropped to 16.5% against the forecasted 17.2%. At 09:59 GMT, Consumer Confidence raised to 33.7 against the anticipated 33.0 and supported the Japanese Yen that capped additional gains in the USD/JPY pair on Wednesday. At 18:15 GMT, the ADP Non-Farm Employment Change for November fell to 307K against the estimated 433K and weighed on the U.S. dollar that limited the gains of the USD/JPY pair on Wednesday.

The prospects of a U.S. coronavirus relief package weighed on the greenback and forced the currency pair USD/JPY to lose most of its daily gains. As the $1.4trillion spending bill’s support increased, the top U.S. economic officials on Tuesday advised Congress to present more assistance for small businesses to survive during the pandemic.

Meanwhile, Philadelphia Federal Reserve Bank President Patrick Harker said on Wednesday that due to the increased spread of the coronavirus and delayed fiscal help along with the permanent job loss of some workers, the U.S. economic growth has been moderate.

Harker also forecasted moderate growth for the rest of this year and the first quarter of 2021. He also predicted that the economy would stay below pre-pandemic levels. Harker also said that if the vaccine is widely available by next spring and summer, then the growth will pick up in the second half of the next year. Harker added that more financial support was needed to get the economy to that point and to support low-income households.

Harker also said that the Central Bank’s emergency lending programs should be extended beyond next year as they are set to expire on December 31. Harker’s comments came in after Treasury Secretary Steven Mnuchin asked the Fed to return the unused funds. All these comments added pressure on the U.S. dollar as the continuous demand for a second stimulus bill weighed on local currency.

Daily Technical Levels

Support   Resistance

104.13       104.54

103.95       104.77

103.72       104.95

Pivot point: 104.36

USD/JPY – Trading Tips

The USD/JPY is trading with a sideways trading range of 104.600 – 104.200, holding below an immediate resistance level of 104.600. On the lower side, the safe-haven currency pair may find support at the 103.719 level. The pair seems to disrupt the resistance level of 104.600, and if this happens, the USD/JPY may soar until the next resistance area of 105.030 level. The MACD and RSI support the buying trend, but we should only take buying positions over the 104.600 level today. Good luck!

Categories
Forex Market Analysis

Daily F.X. Analysis, December 02 – Top Trade Setups In Forex – Advance NFP in Focus!

On Wednesday, the eyes will remain on the Fed Chair Powell Testifies, ADP Non-Farm Employment Change and Unemployment Rate from the Eurozone. A primary focus will remain on the ADP Non-Farm Employment Change as this will help investors determine the odds of actual NFP data, which is due on Friday.

On Wednesday, the eyes will remain on the Fed Chair Powell Testifies, ADP Non-Farm Employment Change and Unemployment Rate from the Eurozone. A primary focus will remain on the ADP Non-Farm Employment Change as this will help investors determine the odds of actual NFP data, which is due on Friday.

On Wednesday, the eyes will remain on the Fed Chair Powell Testifies, ADP Non-Farm Employment Change and Unemployment Rate from the Eurozone. A primary focus will remain on the ADP Non-Farm Employment Change as this will help investors determine the odds of actual NFP data, which is due on Friday.

Economic Events to Watch Today  

 

EUR/USD – Daily Analysis

The EUR/USD closed at 1.20715 after placing a high of 1.20764 and a low of 1.19243. The EUR/USD surged above 1.2000 level and reached 1.20764 level, the highest level since May 2018 amid the optimism surrounding the coronavirus vaccine and broad-based U.S. dollar weakness.

Many factors were involved in the breakout of the EUR/USD pair on Tuesday above the 1.2000 level, including the latest optimism because of vaccine hopes, monetary stimulus from both sides, and the political certainty for a change. 

Pfizer and BioNtech were the first to report a high efficacy of 95% in a phase-3 coronavirus immunization trial on November 09. After that, many drug companies, including Moderna, AstraZeneca, Novavax, and Oxford University, also followed them. Pfizer and Moderna have already applied for emergency use authorization from the US FDA, and soon after getting the approval, these vaccines will be available for usage. Even Pfizer has sent its first mass shipment of vaccine to Chicago on Monday. All this vaccine optimism pushed the safe-haven U.S. dollar down and raised the risk sentiment in the market that supported the upward momentum of the EUR/USD pair on Tuesday.

On the stimulus front, the European Central Bank and the U.S. Federal Reserve were set to expand their bond-buying schemes. Since the pandemic has started, the stimulus aid from ECB has supported the Eurozone’s economy by allowing governments to spend more. In the United States, the Federal Reserve’s dollar printing triggered a broad risk-on mood that also helped the riskier assets like EUR/USD pair to rise. 

On the Political certainty front, the U.S. elections have declared a final winner- Joe Biden. While outgoing President Donald Trump has been continuously crying foul, his attempts to overturn the elections failed, and investors continued to price the Joe Biden victory and selling the U.S. dollar. Moreover, the nomination of Janet Yellen as Treasury Secretary was also reassuring.

On the E.U. front, the political development in the upcoming Brexit deal has entered a tunnel as an intense final round of talks is in progress, and the results of talks are yet to be declared. All these factors combined and supported the EUR/USD pair’s upward momentum on Tuesday.

On the data front, at 13:15 GMT, the Spanish manufacturing PMI for November declined to 49.8 against the forecasted 50.8 and weighed on Euro. At 13:45 GMT, the Italian Manufacturing PMI also dropped to 51.5 against the projected 52.0 and weighed on the single currency. At 13:50 GMT, the French Final Manufacturing PMI raised to 49.6 from the expected 49.1 and supported Euro. AT 13:55 GMT, the German Final Manufacturing PMI stayed the same at 57.8. The German Unemployment Change came in as -39K against the expected 9K and supported the single currency. At 14:00 GMT, the Final Manufacturing PMI from the Eurozone remained flat with the expected 53.8. At 15:00 GMT, the CPI Flash Estimate for the year dropped to -0.3% against the estimated -0.2% and weighed n Euro. The Core CPI Flash Estimate for the year came in line as expected 0.2%. 

On the U.S. front, at 20:00 GMT, the ISM Manufacturing PMI for November fell to 5.75 against the forecasted 5.9 and weighed on the U.S. dollar and supported the upward momentum of the EUR/USD pair. The Construction Spending for October surged to 1.3% against the estimated 0.8% and supported the U.S. dollar. The ISM Manufacturing Prices for November also surged to 65.4 against the forecasted 65.0 and helped the U.S. dollar. The Wards Total Vehicle Sales from the U.S. declined to 15.6M against the estimated 16.1M and weighed on the U.S. dollar that added further gains in EUR/USD pair.

Given the above manufacturing data, the Eurozone economy’s outlook looks somewhat better than the United States outlook that added extra pressure on the U.S. dollar and helped the EUR/USD pair to place highs above the 1.200 level on Tuesday.

Daily Technical Levels

Support   Resistance

1.1971       1.2122

1.1873       1.2175

1.1819       1.12273

Pivot point: 1.2024

EUR/USD– Trading Tip

The EUR/USD surged dramatically on the back of risk-on sentiment amid positive reports over the COVID19 vaccine, which dragged the pair higher above the 1.2074 level. On the higher side, the violation of the 1.2010 resistance level is now working as a support, and it can lead the pair further higher until 1..2160. The bullish bias remains dominant today, especially over the 1.2015 level. However, the EUR/USD pair has recently formed a tweezers top pattern around 1.2076, suggesting the odds of bearish retracement. In this case, the EUR/USD can also drop until the support level of 1.2017 that marks 23.6% Fibonacci retracement. Let’s keep an eye on the 1.2060 support level today. 

GBP/USD – Daily Analysis

The GBP/USD closed at 1.34224 after placing a high of 1.34424 and a low of 1.33149. After placing losses for three consecutive days, the GBP/USD pair rose on Tuesday and recorded gains on the back of broad-based U.S. dollar weakness and increased Brexit hopes. The GBP/USD pair hit the highs at 1.3400 level on Tuesday over the positive Brexit news after the Times Radio’s Chief Political Commentator Tom Newton Dunn tweeted the U.K. and E.U. trade deal talks have entered a mythical tunnel. Though either side formally confirmed or rejected the “tunnel” status of negotiations after his tweet. 

The tunnel refers to a state of intense negotiation that essentially ends up having some agreement between both parties, and before that, neither side leaves. Though it does not guarantee a deal will be made, it shows a strong willingness/commitment from both sides to work as hard as possible to get a compromise. After this tweet by Dunn, the GBP/USD pair started to gain traction and rise in the financial market due to increased demand for British Pound. 

On the other hand, the GBP/USD pair’s gains could also be attributed to the U.S. dollar’s weakness. The greenback was weak across the board after the release of poor macroeconomic data and the rising number of coronavirus cases in the U.S.

The top U.S. health officials announced plans on Tuesday to begin vaccinating Americans against the coronavirus as early as mid-December amid the increasing death from coronavirus. The nationwide deaths hit the highest number for a single day in six months in the U.S. and raised economic recovery fears that led to the U.S. dollar’s weakness and improved GBP/USD pair.

On the data front, at 20:00 GMT, the ISM Manufacturing PMI for November declined to 5.75 against the estimated 5.9 and weighed on the U.S. dollar and supported the bullish momentum of the GBP/USD pair. For October, the Construction Spending rose to 1.3% against the projected 0.8% and helped the U.S. dollar. The ISM Manufacturing Prices for November also raised to 65.4 against the estimated 65.0 and supported the U.S. dollar. The Wards Total Vehicle Sales from the U.S. fell to 15.6M against the anticipated 16.1M and weighed on the U.S. dollar that added further gains in GBP/USD pair.

On Britain front, at 12:00 GMT, the Nationwide HPI for November raised to 0.9% against the forecasted 0.2% and supported the British Pound that added further gains in GBP/USD pair on Tuesday. At 14:30 GMT, the Final Manufacturing PMI also raised to 55.6 against the expected 55.2 and supported the British Pound that added further gains in GBP/USD pair.

Daily Technical Levels

Support   Resistance

1.3316       1.3342

1.3301       1.3353

1.3290       1.3368

Pivot point: 1.3327

GBP/USD– Trading Tip

The GBP/USD is trading sideways, having violated the narrow trading range of 1.3397 – 1.3304. The market is expected to display choppy sessions with a new limited range of 1.3397 to 1.3452 level. The violation of a triple top resistance level of 1.3397 level is now working as a support, and it may trigger a bounce off in the Cable until 1.3452 and 1.3512 level. Let’s keep an eye on the 1.3397 level to stay bullish above this level today. 

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 104.305 after placing a high of 104.576 and a low of 104.180. The USD/JPY pair stayed on a bullish track on Tuesday despite the broad-based U.S. dollar weakness due to increased risk flow in the market. The stock markets have been buoyed by the news that the first coronavirus vaccine could be administered by the end of the year. Despite the acceleration of the pandemic in the U.S. and many other parts of the world, the riskier assets gained on the back of improved risk sentiment due to vaccine hopes. The U.S. Dollar Index (DXY) that measures the U.S. dollar value against the six currencies basket fell to 92 levels on Tuesday.

The pair rose above 104.5 level on Tuesday amid the broad-based risk sentiment in the market over the optimism surrounding the vaccine hopes. However, the gains in USD.JPY pair started to fade away in the late trading session after the US ISM Manufacturing PMI release for November. In November, the declining manufacturing activity was the proof of halted manufacturing activity due to the rising number of restrictive measures in many states of America due to escalated second wave of coronavirus.

At 04:30 GMT, the Unemployment Rate from Japan for October remained flat with the expectations of 3.1%. At 04:50 GMT, the Capital Spending for the quarter from Japan came in as -10.6% against the expected -12.0% and supported the Japanese Yen that limited the USD/JPY pair’s gains. AT 05:30 GMT, the Final Manufacturing PMI from Japan also raised to 49.0 against the expected 48.3 and supported the Japanese Yen that capped further gains in the USD/JPY pair.

On the U.S. dollar front, at 20:00 GMT, the ISM Manufacturing PMI for November fell to 5.75 against the projected 5.9 and weighed on the U.S. dollar that capped further gains in the USD/JPY pair. For October, the Construction Spending surged to 1.3% against the estimated 0.8% and supported the U.S. dollar and added gains in the USD/JPY pair. The ISM Manufacturing Prices for November also rose to 65.4 against the expected 65.0 and helped the U.S. dollar that added additional gains in the USD/JPY pair. The Wards Total Vehicle Sales from the U.S. dropped to 15.6M against the expected 16.1M and weighed on the U.S. dollar that capped further gains in the USD/JPY pair.

Meanwhile, the U.S. death rate because of the COVID-19 virus has also increased to an alarming level as it posted the highest number for a single day in six months. The Top U.S. health official announced plans on Tuesday to begin vaccinating Americans against the coronavirus as early as mid-December. This statement also raised the risk sentiment and added weight on the Japanese Yen that supported the USD/JPY pair’s upward momentum on Tuesday.

Furthermore, On Tuesday, Federal Reserve Chairman Jerome Powell said that the United States economy’s outlook was extraordinarily uncertain due to increased numbers of coronavirus cases that have affected the U.S. economy hardly. 

In his testimony to the U.S. Senate Committee on Banking, Housing and Urban Affairs, Powell said that the increasing number of COVID-19 cases in the U.S. and abroad were concerning. He said that until the people were confident about re-engaging the economic activities confidently, full economic recovery was impossible. At the same time, Powell was upbeat over the recent optimistic news on vaccine development worldwide.

Meanwhile, several programs set by the Federal Reserve in March are near to end of the year. In response to this, Powell stated that these programs would help unlock almost $2 trillion funding. After this report, the USD/JPY pair started losing its early daily gains as the greenback became weak across the board due to rising hopes for stimulus measure.

Furthermore, On Tuesday, the outgoing Treasury Secretary Steven Mnuchin also testified before the Senate and urged lawmakers to pass a second stimulus bill quickly. This also added in the U.S. dollar weakness and capped further gains in the USD/JPY pair on Tuesday.

Daily Technical Levels

Support   Resistance

104.03       104.16

103.97       104.23

103.91       104.29

Pivot point: 104.10

USD/JPY – Trading Tips

The USD/JPY is trading with a sideways trading range of 104.600 – 104.200, holding below an immediate resistance level of 104.600. On the lower side, the safe-haven currency pair may find support at the 103.719 level. The pair seems to disrupt the resistance level of 104.600, and if this happens, the USD/JPY may soar until the next resistance area of 105.030 level. The MACD and RSI support the buying trend, but we should only take buying positions over the 104.600 level today. Good luck!

Categories
Forex Elliott Wave Forex Market Analysis

Is AUDUSD Turning Bearish?

In our previous technical analysis of the AUDUSD pair, we mentioned the potential corrective formation that was developing. In particular, we warned about the progress of an incomplete fourth wave of Minute degree identified in black, in which the pair was advancing on the wave (b) of Minutette degree in blue.

In our previous technical analysis of the AUDUSD pair, we mentioned the potential corrective formation that was developing. In particular, we warned about the progress of an incomplete fourth wave of Minute degree identified in black, in which the pair was advancing on the wave (b) of Minutette degree in blue.

In our previous technical analysis of the AUDUSD pair, we mentioned the potential corrective formation that was developing. In particular, we warned about the progress of an incomplete fourth wave of Minute degree identified in black, in which the pair was advancing on the wave (b) of Minutette degree in blue.

Technical Overview

As the previous chart shows, the price action seems moving in a mid-term sideways channel. This formation has been evolving since early September, when the price topped at 0.74134. In terms of the Elliott Wave theory, the figure shows the progression of a likely incomplete flat pattern (3-3-5).

In this context, the bearish rejection below September’s high of 0.74134 should confirm the end of wave (b), in blue, and the beginning of wave (c). Also, according to Elliott’s textbook, the coming wave (c) should follow an internal sequence subdivided into five waves.

The big picture of the AUDUSD pair currently reveals the gray box’s rejection suggested in our previous analysis. From here, the Aussie could start to decline in a five-wave sequence corresponding to the already mentioned wave (c) of Minuette degree, labeled in blue. 

Moreover, after wave (c) completes, the Australian currency should also end its wave ((iv)) of Minute degree in black and giving way to a new impulsive wave corresponding to the fifth wave of the same degree.

Short-term Technical Outlook

The AUDUSD price exposed in the next 2-hour chart reveals the completion of wave c of Subminuette degree identified in green, which topped at 0.74076 on November 30th, as the price action developed an ending diagonal pattern.

Once the price touched the psychological barrier of 0.74, the price began to decline, developing a breakdown below the baseline of the ending diagonal pattern, piercing the demand zone between 0.73492 and 1.73571, where the Aussie started a consolidation in the current trading session.

Considering that the pair started to consolidate, we expect an intraday sideways formation, likely a flag pattern. In this context, if the price breaks and closes below the baseline of this flag pattern, the AUDUSD could confirm the bearish continuation, which could make it drop to the next demand zone between 0.72654 and 0.72801.

Likewise, the price could extend its declines toward the next demand zone between 0.71449 and 0.71651. The movement, developed into a five-wave sequence, should complete the wave (c) of Minuette degree identified in blue, which, at the same time, could confirm the end of wave ((iv)) of Minute degree labeled in black, as we said earlier.

The invalidation level corresponding to this downward scenario is placed at the high of wave c, in green,  0.74076.

Categories
Forex Signals

EUR/JPY Bullish Engulfing Signals Further Buying – Quick Signal Update!

During Tuesday’s early European trading session, the EUR/JPY currency pair managed to extend its overnight bullish streak and drew some further bids around closer to the 125.00 level mainly due to the market risk-on mood, which tends to undermine the safe-haven Japanese yen and contributes to the currency pair gains. Hence, the market trading sentiment was being supported by the prospects of a COVID-19 vaccine.

During Tuesday’s early European trading session, the EUR/JPY currency pair managed to extend its overnight bullish streak and drew some further bids around closer to the 125.00 level mainly due to the market risk-on mood, which tends to undermine the safe-haven Japanese yen and contributes to the currency pair gains. Hence, the market trading sentiment was being supported by the prospects of a COVID-19 vaccine.

During Tuesday’s early European trading session, the EUR/JPY currency pair managed to extend its overnight bullish streak and drew some further bids around closer to the 125.00 level mainly due to the market risk-on mood, which tends to undermine the safe-haven Japanese yen and contributes to the currency pair gains. Hence, the market trading sentiment was being supported by the prospects of a COVID-19 vaccine.

Across the pond, the shared currency upticks also played a significant role in underpinning the currency pair. On the contrary, the long-lasting coronavirus woes in the U.S. and Europe keep challenging the upbeat market sentiment, which becomes the key factor that kept the lid on any additional gains in the currency pair.

On the contrary, the intensifying coronavirus woes across the globe and intensifying lockdowns restrictions in Europe and the U.S. keep challenging the upbeat market performance and become the key factor that kept the lid on any additional gains in the currency pair.

In the absence of the key data/events on the day, the market traders will keep their eyes on US ISM Manufacturing PMI for November and original comments from the Fed Chair’s Testimony for fresh impetus. In addition to this, the updates about the U.S. stimulus package will also be key to watch. In the meantime, the risk catalyst like geopolitics and the virus woes, not to forget the Brexit, will not lose their importance.


Daily Support and Resistance
S1 122.99
S2 123.8
S3 124.11
Pivot Point 124.62
R1 124.93
R2 125.44
R3 126.25

The EUR/JPY has violated the resistance level of 124.780, and above this, the pair has the potential to go after the 125.530 level. However, if the EUR/JPY pair fails to stay over 124.750 support, the odds of bearish reversal will also remain solid. The leading indicator, such as MACD is supporting the buying trend. Checkout a trade setup below.

Entry Price – Buy 124.898

Stop Loss – 124.498

Take Profit – 125.298

Risk to Reward – 1:1

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

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

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Categories
Forex Market Analysis

Daily F.X. Analysis, December 01 – Top Trade Setups In Forex – Manufacturing PMI Figures in Highlights!

Eyes will remain on the series of Manufacturing PMI figures from the Eurozone, UK, Canada, and the U.S. Although it is a low impact event, it may help determine the market sentiment today. The U.S. Fed Chair Powell will be in highlight as he is due to testify on the CARES Act before the Committee on Banking, Housing, and Urban Affairs, in Washington DC. Lastly, the ECB President Lagarde is also due to speak at an online event hosted by the Atlantic Council; however, it is now expected to significantly influence the Euro.

Eyes will remain on the series of Manufacturing PMI figures from the Eurozone, UK, Canada, and the U.S. Although it is a low impact event, it may help determine the market sentiment today. The U.S. Fed Chair Powell will be in highlight as he is due to testify on the CARES Act before the Committee on Banking, Housing, and Urban Affairs, in Washington DC. Lastly, the ECB President Lagarde is also due to speak at an online event hosted by the Atlantic Council; however, it is now expected to significantly influence the Euro.

Eyes will remain on the series of Manufacturing PMI figures from the Eurozone, UK, Canada, and the U.S. Although it is a low impact event, it may help determine the market sentiment today. The U.S. Fed Chair Powell will be in highlight as he is due to testify on the CARES Act before the Committee on Banking, Housing, and Urban Affairs, in Washington DC. Lastly, the ECB President Lagarde is also due to speak at an online event hosted by the Atlantic Council; however, it is now expected to significantly influence the Euro.

Economic Events to Watch Today  

EUR/USD – Daily Analysis

The EUR/USD closed at 1.19547 after placing a high of 1.20030 and a low of 1.19235. The currency pair EUR/USD surpassed the 1.20000 level on Monday amid the rising risk sentiment in the market and decreasing U.S. dollar; however, the pair started to lose its gains and ended up posting losses for the day.

The EUR/USD pair continued its bullish movement in the early trading session on Monday as the risk sentiment improved with more positive news from the coronavirus vaccine side. Pfizer has sent the first mass shipment of its vaccine to Chicago on Monday. Whereas, Moderna has applied for emergency use authorization of its vaccine from the US FDA on Monday. Both these latest reports from the vaccine side added further strength in the risk sentiment as it showed progress in steps that would eventually lead to global economic recovery.
The improved risk sentiment because of optimism regarding vaccine and economic recovery gave strength to riskier assets like EUR/USD pair on Monday.

Meanwhile, the U.S. dollar’s weakness also played an essential role in raising the currency pair EUR/USD above the 1.2000 level. The U.S. dollar was weak across the board due to the latest announcement that Congress has started its brief session to pass the next stimulus package for coronavirus.

Furthermore, both sides’ macroeconomic data were also in favor of pushing the currency pair EUR/USD near its mid-August high level on Monday. From the European Union side, The German Prelim CPI for November came in as -0.8% against the forecasted -0.7% and weighed on the single currency Euro. At 13:00 GMT, Spanish Flash CPI for the year came in as -0.8% against the forecasted -0.9% and supported Euro. At 15:00 GMT, the Italian Prelim CPI for November came in as -0.1%against the forecasted -0.2% and supported the single currency Euro.

On the U.S. dollar front, At 19:45 GMT, the Chicago PMI for November dropped to 58.2 against the anticipated 59.4 and weighed on the U.S. dollar. At 20:00 GMT, the Pending Home Sales for October fell to -1.1% against the estimated 1.1% and weighed on the U.S. dollar. However, the gains in the EUR/USD pair failed to remain till the end of the trading day and started to reverse in late trading hours amid the concerns of coronavirus pandemic in Europe. The outlook for the largest economy in the Eurozone, Germany, became increasingly uncertain due to the rising number of coronavirus cases surpassed above 1 Million.

