Tag: Technical Outlook

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Forex Signals

AUDJPY: Breakout after Consolidation

The AUDJPY pair has moved in a bullish sequence that started in the end week of October and ended with a sharp and large 4H candle on Nov 09. There it began a consolidation cycle that started as a sideways move and finally retraced pushed by the selling pressure to near the begging of the last bullish 4H Candle. From there, it is making an upward movement that is supported by its 50-period SMA.

The AUDJPY pair has moved in a bullish sequence that started in the end week of October and ended with a sharp and large 4H candle on Nov 09. There it began a consolidation cycle that started as a sideways move and finally retraced pushed by the selling pressure to near the begging of the last bullish 4H Candle. From there, it is making an upward movement that is supported by its 50-period SMA.

The AUDJPY pair has moved in a bullish sequence that started in the end week of October and ended with a sharp and large 4H candle on Nov 09. There it began a consolidation cycle that started as a sideways move and finally retraced pushed by the selling pressure to near the begging of the last bullish 4H Candle. From there, it is making an upward movement that is supported by its 50-period SMA.

Chart 1 – AUDJPY 4H Chart.

We see that the primary trend is still bullish. The 1H chart also shows the recent leg of upward movements with higher highs and lows (which define a bullish trend). We also observe that following the last bullish candlestick, there are several consolidation candles that retrace, but the closes are not trespassing the 50-hour SMA. Now, we see the strength is coming again, and the Voss Predictor indicator also shows a trend shift that could forecast a visit to the highs made in the recent past.

Chart 2 – AUDJPY 1H Chart.

The setup

Although we suspect that a new upward phase is just beginning, the setup also considers a confirmation in the form of a breakout of the recent range; thus, the entry signal is a buy-stop order at 76.324, with a 31 pip stop-loss that would trigger if the price goes below the low of the last 1H bullish candle (76.014). The take-profit level is set at 76.774, which is in the region of the last highs. The reward/risk ratio is a decent 1.45.

Trade Summary

Entry: Buy-Stop: 76.324

Stop-Loss: 76.014

Take-Profit: 76.774

Risk and Reward

This trade’s risk is 31 pips, which is 296 USD per traded lot, 29.6 USD per mini-lot, and 2.96 USD per lot. A trader willing to risk 1 percent on each trade should trade about 3 micro-lots every $1,000 on his trading account.

 

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Forex Market Analysis

Daily F.X. Analysis, November 16 – Top Trade Setups In Forex – ECB President Lagarde Speaks!

The eyes will remain on the ECB Financial Stability Review, and President Lagarde Speaks on the news front. The ECB Financial Stability report is an assessment of conditions in the financial system and potential risks to financial stability – the evidence on strains and imbalances can provide insight into monetary policy’s future. Therefore, traders keep a closer eye on reports to predict policy decisions to cope with Covid19 driven economic slowdown.

The eyes will remain on the ECB Financial Stability Review, and President Lagarde Speaks on the news front. The ECB Financial Stability report is an assessment of conditions in the financial system and potential risks to financial stability – the evidence on strains and imbalances can provide insight into monetary policy’s future. Therefore, traders keep a closer eye on reports to predict policy decisions to cope with Covid19 driven economic slowdown.

The eyes will remain on the ECB Financial Stability Review, and President Lagarde Speaks on the news front. The ECB Financial Stability report is an assessment of conditions in the financial system and potential risks to financial stability – the evidence on strains and imbalances can provide insight into monetary policy’s future. Therefore, traders keep a closer eye on reports to predict policy decisions to cope with Covid19 driven economic slowdown.

Economic Events to Watch Today  

 

EUR/USD – Daily Analysis

The EUR/USD currency pair managed to extend its previous 2-day gaining streak and remained bullish around near above mid-1.1800 level, mainly due to the broad-based U.S. dollar selling bias, triggered by the risk-on market sentiment, which keeps the currency pair higher. Hence the market trading sentiment was being supported by the coronavirus vaccine-led enthusiasm. 

On the contrary, the buying interest around the currency pair was capped by the intensifying virus fugues in Europe, which raised doubts over the Eurozone economic recovery and became 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 1.1849 and consolidating in the range between the 1.1834 – 1.1854.

Despite the doubts over the global economic recovery from intensifying coronavirus (COVID-19) woes in the U.S. and Europe, the market trading sentiment flashing green at the start of the week’s trading and remained supportive by the optimism over a potential vaccine for the highly infectious coronavirus disease. After cheering the U.S. pharma giant Pfizer’s recent declaration of its coronavirus vaccine’s positive results, the market traders expect the biotechnology company Moderna to follow suit this week. This, in turn, the futures tied to the S&P 500, Wall Street’s benchmark index, is currently trading 0.8% higher on the day and the major Asian indices are up at approximately 1% each. 

At the USD front, the broad-based U.S. dollar failed to gain any positive traction on the day as doubts persist over the global economic recovery from COVID-19. Besides this, the risk-on market sentiment, backed by the optimism over a potential vaccine for the highly contagious coronavirus disease, also played its major role in weakening the safe-haven U.S. dollar. However, the U.S. dollar losses became the key factor that kept the currency pair’s higher. Meantime, the U.S. Dollar Index that tracks the greenback against a bucket of other currencies dropped by 0.14% to 92.588 by 10:05 PM ET (2:05 AM GMT).

On the contrary, the bullish bias around the EUR/USD currency pair was capped by the on-going doubts over the Eurozone economic recovery amid intensifying coronavirus (COVID-19) worries in the U.S. and Europe. The rising coronavirus (COVID-19) worries urged some European countries, such as the U.K. and France, to imposing restrictive measures such as lockdowns and curfews. As in result, the vehicle traffic in both Europe and the U.S. slowing sharply. As per the latest report, there were over 54 million cases across the globe and over 1.3 million deaths as of November 16.

Looking ahead, the market traders will keep their eyes on updates surrounding the U.S. stimulus package. In the meantime, the risk catalyst like geopolitics and the virus woes, not to forget the Brexit, could not lose their importance. Apart from this, the RBA Gov Lowe Speaks and Monetary Policy Meeting Minutes will also be key to watch.

Daily Technical Levels

Support   Resistance

1.1738      1.1827

1.1697      1.1875

1.1648      1.1917

Pivot point: 1.1786

EUR/USD– Trading Tip

The EUR/USD traded bullish at 1.1850 level, but recently it has formed a Doji pattern followed by bullish candles, suggesting that the buyers are exhausted, and sellers may enter 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 1.1856 level can also trigger buying until 1.1880.

GBP/USD – Daily Analysis

The GBP/USD currency pair managed to extend its overnight winning streak and refreshed 4-day high around above 1.3200 level as the currency pair buyers get a warm welcome after returning from the weekend. However, the bullish tone around the currency pair could be attributed to the broad-based U.S. dollar weakness. The U.S. dollar was being pressured by the market risk-on sentiment, undermining the safe-haven U.S. dollar and contributing to the currency pair gains. 

Whereby, the market trading sentiment has remained supportive by the renewed optimism over a possible vaccine for the highly infectious coronavirus disease, which lends some support to the higher-yielding Pound and contributes to the currency pair gains. On the contrary, the Brexit woes and the virus concerns could stop the currency pair’s on-going recovery moves. At this particular time, the GBP/USD currency pair is currently trading at 1.3234 and consolidating in the range between 1.3174 – 1.3235.

Despite the lingering doubts about global economic recovery and the intensifying tension between the world’s two biggest economies, the market players continue to cheering the optimism over a possible vaccine for the highly infectious coronavirus disease. In the meantime, the release of an above-forecast China factory data, which raised hopes of China’s economic growth, has also played its major role in underpinning the market trading sentiment. However, the risk-on mood slightly overshadowed the concerns over virus cases and restrictions in the U.S. 

On the data front, the Industrial production in China’s economy surged 6.9% year-on-year for the 2nd-straight month in October, surpassing the expected gain of 6.5%. Moreover, the Fixed Asset Investment grew 1.8% year-on-year in October against 1.6% expected and 0.8% previous. 

As a result, the higher-yielding British Pound took support from the risk-rally by ignoring the Brexit issue’s latest negative developments. As per the latest report, the discussions over a possible trade deal between the U.K. and E.U. are expected to extend beyond this week.

At the USD front, the broad-based U.S. dollar failed to stop its previous losses and remain depressed on the day, mainly due to the risk-on market sentiment. Moreover, the losses in the U.S. dollar could also be attributed to the on-going doubts over the global economic recovery in the wake of intensifying coronavirus (COVID-19) worries in the U.S., which tend to undermine the American currency. However, the losses in the U.S. dollar kept the currency pair higher. Meantime, the U.S. Dollar Index that tracks the greenback against a bucket of other currencies dropped by 0.14% to 92.588 by 10:05 PM ET (2:05 AM GMT).

 

On the negative side, the latest negative developments surrounding the Brexit issue and the rising number of coronavirus in the U.K. could be considered the leading factor that kept the lid on a y additional gains in the currency pair. As per the latest report, Irish Foreign Minister Simon Coveney clearly warned that we would not get a deal if the U.K. imposes Internal Market Bill. In the meantime, the U.K. Environment Secretary George Eustice stated that both sides’ agreement remains intact, keeping the hopes alive as differences continue to persist over fisheries and state aid.

Looking ahead, the market traders will keep their eyes on updates surrounding the U.S. stimulus package. In the meantime, the risk catalyst like geopolitics and the virus woes, not to forget the Brexit, could not lose their importance. Apart from this, the RBA Gov Lowe Speaks and Monetary Policy Meeting Minutes will also be key to watch.

Daily Technical Levels

Support   Resistance

1.3170      1.3291

1.3119      1.3361

1.3050      1.3412

Pivot point; 1.3240

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 105.121 after placing a high of 105.476 and a low of 105.068. The pair USD/JPY reversed its direction and started falling on Thursday amid the broad-based U.S. dollar weakness. The decreased risk sentiment due to the escalated second wave of the coronavirus in the United States weighed on the USD/JPY pair on Thursday. The investors started to fear that governments might respond by imposing the lockdown restrictions that will slow down the economic recovery.

The United States reported about 140,453 cases on a single day on Wednesday, and it was the ninth straight day of above 100,000 cases. According to Johns Hopkins University, about 10.4 million Americans have been infected by the coronavirus so far, and nearly 242,000 have died from it. These concerns raised the safe-haven appeal and supported the Japanese Yen that ultimately weighed on the USD/JPY.

On the data front, at 04:50 GMT, the Core Machinery Orders from Japan for September came in as -4.4% against the expected -1.1% and weighed on the Japanese Yen. The Purchasing Price Index (PPI) from Japan remained flat with the expectations of -2.1% for the year. At 09:30 GMT, the Tertiary Industry Activity for September raised to 1.8% against the anticipated 1.3% and supported the Japanese Yen and weighed on the USD/JPY pair.

The Federal Reserve Chairman Jerome Powell cautioned that the U.S. economy would further need support from Congress and the central bank even if a coronavirus vaccine becomes available by the end of the year. He said that despite the vaccine’s availability, there still will be millions of people left who have lost their job to the pandemic, and they will still struggle to find work as the economy will attempt to recover from the economic downturn.

He added that in the Federal Reserve’s eyes, the terrible rise in COVID-19 cases across the country was the “main risk” for the U.S. economy. He added that the coronavirus’s third wave had forced several states to re-impose lockdown restrictions and caused people to lose confidence. He stressed that the economy would not fully recover until people are confident that it was safe to resume activities involving the crowd. These comments from Powell also weighed on the U.S. dollar and added in the losses of the USD/JPY pair on Thursday.

Daily Technical Levels

Support   Resistance

103.82       106.29

102.27       107.21

101.35       108.75

Pivot point: 104.74

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 are supporting the selling trend today. Good luck! 

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Forex Videos

Forex Forecast – EURUSD Approaching Resistance – Buyers Beware!

https://youtu.be/sFr3Oj_ly5E

https://youtu.be/sFr3Oj_ly5E

 

EURUSD approaching resistance – buyers beware!

 

Thank you for joining this forex academy educational video.
In this session, we will be looking at the EURUSD pair, which has found a recent bid tone at the time of writing and is approaching a significant area of resistance.

In this monthly chart, we can see the overall declining price action, which has been conforming to the trendlines from December 2007, where price reached a heady high of over 1.600 against the US Dollar, to a low in January 2017 of 1.0350. That’s quite a fall.

The continuation with the rejection of the declining resistance line and a failure at position A of price action to continue down to the support line gave rise to a lack of institutional sized sellers and a shallower support line forming around position B until price action reverted to the resistance line, where it eventually breached it at position C. This shows that institutional size traders were finding the Euro attractive than the US dollar at around the time of the Covid pandemic seriously affecting the United States economy, while the Europeans got to grips with the pandemic in terms of financial relief packages for EU citizens and businesses.
The big test for institutional size traders is whether or not this is just a breach and that price action will move back inside the channel to retest the shallower support line at position B or if there is a sustained move higher, which will be a failing of the monthly trend.

In this chart, we have reduced the monthly candlesticks to a daily chart to try and identify the section of price action which has been going on since the monthly resistant line was breached in order to try and ascertain where the levels are where we might find further resistance and which might cause price action to revert back into to the monthly channel or to try and identify if the price action will continue outside of that trend and form a new bid trend.

In this chart of the daily time frame, we have identified a clear area of resistance at around 1.1950, followed by a period of support at around 1.1717, which eventually is breached to just above 1.1600, only for price action to find support here and move higher.
Price action has currently reached a double top formation, and with the original area of resistance only around 50 pips above it, the next test will be to see if the price action will continue up to the resistance line, then move above it, fall back to it and where that then becomes an area of support – such as our hypothetical arrows – and that price action will conform a continuation to the upside and the end of the monthly bear channel.

Conversely, should price action move back below the support line, and then back up to it, and fall lower and where they support line becomes an area of resistance, again – such as our hypothetical arrows – this will tell institutional traders that the breach of the monthly trend may see price action fall back in line with the bear trend.

New traders are advised to look at the longer-term trading picture, such as the daily and monthly charts because this is where the swing traders look for trading ideas, and this includes institutional size investors, and these types of traders have big money to play with, which will have a major impact on price direction in the forex market.

Categories
Forex Signals

EURAUD Reversal Breakout on Top of Regression Channel

The EURAUD cross has experienced a strong upward movement that brought its value beyond the top of a descending regression channel.  After topping the upper line, which, as we know, is 2 sigmas above the mean line, the price has made a consolidation on the line, making a series of lower highs.