Daily Technical Levels

Support   Resistance

1.1962       1.1976
1.1954       1.1982
1.1948       1.1991
Pivot point: 1.1968

EUR/USD– Trading Tip

The market’s technical side remains mostly unchanged on the back of a limited number of economic events on the calendar. The EUR/USD pair is trading with a bullish bias at the 1.1955 area, facing immediate resistance at the 1.2000 area. Closing of candles above the 1.1915 support level suggests odds of bullish bias in the EUR/USD as this level is extended by an ascending triangle breakout pattern. On the lower side, the EUR/USD may find support at the 1.1912 and the 1.1865 areas; however, bullish bias remains stable over the 1.1912 level.

GBP/USD – Daily Analysis

The GBP/USD closed at 1.33229 after placing a high of 1.33856 and a low of 1.32911. The GBP/USD pair tried to rise and post gains for Monday but failed to do so and continued its bearish streak for the third consecutive day. The rise in GBP/USD pair in the earlier trading session on Monday was due to the hopes that there was little progress in Brexit talks between U.K. and E.U. to settle disputes on several issues, including the fishing quotas.

The rise in British Pound was due to the latest comments from French European Affairs Minister Clement Beaune. On Monday, he said that he hoped to see an agreement in the next few days and called on negotiators to leap required. He acknowledged that two sticking issues, U.K. fishing waters and the so-called level-playing field for business, are still unresolved.

As both sides have already warned each other that the time was running out, a French presidency official said on Monday that Britain should clarify its positions and consult to find a Brexit deal on its association with the European Union. He added that the E.U. also has the interest to fight for, to give fair competition for its businesses and fishermen. He said that the Union has made a clear and balanced offer for a future partnership with Britain and that the E.U. will not accept a substandard deal that would not respect the E.U.’s interests.

On the other hand, Boris Johnson’s officials believed that the Brexit trade deal could be reached within days if both sides continue working in good faith to resolve fishing rights’ big obstacle. The U.K.’s Foreign Secretary Dominic Raab called on the E.U. to recognize that regaining control over British waters was the question of sovereignty for Britain. He said that talks were going good and he believed a deal on fish might be achievable during the final week of talks.

These optimistic and hopeful comments from both sides added strength to the GBP/USD pair on Monday during the early trading session. Still, the currency pair failed to maintain its gains and started to decline and post losses for the day despite the broad-based U.S. dollar weakness due to insufficient macroeconomic data on the day.

On the U.S. dollar front, at 19:45 GMT, the Chicago PMI for November fell to 58.2 against the estimated 59.4 and weighed on the U.S. dollar. At 20:00 GMT, the Pending Home Sales for October also declined to -1.1% against the projected 1.1% and weighed on the U.S. dollar that capped further losses in GBP/USD pair.

From the Britain side, at 14:30 GMT, the M4 Money Supply for October from Britain was dropped to 0.6% against the forecasted 1.0% and weighed on British Pound and added further losses in GBP/USD pair. The Net Lending to Individuals for October also declined to 3.7B against the expected 4.7B and weighed on British Pound and supported the bearish momentum in GBP/USD pair. At 14:32 GMT, Mortgage Approvals for October raised to 98K against the anticipated 85K and supported British Pound and capped further losses in the currency pair.

Meanwhile, the GBP/USD pair’s bearish trend was continued for the third consecutive day because of the rising fears that the U.K. and E.U. will end up having no-deal at the end of the transition period that is due on December 31. Only a month has left behind to resolve both parties’ issues, and none of them has shown any lenience. If both sides failed to reach a deal by the end of the deadline, then the U.K. will be forced to trade with the E.U. under the World Trade Organization terms that will not be good for both sides.


Daily Technical Levels

Support   Resistance

1.3316       1.3342
1.3301       1.3353
1.3290       1.3368
Pivot point: 1.3327

GBP/USD– Trading Tip

The GBP/USD is trading sideways, within a narrow trading range of 1.3397 – 1.3304. The market is likely to exhibit choppy sessions until this narrow trading range gets violated. On the higher side, the GBP/USD is facing a triple top level at the 1.3397 level; however, the bullish breakout of the 1.3397 level can trigger a buying trend until the 1.3454 level. On the lower side, the Cable is supported over 1.3350 level, supported by an upward channel on the four hourly charts. The MACD suggests a buying trend, and we should look for a buy trade over the 1.3325 level or 1.3400 level today.

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 104.289 after placing a high of 104.384 and a low of 103.830. After placing losses for two consecutive days, the USD/JPY pair rose on Monday as the U.S. dollar rebounds.

The broad-based U.S. dollar weakness in the early trading session pushed the USD/JPY pair lower after the hopes for the U.S. stimulus measure raised. However, Wall Street’s main indexes’ poor performance allowed the U.S. dollar to remain firm against its peers. The Dow Jones Industrial Average and the S&P 500 indexes lost about 1.2% and 0.78% respectively on Monday, which added strength to the U.S. dollar and pushed the USD/JPY pair higher.

Meanwhile, on Monday, US Health Secretary Alex Azar said that Americans could get their first shot of coronavirus vaccine before Christmas if all thing went well. These comments from Azar added further strength in risk-sentiment and weighed on the safe metal Japanese Yen that added gains in USD/JPY pair. Furthermore, on Monday, Moderna applied for emergency authorization with the U.S. Food and Drug Administration to start using its vaccine to reduce the effect of coronavirus. Pfizer and BioNtech, which has already filed for similar FDA approval earlier this month, sent the first mass shipment of its COVID-19 vaccine to Chicago through United Airlines on Friday. This positive news from the drug companies added optimism in the market and weighed on the safe-haven Japanese Yen that added further gains in the USD/JPY pair.

On the data front, at 04:50 GMT, the Prelim Industrial Production for October from Japan raised to 3.8% against the forecasted 2.3% and supported the Japanese Yen that capped further gains in the USD/JPY pair. The Retail Sales for the year from Japan stayed the same as expected by 6.4%. At 10:00 GMT, the Housing Starts for the year came from Japan came in as -8.3% against the forecasted -9.0% and supported the Japanese Yen.

On the U.S. dollar front, at 19:45 GMT, the Chicago PMI for November declined to 58.2 against the expected 59.4 and weighed on the U.S. dollar that capped further gains in the USD/JPY pair. At 20:00 GMT, the Pending Home Sales for October fell to -1.1% against the estimated 1.1% and weighed on the U.S. dollar that capped further gains in the USD/JPY pair.
Another factor involved in the risk sentiment that supported the upward momentum of the USD/JPY pair on Monday was the start of a brief session of Congress over the issue of a second stimulus bill for the coronavirus pandemic. The Democrats and Republicans were under dispute over the size of the stimulus package, and now that the Presidency has shifted from Republicans to Democrats after the victory of Joe Biden, it could be expected that a massive stimulus is on its way that would curb the effects of COVID-19 and support the risk sentiment of the market. The improved risk demand added pressure on the safe-haven Japanese yen and supported the USD/JPY pair on Monday. Another factor involved in the gains of the US/JPY pair was Pfizer’s vaccine’s shipment to Chicago on Monday, along with the latest application by Moderna to FDA for emergency use authorization of its vaccine.

Daily Technical Levels

Support   Resistance

104.03       104.16
103.97       104.23
103.91      104.29
Pivot point: 104.10

USD/JPY – Trading Tips

The USD/JPY is trading with a sideways trading range of 104.475, holding below an immediate resistance level of 104.478. On the lower side, the safe-haven currency pair may find support at the 103.719 level. The pair seems to disrupt the resistance level of 104.478, and if this happens, the USD/JPY may soar until the next resistance area of 105.030 level. The MACD and RSI support the buying trend, but we should only take buying positions over the 104.500 level today. Good luck!

Categories
Forex Elliott Wave Forex Market Analysis Forex Signals

Is EURNZD Developing a Terminal Formation?

The EURNZD cross presents a downward sequence in its 12-hour chart that began on August 20th when the price found fresh sellers at 1.82238. This sequence formed three internal segments and, recently, is likely forming a reversal movement in the following trading sessions.

Technical Overview

The previous chart illustrates the bearish primary trend identified with the descending trendline, drawn in blue. Moreover, the secondary trend, plotted in green, reveals an aggressive decline that is happening since October 20th when the cross found resistance at 1.80212. But we see all that the EURNZD price seems to have found support on November 23rd on 1.69472. Currently, the price action appears consolidating in a narrow range between 1.69622 and 1.70645.

In Elliott Wave theory terms, the cross is advancing in an incomplete downward corrective sequence of Minute degree identified in black, which currently is drawing its wave ((c)). Likewise, its internal structure suggests the progress in the fifth wave of Minuette degree labeled in blue.

The following 2-hour chart reveals the EURNZD cross is moving mostly sideways following a descending wedge breakout, or in terms of the Elliott Wave theory, an ending diagonal breakout. 

Nevertheless, the bullish reversal is still unconfirmed as long as the cross keeps moving below the level of 1.70486.

Short-term Technical Outlook

The EURNZD cross shown in its 2-hour chart below presents a sideways movement below the pivot level of 1.70486, which could correspond to the fifth wave of Minuette degree, labeled in blue. 

Considering that the cross remains in a consolidation structure, there are two potential scenarios:

  • The first scenario occurs if the price action breaks and closes above the 1.70486 pivot level. In this case, the EURNZD could develop an upward movement. According to the Dow Theory, the cross should make an upward motion to the area between 1.73016 and 1.76560. Likewise, the invalidation level for this reversal scenario is seen on 1.69472, which corresponds to the low made on November 24th.
  • The second scenario calls for the price to drop and close below the 1.69472 level. If that happens, the cross could continue its decline toward the lows zone made in January, near the 1.6650 level. The price could find support and complete the wave ((c)) of Minute degree labeled in black. In this scenario, the invalidation level would be located above the last relevant swing high of 1.70961.

However, let’s remember that as long as the price doesn’t confirm any breakout, bullish, or bearish, the bias should be kept neutral.

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Forex Signals

EUR/AUD Violates Downward Trendline – Buy Signal Update!


Entry Price – Buy 1.6243

Stop Loss – 1.62496

Take Profit – 1.6283

Risk to Reward – 1:1

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

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

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

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

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

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Forex Signals

EUR/JPY Triple Top Breakout – Brace for a Buy Trade

The EUR/JPY currency pair failed to stop its early-day losing streak and still flashing red around below 124.50 level mainly due to the intensifying coronavirus cases across Eurozone and lockdown restrictions in France and Germany, which keep fueling the worries over the Eurozone economic recovery and undermines the shared currency. These concerns got further lifted after the German Economic Minister Peter Altmaier said that COVID-19 infection numbers are still much too high in most regions, which adds further burden around the shared currency and contributes to the currency pair losses.

The EUR/JPY currency pair failed to stop its early-day losing streak and still flashing red around below 124.50 level mainly due to the intensifying coronavirus cases across Eurozone and lockdown restrictions in France and Germany, which keep fueling the worries over the Eurozone economic recovery and undermines the shared currency. These concerns got further lifted after the German Economic Minister Peter Altmaier said that COVID-19 infection numbers are still much too high in most regions, which adds further burden around the shared currency and contributes to the currency pair losses.

The EUR/JPY currency pair failed to stop its early-day losing streak and still flashing red around below 124.50 level mainly due to the intensifying coronavirus cases across Eurozone and lockdown restrictions in France and Germany, which keep fueling the worries over the Eurozone economic recovery and undermines the shared currency. These concerns got further lifted after the German Economic Minister Peter Altmaier said that COVID-19 infection numbers are still much too high in most regions, which adds further burden around the shared currency and contributes to the currency pair losses.

Across the pond, the prevalent optimism over a potential vaccine for the highly dangerous coronavirus infection urges investors to retreat from the safe-haven Japanese yen, which could be considered one of the key factors that help the currency pair to limit its deeper losses.

In the meantime, the Japanese Finance Minister Taro Aso said that the Japanese economy remains severe due to the COVID-19 virus, which added further burden around the Japanese yen and becomes the key factor that kept the lid on any additional losses in the currency pair. At this moment, the USD/CHF currency pair is currently trading at 0.9029 and consolidating in the range between 124.31 – 124.67

It is worth recalling that the prevalent optimism over a possible vaccine for the highly infectious coronavirus disease keeps boosting the market risk tone. However, the hopes of the vaccine were boosted after pharmaceutical regulators from the US, Europe, and the UK showed readiness for approving the leading vaccines that have shown almost 90% effective rates during the final rates, which in turn, boosted the hopes of the early arrival of the much-awaited cure to the pandemic. Thereby, the risk-on market mood tends to undermine the safe-haven Japanese yen, which becomes the key factor that lends some support to the currency pair to ease the intraday bearish pressure surrounding the EUR/PY currency pair.

On the other side, the rising coronavirus cases across Eurozone and back-to-back lockdown restrictions in Germany and Franc keep the shared currency under pressure. As per the latest report, German Economic Minister Peter Altmaier said that the COVID-19 infection numbers are still much too high in most regions, putting further pressure around the single currency and contributing to the currency pair declines.

On the contrary, the intensifying market worries regarding the continuous surge in new coronavirus cases in the US and Europe, which keep fueling the concerns over the global economic recovery through imposing new lockdown restrictions on economic and social activity, keep trying to probe the upbeat market performance. Apart from this, the long-lasting inability to pass the US fiscal package and the uncertainty over Brexit, and fears of a full-fledged trade/political war between the West and China also challenging the market risk-on mood, which might push the currency pair further down.

In the absence of significant data/events on the day, the market traders will keep their eyes on the US NFP data, which is due later this week. In addition to this, the updates about the US stimulus package will also be key to watch. In the meantime, the risk catalyst like geopolitics and the virus woes, not to forget the Brexit, will also be key to watch for a fresh direction.

Daily Support and Resistance

S1 122.99
S2 123.66
S3 124.09
Pivot Point 124.33
R1 124.76
R2 125
R3 125.66


The EURJPY has violated the triple top resistance level of 124.730 level and above this it has strong odds of soaring until 125.450. Thus, we have entered the buying trade to capture quick green pips in the market.

Entry Price – Buy 124.932

Stop Loss – 124.532

Take Profit – 125.332

Risk to Reward – 1:1

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

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

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

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

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

Categories
Forex Elliott Wave Forex Market Analysis Forex Price Action Forex Technical Analysis

Is EURGBP Ready for a Fresh Rally?

In our latest EURGBP technical analysis, we commented on the cross moving in an incomplete sideways corrective formation of Minor degree, identified in green. Its internal structure suggested the completion of a double-three pattern of Minute degree.

In our latest EURGBP technical analysis, we commented on the cross moving in an incomplete sideways corrective formation of Minor degree, identified in green. Its internal structure suggested the completion of a double-three pattern of Minute degree.

In our latest EURGBP technical analysis, we commented on the cross moving in an incomplete sideways corrective formation of Minor degree, identified in green. Its internal structure suggested the completion of a double-three pattern of Minute degree.

Also, we saw the pierce and bounce of the September 03rd low at 0.8658, when EURGBP dropped to 0.88610, found fresh buyers there, and created an intraday impulsive move identified as the first wave of Minute degree, labeled in black.

As the next 4-hour chart shows, once the EURGBP cross completed its first wave, in black that belongs to wave C, in green, it reacted mostly bearish, developing a correction, extending the move below our forecasted area, and testing the lows of the previous bullish impulsive move.

The breakout of the short-term descending trendline confirmed the end of wave ((ii)) of Minute degree and the beginning of the third wave of the same degree, which remains in progress.

Likewise, in the last chart, we distinguish the advance of the third wave of Minuette degree identified in blue in its internal structure.

Short-term Technical Outlook

The short-term Elliott Wave view of the EURGBP cross, unveiled in the below 4-hour chart, reveals the breakout of the descending trendline that follows the wave ((ii)) identified in black, which suggests the beginning of a new rally.

Once the price found fresh buyers at 0.88998, the cross began to advance mostly bullish in an impulsive sequence of Minuette degree, identified in blue, that remains in progress. This upward move corresponds to the internal structural series of wave ((iii)) of Minute degree that belongs to wave C of Minor degree, in green.

Furthermore, considering the reduced period it took for the first stage of wave (iii) to complete, It is plausible that the third wave in progress will be the extended wave, as the Elliott Wave theory states that only one extended wave would occur in an impulsive structure. 

In this context, the current upward move could advance to the next supply zone between 0.90446 until 0.90686. But, if the cross maintains its bullish momentum, it could strike the next potential target zone between 0.91260 and 0.91464.

Finally, the current bullish scenario’s invalidation level is 0.88610, which corresponds to the origin of the wave C in green.

 

Categories
Forex Market Analysis

Daily F.X. Analysis, November 30 – Top Trade Setups In Forex – ECB President Lagarde Speaks!

On the news front, the eye will remain on the ECB President Lagarde Speaks, OPEC Meetings, Chicago PMI, and Pending Home Sales m/m. The U.S. events are expected to perform badly, and the dollar index can bear a bearish hit.

On the news front, the eye will remain on the ECB President Lagarde Speaks, OPEC Meetings, Chicago PMI, and Pending Home Sales m/m. The U.S. events are expected to perform badly, and the dollar index can bear a bearish hit.

On the news front, the eye will remain on the ECB President Lagarde Speaks, OPEC Meetings, Chicago PMI, and Pending Home Sales m/m. The U.S. events are expected to perform badly, and the dollar index can bear a bearish hit.

Economic Events to Watch Today  

EUR/USD – Daily Analysis

The EUR/USD pair was closed at 1.19637 after placing a high of 1.19637 and a low of 1.19060. EUR/USD pair raised near its highest level since August amid the increasing risk-on sentiment. Due to Thanksgiving celebrations, the EUR/USD pair continued to move higher in the upward direction in the absence of U.S. traders.

The risk perceived EUR/USD pair gained traction on Friday after the optimism surrounding the market related to the coronavirus vaccine increased. The hopes for a quick economic recovery also increased along with the vaccine progress and supported the market’s risk sentiment that lifted the global equity market on Friday.

The news regarding vaccines from several candidates and their efficacy rates raised hopes that the economy would come back to its pre-pandemic levels, and that weighed on the safe-haven greenback. The U.S. dollar was also weak across the board after the smooth transition of the White House. Joe Biden is set to take power on January 20, and he is expected to work on a second stimulus bill that would weigh on the U.S. dollar.

The U.S. Dollar Index (DXY) that measures the U.S. dollar value against the six currencies basket was also under pressure and at a new monthly low level at 91.8 level on Friday. The U.S. dollar weakness combined with the vaccine optimism added strength in the EUR/USD pair and helped it reach near its highest since mid-August level.

Meanwhile, the single currency Euro was also strong on Friday after releasing strong macroeconomic data from the European Union. At 12:00 GMT, German Import Prices for October raised to 0.3% against the expected 0.1% and supported Euro. At 12:45 GMT, the French Consumer Spending for October also raised to 3.7% from the forecasted 3.6% and supported the single currency Euro. The French Prelim CPI for November surged to 0.2% against the forecasted 0.0% and supported Euro. The French Prelim GDP for the quarter also surged to 18.7% against the anticipated 18.2% and supported Euro. The Euro’s strength added further gains in the already rising EUR/USD pair and pushed it higher on board.
The rising risk sentiment in the market also supported the stock market worldwide as the outlook of the upcoming year 2021 was improved due to the successful development of the coronavirus vaccine.

Furthermore, the victory of Joe Biden in the U.S. Presidential elections also added positivity to the market mood because he has signaled a more promising approach toward international relations, unlike Trump. Due to his promise of keeping smooth trade relations with China and other countries, the favorable global trade conditions improved the global risk sentiment and supported the riskier assets like EUR/USD pair.

Daily Technical Levels

Support   Resistance

1.1885      1.1934

1.1859      1.1957

1.1836      1.1983

Pivot point: 1.1908

EUR/USD– Trading Tip

The EUR/USD pair is trading with a bullish bias at the 1.1974 area, facing immediate resistance at the 1.1975 area. Closing of candles below this level suggests chances of bearish correction as the pair has entered the overbought zone. However, the bullish breakout of the 1.1975 level can extend the buying trend until the next resistance level of the 1.2010 level. The bullish bias remains dominants today. Let us consider taking a selling trade below the 1.1979 level, and above this, the next target stays at 1.1997.

GBP/USD – Daily Analysis

The GBP/USD pair was closed at 1.33066 after placing a high of 1.33815 and a low of 1.32856. The GBP/USD pair continued its previous day’s bearish move and extended its losses on Friday amid the increased Brexit worries. Despite the positive risk environment in the market, the currency pair GBP/USD pair posted losses for the day on Friday as the deadline for the transition period was coming closer day by day, and a deal has still not been secured. With only 34 days left for the Brexit-transition period to end, the pressure on both sides, the E.U. and the U.K., has increased to reach a deal by Saturday to complete the required paper-work legislation process in time.

Chief EU negotiator Michel Barnier reached London for in-person talks after completing his quarantine, and this was the only positive news surrounding Brexit. UK PM Boris Johnson has said that the U.K. will prosper with or without a deal, and the likelihood of a deal is dependent on the E.U. There were still disagreements on Fisheries, governance, and level playing field that needed to sort out to reach a deal.

The rising uncertainty regarding Brexit has been weighing on the local currency British Pound. The E.U. Commission President Ursula von der Leyen, along with the E.U. chief negotiator Barnier, said that they do not know if a deal was possible as the talks were in progress.

On Friday, Barnier told MEPs that he was prepared for a further four days of make-or-break Brexit negotiations, with growing skepticism among E.U. member states about the utility of further talks. Barnier has said that he would work through the weekend and then maybe one-or-two more days in the last-ditch attempt to bridge the large gaps between both sides and reach a deal.

E.U. sources have said that there was a growing feeling that the lack of progress and the need to prepare businesses for the consequences of a no-deal British departure from the E.U. made it unwise for talks to continue beyond then. These concerning statements from both sides have weighed on British Pound and added losses in GBP/USD pair.
Whereas, the U.K.’s foreign minister Dominic Raab said on Sunday that the next week would be very significant for Brexit, in reply to how near the deadline was in trade talks with the European Union. He said that this was a very significant week, the last real major week, subject to further postponement.

As the last 4-6 days for securing a Brexit deal have reached, the local currency pressure also increased and weighed on Sterling that ultimately weighed o GBP/USD pair ahead of any decision despite the improved risk sentiment in the market because of vaccines progress.

Daily Technical Levels

Support   Resistance

1.3319     1.3397
1.3281     1.3437
1.3241     1.3475
Pivot point: 1.3359

GBP/USD– Trading Tip

The GBP/USD traded in line with our previous forecast to hit the support level of 1.333, which is extended by an upward channel. On the higher side, Cable may find resistance at 1.3400 level that’s extended by the double top pattern on the two-hour timeframe. Simultaneously, the bullish crossover of the 1.3400 level is likely to open additional room for buying until the 1.3446 level. On the 4 hour timeframe, the GBP/USD pair has formed a bullish channel that supports the pair at the 1.333 area, and violation of this level on the lower side can drive a sharp selling trend until the 1.3270 mark. The RSI and MACD are suggesting a selling trend in sterling. However, I will prefer to open a buying trade over the 1.3330 area and selling trade below the same level today.

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 104.064 after placing a high of 104.279 and a low of 103.904. Despite the improved risk-on market sentiment, the USD/JPY pair dropped for the second consecutive session amid the U.S. dollar weakness. The U.S. dollar weakness was driven by the increased expectations of a large-scale stimulus from the new Biden administration to combat the coronavirus pandemic. Joe Biden has been fighting to provide massive stimulus support to the economy to fight against the COVID-19 pandemic. As he has won the U.S. Presidential elections and is now due to take power on January 20, the chances for a massive stimulus fiscal support to the economy has increased and weighed on the U.S. dollar.

The U.S. Dollar Index (DXY) that tracks the greenback against a basket of six other currencies was down by 0.1% to a 3-months lower level at 91.8. The trade market volume was also limited, keeping the U.S. dollar under pressure due to Thanksgiving Holiday in the U.S. as many traders were enjoying a long weekend.

Meanwhile, the environment around U.S. politics also got better with President Trump’s latest decision to leave office regarding Electoral College votes for Biden. This smooth transition of power in the White House also supported the risk-on market sentiment and weighed over the safe-haven greenback that added losses in the currency pair USD/JPY.
Furthermore, on the data front, at 04:30 GMT, the Tokyo Core CPI for the year came in as -0.7% against the expected -0.6% and weighed on the Japanese Yen and capped further losses in the USD/JPY pair on Friday.
The risk-on market sentiment failed to impress the USD/JPY buyers. The traders were more focused on the U.S. dollar’s weakness instead of the rising optimism surrounding the global economic recovery due to vaccine development.

Several candidates worldwide, including Pfizer & BioNtech, Moderna, and AstraZeneca, have reported a 60-95% efficacy rate of their vaccine ad said that it would be available for use within weeks as some have applied for US FDA approval for emergency authorization use.

AstraZeneca vaccine is considered the cheapest vaccine as it can be stored at ordinary room temperature or refrigerator temperature, but it requires two dosages to reach a 90% efficacy rate. The hopes for global economic recovery and the outlook for 2021 have improved and weighed on the safe-haven U.S. dollar that ultimately added pressure on the USD/JPY pair.

Daily Technical Levels

Support   Resistance

104.27      104.63

104.09      104.79

103.92      104.98

Pivot point: 104.44

USD/JPY – Trading Tips

The USD/JPY pair’s recent price action has violated the choppy trading range of 104.700 – 104.056. On the lower side, the USD/JPY pair can drop further until the next support level of 103.667 level, especially after the breakout of the 104.150 support level. On the higher side, a bullish breakout of 104.700 resistance can extend the buying trend until the next resistance area of 104.700 and 105.063 level. On the lower side, the support continues to hold around the 103.667 level. The MACD suggests selling bias in the USD/JPY pair; thus, we should consider selling trade below 104.150 and buying above the same. Good luck!

Categories
Forex Elliott Wave Forex Market Analysis

EURJPY Advances from Demand Zone Forecasted

In mid-November, we commented about the technical market context of the EURJPY cross, as its big picture displayed in its weekly chart revealed a technical formation identified as a triangle pattern, which continues progressing since mid-2014.

Moreover, our previous mid-term Elliott wave analysis in its 12-hour chart revealed the advance of an incomplete corrective structure of Minor degree, which currently advances in wave B in green.

In this regard, our main outlook anticipated the progress in its wave ((b)) of Minute degree identified in black. The internal structure also suggested a limited decline toward the demand zone between 122.951 and 122.317. Once reached, the price could have completed the internal wave (b) of Minuette degree labeled in blue. 

Once the cross completed its wave (b), in blue, the cross should begin its wave (c), in blue, with a potential target in the supply zone between 125.285 and 126.123.

Technical Outlook

Currently, the EURJPY cross in its 12-hour chart reveals the bounce from the previous demand zone forecasted, where the price began to advance in its wave (c) in blue.

In the previous chart, we distinguish wave (c)‘s upward progress, which should evolve in a five-wave sequence according to the Elliott Wave theory. The figure also shows the potential target zone between 125.285 and the psychological barrier of 126.

This price landscape brings us three potential scenarios for the current upward movement:

  • First scenario: The EURJPY cross reaches the supply zone between 125.285 and 126.123, completing its wave ((b)) in black, and the price starts to decline in an internal five-wave sequence corresponding to wave ((c)).
  • Second scenario: The cross’ short-term rally fails to surpass the end of wave (a), in blue, and begins to decline. This scenario should be indicative of strong bearish pressure.
  • Third scenario: EURJY price action surpasses the invalidation level located on 127.075. In this case, the cross could be creating a bullish breakout of the long-term triangle, suggesting the continuation of the long-term bullish trend.

Nevertheless, before placing any position on the bearish side or continue on the bullish side, the price action must confirm the end of wave ((b)) in black.

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Forex Elliott Wave Forex Market Analysis Forex Technical Analysis

AUDNZD: Potential Bounce among Overall Weakness

This analysis discusses AUDUSD’s overall Elliott Structure, the likelihood of a short bounce in the AUDUSD, and its potential continuation.

This analysis discusses AUDUSD’s overall Elliott Structure, the likelihood of a short bounce in the AUDUSD, and its potential continuation.

This analysis discusses AUDUSD’s overall Elliott Structure, the likelihood of a short bounce in the AUDUSD, and its potential continuation.

Technical Overview

In our last AUDNZD technical analysis, the Oceanic cross was moving in an incomplete complex corrective sequence corresponding to wave (c) of Minuette degree labeled in blue, which belongs to wave ((y)) of Minute degree identified in black. 

As illustrated in the following 8-hour chart corresponding to our previous mid-November analysis, we commented on the broadening corrective formation the cross develops, which implies an acceleration of the downward sequence. Also, the move that pierced below the wave (a) in blue suggested further declines in the following trading sessions.

Likewise, we observed the potential bearish reaction areas for the decline until two potential demand zones. The first one located between 1.05186 and 1.04870, and the second one bounded between 1.03511 and 1.02864.

On the other hand, according to the Elliott wave theory, a complex corrective formation as a double-three pattern follows an internal sequence subdivided into 3-3-3, where each “three” corresponds to a single complete corrective wave.

Once completed, the current corrective structural series of wave 2 or B of Minor degree, the AUDNZD cross should give way to the start wave 3 or C, in green.

Technical Outlook

The AUDNZD cross in the next 8-hour chart exposes the price action advancing in its wave iii of Subminuette degree labeled in green, which belongs to the incomplete wave (c) of Minuette degree identified in blue. 

Considering the acceleration present in wave (c), the cross could develop an internal upward corrective movement corresponding to wave iv, in green. This move could find resistance in the adjacent supply zone between 1.0457 and 1.05603, where the cross could resume its downward movement, leading it to complete the wave ((y)) of Minute degree and, in consequence, wave 2 or B, in green. 

Once the current downward sequence finishes, the Oceanic cross will be ready for a new long-term rally corresponding to wave 3 or C, in green, which according to the Elliott wave theory, should be the largest wave of the impulsive sequence.

Finally, the invalidation level for the short-term bearish scenario is found at 1.07029, above the end of wave ii in green.

 

Categories
Forex Signals

GBP/USD Upward Trend in Play – Quick Update on Buy Signal! 

Our forex trading signal on the GBP/USD pair is doing well as the market has bounced off over the 1.3330 support level. On the higher side, Cable may find resistance at 1.3400 level that’s extended by the double top pattern on the two-hour timeframe. Simultaneously, the bullish crossover of the 1.3400 level is likely to open additional room for buying until the 1.3446 level. On the 4 hour timeframe, the GBP/USD pair has formed a bullish channel that supports the pair at the 1.333 area, and violation of this level on the lower side can drive a strong selling trend until the 1.3270 mark. The RSI and MACD are suggesting a selling trend in sterling. However, I will prefer to open a buying trade over the 1.3330 area today as the market has the potential to go after the 1.3400 level. 

Our forex trading signal on the GBP/USD pair is doing well as the market has bounced off over the 1.3330 support level. On the higher side, Cable may find resistance at 1.3400 level that’s extended by the double top pattern on the two-hour timeframe. Simultaneously, the bullish crossover of the 1.3400 level is likely to open additional room for buying until the 1.3446 level. On the 4 hour timeframe, the GBP/USD pair has formed a bullish channel that supports the pair at the 1.333 area, and violation of this level on the lower side can drive a strong selling trend until the 1.3270 mark. The RSI and MACD are suggesting a selling trend in sterling. However, I will prefer to open a buying trade over the 1.3330 area today as the market has the potential to go after the 1.3400 level. 

Our forex trading signal on the GBP/USD pair is doing well as the market has bounced off over the 1.3330 support level. On the higher side, Cable may find resistance at 1.3400 level that’s extended by the double top pattern on the two-hour timeframe. Simultaneously, the bullish crossover of the 1.3400 level is likely to open additional room for buying until the 1.3446 level. On the 4 hour timeframe, the GBP/USD pair has formed a bullish channel that supports the pair at the 1.333 area, and violation of this level on the lower side can drive a strong selling trend until the 1.3270 mark. The RSI and MACD are suggesting a selling trend in sterling. However, I will prefer to open a buying trade over the 1.3330 area today as the market has the potential to go after the 1.3400 level. 


Entry Price – Buy 1.33719

Stop Loss – 1.33319

Take Profit – 1.34119

Risk to Reward – 1:1

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

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

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

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

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

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Forex Market Analysis

Daily F.X. Analysis, November 27 – Top Trade Setups In Forex – French Events in Focus! 

The economic calendar is a bit muted on the last trading day of the week as investors seem to enjoy the Thanksgiving holiday. However, France is due to report few low impact economic events such as French Consumer Spending with a positive forecast of 3.6% vs. -5.1%, Prelim CPI m/m with a neutral forecast of 0.0%, and Prelim GDP with a neutral growth rate forecast of 18.2% vs. 18.2%. These events are likely to have a muted impact on the market today. 

The economic calendar is a bit muted on the last trading day of the week as investors seem to enjoy the Thanksgiving holiday. However, France is due to report few low impact economic events such as French Consumer Spending with a positive forecast of 3.6% vs. -5.1%, Prelim CPI m/m with a neutral forecast of 0.0%, and Prelim GDP with a neutral growth rate forecast of 18.2% vs. 18.2%. These events are likely to have a muted impact on the market today. 

The economic calendar is a bit muted on the last trading day of the week as investors seem to enjoy the Thanksgiving holiday. However, France is due to report few low impact economic events such as French Consumer Spending with a positive forecast of 3.6% vs. -5.1%, Prelim CPI m/m with a neutral forecast of 0.0%, and Prelim GDP with a neutral growth rate forecast of 18.2% vs. 18.2%. These events are likely to have a muted impact on the market today. 

 

Economic Events to Watch Today  

  

EUR/USD – Daily Analysis

The EUR/USD pair was closed at 1.19123 after placing a high of 1.19406 and a low of 1.18850. EUR/USD pair hit a fresh 2-months high on Thursday in the early trading session and started to decline and ended up posting losses for the day after the German Consumer Confidence contracted.

At 12:00GMT, the German GfK Consumer Climate in November missed the market’s expectations and dropped to -6.7 against the expected -4.9 and weighed on Euro. At 14:00 GMT, the M3 Money Supply for the year from Eurozone remained flat at 10.5%. Private Loans for the year also came in line with the expectations of 3.1%.

The Eurozone’s largest economy, Germany, appeared to struggle to shake off the coronavirus crisis as consumers’ confidence declined. The investors became cautious about it. That weighed on the single currency Euro and added in the losses of EUR/USD pair.

Furthermore, the European Central bank (ECB) published its November policy meeting minutes in which the policymakers believe that there was the possibility that pandemic might have long-lasting effects. They were cautious that pandemics might take a toll on the demand side, supply sides and reduce the economy’s growth potential.

Minutes revealed that Inflation would remain negative for longer while employment could contract further. Policymakers believed that flexibility from PEPP was essential to its continued success, and they wanted to wait for a further fiscal response before reacting instead. They were of the review that more bond-buying may not have the same impact now. There were no surprises in the minutes as Central Bank has begun to pave the way towards additional easing next December.

The single currency Euro came under pressure after releasing these minutes from the European Central Bank and weighed on EUR/USD pair on Thursday. The U.S. markets were closed due to the Thanksgiving Holiday, and as Friday is not an official holiday, thin trading is expected to extend into the weekend.

Moreover, the currency pair also followed yesterday’s release of the flash US GDP data for the third quarter that remained low at 33.1% in annualized terms and raised concerns over the world’s largest economy. The coronavirus vaccine and the U.S. stimulus talks are considered as the prevailing risks to the Federal Reserve’s outlook going ahead.

The demand for safe-haven greenback continued to slip with the global economy’s improving outlook after the release of vaccines for a deadly virus. The weak U.S. dollar kept the losses in EUR/USD pair limited on Thursday.

Daily Technical Levels

Support   Resistance

1.1885      1.1934

1.1859      1.1957

1.1836      1.1983

Pivot point: 1.1908

EUR/USD– Trading Tip

On Friday, the direct currency pair EUR/USD is trading with a bullish bias at the 1.1912 level, holding above an immediate resistance becomes a support level of the 1.1905 level. On the higher side, the EUR/USD pair may find resistance at 1.1979, and a bullish breakout of 1.199 level can extend the upward trend until 1.1942. On the 2 hour timeframe, the EUR/USD pair has violated the symmetric triangle pattern that was extending resistance at the 1.19052 level, and now this level is working as a support. Let’s consider taking a buying trade over the 1.1905 level, and above this, the next target stays at 1.1997.

GBP/USD – Daily Analysis

The GBP/USD pair was closed at 1.33550 after a high of 1.33974 and a low of 1.33218. GBP/USD pair struggled to surpass the 1.3400 level and was unable to do so during the early European session, and after that, sellers came in and reversed the pair’s movement to as low as 1.3320 level.

The GBP/USD pair was amongst the worst performers on Thursday out of the G10 currencies, with losses of around 40 pips on the day. After posting gains for four consecutive days, the GBP/USD pair declined on Thursday. Much of the GBP/USD pair’s bullish rally was due to the U.S. dollar’s weakness following the U.S. President-elect Joe Biden’s victory at the start of the month was also escalated by the combination of vaccine optimism and the increasingly dovish tone of the FOMC.

Federal Reserve is expected to squeeze their asset purchase program in December to offer the economy more stimulus because of the rising number of coronavirus cases across the States that has forced the local governments to impose a second lockdown, as the fiscal stimulus from Congress remains indefinable.

Meanwhile, British Pound has also performed significantly better during this month as the hopes surrounding the Brexit deal were higher after the French compromise over the fisheries issue. An agreement over one sticking point also revealed progress made in the Brexit agreement and supported the Sterling that added gains in GBP/USD pair. Furthermore, the vaccine development from Pfizer & BioNtech, Moderna, and AstraZeneca also gave strength to the GBP/USD pair after adding demand for the market’s risk sentiment.

However, on Thursday, the tone behind GBP/USD was changed somewhat after the hopes for a Brexit deal started to fade away. Many reports suggested that the remaining key sticking issues related to Ireland and level playing field were proving to be very hard to reach an agreement. During Thursday’s European session, the Irish Foreign Minister said that Brexit’s outstanding issues were proving to be complicated. E.U. sources also reported that talks between the E.U. and the U.K. were not going well. Simultaneously, the French Foreign Minister put public pressure on the U.K. to adopt a more realistic negotiating stance on Wednesday that faded the optimistic tone around the market and weighed on GBP/USD pair.

During the Thanksgiving Holiday in the U.S. and, in the absence of any macroeconomic data from the U.K., the GBP/USD pair continued following the latest headlines and dropped on Thursday.

Daily Technical Levels

Support   Resistance

1.3318      1.3394

1.3282      1.3434

1.3242      1.3470

Pivot point: 1.3358

GBP/USD– Trading Tip

The GBP/USD traded in line with our previous forecast to hit the support level of 1.333, which is extended by an upward channel. On the higher side, Cable may find resistance at 1.3400 level that’s extended by the double top pattern on the two-hour timeframe. Simultaneously, the bullish crossover of the 1.3400 level is likely to open additional room for buying until the 1.3446 level. On the 4 hour timeframe, the GBP/USD pair has formed a bullish channel that supports the pair at the 1.333 area, and violation of this level on the lower side can drive a sharp selling trend until the 1.3270 mark. The RSI and MACD are suggesting a selling trend in sterling. However, I will prefer to open a buying trade over the 1.3330 area and selling trade below the same level today. 

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 104.233 after placing a high of 104.479 and a low of 104.214. On Thursday, the U.S. dollar was down in early trading session subdued by weak U.S. economic data. The optimism surrounding the coronavirus vaccines prompted investors to seek out riskier assets instead of safe-haven. The U.S. Dollar Index (DXY) was down on Thursday against the basket of six major currencies by 0.3% at 91.97 level, the lowest level in more than two months as the volume was limited due to the holiday in the U.S. for Thanksgiving.

In late Wednesday, the Federal Reserve released the minutes of its last monetary policy meeting, and they showed that Fed members debated on a range of options on bond purchases to support the recovery, including pivoting to purchases of longer-term securities that could put more pressure on the dollar by keeping longer-term yield unattractively low. These comments from the Fed weighed on the U.S. dollar and added pressure on the USD/JPY pair on Thursday.

Meanwhile, the number of global coronavirus cases reached above 60 million on Thursday, out of which 12.7 million were from the U.S., according to Johns Hopkins University. Many states in the U.S. started to impose restrictive measures to curb the increasing numbers of coronavirus cases that led to more job losses, weighed on the U.S. dollar, and kept the USD/JPY pair under pressure.

Positive data from 3 vaccine candidates and their efficacies, along with a smoother transition to Joe Biden administration in the U.S., added pressure on the greenback and forced investors to move towards riskier currencies. Reports also suggested that the Fed’s monetary easing was on its way that continued weighing on the greenback and added pressure on the USD/JPY pair. Apart from this, a mixed performance in the European equity markets provided a modest lift to the safe-haven Japanese yen that ultimately contributed to the USD/JPY pair’s fall on Thursday.

Due to the absence of any macroeconomic data on the day and the thin liquidity conditions due to the Thanksgiving Holiday, the pair USD/JPY continued following the last day’s economic data of Unemployment claims that showed a negative labor market report and added pressure on the pair.

Daily Technical Levels

Support   Resistance

104.27      104.63

104.09      104.79

103.92      104.98

Pivot point: 104.44

USD/JPY – Trading Tips

The USD/JPY pair’s recent price action has violated the choppy trading range of 104.700 – 104.056. On the lower side, the USD/JPY pair can drop further until the next support level of 103.667 level, especially after the breakout of the 104.150 support level. On the higher side, a bullish breakout of 104.700 resistance can extend the buying trend until the next resistance area of 104.700 and 105.063 level. On the lower side, the support continues to hold around the 103.667 level. The MACD suggests selling bias in the USD/JPY pair; thus, we should consider selling trade below 104.150 and buying above the same. Good luck! 

Categories
Forex Signals

GBP/USD Sell Signal Update – Brace for a Manual Close! 

The GBP/USD is trading bullish around 1.3396 level, facing resistance at 1.3400 level. The resistance level is extended by the double top pattern at 1.3400 level, and a bullish crossover of 1.3400 level is likely to open further room for buying until 1.3446 level. On the 4 hour timeframe, the GBP/USD pair has formed a bullish channel that supports the pair at the 1.333 area. The RSI and MACD are suggesting a buying trend in sterling. However, I will prefer to open a buying trade only above the 1.3396 area, and below this, sell trade will be preferred. Therefore, I have shared a sell trade below 1.3395 area to capture quick green pips. Check out a trading plan below… 

The GBP/USD is trading bullish around 1.3396 level, facing resistance at 1.3400 level. The resistance level is extended by the double top pattern at 1.3400 level, and a bullish crossover of 1.3400 level is likely to open further room for buying until 1.3446 level. On the 4 hour timeframe, the GBP/USD pair has formed a bullish channel that supports the pair at the 1.333 area. The RSI and MACD are suggesting a buying trend in sterling. However, I will prefer to open a buying trade only above the 1.3396 area, and below this, sell trade will be preferred. Therefore, I have shared a sell trade below 1.3395 area to capture quick green pips. Check out a trading plan below… 

The GBP/USD is trading bullish around 1.3396 level, facing resistance at 1.3400 level. The resistance level is extended by the double top pattern at 1.3400 level, and a bullish crossover of 1.3400 level is likely to open further room for buying until 1.3446 level. On the 4 hour timeframe, the GBP/USD pair has formed a bullish channel that supports the pair at the 1.333 area. The RSI and MACD are suggesting a buying trend in sterling. However, I will prefer to open a buying trade only above the 1.3396 area, and below this, sell trade will be preferred. Therefore, I have shared a sell trade below 1.3395 area to capture quick green pips. Check out a trading plan below… 


Entry Price – Sell 1.33519

Stop Loss – 1.33919

Take Profit – 1.33119

Risk to Reward – 1:1

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

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

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

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

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

Categories
Forex Signals

USD/CAD Violates Choppy Session – Bearish Setup in Play! 

The USD/CAD pair was closed at 1.30060 after placing a high of 1.30288 and a low of 1.29860. The currency pair USD/CAD rose to1.3030 level in the early trading session but failed to remain there and started to decline on the back of US dollar weakness and the rising crude oil prices on Wednesday.

The USD/CAD pair was closed at 1.30060 after placing a high of 1.30288 and a low of 1.29860. The currency pair USD/CAD rose to1.3030 level in the early trading session but failed to remain there and started to decline on the back of US dollar weakness and the rising crude oil prices on Wednesday.

The USD/CAD pair was closed at 1.30060 after placing a high of 1.30288 and a low of 1.29860. The currency pair USD/CAD rose to1.3030 level in the early trading session but failed to remain there and started to decline on the back of US dollar weakness and the rising crude oil prices on Wednesday.

The US’s mixed macroeconomic data failed to help the greenback gather strength against its rival currencies and forces the USD/CAD pair to lose most of its daily gains in the late trading session. There was no macroeconomic data from the Canadian side, so the pair followed the US data on Wednesday.

On the data front, at 18:30 GMT, the Prelim Gross Domestic Product for the third quarter remained flat at 33.1%. The Unemployment Claims from last week surged to 778K against the projected 732K and weighed on the US dollar. The Core Durable Goods Orders for October surged to 1.3% against the projected 0.5% and supported the US dollar. The Durable Goods Orders rose to 1.3% from the forecasted 1.0% and supported the US dollar. The Prelim Wholesale Inventories for October rose to 0.9% against the expected 0.4% and weighed on the US dollar.

The New Home Sales for October rose to 999K against the forecasted 972K and supported the US dollar. The Personal Income fell to -0.7% from the projected 0.0% and weighed on the US dollar. The Personal Spending raised to 0.5% from the anticipated 0.4% and supported the US dollar.

On the other hand, the weekly report published by the US Energy Information Administration (EIA) showed that the Crude Oil stocks declined by 0.75M barrels last week and boosted oil prices. 

The WTI crude oil raised above the $46 level on Wednesday and gave strength to the Canadian dollar that added pressure on the USD/CAD pair.

However, the pair managed to remain on the positive side as the market mood was still risky due to the rising hopes of global economic recovery from the latest progress made in coronavirus vaccines from Pfizer & BioNtech, Moderna, and AstraZeneca.

Meanwhile, from Canada, almost 1,373 cases of coronavirus were reported, along with 35 additional deaths in Ontario. The total number of deaths from coronavirus in Toronto reached 3554 on Wednesday. The currency pair also remained strong ahead of the FOMC minutes release published in the early Thursday session.

Daily Technical Levels

Support Resistance

1.2979 1.3026

1.2959 1.3051

1.2933 1.3072

Pivot Point: 1.3005

The USD/CAD has violated the sideways trading range of 1.3119 – 1.3035 level. A bearish breakout of the 1.3035 level is likely a further selling trend until the 1.2936 level. The pair forms a neutral candle, suggesting indecision among investors, perhaps due to lack of economic events. Secondly, the investors are expecting thin volatility amid the Thanksgiving holiday. Let’s consider staying bearish below 1.3030 today. Good luck! 