The EURAUD cross has experienced a strong upward movement that brought its value beyond the top of a descending regression channel.  After topping the upper line, which, as we know, is 2 sigmas above the mean line, the price has made a consolidation on the line, making a series of lower highs.

The EURAUD cross has experienced a strong upward movement that brought its value beyond the top of a descending regression channel.  After topping the upper line, which, as we know, is 2 sigmas above the mean line, the price has made a consolidation on the line, making a series of lower highs.

Currently, the current 1H bar is making an engulfing pattern and managing to break the recent lows, which acted as supports for the action.

If that happens, the pair may experience a corrective run to the mid of the channel. This setup has a 2.28 reward-to-risk ratio, therefore, suitable for a controlled trade on the short side, using a sell-stop order that triggers below the recent lows.

Trade Setup:

Entry: Sell-Stop at 1.6295

Stop-Loss: 1.6345

Take-Profit:1.6185

Risk and Reward

This trade setup has a risk of 52 pips and a 118 pip reward. Then, the dollar risk is 377 USD on one lot, 37.7 USD on a mini-lot, and 3.77 USD on a micro-lot. The reward is 855 USD on a lot, 85.5 USD on a mini-lot, and 8.55 USD on a micro-lot.

Categories
Forex Signals

EUR/GBP Closes Bearish Setup – Quick Signal Update


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
Fellas, now you can check out forex trading signals via Forex Academy mobile app. Follow the links below.
iPhone Users: https://apps.apple.com/es/app/fasignals/id1521281368
Andriod Users: https://play.google.com/store/apps/details?id=academy.forex.thesignal&hl=en_US

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Forex Signals

USD/CAD Extends Overnight Bearish Moves – Weaker U.S. Dollar in Play! 

During Friday’s Early Asian trading session, the USD/CAD currency pair extended its overnight losses and remain bearish around the 1.3135 level, mainly due to the broad-based U.S. dollar weakness. Hence, the broad-based U.S. dollar was being pressured by the doubts persist over the global economic recovery from COVID-19. This, in turn, undermined the greenback and contributed to the currency pair losses. Moreover, the political uncertainty in the U.S. also weighs on the already weaker U.S. dollar, which adds further burden around the currency pair.

During Friday’s Early Asian trading session, the USD/CAD currency pair extended its overnight losses and remain bearish around the 1.3135 level, mainly due to the broad-based U.S. dollar weakness. Hence, the broad-based U.S. dollar was being pressured by the doubts persist over the global economic recovery from COVID-19. This, in turn, undermined the greenback and contributed to the currency pair losses. Moreover, the political uncertainty in the U.S. also weighs on the already weaker U.S. dollar, which adds further burden around the currency pair.

During Friday’s Early Asian trading session, the USD/CAD currency pair extended its overnight losses and remain bearish around the 1.3135 level, mainly due to the broad-based U.S. dollar weakness. Hence, the broad-based U.S. dollar was being pressured by the doubts persist over the global economic recovery from COVID-19. This, in turn, undermined the greenback and contributed to the currency pair losses. Moreover, the political uncertainty in the U.S. also weighs on the already weaker U.S. dollar, which adds further burden around the currency pair.

On the contrary, the decline in the crude oil prices tends to undermine the commodity-linked currency the Loonie, which turned out to be one of the leading factors that kept the lid on any additional losses in the currency pair contributes to the currency pair’s losses. However, the crude oil prices were being pressured by the worsening coronavirus (COVID-19) conditions in Europe and the U.K. Apart from this, the crude oil prices’ losses were further bolstered after the EIA’s downbeat inventory numbers, which showed a sharp build-up in U.S. crude oil stocks. As of writing, the USD/CAD currency pair is currently trading at 1.3139 and consolidating in the range between 1.3133 – 1.3147.

Despite the optimism over the potential vaccine for the highly infectious coronavirus disease, the market trading sentiment failed to stop its previous negative performance and remain depressed during the early Asian session on the day, possibly due to the combination of factors. Be it the worrisome headlines concerning Brexit or the tension between the US-China, not to forget the coronavirus issues in the U.S. and Europe, everything has been weighing on the market trading sentiment; as per the latest report, the U.S. sanctions 4- Chinese diplomats over the Hong Kong crackdown. Apart from this, the Trump administration shows a willingness to limit investments in Chinese companies, fueling the already intensified tussle. 

At the coronavirus front, the U.S. coronavirus cases touched a new daily record high, with 140,543 reported. Almost 10.4 million peoples in the U.S. have been infected by the Covid-19 so far. While nearly 242,000 have died so far, according to the Johns Hopkins University report. As in result, New York has announced a 10 p.m. curfew on bars, gyms, and restaurants to curb the spread. Afterward, Chicago also followed the footsteps of New York and restricted activities.

In addition to the U.S., Europe also imposed lockdown again last week, threatening the oil outlook and undermining oil prices. It is worth recalling that Sweden declared a partial lockdown shutting down bars and restaurants for the 1st-time since the virus started. Thus, the back to back lockdowns restrictions keep harming the crude oil demand.

Despite the risk-off market mood, the broad-based U.S. dollar remained depressed. The investors continue to sell U.S. dollars on the back of optimism over the potential vaccine for the highly infectious coronavirus disease. Moreover, the losses in the U.S. dollar could also be associated with political uncertainty in the U.S. However, the U.S. dollar losses could be considered the major factor that kept the currency pair under pressure. Meanwhile, the U.S. Dollar Index that tracks the greenback against a bucket of other currencies dropped to 92.957.

The crude oil prices dropped further after the U.S. Energy Information Administration reported that crude oil inventories across the country climbed sharply by 4.3 million barrels last week, against expectations for a draw of 913,000 barrels. Moreover, the decline in crude oil prices was further bolstered after Libya’s oil production increased, which eventually raised fears of oversupply and undermined the crude oil prices. Hence, the declines in oil prices undermined demand for the commodity-linked currency the Loonie and became the key factor that helped the currency pair limit its deeper losses. 

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


Daily Support and Resistance

S1 1.2933

S2 1.3025

S3 1.3084

Pivot Point 1.3117

R1 1.3176

R2 1.3209

R3 1.3302

Entry Price – Buy 1.31412

Stop Loss – 1.31812

Take Profit – 1.31012

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, November 13 – Top Trade Setups In Forex – CPI, Employment in Focus! 

The eyes will remain on the U.S. Core PPI m/m and the Prelim UoM Consumer Sentiment from the United States on the news side. Both of the events are expected to drive some movement in the U.S. dollar and related currency pairs. During the European session, the French Final CPI m/m, Flash Employment Change q/q, and Flash GDP q/q will remain in highlights as these are coming from European counties; therefore, we can expect support to the Euro pairs.

The eyes will remain on the U.S. Core PPI m/m and the Prelim UoM Consumer Sentiment from the United States on the news side. Both of the events are expected to drive some movement in the U.S. dollar and related currency pairs. During the European session, the French Final CPI m/m, Flash Employment Change q/q, and Flash GDP q/q will remain in highlights as these are coming from European counties; therefore, we can expect support to the Euro pairs.

The eyes will remain on the U.S. Core PPI m/m and the Prelim UoM Consumer Sentiment from the United States on the news side. Both of the events are expected to drive some movement in the U.S. dollar and related currency pairs. During the European session, the French Final CPI m/m, Flash Employment Change q/q, and Flash GDP q/q will remain in highlights as these are coming from European counties; therefore, we can expect support to the Euro pairs.

Economic Events to Watch Today  

 

EUR/USD – Daily Analysis

The EUR/USD pair was closed at 1.18054 after placing a high of 1.18230 and a low of 1.17584. The currency pair EUR/USD reversed its Wednesday’s movement and raised on Thursday despite coronavirus worsened Europe’s situation. Italy was now expecting to enter a nationwide lockdown due to the increased number of coronavirus cases and curb the virus’s spread that should have caused the EUR/USD pair to continue movement in the downward direction. Still, the pair surged on the back of the weak U.S. dollar.

The U.S. dollar has suffered from risk-on markets sentiment, with investors becoming more optimistic after Pfizer’s 90% effective coronavirus vaccine. The greenback was also weak due to the declining CPI data from the U.S. At 12:00 GMT, the German Final CPI for October came in line with the expectations of 0.1%. At 15:00 GMT, the Industrial Production in September from Eurozone declined to -0.4% against the forecasted 0.6% and weighed on Euro and capped further gains in EUR/USD pair.

At 18:30 GMT, the Consumer Price Index for October fell to 0.0% against the projected 0.1% and weighed on the U.S. dollar and supported the EUR/USD pair’s upward direction. The Core CPI for October also declined to 0.0% from the projected 0.2% and weighed on the U.S. dollar and added further in gains of EUR/USD pair. However, the Unemployment Claims from last week fell to 709K against the projected 730K and supported the U.S. dollar and capped further gains in currency pair EUR/USD pair.

Moreover, the U.S. political uncertainties also continued weighing on the U.S. dollar after the victory of Joe Biden and becoming 46th U.S. President. Donald Trump has failed to concede Biden’s victory and has left the markets uncertain about what could happen next as Trump attempts to challenge the vote. 

Meanwhile, the U.S. dollar was also under pressure because of the rising number of coronavirus infections on Wednesday. The cases increased to 142,000 new cases in a single day, and the hospitalization rate also increased and reached 65,000, the highest during the pandemic. These virus conditions in the U.S. also weighed on the U.S. dollar and supported the upward movement of the EUR/USD pair.

On the other hand, the ECB President Christine Lagarde said that she believes that the region’s monetary authority will move to launch a digital version of the Euro in the next two to four years. Previously, ECB officials disclosed that they were researching a central bank digital currency.

On the virus front, the ECB President, Christine Lagarde, said that the coronavirus vaccine had reduced the uncertainty and complete lockdown was not the best way to deal with the second wave. These comments from Lagarde also supported the upward movement of the EUR/USD pair on Thursday.

Daily Technical Levels

Support   Resistance

1.1738      1.1827

1.1697      1.1875

1.1648      1.1917

Pivot point: 1.1786

EUR/USD– Trading Tip

The EUR/USD continues to trade sideways at the 1.1804 area, facing immediate support at the 1.1749 level along with resistance at the 1.1835 level. On the further higher side, the violation of the 1.1835 level can extend the buying trend until 1.1907. On the lower side, the support level prevails at 1.1749 and 1.1680 level. The MACD and EMA are also neutral; therefore, we may see selling below the 1.1835 and bullish above the same level today.

GBP/USD – Daily Analysis

The GBP/USD pair was closed at 1.31222 after a high of 1.32281 and a low of 1.31062. The pair GBP/USD continued following its previous day movement and extended its losses on Thursday. On Thursday, the Bank of England Governor said that he hoped a goodwill spirit would prevail between Britain and the European Union countries to smooth over unavoidable trade disruptions after the end of the Brexit transition period on Jan-1st.

Bailey also told a panel discussion with the U.S. Federal Reserve Chair Jerome Powell and European Central bank President Christine Lagarde that he felt very uncomfortable at the huge amount of economic uncertainty created by a coronavirus. On Thursday, Bailey said that he was encouraged by the latest coronavirus vaccine developments, which reduce economic uncertainty.

He also said that the trade talks were continuing between Britain and the European Union, but he could not judge the outcome. He said that he hoped that if there will be a trade agreement, there will be a goodwill spirit. However, he also told the panel Britain’sain’s financial sector was ready for the end of transition periods irrespective of a deal and was better prepared than the rest of the economic sectors. Bailey’s comments raised concerns in the market sentiment and kept the British Pound under pressure that left the GBP/USD pair on the downside.

On the data front, at 05:01 GMT, the RICS House Price Balance from the U.K. for October raised to 68% from the forecasted 54% and supported GBP. At 12:00 GMT, the Prelim GDP for the 3rd Quarter declined to 15.5% against the expected 15.8% and weighed on British Pound and added in the losses of GBP/USD pair. For September, the U.K.’s Construction Output raised to 2.9% against the forecasted 2.1% and supported British Pound. The GDP for September from the U.K. also declined to 1.1% against the estimated 1.5% and weighed on British Pound and further supported the GBP/USD pair’s losses.

The Goods Trade Balance came in as expected -9.3B. The Index of Services for the Quarter also declined to 14.2% from the forecasted 14.6% and weighed on British Pound and added losses in currency pair. The Industrial Production for September again fell to 0.5% from the estimated 0.9% and weighed on GBP. The Manufacturing Production in September from the U.K. dropped to 0.2% against the projected 0.7% and weighed on GBP. The Prelim Business Investment dropped to 8.8% in September from the projected 14.4% and weighed on local currency Sterling and further pushed the pair on the downside.

From the U.S. side, at 18:30 GMT, the Consumer Price Index for October was dropped to 0.0% against the expected 0.1% and weighed on the U.S. dollar and capped further losses in GBP/USD pair. The Core CPI for October also dropped to 0.0% from the expected 0.2% and weighed on the U.S. dollar. However, the Unemployment Claims from last week fell to 709K against the estimated 730K and supported the U.S. dollar and added losses in GBP/USD pair on Thursday.

Daily Technical Levels

Support   Resistance

1.3170      1.3291

1.3119      1.3361

1.3050      1.3412

Pivot point; 1.3240

GBP/USD– Trading Tip

The GBP/USD pair is trading at 1.3116 level, holding over 1.3110 level, which is extended by an upward trendline on a 2-hour timeframe. The Cable has recently completed 38.2% Fibonacci retracement, and now it’s holding above the double bottom support level of 1.3110 level. On the higher side, the pair may surge until the resistance level of 1.3190 level. The MACD and RSI support selling trend, but considering the trendline support and oversold indicators, it is worth giving a buy shot to GBP/USD pair. Let’s consider buying over 1.3110 level today. 

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 105.121 after placing a high of 105.476 and a low of 105.068. The pair USD/JPY reversed its direction and started falling on Thursday amid the broad-based US dollar weakness. The decreased risk sentiment due to the escalated second wave of the coronavirus in the United States weighed on the USD/JPY pair on Thursday. The investors started to fear that governments might respond by imposing the lockdown restrictions that will slow down the economic recovery.

The United States reported about 140,453 cases on a single day on Wednesday, and it was the ninth straight day of above 100,000 cases. According to Johns Hopkins University, about 10.4 million Americans have been infected by the coronavirus so far, and nearly 242,000 have died from it. These concerns raised the safe-haven appeal and supported the Japanese Yen that ultimately weighed on the USD/JPY pair on Thursday.