Categories
Forex Elliott Wave Forex Market Analysis

Beware of these Supply and Demand Zones on the GBPJPY

The short-term overview for the GBPJPY pair reveals the sideways movement in a trading range bounded by its 90-day high and low range between levels of 133.040 and 142.714. The cross recently developed a rally that found resistance in the bullish sentiment zone resistance located on 140.296, where the GBPJPY presents a set of scenarios.

The short-term overview for the GBPJPY pair reveals the sideways movement in a trading range bounded by its 90-day high and low range between levels of 133.040 and 142.714. The cross recently developed a rally that found resistance in the bullish sentiment zone resistance located on 140.296, where the GBPJPY presents a set of scenarios.

The short-term overview for the GBPJPY pair reveals the sideways movement in a trading range bounded by its 90-day high and low range between levels of 133.040 and 142.714. The cross recently developed a rally that found resistance in the bullish sentiment zone resistance located on 140.296, where the GBPJPY presents a set of scenarios.

Technical Overview

The following 12-hour chart illustrates the short-term market participants’ sentiment bounded by the 90-day high and low range. The figure presents a bullish bias that remains active since the GBPJPY found fresh buyers on 133.040.

After the cross found resistance at 140.296, the price action retraced it until a neutral zone located on 137.877, forming an intraday sideways channel that suggests a pause in the short-term bullish cycle.

On the other hand, the following figure unveils that the retail traders’ market sentiment is positioned on the bearish side. As the chart shows, 75% of retail traders hold their positioning on the sell-side, which is contrarian.

(source: myfxbook.com)

In this context, we can see that numerous retail traders are expecting a downward movement, while the price action remains moving in the bullish sentiment without exposing a reversal pattern. Thus, it is plausible the GBPJPY pair could develop a new upward movement.

Short-term Technical Outlook

The short-term Elliott Wave view shows a movement inside an incomplete corrective wave of Minor degree, labeled in green, which could be in its wave C. 

The following chart shows the price action developing an upward corrective rally, which could correspond to a wave (ii) or (b) of Minute degree identified in green. In this context, the following movement should correspond to wave (iii) or (c).

Under this scenario, if the supply zone between 139.831 and 140.315 confirms the end of the current second segment, in blue, GBPJPY should begin a decline to the first demand zone between 137.594 and 137.196. Moreover, the market action could extend its down move toward the next demand zone between 134.997 and 134.404.

An alternative scenario considers the possibility of the price extending its advance beyond the 140.315 level. In this case, the GBPJPY could find fresh sellers in the next supply zone between 141.759 and 142.714. The pair could complete its wave B in green and start to weaken, developing the wave C subdivided into a five-wave sequence with a potential target in the demand zones identified in green.

Finally, the invalidation level of the bearish scenario is set above the origin of wave A in green at 142.714

Categories
Forex Market Analysis

Daily F.X. Analysis, November 26 – Top Trade Setups In Forex – Thanksgiving Day! 

The economic calendar is a bit muted amid the Thanksgiving holiday. Most Forex brokers remain open for every holiday except Christmas and New Year’s Day. Stock markets and banks have slightly different holiday schedules. In addition to this, the eyes will remain on ECB Monetary Policy Meeting Accounts during the European session. It’s a detailed record of the ECB Governing Board’s most recent meeting, providing in-depth insights into the economic conditions that influenced their decision on where to set interest rates. 

The economic calendar is a bit muted amid the Thanksgiving holiday. Most Forex brokers remain open for every holiday except Christmas and New Year’s Day. Stock markets and banks have slightly different holiday schedules. In addition to this, the eyes will remain on ECB Monetary Policy Meeting Accounts during the European session. It’s a detailed record of the ECB Governing Board’s most recent meeting, providing in-depth insights into the economic conditions that influenced their decision on where to set interest rates. 

The economic calendar is a bit muted amid the Thanksgiving holiday. Most Forex brokers remain open for every holiday except Christmas and New Year’s Day. Stock markets and banks have slightly different holiday schedules. In addition to this, the eyes will remain on ECB Monetary Policy Meeting Accounts during the European session. It’s a detailed record of the ECB Governing Board’s most recent meeting, providing in-depth insights into the economic conditions that influenced their decision on where to set interest rates. 

Economic Events to Watch Today  

  

EUR/USD – Daily Analysis

The EUR/USD pair closed at 1.19136 after placing a high of 1.18959 and a low of 1.18334. EUR/USD pair extended its upward momentum on Wednesday amid the broad-based U.S. dollar weakness and the rising optimism around the market. 

The risk sentiment was triggered by the latest vaccine development that suggested a quick economic recovery and pushed riskier assets like EUR/USD pair on the higher levels. The currency pair EUR/USD rose and placed fresh highs on Wednesday after reaching its highest level since mid-August.

The U.S. dollar was weak on Wednesday after the release of mixed and depressing data from the U.S. The Unemployment claims rose unexpectedly and weighed on the U.S. dollar, and supported the upward momentum in EUR/USD pair.

On the data front, there was no data from the Europe side on Wednesday, while from the U.S., at 18:30 GMT, the Prelim Gross Domestic Product for the third quarter came in line with the anticipations of 33.1%. The Unemployment Claims from last week rose to 778K against the projected 732K and weighed on the U.S. dollar. The Core Durable Goods Orders for October rose to 1.3% against the estimated 0.5% and supported the U.S. dollar. The Durable Goods Orders also rose to 1.3% from the projected 1.0% and helped the U.S. dollar. The Goods Trade Balance from the U.S. for October came in as forecasted -80.3B. The Prelim Wholesale Inventories for October rose to 0.9% against the estimated 0.4% and weighed on the U.S. dollar that added strength to EUR/USD pair.

At 18:36 GMT, the Prelim GDP Price Index for the third quarter also remained as expected at 3.6%. At 20:00 GMT, the Revised UoM Consumer Sentiment for November also came in line with the projections of 76.9. The Core PCE Price Index for October remained flat with the predictions of 0.0%. The New Home Sales for October surged to 999K against the anticipated 972K and supported the U.S. dollar. The Personal Income declined to -0.7% from the projected 0.0% and weighed on the U.S. dollar added in the gains of EUR/USD pair. The Personal Spending raised to 0.5% from the forecasted 0.4% and supported the U.S. dollar. The Revised UoM Inflation Expectations also came in line as expected at 2.8%.

On Wednesday, the European Central Bank released its review on the economy’s financial stability. The central bank warned that European banks would not see profits return to the pre-pandemic level before 2022. According to ECB, the Eurozone leaders have struggled to make sizeable profits over the last decade after the 2008 global financial crisis with more robust regulatory scrutiny and low-interest rates. While the recent coronavirus crisis has worsened bottom lines further, and that will continue to affect the financial sector in the coming months.

In simple words, the banks’ profitability will remain weak, which could hurt their ability to lend money to businesses and individuals that would also reflect the economy’s weak health. These comments from ECB failed to break the upward momentum of the EUR/USD pair on Wednesday.

Daily Technical Levels

Support   Resistance

1.1888     1.1936

1.1861     1.1957

1.1841     1.1984

Pivot point: 1.1909

EUR/USD– Trading Tip

The EUR/USD is trading with a bullish bias at the 1.1936 level, holding below an immediate resistance level of 1.1979. On the higher side, the EUR/USD pair may find resistance at 1.1979, and a bullish breakout of 1.199 level can extend the upward trend until 1.1942. On the 2 hour timeframe, the EUR/USD pair has violated the symmetric triangle pattern that was extending resistance at the 1.19052 level, and now this level is working as a support. Let’s consider taking a buying trade over the 1.1905 level, and above this, the next target stays at 1.1997.

GBP/USD – Daily Analysis

The GBP/USD pair closed at 1.33864 after a high of 1.33935 and a low of 1.33037. GBP/USD pair extended its gains for the 4th consecutive session on Wednesday amid the U.S. dollar weakness and the rising global market confidence due to vaccine progress. Meanwhile, the currency pair GBP/USD also remained under pressure on Wednesday after the Brexit uncertainty returned to the market.

The GBP/USD pair has been trading with an upside bias since the start of this week due to rising optimism in the market regarding the latest vaccine developments. Pfizer and BioNtech first reported its vaccine’s efficacy rate, followed by Moderna and AstraZeneca within two weeks. The back to back vaccine progress and the fact that Pfizer and BioNtech have already filed for emergency use authorization of their vaccine and others being in line for it has further supported the market’s risk sentiment.

The risk perceived GBP/USD pair gained traction and saw a jump in demand on expectations that the U.K. and the E.U. were getting closer to reaching a deal on Brexit. However, on Wednesday, the lack of recent progress raised uncertainty in the market and weighed on British Pound.

The French Foreign Minister Jean-Yves Le Drian recently commented that British proposals in the latest negotiations were insufficient. He also accused the U.K. of slowing talks over secondary subjects and playing with the calendar. He urged that securing a deal over fisheries will not be the adjustment variable in the talks.

Meanwhile, a BBC reporter Katya Adler also tweeted that E.U. sources have said that there were doubts about the E.U. Brexit negotiator Michelle Barnier going to London to negotiate once he leaves quarantine on Friday and that the talks were not going well. These updates were also confirmed by the President of the European Commission, Ursula von der Leyen, who said on Wednesday morning that she could not say if there will be a deal and the next few days would be decisive.

All this Brexit news dented the expectations that the two sides will eventually reach a deal on key sticking points. However, market participants decided not to react to such news for Wednesday and continued following the market’s optimism.

On the data front, at 18:30 GMT, the Prelim Gross Domestic Product for the third quarter remained flat with the expectations of 33.1%. The Unemployment Claims from last week surged to 778K against the anticipated 732K and weighed on the U.S. dollar. 

The Core Durable Goods Orders for October raised to 1.3% against the forecasted 0.5% and supported the U.S. dollar. The Durable Goods Orders increased to 1.3% from the estimated 1.0% and helped the U.S. dollar. The Goods Trade Balance from the U.S. for October remained flat at -80.3B. The Prelim Wholesale Inventories for October raised to 0.9% against the projected 0.4% and weighed on the U.S. dollar that added strength to GBP/USD pair.

At 18:36 GMT, the Prelim GDP Price Index for the third quarter also came in line with the projections of 3.6%. At 20:00 GMT, the Revised UoM Consumer Sentiment for November also remained flat at 76.9. The Core PCE Price Index for October stayed the same at 0.0%. The New Home Sales for October raised to 999K against the estimated 972K and supported the U.S. dollar. The Personal Income fell to -0.7% from the forecasted 0.0% and weighed on the U.S. dollar added in the GBP/USD pair’s gains. The Personal Spending rose to 0.5% from the projected 0.4% and supported the U.S. dollar. Revised UoM Inflation Expectations also remained flat at 2.8%.

Daily Technical Levels

Support   Resistance

1.3325     1.3416

1.3269     1.3451

1.3235     1.3507

Pivot Point: 1.3360

GBP/USD– Trading Tip

The GBP/USD is trading bullish around 1.3396 level, facing resistance at 1.3400 level. The resistance level is extended by the double top pattern at 1.3400 level, and a bullish crossover of 1.3400 level is likely to open further room for buying until 1.3446 level. On the 4 hour timeframe, the GBP/USD pair has formed a bullish channel that supports the pair at the 1.333 area. The RSI and MACD are suggesting a buying trend in sterling. However, I will prefer to open a buying trade over the 1.3396 area today. 

USD/JPY – Daily Analysis

The USD/JPY pair closed at 104.456 after a high of 104.596 and a low of 104.253. The USD/JPY pair stayed relatively low, around 104.5 level for the majority of the day, and remained more down during the American trading hours due to mixed macroeconomic data releases from the U.S.

The U.S. Dollar Index (DXY) edged lower in the late American session, remained at the 91.97 level, and kept the U.S. dollar depressed. On the data front, at 18:30 GMT, the Prelim Gross Domestic Product for the third quarter remained flat at 33.1%. The Unemployment Claims from last week rose to 778K against the expected 732K and weighed on the U.S. dollar. The Core Durable Goods Orders for October rose to 1.3% against the expected 0.5% and supported the U.S. dollar. The Durable Goods Orders surged to 1.3% from the anticipated 1.0% and helped the U.S. dollar. 

The Goods Trade Balance from the U.S. for October remained flat with the expectations of -80.3B. The Prelim Wholesale Inventories for October rose to 0.9% against the estimated 0.4% and weighed on the U.S. dollar.

At 18:36 GMT, the Prelim GDP Price Index for the third quarter remained flat at 3.6%. At 20:00 GMT, the Revised UoM Consumer Sentiment for November stayed at 76.9. The Core PCE Price Index for October came in line with the expectations of 0.0%. The New Home Sales for October surged to 999K against the projected 972K and supported the U.S. dollar. The Personal Income dropped to -0.7% from the expected 0.0% and weighed on the U.S. dollar. The Personal Spending surged to 0.5% from the forecasted 0.4% and supported the U.S. dollar. The Revised UoM Inflation Expectations also came in line with the anticipations of 2.8%.

The rising unemployment claims and declined personal income weighed on the local currency while the durable goods orders and new home sales, along with the personal spending, supported the U.S. dollar on Wednesday.

Meanwhile, from the Japanese side, the year’s SPPI declined to -0.6% from the forecasted -0.5% and weighed on the Japanese Yen. At 09:59 GMT, the BoJ Core CPI for the year raised to 0.0% from the forecasted -0.1% and supported the Japanese Yen that added weight on the USD/JPY pair on Wednesday.

The currency pair USD/JPY remained bullish throughout the day despite the U.S.’s mixed economic data on the back of rising optimism in the market. The global market sentiment remained confident due to the rising number of vaccine candidates reporting progress. The race to file for emergency use authorization of vaccine started with Pfizer and BioNtech has extended to AstraZeneca and Moderna that has helped raised hopes for a pre-pandemic economic environment and supported the risk sentiment.

The rising risk sentiment added weight on the safe-Haven Japanese Yen and supported the USD/JPY pair’s upward momentum on Wednesday. Another factor involved in the USD/JPY pair’s upward movement was the beginning of the transition of the presidency of President-elect Joe Biden.

Daily Technical Levels

Support   Resistance

104.27     104.63

104.09     104.79

103.92     104.98

Pivot point: 104.44

USD/JPY – Trading Tips

The USD/JPY continues to trade in a fresh choppy range of 104.700 – 104.056 level. On the higher side, a bullish breakout of 104.700 resistance can extend the buying trend until the next resistance area of 104.700 and 105.063 level. On the lower side, the support continues to hold around 104.056 and 103.667 level. The MACD suggests an overbought situation of the USD/JPY pair; thus, we should look for selling trade below 104.598 and buying above the same. Good luck! 

Categories
Forex Market Analysis

Daily F.X. Analysis, November 25 – Top Trade Setups In Forex – Unemployment Claims Eyed! 

The economic calendar is filled with medium impact economic events such as Unemployment Claims, UoM Consumer Sentiment, and Prelim GDP q/q from the United States on the news front. The market may show some price action during the U.S. session on the release of U.S. Jobless Claims.

The economic calendar is filled with medium impact economic events such as Unemployment Claims, UoM Consumer Sentiment, and Prelim GDP q/q from the United States on the news front. The market may show some price action during the U.S. session on the release of U.S. Jobless Claims.

The economic calendar is filled with medium impact economic events such as Unemployment Claims, UoM Consumer Sentiment, and Prelim GDP q/q from the United States on the news front. The market may show some price action during the U.S. session on the release of U.S. Jobless Claims.

Economic Events to Watch Today  

 

EUR/USD – Daily Analysis

The EUR/USD pair was closed at 1.18897 after placing a high of 1.18959 and a low of 1.18334. After placing losses for two consecutive days, the EUR/USD pair rose and started to post gains on Tuesday amid the rising optimism and risk sentiment surrounding the market.

The safe-haven appeal suffered after AstraZeneca’s latest news that its vaccine could reach a 90% efficacy rate on the second dosage from 70% in the first one. However, the EUR/USD pair traders remained confused on Tuesday and moved the currency pair between gains and losses throughout the day and ended the day with gains as optimism regarding vaccine overshadowed the U.S. dollar’s strength. The U.S. dollar was strong in the market ahead of Wall Street’s opening; however, it fell under selling pressure after the U.S. Consumer Confidence fell in November. 

On the data front, at 12:00 GMT, the German Final GDP for the third quarter raised to 8.5% against the forecasted 8.2% and supported the single currency Euro that added further gains in EUR/USD pair. AT 14:00 GMT, the German IFO Business Climate for November also raised to 90.7 against the expected 90.3 and supported EUR/USD pair. At 19:00 GMT, the Housing Price Index for September elevated to 1.7% against the projected 0.8% and supported the U.S. dollar from the U.S. side. 

The S&P/CS Composite -20 HPI for the year also surged to 6.6% against the expected 5.3% and supported the U.S. dollar that ultimately capped further gains in EUR/USD pair. At 19:59 GMT, the Richmond Manufacturing Index dropped to 15 points from the projected 20 and weighed on the U.S. dollar that added gains in EUR/USD pair. The most awaited C.B. Consumer Confidence from the U.S. was released at 20:00 GMT also fell to 96.1 against the anticipated 97.7 and weighed on the U.S. dollar that added further gains in EUR/USD pair on Tuesday.

Meanwhile, the reports that the U.S. President Trump has agreed with the transition process with Joe Biden and that the White House has given the go-ahead to Biden raised the risk sentiment and added further gains EUR/USD pair. Furthermore, the vaccine hopes also kept the market sentiment improved with the news that the new vaccine developed by AstraZeneca, a British Pharmaceutical, can provide 90% protection against the coronavirus and be cheaper against the previous Pfizer and Moderna due to its comfortable storage facility. These reports raised hopes that the global economy will start recovering now, and the riskier asset EUR/USD pair gained traction and started posting gains.

Daily Technical Levels

Support   Resistance

1.1851     1.1911

1.1814     1.1934

1.1791     1.1972

Pivot point: 1.1874

EUR/USD– Trading Tip

The EUR/USD is trading with a bullish bias at the 1.1895 level, holding below an immediate resistance level of 1.1912. On the higher side, the EUR/USD pair may find resistance at 1.1912, and a bullish breakout of 1.1912 level can extend the upward trend until 1.1942. On the 2 hour timeframe, the EUR/USD pair was supported by an upward trendline, which got violated, and now the same trendline is supporting EUR/USD pair at 1.1862. Let’s look for a selling trade below the 1.1866 level today. 

GBP/USD – Daily Analysis

The GBP/USD pair was closed at 1.33615 after a high of 1.33802 and a low of 1.32929. The currency pair GBP/USD continued its bullish movement on Tuesday for the 3rd consecutive day. The GBP/USD pair continued getting support from the British Pound’s strength after the rising Brexit optimism in the market. The hopes that a Brexit deal will be reached soon between the U.K. and the E.U. kept underpinning the Sterling and forced GBP/USD pair to remain on the market’s positive side.

Although nothing has been confirmed about the Brexit deal, the talks between both nations have been extended into this week. On Tuesday, a member of the Bank of England’s monetary policy committee said Tuesday that vaccine news had provided some light at the end of the tunnel.

He also said that he saw a long-term scarring effect from the coronavirus outbreak. He added that it was too early to say that vaccine news will significantly improve the Bank’s economic outlook for 2021. He said that even if the economy came back because of the vaccine, it would have to face the economy-Brexit’s further long-term problem.

On the data front, at 16:00 GMT, the CBI Realized Sales for November came in as -25 against the forecasted -34 and supported British Pound and added in the gains of the GBP/USD pair. At 19:00 GMT, the Housing Price Index for September rose to 1.7% against the expected 0.8% and supported the U.S. dollar from the U.S. side. The S&P/CS Composite -20 HPI for the year also raised to 6.6% against the estimated 5.3% and helped the U.S. dollar that ultimately capped further gains in GBP/USD pair. At 19:59 GMT, the Richmond Manufacturing Index fell to 15 points from the anticipated 20 and weighed on the U.S. dollar that added gains in GBP/USD pair. The most awaited C.B. Consumer Confidence from the U.S. was released at 20:00 GMT, also fell to 96.1 against the projected 97.7 and weighed on the U.S. dollar that added further gains in GBP/USD pair on Tuesday.

Furthermore, the GBP/USD pair was also supported by the latest optimism in the market that had kept the risk-on market sentiment improved. The risk perceived British Pound was supported by the risk sentiment raised by the AstraZeneca vaccine news. Its vaccine was proven to be 90% effective in the second dosage. It was said to be cheaper as it can be stored in an ordinary refrigerator compared to Pfizer, and Moderna’s vaccines that provide 95% protection against the virus were not so easy to store. This optimism also kept the market’s risk sentiment on the upper side and continued supporting the GBP/USD pair on Tuesday.

Daily Technical Levels

Support   Resistance

1.3289     1.3312

1.3274     1.3320

1.3266     1.3336

Pivot point: 1.3297

GBP/USD– Trading Tip

The GBP/USD traded bearishly at 1.3340, having bounced off over the support area of the 1.3292 level. On the higher side, the pair may go after the resistance level of 1.3394. Over there’s an upward trendline that is supporting Sterling on the 2-hour timeframe. The Cable below the 1.3292 level may find support at the 1.3240 level while the RSI and MACD support buying. Thus we should consider taking buying trade over the 1.3292 level to target 1.3394. 

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 104.439 after placing a high of 104.759 and a low of 104.144. The pair USD/JPY seesawed on Tuesday as it moved in an upward direction in early trading hours and reached near 104.76 level while in the late trading session, the USD/JPY pair started to lose its earlier gains and continued its bearish bias. The selling bias in the currency pair USD/JPY raised on Tuesday after posting massive gains on Monday amid the mixed market sentiment. The safe-haven Japanese Yen was under pressure on Tuesday after the positive market mood circulated due to progress in AstraZeneca’s coronavirus vaccine.

The equity market rallied after the latest optimism regarding the 90% adequate protection against the coronavirus with a comfortable storage facility compared to Pfizer’s and Moderna vaccine’s 95% protection against the virus with a difficult storage facility. The market participants continued following the optimism and shifted towards riskier assets against the safer ones.

The equity market was also boosted on Tuesday, with Dow Jones moving up at 30,000 points and the three main indexes in Wall Street rising by 1.5% each. The risk rally in Wall Street added pressure on the safe-haven Japanese Yen and supported the USD/JPY pair’s upward momentum on Tuesday. The USD/JPY pair could not remain on the upper side for long and started to lose its earlier gains after releasing the U.S. Macroeconomic data. At 19:00 GMT, the Housing Price Index for September from the U.S. rose to 1.7% against the anticipated 0.8% and supported the U.S. dollar. The S&P/CS Composite -20 HPI for the year also raised to 6.6% against the estimated 5.3% and helped the U.S. dollar. At 19:59 GMT, the Richmond Manufacturing Index was dropped to 15 points from the forecasted 20 and weighed on the U.S. dollar that added pressure on the USD/JPY pair. The most awaited C.B. Consumer Confidence from the U.S. was also released at 20:00 GMT that fell to 96.1 against the estimated 97.7 and weighed on the U.S. dollar that ultimately added in the losses of the USD/JPY pair on Tuesday.

The decline in Consumer Confidence in November weighed on the local currency U.S. dollar as the rising number of coronavirus cases in the U.S. was raising questions over the economic recovery in the absence of further stimulus aid. The talks were set to resume between Republicans and Democrats to discuss the possibility of delivering an additional aid package in December.

Furthermore, the latest news from the White House that the U.S. President-elect Joe Biden was formally given the go-ahead by the federal agency to begin his transition to the presidency also capped further losses in the USD/JPY pair on Tuesday. The U.S. General Services Administration (GSA), an independent agency, determined that Biden was the outward winner of the election and informed Biden that his transition until January 20 could officially begin. The go-ahead was given by the White House to Biden to intensify the fight against the coronavirus. All these positive news kept the risk-on market sentiment supported and continued supporting the USD/JPY pair.

Daily Technical Levels

Support   Resistance

103.76     103.87

103.69     103.93

103.64     103.99

Pivot point: 103.81

USD/JPY – Trading Tips

The USD/JPY continues to trade in a fresh choppy range of 104.700 – 104.056 level. On the higher side, a bullish breakout of 104.700 resistance can extend the buying trend until the next resistance area of 104.700 and 105.063 level. On the lower side, the support continues to hold around 104.056 and 103.667 level. The MACD suggests an overbought situation of the USD/JPY pair; thus, we should look for selling trade below 104.598 and buying above the same. Good luck! 

Categories
Forex Signals

AUD/JPY Triple Top Pattern Offering Sell Trade – Quick Update! 

During Wednesday’s Asian trading session, the AUD/JPY currency pair failed to halt its modest bearish moves and remained depressed near below the 77.00 level due to Australia’s downbeat housing data, which tends to undermine the Australian dollar and contribute to the currency pair declines. Apart from this, the reason for the currency pair’s losses could also be attributed to the prevalent Brexit risks and trade tussles between China and the West, which keep challenging the upbeat market mood and undermining the perceived riskier Australian dollar. 

During Wednesday’s Asian trading session, the AUD/JPY currency pair failed to halt its modest bearish moves and remained depressed near below the 77.00 level due to Australia’s downbeat housing data, which tends to undermine the Australian dollar and contribute to the currency pair declines. Apart from this, the reason for the currency pair’s losses could also be attributed to the prevalent Brexit risks and trade tussles between China and the West, which keep challenging the upbeat market mood and undermining the perceived riskier Australian dollar. 

During Wednesday’s Asian trading session, the AUD/JPY currency pair failed to halt its modest bearish moves and remained depressed near below the 77.00 level due to Australia’s downbeat housing data, which tends to undermine the Australian dollar and contribute to the currency pair declines. Apart from this, the reason for the currency pair’s losses could also be attributed to the prevalent Brexit risks and trade tussles between China and the West, which keep challenging the upbeat market mood and undermining the perceived riskier Australian dollar. 

On the contrary, the market risk-on sentiment, backed by the optimism over a potential vaccine for the highly dangerous coronavirus infection, tends to undermine the safe-haven Japanese yen and becomes the key factor that helps the currency pair limit its deeper losses. Furthermore, the risk-on market sentiment could also be attributed to the reports suggesting that the U.S. presidential transition has finally started, which offers political certainty. Across the pond, the downbeat Japanese corporate service price index data added further burden around the Japanese yen and became the key factor that kept the lid on any additional losses in the currency pair. Currently, the USD/JPY currency pair is currently trading at 76.67 and consolidating in the range between 76.64 – 77.05.

Despite the lingering doubts about the U.S. economic recovery and the escalating tension between the world’s two biggest economies, the market players continue to cheering optimism over a potential vaccine for the highly dangerous coronavirus infection, boosts the hopes of global economic recovery and supporting the market trading sentiment. Thus, these further developments surrounding the covid vaccine favor the market’s risk-on mood. However, the perceived risk currency Australian dollar is relatively unaffected by the risk-on market sentiment and remains defensive amid downbeat housing data from Australia. At the data front, the Constriction Work Done for the 3rd-quarter (Q3) dropped below -2.0% forecast and -0.7% previous readouts to -2.3% QoQ.

Across the pond, the reason for the upbeat market mood could also be associated with the on-going optimism over the U.S. economy as President-elect Joe Biden has recently been allowed to receive the President’s Daily Brief, the collection of classified intelligence reports prepared for the national leader. This, in turn, undermined the safe-haven Japanese yen and became the key factor that helps the currency pair limit its deeper losses. Moreover, the currency pair’s losses were also capped by the downbeat Japanese corporate service price index data, which tends to undermine the Japanese yen and helps the currency pair to cap its downside momentum.

On the other hand, the intensifying coronavirus woes across the globe and intensifying lockdown restrictions in Europe and the U.S. keep challenging the upbeat market sentiment, which could also be considered one of the key factors the currency pair down. The reason could also be associated with the long-lasting delay in the much-awaited coronavirus (COVID-19) relief package, which also probes the bulls and contributes to currency pair declines.

Looking ahead, the market traders will keep their eyes on the U.S. economic calendar, which will show the releases of the U.S. Preliminary Q3 GDP, Initial Jobless Claims, Durable Goods, and Core PCE Index. This data will likely influence the USD price dynamics and help traders to take some fresh directions. All in all, the updates surrounding the Brexit, virus, and U.S. stimulus package will not lose their importance.



Daily Support and Resistance

S1 75.57

S2 76.15

S3 76.52

Pivot Point 76.73

R1 77.1

R2 77.31

R3 77.88

The AUD/JPY pair faced resistance at 77 levels, holding below an immediate support level of 76.58. A bearish breakout of the 76.58 level can extend selling bias until the 76.23 level. The MACD and RSI are holding below a double top level of 77, suggesting odds of a selling bias in the AUD/JPY. Continuing a selling trend can lead the AUD/JPY until 76.58 and 76.25 level today, thus we entered the sell trade signal. Stay tuned; good luck! 

Categories
Forex Elliott Wave Forex Market Analysis

Is the US Dollar Index Ready for a Bounce?

The US Dollar Index (DXY) advances in the extreme bearish sentiment zone finding an intraday support on Monday’s trading session at 92.016. During this intraday bounce, the price jumped to the extreme bearish zone’s resistance, where the price action started to consolidate. Even considering this intraday recovery, the Greenback accumulates losses of nearly 4.40% (YTD).

The US Dollar Index (DXY) advances in the extreme bearish sentiment zone finding an intraday support on Monday’s trading session at 92.016. During this intraday bounce, the price jumped to the extreme bearish zone’s resistance, where the price action started to consolidate. Even considering this intraday recovery, the Greenback accumulates losses of nearly 4.40% (YTD).

The US Dollar Index (DXY) advances in the extreme bearish sentiment zone finding an intraday support on Monday’s trading session at 92.016. During this intraday bounce, the price jumped to the extreme bearish zone’s resistance, where the price action started to consolidate. Even considering this intraday recovery, the Greenback accumulates losses of nearly 4.40% (YTD).

Technical Overview

The US Dollar Index, represented in its 8-hour chart, shows the market sentiment’s participants moving within its 90-high and low range, and it reveals the bearish pressure on the Greenback. In this regard, as long as the price keeps moving below 92.663, the short-term trend should stay mostly bearish.

On the other hand, the big picture under the Elliott Wave perspective illustrated in its 8-hour chart reveals the progress in an incomplete corrective formation, which could correspond to a flat pattern.

According to the wave theory, the flat pattern follows an internal sequence subdivided into 3-3-5. In this case, the Greenback should advance in a rally in a wave ((c)) of Minute degree identified in black subdivided into five segments.

An alternative scenario considers the possibility of a triangle pattern (3-3-3-3-3) or a double-three (3-3-3) in progress. However, the structure observed until this point doesn’t allow us to confirm or discard any of these potential Elliott wave formations.

Short-term Technical Outlook

The Greenback in its 4-hour range unveils the completion of the wave ((b)) of Minute degree labeled in black in the demand zone between 92.019 and 91.750, where the price bounced from on Monday’s trading session until 92.800.


Once the price reacted mostly upward, the US Dollar Index began to decline in a wave ii or B of Subminuette degree identified in green. In this regard, a bullish confirmation should lead us to expect further upward movements that could boost the price toward the next supply zone between 93.343 and 93.545.

If the Elliott wave formation corresponds to a Flat pattern, the price could surpass the supply zone level of 94.303 and seek to test the end of wave ((a)) located on 94.742.

On the other hand, we should be aware that a rally in the US Dollar Index implies a potential drop in the pairs against the US Dollar, for example, EURUSD or GBPUSD.

Finally, the return to a  bullish scenario holds its invalidation level at 92.016, which corresponds to the bottom of the first upwards move identified in green.

Categories
Forex Market Analysis

USD/CAD Breaking Below Triple Bottom – Brace for a Sell Trade! 

The USD/CAD pair was closed at 1.30853 after placing a high of 1.31123 and a low of 1.30452. The USD/CAD pair remained flat during the Monday trading session as the strength of the US dollar kept the pair on the upside while the strength of the Canadian dollar dragged the pair on the lower side simultaneously, which resulted in a flat movement.

The USD/CAD pair was closed at 1.30853 after placing a high of 1.31123 and a low of 1.30452. The USD/CAD pair remained flat during the Monday trading session as the strength of the US dollar kept the pair on the upside while the strength of the Canadian dollar dragged the pair on the lower side simultaneously, which resulted in a flat movement.

The USD/CAD pair was closed at 1.30853 after placing a high of 1.31123 and a low of 1.30452. The USD/CAD pair remained flat during the Monday trading session as the strength of the US dollar kept the pair on the upside while the strength of the Canadian dollar dragged the pair on the lower side simultaneously, which resulted in a flat movement.

The rise in the USD/CAD pair was due to the better-than-expected macroeconomic data on Monday. At 19:45 GMT, the Flash Manufacturing PMI from the US in November raised to 56.7 against the forecasted 52.5, supported the US dollar, and pushed the USD/CAD pair higher. The Flash Services PMI surged to 57.7 against the anticipated 55.8 and kept the US dollar and added gains in the USD/CAD pair.

However, the USD/CAD pair’s gains could not live longer as the improved risk sentiment in the market continuously supported the riskier Canadian dollar. The latest news from AstraZeneca, a British pharmaceutical, said that its vaccine effectively prevented coronavirus. AstraZeneca’s first dosage of vaccine could provide 70% immunity from the virus, whereas the second dosage could provide 90% immunity.

The rising optimism after the vaccine developers’ positive reports gave strength to risk perceived Canadian dollar that added weight on the USD/CAD pair on Monday. Meanwhile, the WTI Crude Oil prices also weighed on the USD/CAD pair after the prices of crude oil rose above the $43 level on Monday amid the rising optimism in the market that, with the progress in vaccine development, the chances for lifting the lockdown restrictions increased that would raise the demand for crude oil.

The rising crude oil prices helped the commodity-sensitive Canadian dollar gather strength against its rival currencies supported by the optimism that coronavirus vaccines will lead to a steady recovery in energy demand. The strong Loonie weighed on the USD/CAD pair, and the pair lost all of its earlier daily gains.

Daily Technical Levels

Support Resistance

1.3079 1.3093

1.3073 1.3101

1.3065 1.3108

Pivot Point: 1.3087


Entry Price – Sell 1.30711

Stop Loss – 1.30711

Take Profit – 1.29911

Risk to Reward – 1:1

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

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

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Categories
Forex Market Analysis

Daily F.X. Analysis, November 24 – Top Trade Setups In Forex – Consumer Confidence in Focus!

On the news front, the focus will remain on the U.S. Prelim Consumer Confidence and C.B. Leading Index m/m, which are expected to report mixed outcomes and drive choppy movement in the U.S. dollar. Let’s focus on technical levels today.

On the news front, the focus will remain on the U.S. Prelim Consumer Confidence and C.B. Leading Index m/m, which are expected to report mixed outcomes and drive choppy movement in the U.S. dollar. Let’s focus on technical levels today.

On the news front, the focus will remain on the U.S. Prelim Consumer Confidence and C.B. Leading Index m/m, which are expected to report mixed outcomes and drive choppy movement in the U.S. dollar. Let’s focus on technical levels today.

Economic Events to Watch Today  

 


 

EUR/USD – Daily Analysis

The EUR/USD pair closed at 1.18402 after placing a high of 1.19058 and a low of 1.17997. The EUR/USD pair rose to its highest since November 9 and reversed its direction after that, and continued placing losses for the day. The decline in the EUR/USD pair despite the improved risk sentiment was due to the U.S. dollar’s strength. The risk-on market sentiment was supported by the latest optimism from various vaccine developments. In contrast, the strength in the U.S. dollar was derived from better-than-expected U.S. macroeconomic data on Monday.

A British pharmaceutical AstraZeneca announced that its potential vaccine was more than 90% effective in its clinical trials for protecting the coronavirus. The first dosage of its vaccine provides 70% protection, while the second dosage could increase the efficacy rate to 90%.

AstraZeneca also said that it would be cheaper than its rival Pfizer vaccine as it can be stored at refrigerator temperature while Pfizer’s vaccine requires a frozen temperature that could make its cost of distribution higher.

Meanwhile, the risk sentiment was also supported by the reports that the US FDA has approved the antibody-drug used by U.S. President Donald Trump last month during his treatment of coronavirus for emergency use. These optimistic reports gave the EUR/USD pair strength in the earlier session and pushed its prices to their highest since November 9.

On the data front, at 13:15 GMT, the French Flash Services PMI declined to 38.0 against the forecasted 39.2 and weighed on Euro. The French Flash Manufacturing PMI also fell to 49.1 against the projected 50.2 and weighed on Euro. At 13:30 GMT, the German Flash Manufacturing PMI raised to 57.9 against the forecasted 56.0 and supported Euro. German Flash Services PMI remained flat with the expectations of 46.2. At 14:00 GMT, Flash Manufacturing PMI from Eurozone in November raised to 53.6 from the projected 53.2 and supported single currency Euro. Flash Services PMI declined 41.3 against the expected 42.2 and weighed on Euro.

The mixed data from Eurozone related to business activity failed to provide any significant movement in EUR/USD pair while the currency pair followed the U.S. dollar movement after the release of macroeconomic data in the American session.

At 19:45 GMT, the Flash Manufacturing PMI from the U.S. in November rose to 56.7 against the projected 52.5 and supported the U.S. dollar. The Flash Services PMI surged to 57.7 against the projected 55.8 and supported the U.S. dollar. After the release of better than expected Manufacturing and Services PMI, the strong U.S. dollar exerted pressure on EUR/USD pair on Monday.

Daily Technical Levels

Support   Resistance

1.1855      1.1871

1.1845      1.1877

1.1839      1.1888

Pivot point: 1.1861

EUR/USD– Trading Tip

The EUR/USD traded sharply bearish, falling from 1.1866 level to 1.1816 support level, which is extended by double bottom level. Closing of a candle over 1.1816 is supported by bullish correction, but at the same time, the EUR/USD pair may also head further higher until the 1.1866 resistance mark. On the 2 hour timeframe, the EUR/USD pair was supported by an upward trendline, which got violated on Monday, and now the same trendline is supporting EUR/USD pair. Let’s look for a selling trade below the 1.1866 level today. 

GBP/USD – Daily Analysis

The GBP/USD pair closed at 1.33222 after a high of 1.33975 and a low of 1.32636. The British Pound raised to its 10-weeks high level and then gave up some gains against the U.S. dollar in late trading sessions on the back of U.S. dollar strength. The rise in GBP/USD pair came in after the rising optimism over a Brexit deal after the European Commission reportedly told E.U. ambassadors that 95% of a post-Brexit deal had been agreed. The deal might be announced over the coming days to allow sufficient time for ratification by the European Parliament before year-end, possibly just the week after Christmas.

Meanwhile, on the data front, at 14:30 GMT, the Flash Manufacturing PMI from the U.K. raised to 55.2 against the forecasted 50.5 and supported British Pound and supported GBP/USD pair. The Flash Services PMI for November from the U.K. also raised to 45.8 against the forecasted 43.2 and supported British Pound and added gains in the GBP/USD pair.

From the U.S. side, at 19:45 GMT, the Flash Manufacturing PMI from the U.S. in November surged to 56.7 against the anticipated 52.5 and supported the U.S. dollar that capped further gains in GBP/USD pair. The Flash Services PMI rose to 57.7 against the forecasted 55.8 and supported the U.S. dollar, and GBP/USD pair lost some of its gains.

Meanwhile, on Monday, the Governor of Bank of England Andrew Bailey said that the long-term effects of a no-deal Brexit on the economy would be worse than the coronavirus pandemic’s long-term impacts. He added that he was relatively optimistic about the economy’s ability to recover from the coronavirus outbreak, but it would be more difficult to adjust with the U.K. trading with the E.U. on World Trade Organization terms.

These concerns added pressure on risk-on market sentiment and made GBP/USD pair to lost some of its earlier daily losses.

Furthermore, Prime Minister Boris Johnson confirmed that the England lockdown would be lifted on December 2, though regional restrictions would be kept to stop coronavirus spread. The second lockdown miscued the U.K. economy that the economy could slip into a double-dip recession and these concerns also added pressure on the GBP/USD pair that lost some of its earlier daily gains.

Daily Technical Levels

Support Resistance

1.3289      1.3312

1.3274      1.3320

1.3266      1.3336

Pivot point: 1.3297

GBP/USD– Trading Tip

The GBP/USD traded bearishly at 1.3290, but it now seems to bounce off over the support area of the 1.3292 level. On the higher side, the pair may go after the resistance level of 1.3394. Over there’s an upward trendline that is supporting Sterling on the 2-hour timeframe. Below the 1.3292 level, the Cable may find support at the 1.3240 level while the RSI and MACD are in support of buying. Thus we should consider taking buying trade over the 1.3292 level to target 1.3394. 

USD/JPY – Daily Analysis

The USD/JPY pair closed at 104.544 after placing a high of 104.635 and a low of 103.681. The USD/JPY pair rose by about 100 pips on Monday after the U.S. dollar became strong across the board. The strength of the greenback was derived from the release of macroeconomic data from the U.S.

At 19:45 GMT, the Flash Manufacturing PMI from the U.S. in November raised to 56.7 against the estimated 52.5 and supported the U.S. dollar. The Flash Services PMI surged to 57.7 against the estimated 55.8 and supported the U.S. dollar that added gains in the USD/JPY pair on Monday.

The better-than-expected U.S. business activity data showed that it was expanded in November at its fastest rate in more than five years and boosted optimism about the U.S. economy’s health that lifted the U.S. dollar, and provided strength to the rising USD/JPY pair.

Other than economic data, the USD/JPY pair was also supported by the market’s rising risk sentiment. The risk sentiment was supported by the latest optimism regarding vaccine developments from different countries. AstraZeneca, the British pharmaceutical, said that its vaccine was 70% effective on the first dosage and 90% effective on the second dosage.

It also reported that it would be cost-effective also as it does not require the frozen temperature to be stored and can only be stored in a refrigerator. These optimistic reports added strength in the risk sentiment and weighed on the safe-haven Japanese Yen that ultimately added strength in the USD/JPY pair.

On Monday, another positive news was that Regeneron’s coronavirus antibody cocktail that President Donald Trump used last month when he was hospitalized with COVID-19 had been approved for an emergency authorization use by the US FDA. There were also reports that the vaccine developed by Pfizer and BioNtech will likely be approved by the US FDA by December 11 and will be available for Americans to use.

With more progress in the vaccine area, lifting the lockdown restrictions increased along with the chances for an economic recovery that raised the risk sentiment and weighed on the safe-haven Japanese Yen that added gains in the USD/JPY pair. However, the pandemic hit economy still needs further support from governments to go through the crisis, and that is why investors were hopeful that the Fed and European Central Banks would likely issue more stimulus aid in December. The USD/JPY pair will likely rise as the risk sentiment has been improved after vaccine development progress.

Daily Technical Levels

Support Resistance

103.76      103.87

103.69      103.93

103.64      103.99

Pivot point: 103.81

USD/JPY – Trading Tips

The USD/JPY has violated a choppy range of 104.056 – 103.667 level. On the higher side, a bullish breakout of 104.056 resistance can extend the buying trend until the next resistance area of 104.59 and 105.063 level. On the lower side, the support continues to hold around 104.056 and 103.667 level. The MACD suggests an overbought situation of the USD/JPY pair; thus, we should look for selling trade below 104.598 and buying above the same. Good luck! 

Categories
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. 

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. 

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.

Categories
Forex Market Analysis

Daily F.X. Analysis, November 23 – Top Trade Setups In Forex – PMI Figures in Highlights! 

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

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

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

Economic Events to Watch Today  

 

EUR/USD – Daily Analysis

The EUR/USD pair closed at 1.18563 after placing a high of 1.18906 and a low of 1.18495. Despite vaccine-related optimism and improved risk sentiment in the market, the currency pair EUR/USD dropped on Friday amid the continuous rise in the number of coronavirus cases along with the latest disagreement between the Fed and U.S. Treasury related to the unused funds of emergency lending programs.

On Thursday, U.S. Treasury Secretary Steven Mnuchin sent a letter to Fed’s Chair Jerome Powell and asked him to return the unused funds in five emergency lending programs that will expire in December. Mnuchin claimed that those funds could be used for other purposes by Congress. Mnuhcin also asked Powell to extend the other four emergency credit facilities.

Meanwhile, the U.S. coronavirus situation got worse as November was not still over, but there have been almost 3 million new cases reported. It is about a quarter of all the U.S. cases since the beginning of the pandemic. The U.S. hospitalization rate was getting higher to an alarming level as it was forcing the health care system to reduce care for even non-COVID-19 patients.

Given the coronavirus situation in the U.S., many states announced restrictive measures to control the spread. On the European side, the situation was a bit under control after the strict lockdown measures. However, the old continent’s situation in Europe was far from getting better, and market players were worried that a steep economic downturn would be seen in the last quarter of the year.

These tensions raised the concerns that economic recovery was under pressure and supported the safe-haven appeal that ultimately weighed on the risk perceived EUR/USD pair on Friday. Furthermore, central banks’ calls for another round of stimulus measures to help support the economy started to increase. In response, the Federal Reserve Chairman Jerome Powell has been refrained to give any hint about any action in December whereas, his European counterpart Christine Lagarde has said that a large easing package will be coming in the next meeting. Lagarde’s comments also weighed on the single currency that ultimately added losses in the EUR/USD pair on Friday.

At 12:00 GMT, The German PPI for October remained flat at 0.1% on the data front. At 19:50 GMT, the Consumer Confidence also came in line with the expectations of -18. There was no macroeconomic figure to be released from the U.S., which means the pair EUR/USD was unaffected by any data on Friday.

Meanwhile, the vaccine news from Pfizer and BioNtech that they were going to apply for US FDA approval for emergency authorization use of their vaccine raised the risk sentiment in the market. Combined with this optimism, the other companies, including Moderna, Oxford, the Russian Sputnik V, and China’s Sinovac, also provided updates about the vaccine’s efficacy and supported the market’s risk of improved sentiment that ultimately capped further losses in the EUR/USD pair.


Daily Technical Levels

Support  Resistance

1.1831      1.1898

1.1790      1.1924

1.1764      1.1965

Pivot point: 1.1857

EUR/USD– Trading Tip

The EUR/USD is trading with a bearish bias at the 1.173 level, forming an ascending triangle on the 2-hour timeframe. On the lower side, the pattern supports the EUR/USD pair at 1.1850, and here violation of the 1.1850 level can extend the EUR/USD pair towards the 1.1816 level. On the higher side, a bullish breakout of the 1.1889 level can extend the buying trend until the 1.1924 level. The bullish bias remains dominants today as the MACD and 50 periods EMA support a bullish trend. Let’s consider taking a buying trade over 1.1889 with a take profit of 1.1924 level. 