On the data front, at 04:50 GMT, the Core Machinery Orders from Japan for September came in as -4.4% against the expected -1.1% and weighed on the Japanese Yen. The Purchasing Price Index (PPI) from Japan remained flat with the expectations of -2.1% for the year. At 09:30 GMT, the Tertiary Industry Activity for September raised to 1.8% against the anticipated 1.3% and supported the Japanese Yen and weighed on the USD/JPY pair.

From the US side, at 18:30 GMT, the Consumer Price Index for October was dropped to 0.0% against the anticipated 0.1% and weighed on the US dollar and dragged the pair USD/JPY on the downside. The Core CPI for October also dropped to 0.0% from the anticipated 0.2% and weighed on the US dollar and added further in the USD/JPY pair’s losses. However, the Unemployment Claims from last week were declined to 709K against the anticipated 730K and supported the US dollar that capped further losses in the USD/JPY pair.

Meanwhile, on Thursday, the Federal Reserve Chairman Jerome Powell cautioned that the US economy would further need support from Congress and the central bank even if a coronavirus vaccine becomes available by the end of the year. He said that despite the vaccine’s availability, there still will be millions of people left who have lost their job to the pandemic, and they will still struggle to find work as the economy will attempt to recover from the economic downturn.

He added that in the Federal Reserve’s eyes, the terrible rise in COVID-19 cases across the country was the “main risk” for the US economy. He added that the coronavirus’s third wave had forced several states to re-impose lockdown restrictions and caused people to lose confidence. He stressed that the economy would not fully recover until people are confident that it was safe to resume activities involving the crowd. These comments from Powell also weighed on the US dollar and added in the losses of the USD/JPY pair on Thursday.


Daily Technical Levels

Support   Resistance

103.82      106.29

102.27      107.21

101.35      108.75

Pivot point: 104.74

USD/JPY – Trading Tips

The USD/JPY is trading sideways between 105.650 – 104.900 level, and violation of this level can extend the selling trend until the next support level of 104.430 mark. Simultaneously, the bullish breakout of the 105.650 level may open further room for buying until the 106.142 level. Overall, the eyes will remain at 104.835 level to trade bearish below this level until 104.435 and 104.175 level today. Good luck! 

Categories
Forex Signals

AUD/USD Maintain Bullish Streak Despite Risk-off Sentiment – Trade Plan!  

Today in the Asian trading session, the AUD/USD currency pair erased some of its earlier gains but still trading on the bullish track and taking rounds just closer to the 0.7250 level, mainly due to the broad-based U.S. dollar weakness. Hence, the broad-based U.S. dollar was being pressured by the doubts persist over the global economic recovery from COVID-19. This, in turn, undermined the greenback and contributed to the currency pair gains. 

Today in the Asian trading session, the AUD/USD currency pair erased some of its earlier gains but still trading on the bullish track and taking rounds just closer to the 0.7250 level, mainly due to the broad-based U.S. dollar weakness. Hence, the broad-based U.S. dollar was being pressured by the doubts persist over the global economic recovery from COVID-19. This, in turn, undermined the greenback and contributed to the currency pair gains. 

Today in the Asian trading session, the AUD/USD currency pair erased some of its earlier gains but still trading on the bullish track and taking rounds just closer to the 0.7250 level, mainly due to the broad-based U.S. dollar weakness. Hence, the broad-based U.S. dollar was being pressured by the doubts persist over the global economic recovery from COVID-19. This, in turn, undermined the greenback and contributed to the currency pair gains. 

On the other hand, the optimism over the coronavirus (COVID-19) vaccine/treatment also lends some minor support to the currency pair by underpinning the perceived risk currency Australian dollar. On the contrary, the intensified clashes between the US-China over the Hong Kong crackdown could be regarded as one of the important factors that might cap further upside momentum for the AUD/USD pair. The AUD/USD pair is currently trading at 0.7237 and consolidating in the range between 0.7228 – 0.7242.

The intensifying market worries regarding the continuous surge in new coronavirus cases in Europe and the United States keep fueling the doubts over the global economic recovery through imposing new lockdown restrictions on economic and social activity, which eventually weighed on the market trading sentiment. As per the recent report, the U.S. coronavirus cases reached a new daily record high, with 140,543 reported. Almost 10.4 million peoples in the U.S. have been infected by the Covid-19 so far. While almost 242,000 have died from this, according to the Johns Hopkins University report. As in result, New York has announced a 10 p.m. curfew on bars, gyms, and restaurants to curb the spread. Afterward, Chicago also followed the footsteps of New York and restricted activities.

In addition to the U.S., Europe also imposed lockdown again last week, threatening the oil outlook and undermining oil prices. It is worth recalling that Sweden declared a partial lockdown shutting down bars and restaurants for the 1st-time since the virus started. Thus, the back to back lockdowns restrictions keep harming the crude oil demand.

Besides the virus woes, the reason for the downbeat market sentiment could also be associated with the long-lasting US-China tussle, which fueled further after the U.S. warned China over the Hong Kong crackdown during the previous day. Apart from this, the Trump administration shows a willingness to limit investments in Chinese companies, fueling the already intensified tussle. 

Despite the risk-off market sentiment, the broad-based U.S. dollar failed to extend its previous day gains. It slipped lower mainly due to the heavy optimism over the potential vaccine for the highly infectious coronavirus disease. Apart from this, coronavirus’s resurgence keeps fueling the fears that the U.S. economic recovery could be halt, which also keeps the USD under pressure. However, the U.S. dollar losses could be considered the major factor that pushes the currency pair higher. Meanwhile, the U.S. Dollar Index that tracks the greenback against a bucket of other currencies dropped to 92.957.

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


Daily Support and Resistance

S1 0.7128

S2 0.7186

S3 0.7208

Pivot Point 0.7245

R1 0.7267

R2 0.7304

R3 0.7363

The AUDUSD traded with a bullish bias, but it recently has violated the upward channel at the 0.7245 level. The Aussie has now entered the new region, and it has formed a downward channel on the smaller timeframe now, which is likely to extend resistance at 0.7245 level along with support at 0.7200. A bearish breakout of 0.7200 level can open further room for buying until 0.7122 level. The MACD is also in support of selling; therefore, we should look for selling trades below the 0.7245 level today. Goold luck! 

Categories
Forex Market Analysis

Daily F.X. Analysis, November 12 – Top Trade Setups In Forex – Spotlight on ECB, BOE & FED! 

On the news side, the eyes will remain on the U.K. Prelim GDP q/q, which is expected to have improved from -19.8% to 15.8% previous month, and it may support the Sterling today. Later in the day, the speeches from the ECB President Lagarde, BOE Gov Bailey, and Fed Chair Powell will remain under the spotlight. All three officials are due to participate in a panel discussion about monetary policy at the ECB Forum on Central Banking via satellite. Lastly, the U.S. CPI figures can also trigger some price action during the U.S. session today; let’s keep an eye on it. 

On the news side, the eyes will remain on the U.K. Prelim GDP q/q, which is expected to have improved from -19.8% to 15.8% previous month, and it may support the Sterling today. Later in the day, the speeches from the ECB President Lagarde, BOE Gov Bailey, and Fed Chair Powell will remain under the spotlight. All three officials are due to participate in a panel discussion about monetary policy at the ECB Forum on Central Banking via satellite. Lastly, the U.S. CPI figures can also trigger some price action during the U.S. session today; let’s keep an eye on it. 

On the news side, the eyes will remain on the U.K. Prelim GDP q/q, which is expected to have improved from -19.8% to 15.8% previous month, and it may support the Sterling today. Later in the day, the speeches from the ECB President Lagarde, BOE Gov Bailey, and Fed Chair Powell will remain under the spotlight. All three officials are due to participate in a panel discussion about monetary policy at the ECB Forum on Central Banking via satellite. Lastly, the U.S. CPI figures can also trigger some price action during the U.S. session today; let’s keep an eye on it. 

Economic Events to Watch Today  

 

 

EUR/USD – Daily Analysis

The EUR/USD closed at 1.17786 after placing a high of 1.18325 and a low of 1.17453. The Euro dropped on Wednesday against the U.S. dollar as the European Central Bank (ECB) policymakers continued signaling further easing, though they downplayed the prospect of further interest rate cuts.

At the ECB forum on central banking in Frankfurt, the ECB President Christine Lagarde said that the coronavirus crisis had produced a highly unusual recession, and recovery is likely to be uneven. She also warned against excessive optimism over the short-term impact on the economy from a vaccine.

Lagarde continued that as the latest news on vaccine looked encouraging, the chances were still there. The economy could face frequent cycles of accelerating viral spread and tightening restrictions until widespread immunity was achieved. On Monday, the U.S. drugmaker Pfizer said that its vaccine’s last stage trials had shown a high level of success in preventing reinfection. Lagarde signaled that the central bank would almost certainly loose monetary policy in the next meeting as the Eurozone economy risks falling back towards recession. She told lawmakers that ECB was ready to take further easing actions. These comments from ECB President weighed on the single currency Euro and dragged the pair EUR/USD on the downside on Wednesday.

Lagarde said that the ECB would keep its interest rates at 0.0%, and it has an asset purchase program in place worth 1.35 trillion euros. She said that bond-buying and pumping extra cash into the financial system were the best ways for the central bank to support the economy.

According to Lagarde, while all the other options were on the table, the PEPP and TLTRO’s have proven their effectiveness in the current environment. Therefore, they will likely remain the main tools for adjusting monetary policy.

According to the latest forecast, the Eurozone GDP in the fourth quarter is likely to decline by roughly 2% as the renewed lockdowns have affected the economic activities. All these updates kept the single currency Euro under pressure and, ultimately, the EUR/USD pair on the downside.

On the U.S. front, the U.S. dollar was high onboard due to the rising hopes of a quick economic rebound and less need for stimulus measures from the FED after the latest optimism from the vaccine front. 

The U.S. Dollar Index rose by about 0.3% on Wednesday and supported the U.S. dollar’s upward trend that ultimately added pressure on the EUR/USD pair. Meanwhile, there was a Bank Holiday in the U.S. and France that kept the macroeconomic data out of the table and left the EUR/USD pair on the mercy of market mood and Lagarde’s speech.

Daily Technical Levels

Support   Resistance

1.1738      1.1827

1.1697      1.1875

1.1648      1.1917

Pivot point: 1.1786

EUR/USD– Trading Tip

The EUR/USD is trading with a bearish bias at the 1.1780 level, having violated the double bottom support level at 1.1800. The same support level was also extended by an upward trendline pattern on the hourly timeframe. At the moment, the EUR/USD has formed a downward channel, which extends resistance at the 1.17800 level. On the lower side, the support holds around 1.1743 level. The MACD and EMA are also turning bearish; therefore, we may see selling below the 1.17800 mark today.

GBP/USD – Daily Analysis

The GBP/USD closed at 1.32237 after placing a high of 1.33133 and a low of 1.31912. The GBP/USD pair dropped on Wednesday after placing gains for four consecutive days on the back of rising concerns over the Brexit deal and the broad-based U.S. dollar strength.

On the Brexit front, the U.K. and E.U. are still far apart on fisheries and the flow of goods between Ireland and Northern Ireland. However, hopes were still high that talks between both sides were moving positively as there had been no public finger-pointing by both parties in the preceding few weeks. Despite this, it cannot be said that a deal will surely reach as when it comes to Brexit, there is nothing sure.

Another unofficial deadline for reaching a deal has been set by both sides: the European Summit on November 19. If a settlement is not reached by then, the chances are high that the U.K. will leave the E.U. on December 31 without a trade deal and will bound to follow WTO rules. As the new deadline was reaching closer, these latest concerns raised the fears of no-deal Brexit and weighed on the British Pound that ultimately dragged GBP/USD pair on the downside.

Furthermore, on the U.S. front, the greenback was strong across the board as the Fed’s need for further stimulus dropped after releasing the latest vaccine news. The U.S. Dollar Index rose by about 0.3% and weighed on GBP/USD pair. Moreover, traders’ eyes will be upon the release of the third quarter GDP from Great Britain. Investors believe that the economy will post a strong rebound in Q3 as the coronavirus pandemic caused a sharp decline in GDP in Q2 when it fell by 19.8%. The third-quarter GDP is expected to stand at 15.3%, and any figure within the expectations will prove bullish for GBP. U.K. will also release monthly GDP for September that is projected to decline by 1.5% down from August’s 2.1%.

Meanwhile, the GBP/USD pair’s losses remained limited as the risk sentiment in the market continued supporting the risk perceived GBP. The risk sentiment was supported by the latest optimism about the vaccine development from Pfizer and BioNtech on Monday. However, the British Pound was also under pressure due to the victory of Joe Biden in the U.S. election last week. Biden has said that he will not make a trade deal with the U.K. after its transition period ends if it failed to reach a deal with the E.U. Now the pressure has been increased in the U.K. for securing a trade deal with the E.U., which has also exerted pressure on local currency British Pound that has been weighing on GBP/USD pair since Biden’s victory.

Daily Technical Levels

Support   Resistance

1.2997      1.3222

1.2851      1.3301

1.2771      1.3448

Pivot point: 1.3076

GBP/USD– Trading Tip

On Thursday, the GBP/USD is consolidating with a neutral bias at 1.3210 level ahead of the UK GDP figures later today. The GBP/USD is holding over the resistance becomes a support level of 1.3159. At the moment, the Cable may find immediate support at the 1.3208 level, and below this, Sterling can dip until the 1.3140 level. As you can see on the hourly timeframe, the Cable is stuck in a very narrow range, and there is likely to be an excellent trade opportunity in the market upon breakout. Let’s consider selling below the 1.3190 level and buying above the same area today. 

USD/JPY – Daily Analysis

During Thursday’s Asian trading session, the USD/JPY currency pair failed to extend its early-day recovery streak and edged lower around below the 105.30 level. Selling bias could be associated with the risk-off market sentiment, which underpins the safe-haven Japanese yen and contributes to the currency pair losses. Therefore, the market trading sentiment was being pressured by the increasing market concerns about the possible economic fallout from the second wave of continuous. 