GBP/USD – Daily Analysis

The GBP/USD pair closed at 1.32891 after placing a high of 1.32977 and a low of 1.32403. GBP/USD remained bullish on Friday amid the latest Brexit optimism and the coronavirus vaccine’s rising hopes. The currency pair remained on the upper track this week as Brexit dominated the scene and supported the British Pound. The coronavirus situation in the U.K. was improving as the U.K. was set to announce a wide easing of coronavirus rules for a week at Christmas.

Next week, Boris Johnson will announce a plan for an easing of rules on Covid, and he also warned that the level of restrictions for the rest of next month would depend on how well the public obey the current lockdown in England that will end on 2nd December. Brexit headlines were, however, contradictory during the week as PM Boris Johnson signaled that the U.K. would prosper without a deal and E.U. officials indicated that talks could collapse. The British press talked about a French compromise on the fisheries issue that a key sticking point in the Brexit deal. After the French compromise on fisheries, the Brexit optimism continued supporting the British Pound and added gains in GBP/USD pair.

Another factor involved in the GBP/USD’s bullish sentiment, Pfizer and BioNtech said that they would apply for approval of emergency use of their vaccine on Friday, which also helped risk sentiment improve and support the British Pound. Following Pfizer, Moderna also said that its vaccine was 94.5% effective in preventing the coronavirus and helped raise the market’s optimism that also supported the GBP/USD pair’s upward trend.

On the data front, at 05:01 GMT, GfK Consumer Confidence remained flat with the forecasted -33. At 12:00 GMT, the Retail Sales from the U.K. for October raised to 1.2% against the expected -0.3% and supported British Pound that added further gains in GBP/USD pair. The Public Sector Net Borrowing declined to 21.6 against the forecasted 31.6B and kept British Pound and added improvements in the currency pair GBP/USD pair.

Meanwhile, in the U.S., the need for a stimulus package increased with the rising coronavirus cases, but Fed Chairman Jerome Powell refrained from giving any hint about further aid in the upcoming December meeting. The hospitalization in the U.S. for coronavirus patients increased to a worse level, forcing many state governors to announce restrictive measures to control the virus’s spread. It weighed on the U.S. dollar and helped GBP/USD pair to post gains on Friday.

Daily Technical Levels

Support   Resistance

1.3211      1.3296

1.3161      1.3331

1.3127      1.3381

Pivot point: 1.3246

GBP/USD– Trading Tip

The GBP/USD continues trading bullish at the 1.3307 level, holding over the 1.3303 support level, supporting the buying trend. The recent bullish engulfing candle on the 2-hour timeframe can lead Sterling further higher until the 1.3368 area. The MACD and RSI have crossed over on the higher side, suggesting further odds of bullish trend continuation. Typically such kind of ascending trend breakout can lead the pair further higher, so let’s consider taking buying trade over the 1.3307 level today. 

USD/JPY – Daily Analysis

The USD/JPY pair closed at 103.823 after placing a high of 103.909 and a low of 103.700. After falling for six consecutive days, the USD/JPY pair posted small gains on Friday amid the reports about the resumption of the U.S. fiscal aid talks. The small uptick in the USD/JPY pair after massive selling in the previous six days could be solely attributed to optimism led by reports that U.S. lawmakers have agreed to resume talks on another coronavirus stimulus package.

The positive sentiment was somehow offset by the U.S. Treasury Secretary Steven Mnuchin’s decision to end some pandemic relief for struggling businesses. This came in after the tensions increased about the potential economic fallout from the continuous rise in new coronavirus cases, which held the U.S. dollar bulls from placing aggressive bets.

Meanwhile, the safe-haven appeal came back in the market after the number of coronavirus cases started to increase in the U.S. On Thursday, the U.S. reported about 185,000 cases of coronavirus in a single day and set a record. The number of hospitalized patients in the U.S. also increased by almost 50% in just the last two weeks that eventually urged many states to impose new restrictions to stop the virus from spreading further.

Meanwhile, the Governor of California imposed a 10 PM curfew in most populated U.S. states that will take effect from Saturday. Moreover, the Centre for Disease Control advised Americans not to travel on Thanksgiving holiday as it would increase the infection rate. These concerns added uncertainty in the market and raised a safe-haven appeal that supported the safe-haven Japanese Yen and capped the USD/JPY pair’s gains on Friday.

There was no macroeconomic data from the U.S. on Friday, and from Japan, at 04:30 GMT, the National Core CPI for the year from Japan remained flat with the anticipations of -0.7%. The macroeconomic data failed to impact on currency pair USD/JPY.

Pfizer and BioNtech announced on Friday that they would apply on the day to the US FDA for approval of emergency use of their vaccine on the vaccine front. This, combined with the other companies, included AstraZeneca and Oxford University’s latest reports of their vaccine’s efficacy, added strength in the risk sentiment, and supported the USD/JPY pair’s gains on Friday.

Daily Technical Levels

Support   Resistance

103.56      104.07

103.38      104.40

103.04      104.58

Pivot point: 103.89

USD/JPY – Trading Tips

The USD/JPY extends its bearish trend below the 104.102 level, consolidating within a narrow trading range 104.102 – 103.650. On the lower side, the USD/JPY pair is likely to find support at the 103.650 level, and violation of this level can also extend further selling bias until 103.227. On the higher side, the USD/JPY safe-haven pair may find resistance at 104.400 and may help us capture a selling trades below this level as the MACD and RSI support the selling trend today. Good luck! 

Categories
Forex Elliott Wave Forex Market Analysis

GBPJPY Consolidates in the Bearish Sentiment Zone

The GBPJPY cross continues moving by its seventh session in a row in a sideways channel turning in the neutral zone. However, since the last Thursday trading session, the price is consolidating in the bearish sentiment zone.

The GBPJPY cross continues moving by its seventh session in a row in a sideways channel turning in the neutral zone. However, since the last Thursday trading session, the price is consolidating in the bearish sentiment zone.

The GBPJPY cross continues moving by its seventh session in a row in a sideways channel turning in the neutral zone. However, since the last Thursday trading session, the price is consolidating in the bearish sentiment zone.

Technical Overview

 

The following 8-hour chart illustrates the 90-day high and low range, which exposes the market participants’ sentiment. The figure shows the price action moving around the pivot level at 137.877. Nevertheless, the close below the pivot level pulled the price toward the bearish sentiment zone.

Additionally, the strong bearish rejection in the price action decreasing from the extreme bullish sentiment zone of 140.296 toward the pivot level leads to suspect that the intraday upward movement developed on November 09th couldn’t be as strong as it seemed.

On the other hand, both the positive EMA(60) to Price Index and the 200-period moving average moving below the price, leads to the conclusion that the mid-term sentiment remains on the bullish side. In this regard, the short-term sideways channel’s breakdown could confirm the turning bias from bullish to bearish.

Short-term Technical Outlook

The GBPJPY cross short-term view and under the Elliott Wave perspective reveals the sideways progress in an incomplete corrective sequence that corresponds to wave B of Minor degree labeled in green.

The next 4-hour chart illustrates the advance in a broadening structural series that could correspond to a possible double-three pattern that ended once the price topped at 140.315 on November 11th.

If this scenario is correct, then the pair’s action should be advancing in wave C of Minor degree labeled in green. In this context, the GBPJPY cross should confirm the end of its internal corrective wave corresponding to wave (ii) of Minuette degree identified in blue. In this scenario, the bearish pressure could drag the price toward the end of wave A zone located between levels 133.70 and 133.

The alternative count considers the possibility that wave B of Minor degree remains incomplete and the internal structural series corresponds to a triple-three pattern. In consequence, the current downward move would correspond to the second wave ((x)) of Minute degree. If this scenario is valid, the wave (c) of Minuette degree in blue should have a limited decline, likely until the previous lows located between 135 and 134.

Finally, the invalidation level for both short-term scenarios locates at 140.315, which corresponds to the end of wave ((y)) in black.

Categories
Forex Market Analysis

Daily F.X. Analysis, November 20 – Top Trade Setups In Forex – Eyes on Retail Sales!

The broad-based U.S. dollar failed to stop its overnight losses and remain bearish on the day mainly due to the mixed U.S. Stimulus story. Moreover, the doubts over the U.S. economic recovery in the wake of coronavirus resurgence also weigh on the U.S. dollar. On the news front, eyes will remain on U.K.’s and Canada’s core retail sales to determine further market trends. 

The broad-based U.S. dollar failed to stop its overnight losses and remain bearish on the day mainly due to the mixed U.S. Stimulus story. Moreover, the doubts over the U.S. economic recovery in the wake of coronavirus resurgence also weigh on the U.S. dollar. On the news front, eyes will remain on U.K.’s and Canada’s core retail sales to determine further market trends. 

The broad-based U.S. dollar failed to stop its overnight losses and remain bearish on the day mainly due to the mixed U.S. Stimulus story. Moreover, the doubts over the U.S. economic recovery in the wake of coronavirus resurgence also weigh on the U.S. dollar. On the news front, eyes will remain on U.K.’s and Canada’s core retail sales to determine further market trends. 

Economic Events to Watch Today  

 

 

EUR/USD – Daily Analysis

The EUR/USD currency pair managed to stop its previous day losing streak and remain bullish around the 1.1886 level mainly due to the broad-based U.S. dollar selling bias, triggered by the cautious sentiment around the U.S. stimulus story, which ultimately lends support to the currency pair. However, Mnuchin’s call to recollect funds allocated to Federal Reserve, which eventually weighed on the market trading sentiment, failed to provide any support to the greenback as the Republican heavyweight McConnell recently showed readiness to resume the discussions with the Democrats on a new COVID-19 relief package, which ultimately undermined the U.S. dollar. 

That’s very surprising as the U.S. dollar usually draws bids alongside losses in the equities market. On the contrary, the buying interest around the single currency was capped by the intensifying virus fugues in Europe, which eventually becomes the key factor that has been capped further upside in the currency pair. At the moment, the EUR/USD currency pair is currently trading at 1.1888 and consolidating in the range between the 1.1865 – 1.1891.

The equity market has been declining since the day started amid mixed concerns over the U.S. stimulus story. The Mnuchin’s asked the Federal Reserve to return the remaining coronavirus stimulus funds, which could limit the central bank’s capacity to give additional support to businesses at a time when the coronavirus second wave is accelerating. Let me remind you that these funds were meant for global lending to local government, non-profits, businesses. These factors have been weighing on the market trading sentiment, which could be considered as the main factors that cap further downside in the safe-haven U.S. dollar losses.

On the contrary, Republican heavyweight McConnell recently showed a willingness to continue the negotiations with the Democrats on a new COVID-19 relief package. This news is negative for the U.S. dollar, as a stimulus package would have the effect of reducing the U.S. dollar.

As in result, the broad-based U.S. dollar failed to stop its overnight losses and remain bearish on the day mainly due to the mixed U.S. Stimulus story. Moreover, the doubts about the U.S. economic recovery in the wake of coronavirus resurgence also weigh on the U.S. dollar. Thus, the U.S. dollar losses could also be a key factor that kept the currency pair higher. Meantime, the dollar index unchanged at 92.306 (=USD), off Thursday’s low of 92.236, though it is still down 0.3% on the week.

On the bearish side, the intensifying market worries regarding the continuous hike in new coronavirus cases in Europe and the United States keep fueling the doubts over the global economic recovery through imposing back to back lockdown restrictions on economic and social activity, which eventually weighed on the shared currency and becomes the key factor that kept the lid on any additional gains in the currency pair. 

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

Daily Technical Levels

Support   Resistance

1.1836       1.1880

1.1820       1.1908

1.1791       1.1924

Pivot point: 1.1864

EUR/USD– Trading Tip

On Friday, the EUR/USD is trading with a bearish bias at the 1.1844 level, having violated an upward trendline on the hourly chart. On the lower side, the support stays at 1.1832, and below this, the EUR/USD may find next support at 1.1814. On the higher side, the resistance can be found at the 1.1867 level. The bullish bias remains dominants today as the MACD and 50 periods EMA support a bullish trend. We are already holding a buying trade from yesterday; therefore, you are advised to follow our forex signals page for more updates on the EUR/USD pair. 

GBP/USD – Daily Analysis

During Friday’s European trading session, the GBP/USD currency pair managed to gain positive traction for the second straight session and refresh the intra-day high around closer to 1.3300 level mainly due to the broad-based U.S. dollar fresh weakness, backed by the doubts over the next round of the U.S. fiscal stimulus measures, which eventually undermined the U.S. dollar and contributed to the currency pair gains. 

On the contrary, the worsening coronavirus (COVID-19) conditions in the U.S. and Europe raised the fears of global economic recovery, which could be considered one of the key factors that kept the lid on any additional gains in the currency pair. In the meantime, the gains in the currency pair were also capped by negative Brexit news. At a particular time, the GBP/USD currency pair is currently trading at 1.3275 and consolidating in the range between 1.3247 – 1.3288.

According to the latest report, the European Union (E.U.) prepares for no-deal Brexit plans after the discussions’ dragging. The fears of no-deal Brexit were further bolstered after E.U.’s Chief Negotiator Michel Barnier self-isolated after a member of his team contracted the infection.

Despite the fears of no-deal Brexit and the Sino-American skirmish, not to forget the record single-day increase in COVID-19 cases, the currency pair managed to gain positive traction amid a weaker U.S. dollar. At the USD front, the broad-based U.S. dollar failed to gain any positive traction and edged lower on the day as doubts over the U.S. economic recovery remain amid the coronavirus crisis. The losses in the U.S. dollar kept the currency pair higher. Meantime, the dollar index unchanged at 92.306 (=USD), off Thursday’s low of 92.236, though it is still down 0.3% on the week.

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

Daily Technical Levels

Support    Resistance

1.3155       1.3236

1.3118       1.3280

1.3073       1.3317

Pivot point: 1.3199

GBP/USD– Trading Tip

Most technical levels are the same as Sterling didn’t make any significant change in the market. The GBP/USD pair is trading bullish at the 1.3279 level, holding over the 1.3227 support level, which is extended by an upward trendline on a 2-hour timeframe. The Cable is likely to face immediate resistance at the 1.3297 area, which will be confirmed if the candle starts closing below this level. However, the bullish breakout of the 1.3297 level can drive further upside movement until the 1.3370 level today. 

USD/JPY – Daily Analysis

A day before, the USD/JPY pair was closed at 103.795 after placing a high of 104.207 and a low of 103.650. The currency pair USD/JPY remained bearish for the 5th consecutive session on Wednesday and dragged its prices below the 103.700 level. The USD/JPY pair was extending its losses due to the U.S. dollar weakness on Wednesday despite the latest optimism regarding the coronavirus vaccine. On Wednesday, Pfizer announced that its vaccine was 95% effective in its study and planning to seek authorization within days.

This news added to the market’s risk sentiment and supported the equity market by providing a 0.45% gain to Dow Jones and 0.04% to NASDAQ. The latest news from Pfizer and BioNtech failed to impress the market, and the pair USD/JPY continued following the U.S. dollar’s weakness on Wednesday. The currency pair was under pressure as the coronavirus situation was getting worse day by day in the U.S. as the death toll surpassed 250,000 level in the major economy. According to Johns Hopkins University, the coronavirus has cost almost 250,180 American lives so far, and the count was increasing day by day. This raised fears that more restrictions could be imposed in many states, which would slow down the economic recovery. These fears weighed in the local currency U.S. dollar, and hence, USD/JPY remained under pressure for the 5th consecutive session on Wednesday.

Given the rising number of infections in the country, the States like California and Illinois stretched their restrictions to battle the rising number of cases as any financial aid package was not close to being delivered by Congress. The rising number of coronavirus cases in the U.S. has forced U.S. officials to announce that public schools in New York City will close again on Thursday as the city has reached a 3% coronavirus test positivity rate. These fears also kept the U.S. dollar under pressure on Wednesday.

The House Speaker Nancy Pelosi and Senate Minority Leader Chuck Schumer urged the Senate Majority Leader Mitch McConnell to resume talks related to the coronavirus relief package. However, McConnell was insisting on a targeted package. The U.S. dollar came under further pressure after the hopes for the talks for further stimulus package increased and weighed on the USD/JPY pair.

On the data front, at 02:00 GMT, the TC Long Term Purchases surged to 108.9B from the expected 41.5B and supported the U.S. dollar. At 18:30 GMT, the Building Permits for October came in line with the projections of 1.55M. The Housing Starts rose to 1.53M from the expected 1.45M and supported the U.S. dollar that ultimately capped further losses in the USD/JPY on Wednesday. On the Japanese side, the Trade Balance for October raised to 0.31T against the 0.11T and supported the Japanese Yen that added further pressure on the USD/JPY pair on Wednesday.

Daily Technical Levels

Support    Resistance

103.58       104.16

103.32       104.48

102.99       104.74

Pivot point: 103.90

USD/JPY – Trading Tips

The USD/JPY extends its bearish trend below the 104.430 level, falling from the 104.850 support area. On the lower side, the USD/JPY pair is likely to find support at the 103.800 level, and violation of this level can also extend further selling bias until 103.227. On the higher side, the USD/JPY safe-haven pair may find resistance at 104.400 and may help us capture a selling trades below this level as the MACD and RSI support the selling trend today. Good luck! 

Categories
Forex Elliott Wave Forex Market Analysis

Is NZDJPY ready for a New Upward Move?

The Elliott Wave perspective of the NZDJPY pair reveals it is moving in an incomplete impulsive sequence that began on March 18th when the price found fresh buyers at 59.49.

The Elliott Wave perspective of the NZDJPY pair reveals it is moving in an incomplete impulsive sequence that began on March 18th when the price found fresh buyers at 59.49.

The Elliott Wave perspective of the NZDJPY pair reveals it is moving in an incomplete impulsive sequence that began on March 18th when the price found fresh buyers at 59.49.

Elliott Wave Landscape

In its 12-hour chart, NZDJPY is seen progressing in its fifth wave of Minute degree labeled in black. Its internal structure reveals a sideways action corresponding to the fourth wave of Minuette degree identified in blue. Looking at this context, the cross would likely develop a new upward movement, which should correspond to the fifth wave of Minuette degree of the fifth wave of Minute degree,  following the Elliott Wave theory.

In this regard, the next movement corresponding to the fifth wave in blue of the fifth wave in black should be a terminal move. However, this potential sequence will not necessarily be an ending diagonal pattern.

On the other hand, as exposed in the previous chart, the third wave of Minute degree corresponds to the extended movement of the complete impulsive sequence of Minute degree. Therefore, under the EW rules, the fifth wave cannot be an extended move.

Finally, considering that the fifth wave doesn’t reveal a reversal formation, the current uptrend is likely to continue mostly bullish.

Short-term Technical Outlook

The short-term Elliott wave outlook for the NZDJPY cross displayed in the following 4-hour chart reveals the incomplete internal sequence that currently appears advancing in its fourth wave of Minuette degree identified in blue. At the same time, the corrective wave in progress is running in wave b of Subminuette degree labeled in green.

Once NZDUSD completes its wave b (labeled in green), it could develop a new decline corresponding to wave c. This intraday downward movement, subdivided into five internal segments, could fail below the latest lows, with its potential support on 71.411, where the NZDJPY cross could find fresh buyers expecting to boost its price toward the potential target zone located between 72.569, even till the psychological barrier at 73.002. This likely decline could be a “bear trap,” the big market participant could use to incorporate their long positions.

On the other hand, looking back in our first 12H chart, considering that the third wave is the extended wave,we can perceive two potential scenarios for the wave (v), in blue.

  • Scenario 1: Wave (v) doesn’t surpass the end of wave (iii) located at 72.791 and starts to decline, unveiling the bearish pressure for the cross. In this case, the price likely would pierce and close below level 71.411.
  • Scenario 2:  Wave (v) exceeds the end of wave (iii). In this case, the bullish pressure continues; therefore, the cross retracement could find support above the recent low located at 71.51.

Finally, the invalidation level corresponding to the intraday bullish scenario is 70.511, corresponding to the end of wave (i) identified in blue.

Categories
Forex Elliott Wave Forex Market Analysis

Is EURGBP Ready for an Elliott Wave Rally?

Technical Overview

Technical Overview

Technical Overview

The EURGBP cross develops an incomplete Elliott wave correction of Minor degree labeled in green, which began on September 03rd when the price found fresh buyers at 0.88658 and rallied until 0.92916, in where the cross completed its wave A in green. 

The following 4-hour chart illustrates wave B completion.  We see that its internal structure looks like a double-three pattern. This second leg started on 0.92916 on September 11th and ended on November 11th when the price found fresh buyers that boosted the cross in a move that looks like an impulsive intraday rally.

According to the Elliott Wave theory, the double-three pattern is a complex correction that follows an internal structure subdivided into 3-3-3. Likewise, in a corrective formation subdivided into three-wave movements, the segment corresponding to wave C should hold five segments inside it.

On the other hand, considering the Elliott wave theory’s alternation principle, the price likely could advance in an aggressive rally after an extended complex movement.

The cross is advancing in its wave ((ii)) of Minute degree labeled in black that belongs to wave C of Minor degree. In this context, the descending channel’s upper line’s breakout would confirm the potential bullish continuation of wave (iii).

Short-term Technical Outlook

The next 4-hour chart shows the second wave of Minute degree’s internal corrective structure, which could be advancing in its wave (c) of Minuette degree labeled in blue. 

From the previous chart, if the cross finds support in the demand zone located between 0.8917 and 0.8901, opens the likelihood of a new rally corresponding to wave ((iii)), which could advance toward the first supply zone between 0.9126 and 0.91464. The next potential target zone resides between 0.9200 and 0.9218.

On the other hand, both the breakout of the intraday descending trendline that connects the end of waves ((i)) in black and (b) in blue and the surpassing of the end of wave ((i)) will confirm the advance in wave ((iii)) of Minute degree.

Finally, the bullish turning scenario’s invalidation level locates at 0.88610, which corresponds to the origin of wave ((i)).

Categories
Forex Signals

USD/CHF Breaks Above Descending Triangle – Watch out! 

The USD/CHF failed to stop its overnight losing streak and remain depressed around just above the 0.9100 level mainly due to the worsening coronavirus (COVID-19) woes in the U.S., Europe, and some of the notable Asian nations like Japan, which eventually exerted downside pressure on the market trading sentiment and contributed to the currency pair losses. 

The USD/CHF failed to stop its overnight losing streak and remain depressed around just above the 0.9100 level mainly due to the worsening coronavirus (COVID-19) woes in the U.S., Europe, and some of the notable Asian nations like Japan, which eventually exerted downside pressure on the market trading sentiment and contributed to the currency pair losses. 

The USD/CHF failed to stop its overnight losing streak and remain depressed around just above the 0.9100 level mainly due to the worsening coronavirus (COVID-19) woes in the U.S., Europe, and some of the notable Asian nations like Japan, which eventually exerted downside pressure on the market trading sentiment and contributed to the currency pair losses. 

Apart from this, the geopolitical tensions between China and some notable countries like the U.S. added a burden around the equity market. Thereby, the risk-off market sentiment underpins the safe-haven Swiss franc and contributes to the currency pair losses. Conversely, the broad-based U.S. dollar strength, backed by the market risk-off tone, has become the key factor that kept the lid on any additional losses in the currency pair. 

In the meantime, the fresh optimism over Brexit talks and the positive news about vaccine progress help the market trading sentiment limit its deeper losses, which might provide some support to the currency pair. As of writing, the USD/CHF currency pair is currently trading at 0.9109 and consolidating in the range between 0.9104 – 0.9126.