Across the pond, the broad-based U.S. dollar selling bias, triggered by the optimism over a potential vaccine for the highly infectious coronavirus pandemic, could also be considered as one of the key factors that dragged the currency pair lower. In the meantime, the U.S. dollar losses were further bolstered by the renewed hopes for substantial U.S. fiscal stimulus measures. On the contrary, the optimism over a potential vaccine and the progress surrounding the Brexit talks keep challenging market risk-off mood and become the key factor that helps the currency pair limit its deeper losses. On the flip side, the currency pair mostly ignores the second-tier data from Japan. At this particular time, the USD/JPY currency pair is currently trading at 105.31 and trading in the range between 105.22 – 105.47.

The market trading sentiment failed to extend its previous day’s positive performance. It started to flash red on the day as the resurgence of (COVID-19) cases still not dispensing any sign of slowing down in the U.S. and Europe, which keep fueling the worries over the global economic recovery. As per the latest report, the U.S. keeps reporting record cases daily, more than 100K per day. Even all U.S. states representing a worse status report of the COVID-19, which was backed by the record hospitalizations and daily cases. As in result, New York has declared a 10 p.m. curfew on bars, gyms, and restaurants to curb the virus spread. It is also worth mentioning that the COVID-19 hospitalizations in the U.S. exceeded 60,000. 

In addition to the U.S., Europe also imposed lockdown again last week, threatening to weaken the economic recovery. As per the latest report, Sweden declared a partial lockdown is shutting down bars and restaurants for the 1st-time since the virus started. Thus, the back to back lockdowns restrictions will have an instant negative effect on global economic recovery.

Moreover, the market risk-off sentiment was further bolstered by the reports suggesting that the Dragon Nation takes one more trade-negative measure for Aussie. As per the latest report, the Dragon Nation extended its anti-Aussie bias while suspending the Victorian timber logs. The dragon nation has already lifted bars for Australian wine, iron ore, and barley after the Pacific inquiry alleging the Asian leader’s negligence caused the coronavirus (COVID-19) outbreak. Apart from this, the bearish market sentiment could also be associated with the long-lasting US-China tussle, which continuously picks the pace. As per the latest report, the U.S. National Security Adviser Robert Charles O’Brien recently threatened the Dragon Nation over its responsibility to trigger Hong Kong freedom violations.

Daily Technical Levels

Support   Resistance

103.82      106.29

102.27     107.21

101.35     108.75

Pivot point: 104.74

USD/JPY – Trading Tips

The USD/JPY is trading sideways, maintaining a narrow range of 105.63 – 104.835 ever since it has violated the descending trendline at 104.950 area. The USD/JPY pair is trading choppy as investors seem to brace for the U.S. inflation figures later today. The USD/JPY pair needs to violate the 104.900 level to continue trading bearish, and below this, we may see the USD/JPY pair falling until the 104.220 level, and a further breakout can lead it towards 102.400. However, we may see buying over 104.950 levels today until 105.600. Good luck! 

Categories
Forex Signals

USD/CAD Heading North – Is It a Good time to go long?

Today in the early Asian trading session, the USD/CAD currency pair successfully extended its previous day recovery streak and remained bullish around above the mid-1.3000 level. However, the bullish sentiment around the currency pair could be attributed to the modest downticks in the crude oil prices, which ultimately undermined the demand for the commodity-linked currency the loonie, and contributed to the currency pair gains. On the contrary, the broad-based U.S. dollar weakness, triggered by the multiple factors, has become one of the major factors that kept the lid on any further gains in the currency pair. Currently, the USD/CAD currency pair is currently trading at 1.3067 and consolidating in the range between 1.3054 – 1.3073.

Today in the early Asian trading session, the USD/CAD currency pair successfully extended its previous day recovery streak and remained bullish around above the mid-1.3000 level. However, the bullish sentiment around the currency pair could be attributed to the modest downticks in the crude oil prices, which ultimately undermined the demand for the commodity-linked currency the loonie, and contributed to the currency pair gains. On the contrary, the broad-based U.S. dollar weakness, triggered by the multiple factors, has become one of the major factors that kept the lid on any further gains in the currency pair. Currently, the USD/CAD currency pair is currently trading at 1.3067 and consolidating in the range between 1.3054 – 1.3073.

Today in the early Asian trading session, the USD/CAD currency pair successfully extended its previous day recovery streak and remained bullish around above the mid-1.3000 level. However, the bullish sentiment around the currency pair could be attributed to the modest downticks in the crude oil prices, which ultimately undermined the demand for the commodity-linked currency the loonie, and contributed to the currency pair gains. On the contrary, the broad-based U.S. dollar weakness, triggered by the multiple factors, has become one of the major factors that kept the lid on any further gains in the currency pair. Currently, the USD/CAD currency pair is currently trading at 1.3067 and consolidating in the range between 1.3054 – 1.3073.

Despite the renewed optimism about a potential treatment/vaccine for the highly infectious virus, the market trading sentiment has ben flashing mixed signals as the coronavirus woes overshadowed vaccine hopes. However, the increasing market worries over the potential economic fallout from the constant rise in new COVID-19 cases keep weighing on the market trading sentiment. As per the latest report, the country keeps reporting record cases daily, more than 100K per day. Essentially all American states are getting a worse status report of the COVID-19, strengthened by record hospitalizations and daily cases rising past-100,000 in the last few days. As in result, New York has declared a 10 p.m. curfew on bars, gyms, and restaurants to curb the spread. It is also worth mentioning that the COVID-19 hospitalizations in the U.S. exceeded 60,000.

On the bullish side of the story, the prevalent optimism over the potential vaccine for the highly infectious coronavirus disease helps the market trading sentiment limit its deeper losses. The leading vaccine producers like Pfizer and Moderna still show progress over the vaccine for the deadly virus. This was witnessed after the U.S. infectious disease expert Dr. Anthony Fauci said that Moderna could begin analyzing vaccine data within days. However, the market trading mood mostly ignored the U.S. official’s another push to keep vaccine optimism high amid surging virus cases and hospitalizations in the U.S.

Despite the risk-off market sentiment, the broad-based U.S. dollar failed to extend its overnight gains. It edged lower on the day, mainly due to the heavy optimism over the potential vaccine for the highly infectious coronavirus disease. Apart from this, coronavirus’s resurgence keeps fueling the fears that the U.S. economic recovery could be halt, which also keeps the greenback under pressure. However, the U.S. dollar losses could be considered the major factor that pushes the currency pair down. Meanwhile, the U.S. Dollar Index that tracks the greenback against a bucket of other currencies dropped to 92.922.

At the crude oil front, the WTI crude oil prices failed to extend its overnight winning streak and remained under some selling pressure on the day. However, the fresh declines in crude oil could be attributed to reports suggesting the next wave of lockdowns throughout the world, which is threatening the crude oil demand once again. Apart from this, the reason for the modest losses in crude oil prices could also be associated with the latest reports suggesting that OPEC’s oil output in October rose by 320,000 BPD in the wake of recovery in Libya’s production. Thus, the pullback in oil prices undermined demand for the commodity-linked currency – the loonie and remained supportive of the USD/CAD pair’s ongoing recovery momentum.

Moving ahead, the market traders will keep their eyes on the U.S. economic calendar, which highlights the latest data concerning U.S. inflation and jobless claims. In the meantime, the Brexit trade talks’ updates could not lose their importance on the day.


Daily Support and Resistance
S1 1.2951
S2 1.3003
S3 1.3032
Pivot Point 1.3055
R1 1.3084
R2 1.3107
R3 1.3158

The USD/CAD is trading with bullish sentiment at 1.3094, facing immediate resistance at 1.3100. Crossing above this level may drive further upward movement until 1.3177 level. On the downside, the USD/CAD may find support at 1.3025, and below this, the next support level stays at 1.2975 level. The MACD is in support of buying; thus, we may look for a buying trade over the 1.3105 level today. Good luck!

Categories
Forex Signals

EUR/JPY Violates Symmetric Triangle Pattern


Entry Price – Buy 124.623
Stop Loss – 124.223
Take Profit – 125.023
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 11 – Top Trade Setups In Forex – Bank Holidays! 

On the news front, the economic calendar is mostly empty on the back of the Bank holiday in Europe and the United States. French banks will be closed in observance of Armistice Day, while Canadian banks will be closed in observance of Remembrance Day. The U.S. banks will also remain closed amid the Veterans Day holiday in the bank. We may experience thin trading volume and volatility in the market. 

On the news front, the economic calendar is mostly empty on the back of the Bank holiday in Europe and the United States. French banks will be closed in observance of Armistice Day, while Canadian banks will be closed in observance of Remembrance Day. The U.S. banks will also remain closed amid the Veterans Day holiday in the bank. We may experience thin trading volume and volatility in the market. 

On the news front, the economic calendar is mostly empty on the back of the Bank holiday in Europe and the United States. French banks will be closed in observance of Armistice Day, while Canadian banks will be closed in observance of Remembrance Day. The U.S. banks will also remain closed amid the Veterans Day holiday in the bank. We may experience thin trading volume and volatility in the market. 

Economic Events to Watch Today  

 

EUR/USD – Daily Analysis

The EUR/USD pair was closed at 1.18133 after placing a high of 1.19198 and a low of 1.17951. The EUR/USD pair rose to its highest since September 02 on Monday but failed to keep its gains and fell to post losses for the day as the U.S. dollar rallied in the American session as risk appetite took over. Pfizer and BioNtech announced that their coronavirus vaccine was more than 90% effective in preventing the coronavirus. The news about the vaccine optimism raised the risk sentiment further and pushed the pair to its highest in 9 weeks in earlier sessions on Monday.

Pfizer and BioNtech said they would seek the approval authorization for emergency-use from the U.S. later this month. The market’s optimism raised and supported the EUR/USD pair’s an upward movement in earlier trading hours.

A vaccine will likely mean the end of lockdowns and restrictions and hence, a sharp economic comeback. However, it will take up to the second half of next year for the vaccine or vaccines to reach enough people to grant a more regular return to activities. Nevertheless, optimism will prevail. However, the EUR/USD pair failed to keep its gains for the day and started declining on Monday on the back of Joe Biden’s victory in the U.S. presidential election. The political gridlock in the U.S. Senate could stall the prospect of any fresh package of U.S. fiscal stimulus package that failed to keep the U.S. dollar under pressure and weighed on the EUR/USD pair.

The European Central Bank (ECB) President Christine Lagarde refrained from touching upon monetary policy in her scheduled speech at the Green Horizon Summit on Monday. She only talked about climate risks and said that the economic challenges of climate transition were phenomenal. The main driver of the EUR/USD pair remained the strength of the U.S. dollar triggered by the faded hopes of additional stimulus measures as the vaccine news raised optimism about the economic recovery.

European banks will be closed in observance of Armistice Day; therefore, thin trading volume and volatility can be expected today. 

Daily Technical Levels

Support   Resistance

1.1766      1.1891

1.1717      1.1969

1.1640      1.2017

Pivot point: 1.1843

EUR/USD– Trading Tip

On Wednesday, the EUR/USD is trading bullish at the 1.1833 level amid a stronger U.S. dollar. The pair may now head higher until an immediate resistance level of 1.1883. On the 4 hour timeframe, the EUR/USD has formed an upward channel supporting the pair at the 1.18016 level. On the higher side, a bullish crossover of 1.1883 level can extend the buying trend until the 1.1945 area. The MACD entered the oversold zone and now suggesting odds of bullish trend continuation; therefore, we should look for a buying trade over the 1.1801 level.  

GBP/USD – Daily Analysis

The GBP/USD pair was closed at 1.31634 after a high of 1.32081 and a low of 1.31183. Despite higher market sentiment and weaker safe-haven demand on Monday, the British Pound to U.S. dollar exchange rate has been under pressure. The Sterling remained weak despite the increased market sentiment from the news of coronavirus vaccine efficiency. Pfizer and the BioNtech announced that their vaccine had been proved more than 90% efficient in preventing the coronavirus on Monday. Both companies also said they would be taking approval from the U.S. for the vaccine’s emergency-use later this month. After this news, risk appetite increased in the market, and global equities raised; however, the risk perceived GBP/USD pair remained under pressure as British Pound was weak due to Biden victory in the U.S. elections.

Joe Biden’s victory decreased the hopes for the U.K. & U.S. post-Brexit trade deal as Joe Biden has already said that if U.K. fails to reach a deal with the E.U., then the US-UK deal will also be jeopardized. As there was no news regarding the progress made in the U.K. & E.U. talks, the British Pound came under fresh pressure after Joe Biden became the U.S.

The governor of the Bank of England, Andrew Bailey, explained that what the BoE was doing to ensure the financial system plays its part in tackling climate change. He warned that climate change was a bigger risk than coronavirus. Furthermore, the chief economist from the Bank of England, Andy Haldane, said that a breakthrough in developing a coronavirus vaccine could deliver a vital boost of confidence to consumers and businesses. He added that the economy might have reached a decisive moment after the pharmaceutical company Pfizer announced that its coronavirus vaccine candidate was 90% effective.

He also said that the vaccine could be a game-changer for the economy. He cautioned that it would take several months for the vaccine to be rolled out but would have an immediate effect on consumer and business confidence. He added that the economic cycle would start again as it would unlock the business investments, and the economy will start recovering. The GBP/USD pair remained a little bullish due to high pressure on British Pound on Tuesday.

Daily Technical Levels

Support   Resistance

1.2997      1.3222

1.2851      1.3301

1.2771      1.3448

Pivot point: 1.3076

GBP/USD– Trading Tip

The GBP/USD is trading with a strong bullish bias due to a stronger Sterling 1.3191 area. The pair has violated the intraday resistance level at 1.3159, which is now working as a support for Sterling. On the higher side, the continuation of an upward trend can lead to the GBP/USD pair until the 1.3226 area. The cable had violated the descending triangle pattern, and ever since, it’s trading with a bullish bias. 

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 105.388 after placing a high of 105.645 and a low of 103.187. The USD/JPY pair surged past the 105.6 level on Monday after the risk-on market sentiment raised and weighed on the Japanese Yen. The safe-haven Japanese Yen came under fresh pressure after the Pfizer and its German partner BioNtech announced that their vaccine candidate was proved more than 90% efficient in its last-stage trials. Both companies announced that they would seek U.S. approval for the emergency-use of vaccine later this month.

The pair USD/JPY witnessed a sharp rise in its prices of almost 3-4% on Monday after the vaccine optimism raised the risk appetite in the market that weighed heavily on the safe-haven Japanese Yen. This ultimately pushed the USD/JPY pair to the highest level since October 20.