Despite the renewed optimism over the possible vaccine for the highly infectious coronavirus disease, the market trading sentiment failed to extend its overnight positive performance. It started to flash red during the Asian session on the day, possibly due to the combination of factors. Be it the worrisome headlines concerning the US-China tussle or the resurgence of COVID-19 new cases in the U.S., Europe, and Japan; everything has been weighing on the market trading sentiment. This, in turn, provided a boost to the safe-haven Swiss Franc and exerted some additional pressure on the currency pair.

As per the latest Johns Hopkins University report, the global cases crossed 56 million figures, of which 11.5 million are in the U.S., along with nearly 250,000 deaths, nearly one-fifth of total global deaths. Not only from the U.S. but Tokyo also alarmed investors. As in result, New York restricts personal presence at the schools while Japan alarmed alerts in the capital after the daily cases rise crosses 500 on November 16. It is worth mentioning that Japan’s COVID-19 cases raised past-2,000 for the first time since the virus outbreak began. At the same time, Germany reported 22,609 new coronavirus infections, the 3rd-highest daily hike on record. Two hundred fifty-one deaths were recorded, as the total fatalities reached 13,370 so far.

Considering the current condition of virus spreading, Poland is also thinking about imposing a nationwide lockdown while major European economies, including France, Italy, Spain, and the U.K., are already under lockdowns. This, in turn, exerted downside pressure on the market risk tone and contributed to currency pair gains.

Elsewhere, the U.S., U.K., and Australia recently released a joint statement showing their disappointment over the Dragon Nation’s performance in Hong Kong. The global policymakers urged the Asian major to respect international commitment while urging to stop threatening Hong Kong peoples. 

As in result, the broad-based U.S. dollar managed to keep its gains throughout the Asian session as the traders are still cheering the risk-off marker mood. However, the U.S. dollar bullish bias was rather unaffected by the worsening coronavirus (COVID-19) conditions in the U.S. or the US COVID-19 aid package delay. However, the U.S. dollar gains turned out to be one of the leading factors that help the currency pair limit its deeper losses. Simultaneously, the U.S. Dollar Index that tracks the greenback against a bucket of other currencies rose to 92.448.

Looking forward, the traders will keep their eyes on U.S. Unemployment Claims along with Philly Fed Manufacturing Index. In the meantime. The release of Trade Balance will be key to watch. Across the pond, the ongoing drama surrounding the US-China relations and updates about the U.S. stimulus package will not lose their importance. 


Daily Support and Resistance

S1 0.9049

S2 0.908

S3 0.91

Pivot Point 0.9111

R1 0.9131

R2 0.9143

R3 0.9174

The USD/CHF has violated the descending triangle pattern, extending resistance at 0.9148 level. Previously, the USD/CHF was extending resistance at the 0.9120 level, and since this level has already been violated, we may have further upward movement until 0.9150 and 0.9199 level. The MACD is also supporting the buying trend; therefore, we can try to capture a quick buy trade over the 0.9110 level today. Good luck!  

Categories
Forex Signals

AUD/USD Violates Upward Channel Breakout – Update on Sell Signal! 

The AUD/USD pair is trading with bearish bias around 0.7284 level; that’s where we have entered sell trade in the Aussie. The U.S. dollar seems to gain strength amid supported fundamentals. From the U.S. side, at 02:00 GMT, the TC Long Term Purchases for October rose to 108.9B against the estimated 41.5B and supported the U.S. dollar. At 18:30 GMT, the Building Permits for October came in line with the estimation of 1.55M. The Housing Starts also rose to 1.53M from the forecasted1.45M and supported the U.S. dollar that ultimately capped further gains in AUD/USD pair on Wednesday.

The AUD/USD pair is trading with bearish bias around 0.7284 level; that’s where we have entered sell trade in the Aussie. The U.S. dollar seems to gain strength amid supported fundamentals. From the U.S. side, at 02:00 GMT, the TC Long Term Purchases for October rose to 108.9B against the estimated 41.5B and supported the U.S. dollar. At 18:30 GMT, the Building Permits for October came in line with the estimation of 1.55M. The Housing Starts also rose to 1.53M from the forecasted1.45M and supported the U.S. dollar that ultimately capped further gains in AUD/USD pair on Wednesday.

The AUD/USD pair is trading with bearish bias around 0.7284 level; that’s where we have entered sell trade in the Aussie. The U.S. dollar seems to gain strength amid supported fundamentals. From the U.S. side, at 02:00 GMT, the TC Long Term Purchases for October rose to 108.9B against the estimated 41.5B and supported the U.S. dollar. At 18:30 GMT, the Building Permits for October came in line with the estimation of 1.55M. The Housing Starts also rose to 1.53M from the forecasted1.45M and supported the U.S. dollar that ultimately capped further gains in AUD/USD pair on Wednesday.

The rising number of coronavirus cases and extended restrictions in California in the U.S. with New York closing its schools from Thursday weighed on the U.S. dollar. As well as, the death rate from the virus in the U.S. reached above 250,000 numbers and became the highest death rate that depressed the U.S. dollar and supported.

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Daily technical Levels

Support Resistance

0.7273 0.7334

0.7242 0.7364

0.7212 0.7395

Pivot point: 0.7303

The AUD/USD was consolidating near the 0.7291 mark, staying below an immediate resistance area of 0.7330. The AUD/USD is expected to remain supported above 0.7270, but until this level gets achieve, we may have an opportunity to short the Aussie. Checkout a trade signal below…

 

Entry Price – Buy 0.8973
Stop Loss – 0.9013
Take Profit – 0.8933
Risk to Reward – 1:1
Profit & Loss Per Standard Lot = -$400/ +$400
Profit & Loss Per Micro Lot = -$40/ +$40
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Categories
Forex Market Analysis

Daily F.X. Analysis, November 19 – Top Trade Setups In Forex – U.S. Jobless Claims in Focus! 

The economic calendar is filled with medium impact economic events such as Unemployment Claims, C.B. Leading Index m/m, and Existing Home Sales from the United States on the news front. Besides, the Current Account from the Eurozone will also remain in the highlights today. The market may show some price action during the U.S. session on the release of U.S. Jobless Claims.

The economic calendar is filled with medium impact economic events such as Unemployment Claims, C.B. Leading Index m/m, and Existing Home Sales from the United States on the news front. Besides, the Current Account from the Eurozone will also remain in the highlights today. The market may show some price action during the U.S. session on the release of U.S. Jobless Claims.

The economic calendar is filled with medium impact economic events such as Unemployment Claims, C.B. Leading Index m/m, and Existing Home Sales from the United States on the news front. Besides, the Current Account from the Eurozone will also remain in the highlights today. The market may show some price action during the U.S. session on the release of U.S. Jobless Claims.

Economic Events to Watch Today  

 

EUR/USD – Daily Analysis

The EUR/USD pair was closed at 1.18539 after placing a high of 1.18908 and a low of 1.18491. The EUR/USD pair dropped on Wednesday after placing gains for four consecutive days. The EUR/USD pair remained on an upbeat track last days amid the market sentiment’s risk-on market sentiment due to the vaccine optimism. The riskier currencies gathered strength against the safe-havens like the USD and posted gains over the last week. However, on Wednesday, the EUR/USD pair started to decline as Europe’s lockdown situation started to raise fears for economic recovery.

However, the second wave of the coronavirus in Europe started to show signs of slowing. The latest numbers showed a stabilization in new cases in Germany, Spain, Italy and a decline in Belgium, France, and the Netherlands. Despite this, the experts have warned that it was too early to get complacent. The lockdowns and tough social restrictions were reintroduced across numerous European countries in October due to the increased spread of the second wave of coronavirus. These restrictions have been placing a threat on European nations’ economic recovery and weighed on Euro currency that has dragged the EUR/USD pair down on Wednesday.

On the data front, at 02:00 GMT, the TC Long Term Purchases from the U.S. raised to 108.9B against the forecasted 41.5B and supported the U.S. dollar that ultimately added losses in the EUR/USD pair. At 18:30 GMT, the Building Permits from October remained flat with the anticipations of 1.55M. The Housing Starts were raised to 1.53M from the projected 1.45M and supported the U.S. dollar that weighed on EUR/USD pair on Wednesday.

From the European side, at 15:00 GMT, the Final CPI for the year came in line with the expectations of -0.3%. The Final CPI for the year also remained flat as expected, 0.2%. European data failed to impact the EUR/USD pair on Wednesday, and the pair continued following the U.S. dollar’s movement.

The losses in the EUR/USD pair were limited after the risk sentiment was improved in the market due to the latest optimism regarding the coronavirus vaccine. Pfizer and BioNtech announced that they would be filing for emergency authorization of their vaccine in the coming days from the U.S. This raised the optimism that vaccines will soon be available in the market, and the chaos will be lifted from the economy, and it will start to recover. The riskier currency Euro gained traction and capped further losses in the EUR/USD pair on Wednesday.

Daily   Technical Levels

Support Resistance

1.1836      1.1880

1.1820      1.1908

1.1791      1.1924

Pivot point: 1.1864

EUR/USD– Trading Tip

The EUR/USD is trading with a bearish bias at the 1.1844 level, having violated an upward trendline on the hourly chart. On the lower side, the support stays at 1.1832, and below this, the EUR/USD may find next support at 1.1814. On the higher side, the resistance can be found at the 1.1867 level. The bullish bias remains dominants today as the MACD and 50 periods EMA support a bullish trend. We are already holding a buying trade from yesterday; therefore, you are advised to follow our forex signals page for more updates on the EUR/USD pair. 

GBP/USD – Daily Analysis

The GBP/USD closed at 1.32670 after placing a high of 1.33120 and a low of 1.32410. The pair GBP/USD continued its bullish momentum for the 4th consecutive day on Wednesday and reached near 1.33200 level. The latest rise in the GBP/USD pair was driven by the growing hopes that a Brexit deal could be within reach after the French President Emmanuel Macron was ready to cave in on demands from the U.K. for full sovereignty waters that will likely rein in access for French fishermen.

This news raised hopes for a Brexit deal before the end of the transition period and supported the British Pound that ultimately lifted the GBP/USD pair higher on board. The Irish Minister Micheal Martin also said that a landing zone for an agreement was within sight just a day ahead of the European Union Summit when the E.U. Brexit negotiator Michel Barnier will brief E.U. leaders about the two weeks of talks held with the U.K.

Chances are increased that an agreement will be made as soon as Monday and will be approved within a week, most likely at the next E.U. Summit on December 10. After that, the European Parliament would have to rubberstamp the agreement to ensure a deal was placed before the end of the transition period on Dec.31st.

All these hopes lifted the British Pound as the chances of a deal were clear for the first time, and things were going in favor of the U.K. However, analysts were concerned that inflation was likely to slow in the months ahead. The GBP/USD pair picked up its pace towards an upward direction due to renewed Brexit optimism and reached near 1.3200 level on Wednesday. On the data front, At 12:00 GMT, the Consumer Price Index for the year raised to 0.7% from the expected 0.5% and supported the Sterling. The year’s Core CPI also raised to 1.5% against the anticipated 1.3% and supported British Pound. The RPI from the U.K. also rose to 1.3% from the expected 1.2% and supported British Pound that ultimately added further gains in GBP/USD pair. At 12:02 GMT, the PPI Input for October surged to 0.2% against the expected 0.0% and supported the British Pound. At the same time, the PPI Output in October remained flat with the expectations of 0.0%. The Housing Price Index from the U.K. also surged to 4.7% against the forecasted 2.9% and supported the British Pound.

The U.K.’s positive macroeconomic data supported the British Pound against the U.S. dollar and raised the GBP/USD pair on Wednesday.

While from the U.S. side, at 02:00 GMT, the TC Long Term Purchases rose to 108.9B against the anticipated 41.5B and supported the U.S. dollar. At 18:30 GMT, the Building Permits for October remained flat with the projections of 1.55M. The Housing Starts surged to 1.53M from the anticipated 1.45M and supported the U.S. dollar that ultimately capped further gains in GBP/USD pair on Wednesday.

Meanwhile, the Bank of England’s Chief Economist Andy Haldane said that the economic outlook for 2021 was materially brighter than he had expected just a few weeks ago despite the short-term uncertainty from a renewed coronavirus lockdown in England. He said that Britain’s economy shrank by almost 20% in the second quarter of 2020, more than any other peer economy, and at the end of September, it was still 8.4% smaller than a year before. He struck a somewhat positive note in line with his previous assessments of Britain’s recovery on Wednesday that raised the British Pound on board against the U.S. dollar. This also benefited the GBP/USD pair on Wednesday, and hence, the pair ended its day with a bullish candle.

Daily Technical Levels

Support   Resistance

1.3155      1.3236

1.3118      1.3280

1.3073      1.3317

Pivot point: 1.3199

GBP/USD– Trading Tip

The GBP/USD pair is trading bullish at the 1.3279 level, holding over the 1.3227 support level, which is extended by an upward trendline on a 2-hour timeframe. The Cable is likely to face immediate resistance at the 1.3297 area, which will be confirmed if the candle starts closing below this level. However, the bullish breakout of the 1.3297 level can drive further upside movement until the 1.3370 level today. 

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 103.795 after placing a high of 104.207 and a low of 103.650. The currency pair USD/JPY remained bearish for the 5th consecutive session on Wednesday and dragged its prices below the 103.700 level. The USD/JPY pair was extending its losses due to the U.S. dollar weakness on Wednesday despite the latest optimism regarding the coronavirus vaccine. On Wednesday, Pfizer announced that its vaccine was 95% effective in its study and planning to seek authorization within days.

This news added to the market’s risk sentiment and supported the equity market by providing a 0.45% gain to Dow Jones and 0.04% to NASDAQ. The latest news from Pfizer and BioNtech failed to impress the market, and the pair USD/JPY continued following the U.S. dollar’s weakness on Wednesday.

The currency pair was under pressure as the coronavirus situation was getting worse day by day in the U.S. as the death toll surpassed 250,000 level in the major economy. According to Johns Hopkins University, the coronavirus has cost almost 250,180 American lives so far, and the count was increasing day by day. This raised fears that more restrictions could be imposed in many states, which would slow down the economic recovery. These fears weighed in the local currency U.S. dollar, and hence, USD/JPY remained under pressure for the 5th consecutive session on Wednesday.

Given the rising number of infections in the country, the States like California and Illinois stretched their restrictions to battle the rising number of cases as any financial aid package was not close to being delivered by Congress. The rising number of coronavirus cases in the U.S. has forced U.S. officials to announce that public schools in New York City will close again on Thursday as the city has reached a 3% coronavirus test positivity rate. These fears also kept the U.S. dollar under pressure on Wednesday.

The House Speaker Nancy Pelosi and Senate Minority Leader Chuck Schumer urged the Senate Majority Leader Mitch McConnell to resume talks related to the coronavirus relief package. However, McConnell was insisting on a targeted package. The U.S. dollar came under further pressure after the hopes for the talks for further stimulus package increased and weighed on the USD/JPY pair.

On the data front, at 02:00 GMT, the TC Long Term Purchases surged to 108.9B from the expected 41.5B and supported the U.S. dollar. At 18:30 GMT, the Building Permits for October came in line with the projections of 1.55M. The Housing Starts rose to 1.53M from the expected 1.45M and supported the U.S. dollar that ultimately capped further losses in the USD/JPY on Wednesday. On the Japanese side, the Trade Balance for October raised to 0.31T against the 0.11T and supported the Japanese Yen that added further pressure on the USD/JPY pair on Wednesday.

Daily Technical Levels

Support   Resistance

103.58      104.16

103.32      104.48

102.99      104.74

Pivot point: 103.90

USD/JPY – Trading Tips

The USD/JPY extends its bearish trend below the 104.430 level, falling from the 104.850 support area. On the lower side, the USD/JPY pair is likely to find support at the 103.800 level, and violation of this level can also extend further selling bias until 103.227. On the higher side, the USD/JPY safe-haven pair may find resistance at 104.400 and may help us capture a selling trades below this level as the MACD and RSI support the selling trend today. Good luck! 

Categories
Forex Market Analysis

AUDUSD Prepares for Employment Data Ahead

Market Overview

Market Overview

Market Overview

The AUDUSD pair during the overnight trading session will be driven by October’s employment data, to be released by the Australian Bureau of Statistics in a few hours. The analysts’ consensus expects an increase of 7.1% in the unemployment rate (YoY), representing a deterioration in the labor market conditions and a rise over the 6.9% reported in September.

The unemployment rate jumped from 5.1% in January to 7.5% in August during the current year. In this context, the Governor of the Reserve Bank of Australia (RBA), Philip Lowe, confirmed the change in the focus from inflation rate to labor market conditions, which according to Governor Lowe, would face “an extended period of higher unemployment than we have become used to.”

On the other hand, the next 8-hour chart illustrates the market participants’ sentiment unveiled by the 90-day high and low range, where the price action looks testing the extreme bullish sentiment zone support located at 0.73009.

Likewise, the Aussie advances in a sideways movement. We can see that, after reaching its yearly high at 0.74135, the Aussie was dragged toward the extreme bearish sentiment zone, where the Australian currency bounced back to the extreme bullish sentiment.

Currently, the re-test of the recent intraday high at 0.7335 leads us to expect further upsides in the following sessions, likely to head to its early September highs at 0.7400.

Short-term Technical Outlook

The short-term Elliott Wave view exposed in the next 8-hour chart reveals the sideways advance in an incomplete flat pattern of Minuette degree identified in blue, which, according to the Elliott Wave theory, follows an internal sequence subdivided into 3-3-5. This corrective pattern in progress belongs to the fourth wave of Minute degree labeled in black.

The previous figure shows the current wave (b) in blue, which began on September 25th on 0.70059. The end of wave b of Subminuette degree identified in green pierced the origin of wave a. That leads us to consider the possibility that the current corrective formation could correspond to an expanded flat pattern. 

Finally, the current incomplete movement corresponding to wave c in green could advance to the potential target area between 0.7352 and 0.7465. If the price action doesn’t surpass the level 0.7352, then the price could test the sideways channel’s previous lows. 

The alternative scenario is if the price breaks above the 0.74134 level, climbing until 0.7465. Thar means the bullish pressure is strong. In that case, the next decline corresponding to wave c in blue will likely be weaker, ending in a region under 0.71, but no further than 0.70.

Categories
Forex Signals

AUD/USD Upward Channel Supports – Choppy Session in Play!

The AUD/USD was closed at 0.72998 after placing a high of 0.73393 and a low of 0.72887. After placing gains for two consecutive days, the AUD/USD pair was declined on Tuesday amid the risk-off market sentiment. On Tuesday, the Assistant Governor of Reserve Bank of Australia, Dr. Kent, said that the Aussie’s recent rise was due to the optimistic news of the coronavirus vaccine rather than about the US Presidential election outcome. He said that any positive news about vaccine development would be a good thing for the global economy, including the Australian economy.

The AUD/USD was closed at 0.72998 after placing a high of 0.73393 and a low of 0.72887. After placing gains for two consecutive days, the AUD/USD pair was declined on Tuesday amid the risk-off market sentiment. On Tuesday, the Assistant Governor of Reserve Bank of Australia, Dr. Kent, said that the Aussie’s recent rise was due to the optimistic news of the coronavirus vaccine rather than about the US Presidential election outcome. He said that any positive news about vaccine development would be a good thing for the global economy, including the Australian economy.

The AUD/USD was closed at 0.72998 after placing a high of 0.73393 and a low of 0.72887. After placing gains for two consecutive days, the AUD/USD pair was declined on Tuesday amid the risk-off market sentiment. On Tuesday, the Assistant Governor of Reserve Bank of Australia, Dr. Kent, said that the Aussie’s recent rise was due to the optimistic news of the coronavirus vaccine rather than about the US Presidential election outcome. He said that any positive news about vaccine development would be a good thing for the global economy, including the Australian economy.

Over the chances of negative interest rates by the Reserve Bank of Australia, Kent said it was extraordinarily unlikely that the bank would go for it. These comments from Kent failed to provide any specific movement in AUD/USD pair. Meanwhile, the minutes from the Reserve Bank of Australia were released on Tuesday, showing that the central bank was ready to provide more policy stimulus if needed after cutting rates to record lows. The bank’s board felt taking interest rates negative was not sensible, and any further action would involve increasing bond purchases.

The minutes revealed that the bank has decided to cut its main cash rate by 15 basis points to just 0.1% and launch a new bond-buying program. The board was ready to do more in need, and the focus over the period ahead will be the government bond purchase program. Moreover, on the data front, from the US side, at 19:00 GMT, the Capacity Utilization Rate raised to 72.8% against the estimated 72.3%. It supported the US dollar added further losses in the AUD/USD pair. The Industrial Production came in line with the anticipations of 1.1% in October. At 20:00 GMT, the Business Inventories for September rose to 0.7% against the expected 0.5% and weighed on the US dollar. The NAHB Housing Market Index from the US surged to 90 from the expected 85 and supported the US dollar that weighed on AUD/USD pair.

Another aspect included in the AUD/USD pair’s downward momentum was the risk-off market sentiment due to the rising coronavirus cases across the globe. The second wave of coronavirus forced many governments to re-impose restrictions that raised economic recovery concerns and increased the appeal for safe-haven that weighed on the AUD/USD pair on Tuesday.


Daily technical Levels
Support Resistance
0.7278 0.7329
0.7257 0.7361
0.7226 0.7381
Pivot point: 0.7309

The AUD/USD pair’s technical side hasn’t changed much as it continues to trade around the 0.7291 level, holding below an immediate resistance area of 0.7330 level. The AUD/USD is likely to remain supported over the 0.7270 level, and it may find resistance around the 0.7330 mark. A bearish breakout of the 0.7272 level can extend the selling trend until the 0.7260 level today; let’s keep an eye on the 0.7290 level as below this selling trend can be seen and vice versa. Good luck!

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Forex Signals

USD/CAD Holds Above 1.3060 Support – Brace for a Buy Trade! 

The USD/CAD pair was closed at 1.31037 after placing a high of 1.31164 and a low of 1.30631. After placing losses for two consecutive days, the USD/CAD pair raised on Tuesday amid the declining crude oil prices and weak Canadian dollar. The Canadian dollar was weak on Tuesday as the crude oil prices declined after the coronavirus cases surged in the US to an alarming level and forced many states to re-impose lockdown restrictions. The restrictions meant less use and demand for energy and weighed on crude oil prices that were also considered commodity-linked Loonie. The weak Loonie then eventually pushed the USD/CAD pair higher on Tuesday.

The USD/CAD pair was closed at 1.31037 after placing a high of 1.31164 and a low of 1.30631. After placing losses for two consecutive days, the USD/CAD pair raised on Tuesday amid the declining crude oil prices and weak Canadian dollar. The Canadian dollar was weak on Tuesday as the crude oil prices declined after the coronavirus cases surged in the US to an alarming level and forced many states to re-impose lockdown restrictions. The restrictions meant less use and demand for energy and weighed on crude oil prices that were also considered commodity-linked Loonie. The weak Loonie then eventually pushed the USD/CAD pair higher on Tuesday.

The USD/CAD pair was closed at 1.31037 after placing a high of 1.31164 and a low of 1.30631. After placing losses for two consecutive days, the USD/CAD pair raised on Tuesday amid the declining crude oil prices and weak Canadian dollar. The Canadian dollar was weak on Tuesday as the crude oil prices declined after the coronavirus cases surged in the US to an alarming level and forced many states to re-impose lockdown restrictions. The restrictions meant less use and demand for energy and weighed on crude oil prices that were also considered commodity-linked Loonie. The weak Loonie then eventually pushed the USD/CAD pair higher on Tuesday.