The gains in USD/JPY pair were also supported by the victory of Democratic Joe Biden in U.S. elections. Biden was expected to deliver a massive stimulus package that had been weighing on the U.S. dollar. Still, after the news of vaccine development and its efficiency, the need for the massive stimulus package dropped and raised the U.S. dollar onboard. 

The Bank of Japan released the Summary of opinions that stated that one member said that the bank needs to ensure its purchases of exchange-traded funds are sustainable. Other members said that BOJ must be ready to ramp up stimulus to cushion the economic blow from the coronavirus pandemic. The Cleveland Federal Reserve Bank President Loretta Mester said that the emergency lending programs the Fed set up during the coronavirus pandemic had reduced distress in financial markets. She also said that there was still a need for lending programs. 

Mester also noted that Fed Chair Jerome Powell would be working with the Treasury Department to determine if the programs should be extended beyond the end of the year. She also stated that the Fed was not out of ammunition to stimulate the economy. The Fed could provide more accommodation by adjusting its asset purchase program and using other tools. She said that the economy recovered more strongly than expected, but gains have not been evenly spread. Mester said that economic growth would be more slowly despite the optimistic news about the vaccine. These comments kept the markets under pressure and capped further gains in the USD/JPY pair.

Daily Technical Levels

Support   Resistance

103.82      106.29

102.27      107.21

101.35      108.75

Pivot point: 104.74

USD/JPY – Trading Tips

The USD/JPY has violated the descending trendline at 104.950 area, and on the lower side, it’s testing the support area of 104.840 level. The USD/JPY pair has recently entered the overbought zone, and now investors may experience a bearish correction in the market. The USD/JPY pair needs to violate the 104.900 level. Below this, we may see the USD/JPY pair falling until the 104.220 level, and a further breakout can lead it towards 102.400, which seems a bit hard. However, we may see buying over 104.950 levels today until 105.600. Good luck! 

Categories
Forex Signals

Choppy Session in USD/CAD Continues – Traders Braces for a Breakout Setup!

During Wednesday’s early Asian trading session, the USD/CAD currency pair failed to stop its overnight losses and remain depressed around the 1.3030 level, mainly due to the broad-based U.S. dollar weakness. The prevalent downtrend in the U.S. dollar was mainly tied to the confidence over a potential vaccine for the extremely contagious coronavirus disease, which struggling to keep market trading sentiment positive. Moreover, President-elect Joe Biden faces difficulties from Donald Trump, which also weighs on the already weaker U.S. dollar. The reason for the declines in the currency pair could also be attributed to the fresh upward movement in the crude oil prices, which tend to underpin the commodity-linked currency the Loonie and contributes to the currency pair’s losses. However, the crude oil prices were being supported by fresh released upbeat American Petroleum Institute (API) data. As of writing, the USD/CAD currency pair is currently trading at 1.3028 and consolidating in the range between 1.3024 – 1.3037.

During Wednesday’s early Asian trading session, the USD/CAD currency pair failed to stop its overnight losses and remain depressed around the 1.3030 level, mainly due to the broad-based U.S. dollar weakness. The prevalent downtrend in the U.S. dollar was mainly tied to the confidence over a potential vaccine for the extremely contagious coronavirus disease, which struggling to keep market trading sentiment positive. Moreover, President-elect Joe Biden faces difficulties from Donald Trump, which also weighs on the already weaker U.S. dollar. The reason for the declines in the currency pair could also be attributed to the fresh upward movement in the crude oil prices, which tend to underpin the commodity-linked currency the Loonie and contributes to the currency pair’s losses. However, the crude oil prices were being supported by fresh released upbeat American Petroleum Institute (API) data. As of writing, the USD/CAD currency pair is currently trading at 1.3028 and consolidating in the range between 1.3024 – 1.3037.

During Wednesday’s early Asian trading session, the USD/CAD currency pair failed to stop its overnight losses and remain depressed around the 1.3030 level, mainly due to the broad-based U.S. dollar weakness. The prevalent downtrend in the U.S. dollar was mainly tied to the confidence over a potential vaccine for the extremely contagious coronavirus disease, which struggling to keep market trading sentiment positive. Moreover, President-elect Joe Biden faces difficulties from Donald Trump, which also weighs on the already weaker U.S. dollar. The reason for the declines in the currency pair could also be attributed to the fresh upward movement in the crude oil prices, which tend to underpin the commodity-linked currency the Loonie and contributes to the currency pair’s losses. However, the crude oil prices were being supported by fresh released upbeat American Petroleum Institute (API) data. As of writing, the USD/CAD currency pair is currently trading at 1.3028 and consolidating in the range between 1.3024 – 1.3037.

As we already mentioned, the market trading sentiment represented negative performance on the day as the sluggish appearance of Asia-Pacific stocks and declines of the U.S. 10-year Treasury yields tend to highlight the risk-off mood. However, the reason behind the risk-off market bias could be attributed to a combination of factors. Be it the worrisome headlines concerning the Sino-US tussle or the resurgence of the coronavirus. The market trading sentiment has been flashing red since the day started, which ultimately keeps the safe-haven assets supportive on the day. 

At the US-China front, the tensions between the United States and China still do not show any sign of slowing down as the U.S. imposed fresh sanctions on 4-Chinese diplomats over the Hong Kong Security Bill crackdown initially overshadowed the optimism over a potential vaccine and weighed on the market sentiment. Elsewhere, the declines in the equity market were further bolstered after U.S. President Donald Trump’s push to block election results to confuse optimists. 

Despite the risk-off mood, the broad-based U.S. dollar remained depressed. The investors continue to sell U.S. dollars on the back of optimism over a potential vaccine for the highly contagious coronavirus disease. Moreover, the losses in the U.S. dollar could also be associated with political uncertainty in the U.S. Thus, the losses in the U.S. dollar kept the currency pair lower. Meantime, the U.S. Dollar Index, which tracks the greenback against a bucket of other currencies, was down at 92.707.

At the crude oil front, WTI crude oil prices remained well bid around above $41 on the day, backed by the COVID vaccine hopes and the victory of Joe Biden, which boosted the market trading sentiment and demand sentiment the crude oil. Apart from this, China has played a significant role in underpinning global oil demand recovery. They showed that the inventories had declined considerably in recent weeks, indicating the domestic economic recovery. Moreover, the crude oil prices upticks were further boosted after the American Petroleum Institute (API) reported the major draw in crude oil inventories of 5.147 million barrels for the week ending November 6. Thus, the crude oil prices’ upticks underpinned the commodity-linked currency the Loonie and exerted some downside pressure on the currency pair. 


Daily Support and Resistance

S1 1.289

S2 1.2957

S3 1.2995

Pivot Point 1.3023

R1 1.3061

R2 1.3089

R3 1.3156

The USD/CAD pair is consolidating around the 1.3020 area, testing the resistance level of the 1.3033 mark. On the higher side, the bullish breakout of the 1.3033 level can stretch the buying trend until the next resistance level of 1.3098. While on the lower side, the immediate support stays at 1.3000, and below this, the next support is likely to be found around 1.2935 level. Overall, the USD/CAD isn’t moving a lot as traders are enjoying bank holidays in Canada and the U.S. amid Remembrance and Veterans Day. We may have a thin trading volume and volatility in the market today. Good luck!

Categories
Forex Elliott Wave Forex Market Analysis

Euphoric Market’s Sentiment Pushes GBPCHF Up

Overview

Overview

Overview

The GBPCHF cross began the current trading week, advancing over 1.30%, boosted by the U.S. post-election rally and Pfizer’s Covid vaccine upbeat results. However, the Elliott Wave view anticipates that the euphoric rally could soon end, and the cross could reverse its course toward new lows.

Market Sentiment

The week started with a risk-on U.S. Presidential post-election stock market rally, driving the risk-off currencies to drop. In this context, the GBPCHF cross advances over 1.30% to its highest level since late September.

The following 8-hour chart displays the intraday market sentiment. Although the sideways movement predominates since late September, the strong bullish move developed in the Monday trading session takes the GBPCHF cross to the extreme bullish sentiment zone.

Likewise, we can see the price action developing above the 60-period weighted moving average, which confirms the intraday upward bias that could hold during the following trading sessions.

On the other hand, the euphoric sentiment bolstered by news media’s coverage of the U.S. elections and the continuation of the stock market rally added to the news of the promising vaccine results developed by Pfizer and BioNTech leads us to expect a limited upside in the risk-on currencies.

Technical Overview

The big picture of the GBPCHF under the Elliott wave perspective reveals its progress in a descending broadening formation. Its latest downward sequence began on December 13th, 2019, when the price found fresh sellers at 1.33113. We can see, as well, that this leg still remains in progress.

The following daily chart unveils the advance in the fifth wave of Minute degree labeled in black, which started on 1.22224, where the price action declined in a bearish impulsive movement reaching a new lower low. This decline that ended on 1.15989 completed the first wave of Minuette degree labeled in blue.

Currently, the GBPCHF cross moves in its second wave (in blue). Nevertheless, the psychological barrier of 1.20 could represent a significative intraday resistance.

Technical Outlook

The intraday outlook of the GBPCHF cross reveals the bullish continuation of the current upward momentum. The next 2-hour chart exposes the supply and demand zones according to the potential next move that the cross could develop in the coming trading sessions.

On the one hand, the price advances in its wave c of Subminuette degree identified in green, developing the third internal wave. Likewise, the retracement that should correspond to its fourth internal wave could retrace to the area between 1.19292 and 1.19694. This zone could back the possibility of a new rally that would boost the price toward 1.21012 and 1.21306. 

On the other hand, our first scenario considers the bearish continuation. In this case, if the price action penetrates and closes below 1.1803, the cross could see further declines toward the zone of 1.1650.

Finally, our second scenario considers that if the GBPCHF cross continues its advance beyond 1.22224, the cross could extend its gains toward the descending upper- trendline shown in the daily chart.

Categories
Forex Elliott Wave Forex Market Analysis

AUDJPY Could Develop a Limited Upside

Overview 

Overview 

Overview 

The AUDJPY cross advances in an incomplete upward sequence that belongs to a corrective structural series backed by Monday’s trading session’s euphoric sentiment. The Elliott Wave view unveils the likelihood of a limited upside before resuming its declines.

Market Sentiment

The AUDJPY cross retraces on the overnight Tuesday trading session after the surprising weekly kick-off, which jumped the price over 2.2%, climbing until 77.037, its highest level since September 18th.

The AUDJPY 8-hour chart illustrates the 30-day high and low range, which exposes the participants’ intraday market sentiment. The figure distinguishes the price action consolidating in the extreme bullish sentiment zone, backed by the stock market’s euphoric rally on Monday’s trading session.

The breakout of the last 30-day high of 76.274 during Monday’s trading session raised the participants’ extreme bullish sentiment, expecting further upsides on the cross. Moreover, we see that the price action remains above its 60-period linear weighted moving average, which confirms the bullish bias on the AUDJPY.

Nevertheless, the AUDJPY found resistance below mid-September’s consolidation zone. This market context expects a significative retracement or a consolidation movement before continuing the rally experienced in Monday’s session. Finally, a retracement below the 75.087 level would turn the market sentiment from bullish to bearish.

Technical Overview

The AUDJPY cross advances in an incomplete upward bullish sequence of a lower degree, which belongs to a descending structure that began on August 31st when the price topped on 78.462.

The below 8-hour chart exposes the price action running in an upward wave ((b)) of Minute degree labeled in black, which currently advances its fourth wave of Minuette degree identified in blue. Likewise, according to the Dow Theory, considering that the AUDJPY cross advanced over 66% of the bearish decline, the price should develop a bearish connector corresponding to wave ((b)).

In this context, following the Elliott Wave theory and considering the third internal segment of the intraday rally, the price could produce a limited upside toward the supply zone bounded between 77.295 and 77.497. Finally, the bearish divergence on the MACD oscillator may mean a confirmation of the upward movement’s exhaustion corresponding to wave ((b)).

Short-Term Technical Outlook 

The incomplete bullish sequence of the AUDJPY cross unfolded in its 4-hour chart exposes the progress in its fourth wave of Subminuette degree labeled in green. Likewise, considering that the third wave is the extended wave of wave (c), the fifth wave in green should not be extended.

On the other hand, considering that the second wave in green is a simple correction, the fourth wave should elapse more time than the second wave. Additionally, the fifth wave in green could extend itself between 77.140 and 77.654. The price could find fresh sellers expecting to open their shorts on the bearish side of wave ((c)) of Minute degree labeled in black. The invalidation level of the bearish scenario locates at 78.462. 

 

Categories
Forex Market Analysis

Daily F.X. Analysis, November 10 – Top Trade Setups In Forex – Risk on Market Sentiment! 

On the news front, the eyes will remain on the European German ZEW Economic Sentiment data and the Industrial Production figures from France and Italy. All of the figures are expected to have dropped, which may put bearish pressure on the single currency Euro. Besides this, the eyes will stay on the labor market figures from the United Kindom. 

On the news front, the eyes will remain on the European German ZEW Economic Sentiment data and the Industrial Production figures from France and Italy. All of the figures are expected to have dropped, which may put bearish pressure on the single currency Euro. Besides this, the eyes will stay on the labor market figures from the United Kindom. 

On the news front, the eyes will remain on the European German ZEW Economic Sentiment data and the Industrial Production figures from France and Italy. All of the figures are expected to have dropped, which may put bearish pressure on the single currency Euro. Besides this, the eyes will stay on the labor market figures from the United Kindom. 

Economic Events to Watch Today  

 


 

EUR/USD – Daily Analysis

The EUR/USD pair was closed at 1.18133 after placing a high of 1.19198 and a low of 1.17951. The EUR/USD pair rose to its highest since September 02 on Monday but failed to keep its gains and fell to post losses for the day as the U.S. dollar rallied in the American session as risk appetite took over.

Pfizer and BioNtech announced that their coronavirus vaccine was more than 90% effective in preventing the coronavirus. The news about the vaccine optimism raised the risk sentiment further and pushed the pair to its highest in 9 weeks in earlier sessions on Monday.

Pfizer and BioNtech said they would seek the approval authorization for emergency-use from the U.S. later this month. The optimism around the market raised and supported the EUR/USD pair’s upward movement in earlier trading hours.

A vaccine will likely mean the end of lockdowns and restrictions and hence, a sharp economic comeback. However, it will take up to the second half of next year for the vaccine or vaccines to reach enough people to grant a more normal return to activities. Nevertheless, optimism will prevail.

However, the EUR/USD pair failed to keep its gains for the day and started declining on Monday on the back of Joe Biden’s victory in the U.S. presidential election. The political gridlock in the U.S. Senate could stall the prospect of any fresh package of U.S. fiscal stimulus package that failed to keep the U.S. dollar under pressure and weighed on the EUR/USD pair.

On the data front, at 12:00 GMT, the German Trade Balance for September raised to 17.8B against the expected 17.2B and supported Euro that pushed the EUR/USD pair higher on Monday. AT 14:30 GMT, the Sentix Investor Confidence for October came in as -10.0 against the forecasted -15.0 and supported Euro.

Moreover, the European Central Bank (ECB) President Christine Lagarde refrained from touching upon monetary policy in her scheduled speech at the Green Horizon Summit on Monday. She only talked about climate risks and said that the economic challenges of climate transition were phenomenal. The main driver of the EUR/USD pair remained the strength of the U.S. dollar triggered by the faded hopes of additional stimulus measures as the vaccine news raised optimism about the economic recovery.

Daily Technical Levels

Support   Resistance

1.1766      1.1891

1.1717      1.1969

1.1640      1.2017

Pivot point: 1.1843

EUR/USD– Trading Tip

The EUR/USD is trading bullish at the 1.1833 level amid a stronger U.S. dollar. The pair may now head higher until an immediate resistance level of 1.1883. On the 4 hour timeframe, the EUR/USD has formed an upward channel supporting the pair at the 1.18016 level. On the higher side, a bullish crossover of 1.1883 level can extend the buying trend until the 1.1945 area. The MACD entered the oversold zone and now suggesting odds of bullish trend continuation; therefore, we should look for a buying trade over the 1.1801 level.  

GBP/USD – Daily Analysis

The GBP/USD pair was closed at 1.31634 after a high of 1.32081 and a low of 1.31183. Despite higher market sentiment and weaker safe-haven demand on Monday, the British Pound to U.S. dollar exchange rate has been under pressure. The Sterling remained weak despite the increased market sentiment from the news of coronavirus vaccine efficiency.

Pfizer and the BioNtech announced that their vaccine had been proved more than 90% efficient in preventing the coronavirus on Monday. Both companies also said they would be taking approval from the U.S. for the vaccine’s emergency-use later this month. After this news, risk appetite increased in the market, and global equities raised; however, the risk perceived GBP/USD pair remained under pressure on Monday as British Pound was weak due to Biden victory in the U.S. elections.

Joe Biden’s victory decreased the hopes for the U.K. & U.S. post-Brexit trade deal as Joe Biden has already said that if U.K. fails to reach a deal with the E.U., then the US-UK deal will also be jeopardized. As there was no news regarding the progress made in the U.K. & E.U. talks, the British Pound came under fresh pressure after Joe Biden became the U.S.

Meanwhile, on Monday, the governor of Bank of England, Andrew Bailey, explained that what the BoE was doing to ensure the financial system plays its part in tackling climate change. He warned that climate change was a bigger risk than coronavirus. Furthermore, the chief economist from the Bank of England, Andy Haldane, said that a breakthrough in developing a coronavirus vaccine could deliver a vital boost of confidence to consumers and businesses. He added that the economy might have reached a decisive moment after the pharmaceutical company Pfizer announced that its coronavirus vaccine candidate was 90% effective.

He also said that the vaccine could be a game-changer for the economy. He cautioned that it would take several months for the vaccine to be rolled out but would have an immediate effect on consumer and business confidence. He added that the economic cycle would start again as it would unlock the business investments, and the economy will start recovering. The GBP/USD pair remained a little bullish due to high pressure on British Pound on Monday.

Daily Technical Levels

Support   Resistance

1.2997      1.3222

1.2851      1.3301

1.2771      1.3448

Pivot point: 1.3076

GBP/USD– Trading Tip

The GBP/USD is trading with a strong bullish bias due to a stronger Sterling 1.3191 area. The pair has violated the intraday resistance level at 1.3159, which is now working as a support for Sterling. On the higher side, the continuation of an upward trend can lead to the GBP/USD pair until the 1.3226 area. The cable had violated the descending triangle pattern, and ever since, it’s trading with a bullish bias. 

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 105.388 after placing a high of 105.645 and a low of 103.187. The USD/JPY pair surged past the 105.6 level on Monday after the risk-on market sentiment raised and weighed on the Japanese Yen. The safe-haven Japanese Yen came under fresh pressure after the Pfizer and its German partner BioNtech announced that their vaccine candidate was proved more than 90% efficient in its last-stage trials. Both companies announced that they would seek U.S. approval for the emergency-use of vaccine later this month.

The pair USD/JPY witnessed a sharp rise in its prices of almost 3-4% on Monday after the vaccine optimism raised the risk appetite in the market that weighed heavily on the safe-haven Japanese Yen. This ultimately pushed the USD/JPY pair to the highest level since October 20.

The gains in USD/JPY pair were also supported by the victory of Democratic Joe Biden in U.S. elections. Biden was expected to deliver a massive stimulus package that had been weighing on the U.S. dollar. Still, after the news of vaccine development and its efficiency, the need for the massive stimulus package dropped and raised the U.S. dollar onboard. The rising U.S. dollar also helped the USD/JPY pair to post massive gains on Monday.

Meanwhile, on Monday, the Bank of Japan released the Summary of opinions that stated that one member said that the bank needs to ensure its purchases of exchange-traded funds are sustainable. Other members said that BOJ must be ready to ramp up stimulus to cushion the economic blow from the coronavirus pandemic.

On Monday, the Cleveland Federal Reserve Bank President Loretta Mester said that the emergency lending programs the Fed set up during the coronavirus pandemic had reduced distress in financial markets. She also said that there was still a need for lending programs. Mester also said that Fed Chair Jerome Powell would be working with the Treasury Department to determine if the programs should be extended beyond the end of the year. She also stated that the Fed was not out of ammunition to stimulate the economy and that the Fed could provide more accommodation by adjusting its asset purchase program and using other tools.

She said that the economy recovered more strongly than expected, but gains have not been evenly spread. Mester said that economic growth would be more slowly despite the optimistic news about the vaccine on Monday. These comments kept the markets under pressure and capped further gains in the USD/JPY pair.

Daily Technical Levels

Support   Resistance

103.82      106.29

102.27      107.21

101.35      108.75

Pivot point: 104.74

USD/JPY – Trading Tips

The USD/JPY has violated the descending trendline at 104.950 area, and on the lower side, it’s testing the support area of 104.840 level. The USD/JPY pair has recently entered the overbought zone, and now investors may experience a bearish correction in the market. To see a bearish retracement, the USD/JPY pair needs to violate the 104.900 level. Below this, we may see the USD/JPY pair falling until the 104.220 level, and a further breakout can lead it towards 102.400, which seems a bit hard. However, we may see buying over 104.950 levels today until 105.600. Good luck! 

Categories
Forex Signals

USD/CAD Downward Channel Continues to Play – Brace for Selling!

The USD/CAD pair was closed at 1.30072 after placing a high of 1.30519 and a low of 1.29281. The USD/CAD pair slipped to its lowest since mid-October 2018 on Monday as the risk appetite increased and weighed on the safe-haven US dollar that ultimately dragged the USD/CAD pair lower.

The USD/CAD pair was closed at 1.30072 after placing a high of 1.30519 and a low of 1.29281. The USD/CAD pair slipped to its lowest since mid-October 2018 on Monday as the risk appetite increased and weighed on the safe-haven US dollar that ultimately dragged the USD/CAD pair lower.

The USD/CAD pair was closed at 1.30072 after placing a high of 1.30519 and a low of 1.29281. The USD/CAD pair slipped to its lowest since mid-October 2018 on Monday as the risk appetite increased and weighed on the safe-haven US dollar that ultimately dragged the USD/CAD pair lower.
On Monday, the primary driver of the USD/CAD was the WTI Crude Oil prices that rose to $41.32 per barrel on the day after the optimism regarding the vaccine development raised in the market. The hopes for economic recovery were also raised as the vaccine news increased the chances of removing lockdowns and restrictions from the countries across the globe.

On Monday, Pfizer in collaboration with the BioNtech, announced together that their vaccine had proven 90% efficient in preventing the infection of coronavirus in its last stage clinical trials. They said that they would seek approval for their vaccine’s emergency use from the US later this month.

This news raised the risk sentiment and decreased the need for lockdowns weighing on the oil prices due to decreased demand during lockdowns. The crude oil prices surged and placed high gains on Monday that gave strength to commodity-linked Loonie that ultimately weighed heavily on the USD/CAD pair.

However, most of its daily losses were recovered after the US dollar rebounded on the hopes of no need for further stimulus measures as the vaccine had been developed. The US dollar strength drove the USD/CAD pair higher and recovered most of its daily losses. There were no macroeconomic releases from both sides s the pair continued following Pfizer and BioNtech’s latest announcement regarding vaccine development.


Daily technical Levels
Support Resistance
1.2932 1.3076
1.2857 1.3145
1.2788 1.3220
Pivot point: 1.3001

The USD/CAD pair is consolidating with a selling bias beneath the 1.3007 zones, disrupting the support region of the 1.3025 mark. On the downside, the bearish breakout of the 1.3025 level can extend selling bias until the 1.29720 level. Continuation of a selling bias can help us capture a quick sell trade until the 1.2972 area. So far, the MACD and EMA are neutral as the market lacks volatility. But we can expect some price action during the European session. Let’s brace for it. Good luck!

Categories
Forex Signals

GBP/JPY: Bearish Breakout

GBP/JPY made a bullish move to start its trading day today. The 15M chart shows that the price upon finding its resistance around 136.610 made a strong bearish move and made a bearish breakout at an up-trending trendline.

GBP/JPY made a bullish move to start its trading day today. The 15M chart shows that the price upon finding its resistance around 136.610 made a strong bearish move and made a bearish breakout at an up-trending trendline.

GBP/JPY made a bullish move to start its trading day today. The 15M chart shows that the price upon finding its resistance around 136.610 made a strong bearish move and made a bearish breakout at an up-trending trendline.

The chart produces two bullish corrective candles and finds its resistance around 136.270. It produces a bearish engulfing candle closing at the level where the price had a bounce after the breakout.

We triggered a short entry right after the candle closes. The 15 M chart shows that the price may find its next support around 135.797. The price may continue its bearish move if the level of 135.797 is breached.

Entry- 136.047

Stop Loss- 136.297

Take Profit– 135.797

The risk for the trade is 207 USD per standard lot, 20.7 USD for a mini lot, and 2.07 USD for a micro lot. The risk-reward is 1:1, so the reward is 207 USD per standard lot, 20.7 USD for a mini lot, and 2.07 USD for a micro lot.

Categories
Forex Signals

AUD/USD Succeeded to Stop Its Overnight Losses – Combination Of Factors in Play! 

During Monday’s early Asian trading session, the AUD/USD currency pair succeeded to stop its overnight losing streak and caught some sharp bids around above mid-0.7200 level mainly due to the risk-on market sentiment, which tend to support the observed risk currency Australian dollar and offers to the currency pair gains. Therefore, Democratic candidate Joe Biden’s victory in the U.S. presidential elections was supported by the market trading bias. Aside from this, the market trading sentiment was further supported by Brexit’s confidence, which boosted the currency pair. Across the pond, the broad-based U.S. dollar selling bias, triggered by the marker risk-on sentiment, also played its major role in supporting the currency pair. 

During Monday’s early Asian trading session, the AUD/USD currency pair succeeded to stop its overnight losing streak and caught some sharp bids around above mid-0.7200 level mainly due to the risk-on market sentiment, which tend to support the observed risk currency Australian dollar and offers to the currency pair gains. Therefore, Democratic candidate Joe Biden’s victory in the U.S. presidential elections was supported by the market trading bias. Aside from this, the market trading sentiment was further supported by Brexit’s confidence, which boosted the currency pair. Across the pond, the broad-based U.S. dollar selling bias, triggered by the marker risk-on sentiment, also played its major role in supporting the currency pair. 

During Monday’s early Asian trading session, the AUD/USD currency pair succeeded to stop its overnight losing streak and caught some sharp bids around above mid-0.7200 level mainly due to the risk-on market sentiment, which tend to support the observed risk currency Australian dollar and offers to the currency pair gains. Therefore, Democratic candidate Joe Biden’s victory in the U.S. presidential elections was supported by the market trading bias. Aside from this, the market trading sentiment was further supported by Brexit’s confidence, which boosted the currency pair. Across the pond, the broad-based U.S. dollar selling bias, triggered by the marker risk-on sentiment, also played its major role in supporting the currency pair. 

Moreover, the U.S. dollar losses were further bolstered by the intensifying doubts over the U.S. economic recovery as U.S. total coronavirus cases surpass 10 million. On the contrary, the long-lasting coronavirus woes in the U.S. and Europe and Trump’s challenges to the election results keep challenging the upbeat market sentiment, which becomes the key factor that kept the lid on any additional gains in the currency pair. The AUD/USD is trading at 0.7269 and consolidating in the range between 0.7268 – 0.7290.

Despite the doubts over the global economic recovery from intensifying coronavirus (COVID-19) woes in the U.S. and Europe, the market trading sentiment ticked up to the 4-week high at the start of the week’s trading and remained supportive by the Democratic candidate Joe Biden’s victory in the U.S. presidential elections. Despite many lawsuits filed by the Trump administration against the result of the presidential election, the market traders still believe that the Republican member will not keep the White House leadership. Although, the optimism surrounding the Bidden victory was further bolstered after the JPMorgan Chief Executive Jamie Dimon said that “We must respect the results of the U.S. presidential election and, as we have with every election, honor the decision of the voters and support a peaceful transition of power.” However, this helped the market’s risk sentiment and undermined the U.S. dollar’s safe-haven demand.

Across the ocean, bullish sentiment around the equity market was further bolstered by the optimism concerning Brexit, which was recently triggered after the European Union’s (E.U.) Brexit negotiator Michel Barnier recently said that he is pleased to be back in London for Brexit talks.