The rising hopes of a coronavirus vaccine after the release of Moderna vaccine promising test results and market speculation about a likely OPEC+ agreement to extend output cuts beyond January 2021 failed to offset fears about the economic consequences of the escalating numbers of infections and deaths in Europe and the US. On the data front, the US dollar remains weak after the release of macroeconomic data on Tuesday. At 18:30 GMT, the Core Retail Sales from the US dropped to 0.2% against the expected 0.6% and weighed on the US dollar that capped further gains in the USD/CAD pair. The Retail Sales in October from the US also fell to 0.3% from the anticipated 0.5% and weighed on the US dollar. The Import Prices in the US for October also fell to -0.1% from the expected 0.2%and weighed on the US dollar.

At 19:00 GMT, the Capacity Utilization Rate from the US surged to 72.8% against the estimated 72.3% and supported the US dollar that provided support to the USD/CAD pair’s bullish moves. The Industrial Production remained flat at 1.1% in October. At 20:00 GMT, the Business Inventories for September raised to 0.7% against the expected 0.5% and weighed on the US dollar. The NAHB Housing Market Index from the US surged to 90 from the expected 85 and supported the US dollar that eventually supported the USD/CAD pair’s gains on Tuesday.

From the Canadian side, the Housing Starts for October were released at 18:13 GMT that dropped to 215K from the forecasted 220K and weighed on the Canadian dollar that eventually pushed the USD/CAD pair higher. At 18:30 GMT, the Foreign Securities Purchases were dropped to 4.46B against the projected 5.0B and weighed on the Canadian dollar that ultimately added strength to the USD/CAD pair. The Wholesale Sales from Canada raised to 0.9% against the forecasted 0.4% and supported the Canadian dollar.


Daily Technical Levels

Support Resistance

1.3070 1.3127

1.3037 1.3151

1.3014 1.3184

Pivot point: 1.3094

The USD/CAD pair is trading over the 1.3060 level, mostly supported by the CPI report. A bearish breakout of the 1.3060 level can drive the selling trend until the 1.2935 area. While on the other hand, the resistance stays at the 1.3173 level today. The MACD and RSI are in support of the selling trend; thus, we may consider taking a selling trade only upon the breakout of the 1.3055 level and buying over the 1.3060 level. Good luck! 

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Forex Market Analysis

Daily F.X. Analysis, November 18 – Top Trade Setups In Forex – Series of Inflation Reports Ahead! 

On the news front, eyes will remain on the low and medium series impacts economic evens from U.K., Eurozone, and Canada. Its the CPI figures which are coming from all three major economies during European and the U.S. sessions. The U.K. and Eurozone Inflation reports are expected to remain neutral, with no major change expected, and these may have a muted impact on the market. However, the Canadian CPI is expected to perform slightly better, surging by 0.2% vs. -0.1% dip during the previous month. It may support Lonnie pairs today.

On the news front, eyes will remain on the low and medium series impacts economic evens from U.K., Eurozone, and Canada. Its the CPI figures which are coming from all three major economies during European and the U.S. sessions. The U.K. and Eurozone Inflation reports are expected to remain neutral, with no major change expected, and these may have a muted impact on the market. However, the Canadian CPI is expected to perform slightly better, surging by 0.2% vs. -0.1% dip during the previous month. It may support Lonnie pairs today.

On the news front, eyes will remain on the low and medium series impacts economic evens from U.K., Eurozone, and Canada. Its the CPI figures which are coming from all three major economies during European and the U.S. sessions. The U.K. and Eurozone Inflation reports are expected to remain neutral, with no major change expected, and these may have a muted impact on the market. However, the Canadian CPI is expected to perform slightly better, surging by 0.2% vs. -0.1% dip during the previous month. It may support Lonnie pairs today.

Economic Events to Watch Today  

 

 

EUR/USD – Daily Analysis

The EUR/USD pair was closed at 1.18605 after placing a high of 1.18935 and a low of 1.18423. The EUR/USD pair continued to move in bullish track for the 4th consecutive day on Tuesday amid the downbeat economic data from the U.S. and broad-based U.S. dollar weakness. The improved risk sentiment in the market continued supporting the EUR/USD pair on Tuesday in the early trading session, which pushed the currency pair towards a fresh weekly high at 1.1894. The risk sentiment was supported by the latest optimism from the vaccine candidates of Pfizer and Moderna. After the latest announcement from Moderna that its vaccine was 94.5% effective in last stage trials, the risk sentiment picked its pace and favored the riskier assets like EUR/USD pair.

However, the currency pair could not remain on the top for long and started losing some of its daily gains on Tuesday amid the risk-off market environment in the second half of the day. The U.S. dollar gained traction in the second half and weighed on the currency pair EUR/USD after the chances for a further stimulus package from Congress declined.

The U.S. Dollar Index was down to an 8-day lowest level of 92.26 in the first half of the day because of the rising number of coronavirus cases and lockdown restrictions in the economy. The increased number of coronavirus cases from the U.S. forced governments to impose restrictive measures to control the spread of the virus, and the chances for quick economic recovery faded that ultimately weighed on the U.S. dollar and helped EUR/USD pair to reach a new weekly high level.

However, the U.S. dollar lost its momentum after the release of its macroeconomic data on Tuesday. At 18:30 GMT, the Core Retail Sales for October dropped to 0.2% from the estimated 0.6% and weighed on the U.S. dollar. In October from the U.S., the Retail Sales also dropped to 0.3% from the expected 0.5% and weighed on the U.S. dollar. The Import Prices in the U.S. for October were declined to -0.1% from the estimated 0.2%and weighed on the U.S. dollar that helped EUR/USD pair to post gains.

At 19:00 GMT, the Capacity Utilization Rate from the U.S. raised to 72.8% against the forecasted 72.3% and supported the U.S. dollar that capped further gains in EUR/USD pair. The Industrial Production remained flat with the anticipations of 1.1% in October. At 20:00 GMT, the Business Inventories for September surged to 0.7% against the projected 0.5% and weighed on the U.S. dollar. The NAHB Housing Market Index from the U.S. surged to 90 from the estimated 85 and supported the U.S. dollar that eventually weighed on the EUR/USD pair and capped further gains.

From the European side, at 14:02 GMT, the Italian Trade Balance raised to 5.85B against the forecasted 4.30B. It supported the single currency Euro that ultimately added gains in the EUR/USD pair.

Furthermore, the European Central Bank President, Christine Lagarde, sounded pessimistic on Tuesday concerning the economic outlook and said that there was very negative news on the second wave of coronavirus in the economy before vaccine news. She expected a massive effect of the second wave of COVID-19 on the European economy into 2021. These comments from Lagarde also kept the pair EUR/USD under pressure on Tuesday.

Daily Technical Levels

Support   Resistance

1.1837      1.1890

1.1814      1.1918

1.1785      1.1942

Pivot Point: 1.1866

EUR/USD– Trading Tip

The EUR/USD is trading with a bullish bias, holding mostly above the upward trendline support level of 1.1850. Closing of candles above the 1.1869 level is likely to drive bullish movement in the EUR/USD pair until the 1.1885 level. The bullish bias remains dominants today as the MACD and 50 periods EMA support a bullish trend. We are already holding a buying trade from yesterday; therefore, you are advised to follow our forex signals page for more updates on the EUR/USD pair. 

GBP/USD – Daily Analysis

The GBP/USD pair was closed at 1.32483 after a high of 1.32724 and a low of 1.31863. The GBP/USD pair raised and continued its bullish track for 3rd consecutive day on Tuesday amid the latest Brexit hopes.

Due to the increased number of COVID-19 cases from across the globe, and the restrictive measures by countries to curb the virus’s spread, the demand for safe-haven currencies increased. In contrast, the riskier currencies like the British Pound remained under pressure.

The Sterling remained supportive in this risk-off mode due to the latest comments from the U.K. chief negotiator, David Frost, that boosted the Brexit deal’s confidence. According to a news report by the U.K. newspaper, The Sun, the previous concerns about the differences in key issues vanished after Britain’s chief negotiator David Frost commented to Boris Johnson that he expects a trade deal signed early next week.

After these comments from David Frost, the GBP/USD pair rallied and started moving upward for the 3rd consecutive day.

Meanwhile, the risk sentiment buoyed by the latest optimism regarding the vaccine development from Moderna also supported the British Pound’s bullish momentum and added further to the gains of the GBP/USD pair on Tuesday. Furthermore, the U.S. dollar weakness also played an important role in pushing the currency pair GBP/USD higher on Tuesday with poor macroeconomic figures. At 18:30 GMT, the Core Retail Sales for October declined to 0.2% from the expected 0.6% and weighed on the U.S. dollar. In October from the U.S., the Retail Sales also fell to 0.3% from the anticipated 0.5% and weighed on the U.S. dollar. The Import Prices in the U.S. for October fell to -0.1% against the projected 0.2%and weighed on the U.S. dollar that added further gains in the GBP/USD pair on Tuesday.

At 19:00 GMT, the Capacity Utilization Rate from the U.S. surged to 72.8% against the anticipated 72.3% and supported the U.S. dollar that capped further gains in GBP/USD pair. The Industrial Production came in line with the projections of 1.1% in October. At 20:00 GMT, the Business Inventories for September increased to 0.7% against the estimated 0.5% and weighed on the U.S. dollar, which added strength to the GBP/USD pair. The NAHB Housing Market Index from the U.S. rose to 90 from the projected 85 and supported the U.S. dollar.

Meanwhile, the governor of Bank of England, Andrew Bailey, said that the development of seemingly effective coronavirus vaccines was a bigger step forward for the economy that could lower uncertainty and get firms to reinvest. He also said that the business investment had been unusually weak since the financial crisis and weighting on productivity. Bailey also said that the changes due to coronavirus would more likely be within the services sector as it can be seen with a focus on digital services over the face to face work taking hold. Moreover, the Bank of England Deputy Governor Dave Ramsden said that positive news about the coronavirus vaccine could help reduce the risks facing Britain’s economy. Still, the central bank was unlikely to revise up its forecasts as a result.

Daily Technical Levels

Support   Resistance

1.3155      1.3236

1.3118      1.3280

1.3073      1.3317

Pivot point: 1.3199

GBP/USD– Trading Tip

The GBP/USD pair is trading bullish at the 1.3279 level, holding over the 1.3227 support level, which is extended by an upward trendline on a 2-hour timeframe. The Cable is likely to face immediate resistance at the 1.3297 area, which will be confirmed if the candle starts closing below this level. However, the bullish breakout of the 1.3297 level can drive further upside movement until the 1.3370 level today. 

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 104.184 after placing a high of 104.598 and a low of 104.069. The pair USD/JPY continued its bearish trend for the 4th consecutive day on Tuesday amid broad-based U.S. dollar weakness and Japanese yen strength due to safe-haven appeal.

On Tuesday, the USD/JPY pair fell below 104.1 level after the safe-haven demand rose due to the increasing number of coronavirus cases and the restrictions from all over the world. Many countries started imposing restrictive measures to control the spread of coronavirus that raised concerns over the global economy’s recovery that lifted the safe-haven appeal. The rising safe-haven demand supported the safe-haven Japanese Yen and weighed on the USD/JPY pair on Tuesday.

The safe-haven demand deteriorated a little after the latest optimism regarding the vaccine development from Moderna that gave an efficacy rate of 94.5%. However, there was still a long way to go before the vaccine can be delivered to everyone. According to Federal Reserve Vice Chairman Richard Clarida, the chances for the U.S. economic recovery have been improved due to candidates’ successful test from both Moderna and Pfizer Inc.

On the U.S. front, the U.S. dollar was weak due to the poor macroeconomic data on Tuesday. At 18:30 GMT, the Core Retail Sales for October fell to 0.2% from the anticipated 0.6% and weighed on the U.S. dollar that added pressure on the USD/JPY pair. In October from the U.S., the Retail Sales also declined to 0.3% from the forecasted 0.5% and weighed on the U.S. dollar that weighed on USD/JPY pair. The Import Prices in the U.S. for October were declined to -0.1% from the estimated 0.2%and weighed on the U.S. dollar added pressure on the USD/JPY pair.

At 19:00 GMT, the Capacity Utilization Rate from the U.S. surged to 72.8% against the estimated 72.3% and supported the U.S. dollar that capped further losses in the USD/JPY pair. The Industrial Production came in line with the anticipations of 1.1% in October. At 20:00 GMT, the Business Inventories for September rose to 0.7% against the projected 0.5% and weighed on the U.S. dollar that added pressure on the USD/JPY pair. The NAHB Housing Market Index from the U.S. surged to 90 from the expected 85 and supported the U.S. dollar that eventually capped further losses in the USD/JPY pair.

Moreover, the Federal Reserve Chairman, Jerome Powell, said on Tuesday that as the coronavirus cases were increasing to an alarming rate, it was the time when there was a bigger need for further coronavirus relief from Congress. Powell also noted that the recent announcements from Pfizer and Moderna were certainly good news in the medium term; however, major challenges and uncertainties remain in the near term.

Powell also said that Congress should deliver direct financial support targeted to specific groups instead of using the Federal Reserve’s lending tools. Powell’s comments also weighed on the USD/JPY pair as the need for further support from the Fed and Congress weighed on the U.S. dollar.

Daily Technical Levels

Support   Resistance

103.95      104.51

103.73      104.85

103.39      105.08

Pivot point: 104.29

USD/JPY – Trading Tips

The USD/JPY extends its bearish trend below the 104.430 level, falling from the 104.850 support area. On the lower side, the USD/JPY pair is likely to find support at the 103.800 level, and violation of this level can also extend further selling bias until 103.227. On the higher side, the USD/JPY safe-haven pair may find resistance at 104.400 and may help us capture a selling trades below this level as the MACD and RSI support the selling trend today. Good luck! 

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Forex Market Analysis

Daily F.X. Analysis, November 17 – Top Trade Setups In Forex – Retail Sales in Focus! 

TheThe eyes will remain on the retail sales, Capacity Utilization Rate, and Industrial Production from the United States on the news side on the news side. Retail sales are expected to drop, and they may place bearish pressure on the U.S. dollar. At the same time, the Capacity Utilization Rate and Industrial Production are expected to perform better.

TheThe eyes will remain on the retail sales, Capacity Utilization Rate, and Industrial Production from the United States on the news side on the news side. Retail sales are expected to drop, and they may place bearish pressure on the U.S. dollar. At the same time, the Capacity Utilization Rate and Industrial Production are expected to perform better.

TheThe eyes will remain on the retail sales, Capacity Utilization Rate, and Industrial Production from the United States on the news side on the news side. Retail sales are expected to drop, and they may place bearish pressure on the U.S. dollar. At the same time, the Capacity Utilization Rate and Industrial Production are expected to perform better.

Economic Events to Watch Today  

 

EUR/USD – Daily Analysis

The EUR/USD pair was closed at 1.18537 after placing a high of 1.18686 and a low of 1.18139. EUR/USD pair remained on positive foot for the 3rd consecutive day and posted gains on Monday. In the early trading session, risk sentiment started to dominate financial markets after Moderna announced that its COVID vaccine candidate showed 94.5% effectiveness in the latest trials. However, the single currency Euro found it hard to take advantage of the improved market mood since the European Central Bank made it clear that they will act in the upcoming December meeting.

While speaking at an event on Monday, the European Central Bank and policymaker Pablo Hernandez de Cos said that foreign exchange moves between the USD and the EUR had reached a concerning phase. De Cos further said that the monetary aid should be increased to avoid market destruction, given the worsening outlook for economic activity and inflation.

These comments from ECB policymaker, along with the hopes for further easing from ECB next month, exerted high pressure on the single currency that capped further gains in EUR/USD pair on Monday. However, the currency pair remained positive for the day, even though the European economy was hit hard by the coronavirus pandemic.

According to Johns Hopkins University, more than 54 million people had been infected by COVID-19 globally. In Europe, governments scrambled amid an alarming rise in numbers as France’s health authorities reported 9406 new cases on Monday. Germany postponed its decision on further lockdown measures until next week.

The German Chancellor Angela Merkel said that she wanted to impose further restrictions immediately, but she did not have a majority, so the decision was postponed until November 25. The tightening of lockdown measures was something nobody wanted, and that helped the single currency Euro and supported it. Meanwhile, Sweden placed a nationwide limit of eight people for all gatherings to slow down coronavirus spread. The limit will take effect from November 24 and will last for four weeks.

Despite all these tensions regarding the coronavirus pandemic, the single currency Euro struggled to hold near its best levels against its rival, the U.S. dollar, on Monday. The higher market sentiment also supported Euro amid the coronavirus vaccine news.

On the data front, the Empire State Manufacturing Index for November declined to 6.3 against the forecasted 13.8 and weighed on the U.S. dollar that added gains in EUR/USD pair on Monday. Other than macroeconomic data, the U.S. dollar was already weak in the market due to the rising number of coronavirus cases in the U.S. The weak U.S. dollar added further to the upward movement of the EUR/USD pair.

Daily   Technical Levels

Support Resistance

1.1821      1.1877

1.1789      1.1901

1.1765      1.1932

Pivot point: 1.1845

EUR/USD– Trading Tip

The EUR/USD is trading sideways, holding mostly below the double top resistance level of 1.1860 level. Still, recently it has formed a Doji pattern followed by bullish candles, suggesting that the buyers are exhausted, and sellers may enter into the market soon. Therefore, we can expect the EUR/USD price to trade bearish until the 1.1838 level, the support level extended by an upward trendline on the hourly timeframe. Bullish crossover of 1.1865 level can also trigger buying until 1.1910.

GBP/USD – Daily Analysis

The GBP/USD pair was closed at 1.31999 after placing a high of 1.32422 and a low of 1.31654. The British Pound was high on Monday as the Brexit talks were resumed between the E.U. and the U.K.

There were increasing signs that little progress could be made in this week’s trade talks. The Brexit optimism with the resumed trade talks drove the British Pound higher on Monday that ultimately pushed the GBP/USD pair on the upside.

However, the pair failed to remain there for long as some investors started giving warning that a deal between the E.U. and the U.K. was unlikely this week in the wake of turmoil in the U.K. government. The two of Prime Minister Boris Johnson’s pro-Brexit advisors, Cummings and Cain, were ousted last week. Moreover, the prospects of failure to reach a deal were fading away with the hopes that if an agreement would not be reached, the deadline could stretch into the final weeks before the end of the transition period on December 31.

The negotiations are potentially stretching into December as the deadline of November 19 was close, and the differences in both sides were larger. Ireland’s foreign minister initially warned that a deal f this size is difficult to reach within a week or ten days, although the talks could continue for a further two weeks. The Brexit deal has left to solve 3 key sticking points, including the level playing field, governance, and fisheries. The control over fisheries has been highlighted as one of the main hindrances, as French President Emmanuel Macron has been reluctant to give Britain’s demand for full sovereignty over access to its waters amid concerns French fishers could lose out.

However, the GBP/USD pair posted gains as the UK PM Boris Johnson’s office said in a statement that they were confident that the U.K. would prosper if they fail to reach a trade deal with the E.U. Apart from Brexit, the GBP/USD pair’s gains were lost a bit after the UK PM Johnson self-isolated himself after having close contact with a coronavirus case despite without symptoms and being well. Johnson has already contracted coronavirus case back in April.

The number of coronavirus cases in the U.K. stayed above 20,000 per day despite the ongoing restrictive measures. Meanwhile, a medical adviser in the U.K. said that the government would have to consider strengthening the three-tier system of restrictions used to control coronavirus spread when the full lockdown in England ends. These tensions kept the GBP/USD pair under pressure on Monday and kept the gains limited.

Meanwhile, a U.S. drugmaker Moderna also announced that its vaccine was proven 94.5% effective in preventing the coronavirus that raised risk sentiment in the market and supported the risk perceived British Pound and added in the gains of GBP/USD pair on Monday. Furthermore, Britain reported that it had secured about five million doses of an experimental coronavirus vaccine developed by Moderna after reporting positive trial results. The health minister Matt Hancock from the U.K. said that the earliest doses are expected for delivery in Spring.

On the data front, the Rightmove HPI from Great Britain was released on Monday at 05:01 GMT, which came in as -0.5% in November against October’s 1.1%. From the U.S. side, the Empire State Manufacturing Index was declined to 6.3 against the forecasted 13.8 and weighed on the U.S. dollar and added strength to GBP/USD pair on Monday.

Daily   Technical Levels

Support Resistance

1.3155      1.3236

1.3118      1.3280

1.3073      1.3317

Pivot point: 1.3199

GBP/USD– Trading Tip

The GBP/USD pair is trading at 1.3208 level, holding over 1.3189 level, which is extended by an upward trendline on a 2-hour timeframe. The Cable has recently crossed over the resistance level of the 1.3185 resistance level as the candle’s closing above this level may drive further upward movement in the market. The MACD and RSI support buying trend, and considering the trendline support and oversold indicators, it is worth giving a buy shot to GBP/USD pair. Let’s consider buying over 1.3160 level today. 

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 104.565 after placing a high of 105.135 and a low of 104.361. The pair followed its previous day’s bearish trend and dropped for 3rd consecutive day on Monday. The USD/JPY pair surged to its previous daily high level on Monday in early trading hours after the news from another drug maker came in about their vaccine’s efficiency. The Moderna reported that its vaccine’s last stage clinical trials were 94.5% effective. After this news, Moderna became the second company to announce its results from last stage clinical trials.

This news raised the risk sentiment in the market and weighed on the safe-haven Japanese Yen that kept the USD/JPY pair higher at the beginning of the Asian session. However, the gains started to fade as the market participant realized the difficulty of vaccine availability and its usage. The vaccine requires -70C temperature to be stored to be transported, that is not an easy task. Furthermore, there was also a lack of information regarding the time duration for the immunity induced through the vaccine. This can only be ascertained after the vaccine becomes available to the general public for usage.

These uncertainties raised the market’s safe-haven status and supported the Japanese Yen that ultimately weighed on the USD/JPY pair and forced it to lose some of its earlier daily gains. Meanwhile, on the U.S. front, the U.S. dollar was also weak on the day as the rising number of coronavirus cases raised fears for further restrictions and raised the hopes for further stimulus aid from the government.

The global cases of coronavirus reached 54 million, out of which 11 million were reported from the United States, according to the Johns Hopkins University. The rising number of coronavirus in the United States raised hopes that the Fed will announce further easing or a larger monetary aid to support the economy after the victory of Joe Biden in the U.S. presidential election this month.

Biden always favors a larger stimulus package to provide strength to the economy through the coronavirus crisis. With him becoming the U.S. 46th President, the chances for a massive stimulus bill for the U.S. economy have increased, which started to weigh on the U.S. dollar and ultimately dragged the USD/JPY pair’s prices on the downside.

On the data front, the Prelim GDP Price Index from Japan was released at 04:50 GMT that raised to 1.1% in the 3rd quarter against the expected 1.0% and supported the Japanese Yen that ultimately added further losses in the USD.JPY pair on Monday. The Prelim GDP for the 3rd Quarter from Japan also raised to 5.0% against the projected 4.4% and supported the Japanese Yen that dragged the USD.JPY pair on the downside. On the U.S. front, the Empire State Manufacturing Index in November dropped to 6.3 from the projected 13.8 and weighed on the U.S. dollar that dragged the USD/JPY pair further on the downside.

Daily   Technical Levels

Support Resistance

104.24      105.02

103.91      105.47

103.46      105.81

Pivot point: 104.69

USD/JPY – Trading Tips

The USD/JPY is with a bearish bias at the 104.400 level, falling from the 104.850 support area. On the lower side, the USD/JPY pair is likely to find support at the 104.141 level, and violation of this level can also extend further selling boas until 103.500. On the higher side, the USD/JPY safe-haven pair may find resistance at 104.845 and may help us capture a selling trades below this level as the MACD and RSI support the selling trend today. Good luck!