On the contrary, the intensifying coronavirus woes in the U.S. and Europe and intensifying lockdowns restrictions in Europe keep challenging the upbeat market sentiment and become the key factor that kept the lid on any additional gains in the currency pair. As per the latest report, the coronavirus cases (COVID-19) have exceeded 50 million globally over the weekend. At the same time, the number of infections in Europe was registered approximately 300K in one day. At the U.S. front, the U.S. reported a record rise in coronavirus cases for a 4th-consecutive day with at least 131,420 new infections, bringing the country’s total count to around 9.91 million. Simultaneously, the number of deaths in the U.S. was more than 1,000 for a 5th-consecutive day. It is also worth mentioning that 242,230 people have died from the infection in the U.S., and 6,391,208 have recovered so far. Considering the current coronavirus condition in Europe, the major Europeans like Germany and France have imposed severe restrictions to try controlling the spread. 


Moving ahead, the market traders will keep their eyes on the U.S. economic calendar, which highlights updates on inflation and consumer confidence along with Thursday’s report on initial jobless claims. In the meantime, the Brexit trade talks’ updates could not lose their importance on the day.

The AUD/USD consolidates with bullish sentiment at the 0.7294 area, facing a solid resistance at the 0.7294 level extended by a triple top pattern. On the higher side, the upward breakout can drive the buying drift to the 0.7346 mark. Alongside this, the support extends to operate at the 0.7220 mark today. The MACD trades with a mixed bias; nevertheless, it can adapt bullish if AUD/USD runs to crossover 0.7295 mark. Good luck!

Categories
Forex Signals

USD/CAD Breaking Underneath Double Bottom Support – Brace for Sell! 

The USD/CAD pair was closed at 1.30589 after placing a high of 1.30967 and a low of 1.30192. The USD/CAD fell to its lowest since 1st September on Friday before rising and posting gains for the day.

The USD/CAD pair was closed at 1.30589 after placing a high of 1.30967 and a low of 1.30192. The USD/CAD fell to its lowest since 1st September on Friday before rising and posting gains for the day.

The USD/CAD pair was closed at 1.30589 after placing a high of 1.30967 and a low of 1.30192. The USD/CAD fell to its lowest since 1st September on Friday before rising and posting gains for the day.

After posting sharp losses for the previous four days, the USD/CAD pair reversed and posted gains on Friday despite the broad-based US dollar weakness. The main driver of the USD/CAD pair on Friday was the Crude oil prices.

The WTI Crude Oil prices declined to $37.06 per barrel on Friday amid the rising number of lockdown restrictions from the European nations and other countries. The resurgence of the second wave of coronavirus forced governments to re-impose restrictions, raising concerns for oil prices.

As the previous lockdowns decreased the crude oil prices to its lowest level in history, the same fears emerged in the market after the second wave of virus escalated. These lingering fears kept the crude oil prices under pressure and weighed on commodity-linked Loonie that ultimately pushed the USD/CAD pair on the higher side.

On the data front, at 18:30 GMT, the Employment Change from Canada for October rose to 83.6K against the forecasted 59.0K and supported the Canadian dollar and capped further upside of the USD/CAD pair. The Unemployment Rate from Canada for October also declined to 8.9% from the forecasted 9.0% and supported the Canadian dollar. At 20:00 GMT, the Ivey PM for October from Canada declined to 54.2 against the projected 55.2 and weighed on the Canadian dollar and supported the USD/CAD pair’s gains on Friday.

From the US side, at 18:30 GMT, Average Hourly Earnings from the US for October fell to 0.1% from the predicted 0.2% and weighed on the US dollar and capped further gains in the USD/CAD pair. For October, the Non-Farm Employment Change rose to 638K against the predicted 595K and supported the US dollar and pushed the pair USD/CAD further on the upside. The Unemployment Rate from the US in October dropped to 6.9%from the predicted 7.7% and supported the US dollar. At 20:00 GMT, the Final Wholesale Inventories for September came in as 0.4% against the expected -0.1% and weighed on the US dollar.

Meanwhile, the US dollar was weak across the board due to the chances of Joe Biden’s victory in US elections on Friday as he was expected to deliver a larger stimulus package. However, the US dollar weakness only affected the pair in an early trading hour at the ending day of the week and failed to impact the USD/CAD pair’s prices in a late trading hour due to declining crude oil prices.


Daily Technical Levels

Support Resistance

1.2989 1.3142

1.2931 1.3237

1.2836 1.3295

Pivot point: 1.3084

The USD/CAD pair is trading with a selling bias below the 1.3007 area, having violated the support area of the 1.3025 level. On the lower side, the bearish breakout of the 1.3025 level can extend selling bias until the 1.29720 level. Continuation of a selling bias can help us capture a quick sell trade until the 1.2972 area. So far, the MACD and EMA are neutral as the market lacks volatility. But we can expect some price action during the European session. Let’s brace for it. Good luck! 

Categories
Forex Market Analysis

Daily F.X. Analysis, November 09 – Top Trade Setups In Forex – BOE Gov Bailey Speaks! 

On the news front, the investor’s focus is likely to stay on the German Trade Balance, and the ECB President Lagarde Speaks ahead of the BOE Gov Bailey Speech during the European session today. German Trade Balance is forecasted to improve from 15.7B to 17.2B, and it may help support the Euro as a single currency. While the ECB President Lagarde and BOE Bailey is scheduled to speak at Green Horizon Summit via satellite.

On the news front, the investor’s focus is likely to stay on the German Trade Balance, and the ECB President Lagarde Speaks ahead of the BOE Gov Bailey Speech during the European session today. German Trade Balance is forecasted to improve from 15.7B to 17.2B, and it may help support the Euro as a single currency. While the ECB President Lagarde and BOE Bailey is scheduled to speak at Green Horizon Summit via satellite.

On the news front, the investor’s focus is likely to stay on the German Trade Balance, and the ECB President Lagarde Speaks ahead of the BOE Gov Bailey Speech during the European session today. German Trade Balance is forecasted to improve from 15.7B to 17.2B, and it may help support the Euro as a single currency, while the ECB President Lagarde and BOE Bailey is scheduled to speak at Green Horizon Summit via satellite.

Economic Events to Watch Today  

 

EUR/USD – Daily Analysis

The EUR/USD pair was closed at 1.18746 after placing a high of 1.18907 and a low of 1.17952. The EUR/USD pair was rose to its highest level since September 15 on Friday. The EUR/USD pair has been holding onto gains as the markets were following the U.S. elections. The lead of Democratic Joe Biden in U.S. elections kept the U.S. dollar under pressure and supported the EUR/USD pair’s bullish momentum.

The safe-haven dollar remained on the back foot throughout the week and pushed the riskier EUR/USD pair to its multi week’s highest level. The greenback was also weak due to the dovish decision by Federal Reserve this week. The Federal Reserve Chairman, Jerome Powell, said that the pace of the recovery was moderated and that fed has discussed the bond-buying scheme. He also showed his concerns about the resurgence of coronavirus in the U.S. and all over the globe and urged lawmakers to act.

On the data front, at 12:00 GMT, the German Industrial Production for September declined to 1.6% from the forecasted 2.6% and weighed on Euro. At 12:45 GMT, the French Prelim Private Payrolls for the quarter raised to 1.8% from the forecasted 0.2% and supported Euro that added in the gains of EUR/USD pair. The French Trade Balance for September came in as -5.7B against the expected -6.9B and supported Euro. At 14:00 GMT, the Italian Retail Sales for September came in as -0.8%against the expected -1.5% and supported Euro and pushed EUR/USD pair higher.

At 18:30 GMT, Average Hourly Earnings from the U.S. for October dropped to 0.1% from the projected 0.2% and weighed on the U.S. dollar and supported the upward trend of the EUR/USD pair. The Non-Farm Employment Change for October elevated to 638K against the predictable 595K and supported the U.S. dollar. In October, the Unemployment Rate from the U.S. dropped to 6.9%from the projected 7.7% and supported the U.S. dollar. At 20:00 GMT, the Final Wholesale Inventories for September came in as 0.4% against the expected -0.1% and weighed on the U.S. dollar that ultimately added strength in the EUR/USD pair on Friday.

The COVID-19 cases have been continuously rising on both sides, Europe and the USA, and once the U.S. elections settle, the par could see a decline in its prices.

The focus of market participants was only on the U.S. election, where over the weekend, the Democratic Joe Biden won the presidency of the United States and became 46th President of the USA. Despite the lawsuits claiming electoral fraud, Biden was elected as U.S. President and weighed on the U.S. dollar that ultimately will help the EUR/USD pair to post further gains.

Daily Technical Levels

Support    Resistance

1.1733      1.1884

1.1647      1.1947

1.1583      1.2034

Pivot point: 1.1797

EUR/USD– Trading Tip

The EUR/USD is trading bullish at the 1.1890 level amid a weaker U.S. dollar. The pair may head further higher until the 1.1945 level, having immediate support at the 1.18826 level. On the 4 hour timeframe, the EUR/USD has violated the double top resistance level of 1.1882 level, which may lead the EUR/USD pair further higher until the 1.1945 mark. The MACD supports buying; therefore, we should look for a buying trade over the 1.1880 level.  

GBP/USD – Daily Analysis

The GBP/USD pair was closed at 1.31474 after placing a high of 131770 and a low of 1.30924. The GBP/USD pair rose to its highest since September 07 on Friday despite the better than expected Unemployment rate and NFP data from the U.S.

The market’s focus was shifted to the U.S. Election results that were showing a Democratic lead; it weighed on the U.S. dollar and contributed to the GBP/USD pair’s gains. The strong Employment figures also failed to improve the mood around the U.S. dollar as investors were not impressed by it, and they continued following the U.S. election results.

Over the weekend, Joe Biden won 290 Electoral College votes against Donald Trump’s 214 that confirmed Biden’s victory as the candidate should secure at least 270 Electoral College votes to win the presidency.

On the data front, at 13:30 GMT, the Halifax Housing Price Index for October declined to 0.3% against the forecasted 1.0% and weighed on British Pound and capped further gains in GBP/USD pair.

On the U.S. front, at 18:30 GMT, Average Hourly Earnings from the U.S. for October fell to 0.1% from the estimated 0.2% and weighed on the U.S. dollar and supported the upward trend of the GBP/USD pair. The Non-Farm Employment Change for October rose to 638K against the estimated 595K and supported the U.S. dollar. In October, the Unemployment Rate from the U.S. fell to 6.9%from the estimated 7.7% and supported the U.S. dollar. At 20:00 GMT, the Final Wholesale Inventories for September came in as 0.4% against the estimated -0.1% and weighed on the U.S. dollar and provided strength to the GBP/USD pair.

The improved employment figures from the U.S. failed to give any strength to the falling U.S. dollar on Friday as the focus of traders was only towards the U.S. election results leading Joe Biden over Donald Trump. Whereas, on the Brexit front, the UK PM Boris Johnson will be under greater pressure to strike a Brexit deal with the E.U. as Joe Biden has won the presidency. It is because a no-deal Brexit could seriously threaten relations with a new Democratic administration.

Joe Biden has already made it clear that there will be no agreement on a post-Brexit UK-US trade deal if the U.K. disagreed with the E.U. The talks between E.U. & U.K. officials were continued throughout the week, and the result of those talks has not been published yet. The market’s focus will be shifted towards economic data and other fundamentals rather than on U.S. elections in the coming week as the uncertainty regarding the U.S. election has faded away.

Daily Technical Levels

Support    Resistance

1.2997      1.3222

1.2851      1.3301

1.2771      1.3448

Pivot point: 1.3076

GBP/USD– Trading Tip

The GBP/USD is also trading with a strong bullish bias due to a weaker dollar in the 1.3181 area. The pair has violated the intraday resistance level at 1.3159, which is now working as a support for Sterling. On the higher side, the continuation of an upward trend can lead the GBP/USD pair until the 1.3226 area. The cable had violated the descending triangle pattern, and ever since, it’s trading with a bullish bias. 

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 103.364 after placing a high of 103.758 and a low of 103.174. The USD/JPY pair was dropped to its lowest since 8th March. The U.S. dollar against the Japanese Yen on Friday dragged the pair to a fresh 8-months lowest level as the chances for Joe Biden to win the U.S. election increases. The USD/JPY pair followed the USD weakness throughout the week and reached the 103 level.

The investors have welcomed a Democrat government’s prospects with a split congress where Republicans can block initiatives to raise taxes or introduce tighter regulations with a risk rally that sent the safe-haven U.S. dollar to multi-month lows against its main rivals.

On the data front, at 04:30 GMT, the Average Cash Earning for the year came in as -0.9% against the forecasted -1.1% and supported the Japanese Yen and added further losses in the USD/JPY pair. The Household Spending for the year came in as -10.2% against the expected -10.5% and supported the Japanese Yen that added further weakness in the currency pair USD/JPY.

From the U.S. side, at 18:30 GMT, Average Hourly Earnings from the U.S. for October weakened to 0.1% from the anticipated 0.2% and weighed on the U.S. dollar added further losses in the USD/JPY pair. The Non-Farm Employment Change for October surged to 638K against the anticipated 595K and supported the U.S. dollar, and capped further losses in the USD/JPY pair. In October, the Unemployment Rate from the U.S. weakened to 6.9%from the anticipated 7.7% and supported the U.S. dollar. At 20:00 GMT, the Final Wholesale Inventories for September came in as 0.4% against the anticipated -0.1% and weighed on the U.S. dollar and dragged the pair USD?JPY to the multi-month lowest level.

The USD/JPY pair’s main driver at the ending day of the week remained the U.S. dollar weakness due to Biden’s prospects in U.S. elections. Over the weekend, the results showed that Biden won 290 Electoral College votes compared to Trump’s 214 and became the 46th President of the U.S. Biden is expected to deliver a larger stimulus package, and the markets were following these hopes that could lead further to the downside of the safe-haven U.S. dollar.

Daily Technical Levels

Support    Resistance

103.09      104.22

102.70      104.95

101.97      105.34

Pivot point: 103.83

USD/JPY – Trading Tips

The USD/JPY has violated the descending triangle pattern at 104.149 area, and on the lower side, it’s testing the support area of 103.270 level. Recently the closing of bullish engulfing patterns may drive an upward movement in the market. On the higher side, the USD/JPY can go after the next 103.850 mark. On the flip side, violation of the 103.215 level can extend selling until the 102.750 mark. The MACD is also showing oversold sentiment among investors; therefore, we should look for a bullish trade over 103.270 and selling below the 103.830 level today. Good luck! 

Categories
Forex Elliott Wave Forex Market Analysis

GBPCAD Advances in a Double-Three Pattern

Overview

Overview

Overview

The GBPCAD cross advances in a sideways sequence corresponding to an incomplete double-three pattern. The mid-term Elliott Wave view foresees a potential rally that could boost the cross toward last March’s highs.

Market Sentiment

The mid-term market sentiment overview of the GBPCAD cross unfolded by the 90-day high and low range and illustrated in its daily chart, reveals the price action moving in the bearish sentiment zone (SZ).

The previous chart reveals the sideways movement bounded between the extreme bullish SZ located at 1.76759 and the extreme bearish SZ at 1.69214. Likewise, the 60-Day moving average looks flat, suggesting the balance between supply and demand, or bull and bear traders, which in turn, is indicative of sideways action.

On the other hand, considering the year’s opening price at 1.71923, we distinguish that the yearly candlestick pattern corresponds to a narrow body candle identified as a doji, revealing the next direction’s market participants’ indecision that the price will take.

In consequence, while the GBPCAD cross remains moving mostly sideways, the primary bias will continue neutral.

Elliott Wave Overview

The long-term Elliott Wave landscape of the GBPCAD cross reveals the price action is developing an incomplete three-wave sequence of Intermediate degree labeled in blue, which currently advances its wave (B). The internal structure unfolds in a double-three pattern as it exposes the next weekly chart on a log scale.

The previous chart reveals that the double-three pattern in progress looks incomplete. According to the Elliott wave theory, this complex formation follows an internal structural series subdivided as 3-3-3. In this context, the GBPCAD cross advances in its last “three” or the third component of the double-three pattern identified as wave Y of Minor degree labeled in green.

The internal structure of wave Y subdivided into another “three” sequence, which advances in its wave ((b)) of Minute degree labeled in black. Likewise, the wave ((b)) follows the arrangement of a triangle pattern. Thus, the GBPCAD cross should develop an upward movement subdivided into five-waves, corresponding to its wave ((c)) of Minute degree identified in black.

Elliott Wave Outlook

Considering the progress of the GBPCAD cross into a triangle pattern, the following 12-hour chart unveils that the price completed its wave ((b)) with the failure of reaching a new lower low at 1.69014, where the cross began to advance in an upward sequence that corresponds to its wave ((c)) of Minute degree identified in black.

The previous chart illustrates the end of the wave (e) of Minuette degree identified in blue and the upward sequence of a potential leading diagonal pattern, which could follow a 5-3-3-3-3 internal sequence. Simultaneously, the price seems to be advancing in its fifth wave of Subminuette degree labeled in blue, which belongs to the first wave of Minuette degree in blue. 

The first impulsive wave of Minuette degree could find resistance in the supply zone between 1.73665 and 1.74341, from where the cross could start to retrace until the demand zone is located between 1.71151 and 1.70262. Once GBPCAD completes its second wave, the third wave could become the upward cycle’s extended wave. This upward movement could drive the pair toward 1.77356 and continue until 1.79911.

The bullish scenario’s invalidation level locates at 1.69014, which coincides with the wave’s origin ((c)) that remains in progress.

Categories
Forex Signals

AUD/USD Bullish Channel Support Assie – Quick Update

The AUD/USD currency pair failed to extend its previous day bullish moves and took fresh offers near below the 0.7250 level mainly due to prevalent risk-off market sentiment, triggered by the worsening coronavirus (COVID-19) conditions in the U.S. and the U.K., which exerted some selling pressure on the perceived riskier Aussie and dragged the currency pair below 0.7000 marks. 

The AUD/USD currency pair failed to extend its previous day bullish moves and took fresh offers near below the 0.7250 level mainly due to prevalent risk-off market sentiment, triggered by the worsening coronavirus (COVID-19) conditions in the U.S. and the U.K., which exerted some selling pressure on the perceived riskier Aussie and dragged the currency pair below 0.7000 marks. 

AUD/USD Bullish Channel Support Assie – Quick Update

The AUD/USD currency pair failed to extend its previous day bullish moves and took fresh offers near below the 0.7250 level mainly due to prevalent risk-off market sentiment, triggered by the worsening coronavirus (COVID-19) conditions in the U.S. and the U.K., which exerted some selling pressure on the perceived riskier Aussie and dragged the currency pair below 0.7000 marks. 

However, the global risk sentiment was further pressured by the uncertainty surrounding the U.S. election, triggered by the rumors concerning the delay in U.S. election results until January. On the other hand, the broad-based U.S. dollar fresh strength, backed by the risk-off market sentiment, has also played its major role in undermining the currency pair. 

On the contrary, the currency pair’s losses were capped by the RBA’s monetary policy statement, in which the RBA explicitly calling out no further reduction in interest rates, which tend to underpin the Australian dollar and helps the currency pair to limit its deeper losses. At the moment, the AUD/USD currency pair is currently trading at 0.7255 and consolidating in the range between 0.7250 – 0.7285.

The market trading sentiment remains depressed during the early Asian trading session due to the second wave of coronavirus infections in the U.S. and the U.K. getting worse day by day. As per the latest report, there are 109,000 new COVID-19 cases from the U.S. so far. Thus, these figures marked the second day in a row with over 100,000 new cases after beating Wednesday’s daily record.

Additionally, the long-lasting inability to pass the U.S. fiscal package, as well as the jitters of the American presidential election also weighed on the risk sentiment, which eventually undermined the perceived riskier Australian dollar and contributed to the currency pair gains.

Despite Democratic candidate Joe Biden’s heavy role in the electoral votes, currently around 260 counts against 270 required, the U.S. election results still not showing any decision. However, the reason could be attributed to President Donald Trump’s lawsuits against multiple states. As per the latest report from Pennsylvania, Trump’s lead getting narrowed over the democratic rival Biden.

Despite this, the broad-based U.S. dollar succeeded in stopping its last session losses and took some fresh bids during Friday’s Asian session as investors started to prefer the safe-haven assets in the wake of the risk-off market sentiment. However, the U.S. dollar gains seem rather unaffected by the downbeat comments from the Fed Chair Jerome Powell. On the other hand, the U.S. dollar gains were also capped by the prevalent worries over the U.S. economic recovery amid the reappearance of coronavirus cases, which could be bad for both the U.S. and the global economy. However, the U.S. dollar gains become the key factor that kept the currency pair under pressure. Simultaneously, the U.S. Dollar Index that tracks the greenback against a basket of other currencies recovered to 92.698.

The Fed has performed as broadly expected, maintaining its benchmark interest rate at the 0%-0.25% range and its bond-buying program unchanged. In the meantime, he showed readiness to fulfill its pledge to support the U.S. economy, “promoting its maximum employment and price stability goals in times of the COVID-19 pandemic.

At home, the currency pair’s losses were capped by the RBA’s monetary policy statement, in which the RBA indicated for no further reduction in interest rates, which tend to underpin the Australian dollar and helps the currency pair to limit its deeper losses.

Moving ahead, the market traders will keep their eyes on the American employment numbers for October., USD price dynamics, and coronavirus headlines, which could give a fresh direction for the currency pair. In the meantime, the updates surrounding the U.S. elections could not lose their importance on the day.


Daily Support and Resistance

S1 0.6867

S2 0.7007

S3 0.7094

Pivot Point 0.7146

R1 0.7233

R2 0.7286

R3 0.7426

The AUD/USD traded distinctly bullish at the 0.7262 area, with a critical resistance of 0.7282 and 0.7335. In the daily chart, the AUD/USD has established a substantial buying candle, conferring substantial bullish sentiment among investors. While on the lower side, the support can be seen around the 0.7230 mark. Bullish sentiment rules the market. Good luck! 

Categories
Forex Elliott Wave Forex Market Analysis

Can EURUSD Re-Test the Level 1.20?

The EURUSD pair advances in an unfinished impulsive formation that raised the common currency from 1.06359 till 1.20114. The price action started to develop a corrective sequence, still progressing, corresponding to its fourth wave of Minor degree. Explore with us what should be the target of the fifth impulsive wave.

The EURUSD pair advances in an unfinished impulsive formation that raised the common currency from 1.06359 till 1.20114. The price action started to develop a corrective sequence, still progressing, corresponding to its fourth wave of Minor degree. Explore with us what should be the target of the fifth impulsive wave.

The EURUSD pair advances in an unfinished impulsive formation that raised the common currency from 1.06359 till 1.20114. The price action started to develop a corrective sequence, still progressing, corresponding to its fourth wave of Minor degree. Explore with us what should be the target of the fifth impulsive wave.

Market Sentiment

The long-term market sentiment of the EURUSD pair based on the 52-week high and low range unveils the price moving in the extreme bullish zone. 

The following daily chart illustrates the common currency moving above the 60-day linear weighted moving average, confirming the extreme short-term upward bias prevalent in the current price action.

Likewise, the consolidation formation bounded between 1.16121 and 1.18566, appearing after the rally from mid-May to early September, leads us to anticipate the take-profit activity of big market participants. In other words, the price could begin a new movement toward the 52-week high zone, creating a euphoric sentiment for the euro before developing a corrective move.

Elliott Wave Overview

 EURUSD pair’s long-term outlook under the Elliott Wave perspective reveals the upward advancement of the common currency in an unfinished impulsive wave, which currently progresses in its fourth wave of Minor degree, suggesting further highs.

The following daily chart exposes de uptrend developed by the EURUSD since the March 23rd low located at 1.06359, where the price found fresh buyers, who remain in control of the long-term uptrend.

The Elliott Wave point of view illustrates the EURUSD pair developed and completed a third extended wave of Minor degree labeled in green when the price reached 1.20114 on past September 01st. Once the common currency found resistance at 1.20114, the EURUSD started to develop its fourth wave of Minor degree identified in green.

Considering that the second corrective wave was simple in terms of price and time, by the alternation principle of the Elliott Wave theory, the fourth wave should be a complex correction. In this regard, the complexity could be in terms of price, time, or both.

If the correction were complex in price, the formation could be a flat pattern like an irregular flat. If the complexity were in terms of time, the corrective pattern could be a triangle formation. Finally, if the correction develops a combination of price and time complexity, the structural series could be a double three or a triple three pattern.

Short-term Elliott Wave Outlook

Once the fourth wave ends, the common currency should advance in its fifth wave, shown in green in the following chart. Considering that the third wave is the extended wave, two potential scenarios exist for the fifth wave target.

The first scenario considers the advance slightly higher than the top of the third wave, which could reach the area between 1.2065 and 1.2257.

The second scenario may arise if the fifth wave’s bullish pressure fails and finds resistance in the supply zone, which is located between 1.19361 and 1.20114.

To conclude, the invalidation level corresponding to this bullish scenario is a close below 1.11639.

Categories
Forex Signals

USD/CAD Bearish Price Action Continues – Downward Channel In Play! 

The USD/CAD pair was closed at 1.30425 after placing a high of 1.31781 and a low of 1.30280. The USD/CAD pair dropped to its lowest since 1st September on the back of U.S. dollar weakness triggered by the expectations of Biden victory in the U.S. presidential elections.

The USD/CAD pair was closed at 1.30425 after placing a high of 1.31781 and a low of 1.30280. The USD/CAD pair dropped to its lowest since 1st September on the back of U.S. dollar weakness triggered by the expectations of Biden victory in the U.S. presidential elections.

The USD/CAD pair was closed at 1.30425 after placing a high of 1.31781 and a low of 1.30280. The USD/CAD pair dropped to its lowest since 1st September on the back of U.S. dollar weakness triggered by the expectations of Biden victory in the U.S. presidential elections.

The pair USD/CAD failed to capitalize its early daily gains and fell to its two months lowest level as the selling bias surrounding the U.S. dollar intensified. The greenback was weak due to the U.S. residential Election’s delayed outcome, where Democrat candidate Joe Biden was leading over the incumbent Donald Trump.

However, the final results are yet to announce as Donald Trump has already filed lawsuits against the counting of votes in key battleground states that added to the uncertainty and dampened prospects for a big stimulus package to aid the COVID-19 hit economy. It added further losses in the U.S. Treasury bond yields and contributed to the losses of the USD/JPY pair. Meanwhile, the USD/JPY pair’s downward momentum was cushioned on the back of fresh losses in crude oil prices that tend to undermine the commodity-linked Loonie. The weak Loonie then capped further losses in the USD/CAD pair on Thursday.

The crude oil prices are expected to decrease further in the coming days as the concerns about the renewed lockdown measures to curb the second wave of coronavirus infections were increasing.

On the data front, at 17: 30 GMT, the Challenger Job Cuts for the year came in as 60.4% in comparison to the previous 185.9% from the U.S. At 18:30 GMT, the Unemployment Claims for the last week surged to 751K against the projected 740K and weighed on the U.S. dollar, and added USD/CAD pair losses. The Prelim Nonfarm Productivity for the quarter surged to 4.9% against the projected 3.6% and weighed on the U.S. dollar.

At 18:32 GMT, the Prelim Unit Labor Costs for the quarter came in as -8.9% against the estimated -10.0% and supported the U.S. dollar.

Furthermore, the U.S. dollar was also weak across the board after releasing the Federal Reserve’s latest announcement to keep the interest rates and assets purchases on the same level. This selling bias in the U.S. dollar added further losses in the USD/CAD pair on Thursday.


Daily Technical Levels

Support Resistance

1.2989 1.3142

1.2931 1.3237

1.2836 1.3295

Pivot point: 1.3084

The USD/CAD is trading with a selling bias at the 1.3061 level, having an immediate resistance at 1.3097 along with support at the 1.3030 level. Violation of 1.3030 level can extend selling until 1.2970 level. The downward channel is also putting pressure on the downward trend; therefore, we should look for selling trades below the 1.3090 level today. Good luck! 

Categories
Forex Market Analysis

Daily F.X. Analysis, November 06– Top Trade Setups In Forex – NFP Figures 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 661K to 595K 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 661K to 595K 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 661K to 595K 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 to 1.18269 after placing a high of 1.18595 and a low of 1.17106. The EUR/USD pair surged to its highest level since October 23 amid the U.S. dollar weakness ahead of U.S. election results.

The U.S. dollar came under fresh pressure after the chances for Joe Biden looked increasingly likely to claim the U.S. presidency. Furthermore, the U.S. stimulus package’s expectations will be delivered by any elected government after the results will also be announced exerted pressure on the U.S. dollar and supported the EUR/USD pair’s upward momentum.

On the data front, at 12:00 GMT, the German Factory Orders for September declined to 0.5% against the expected 2.1% and weighed on Euro. At 15:00 GMT, the Retail Sales from the Eurozone for September declined to -2.0% against the expected -1.4% and weighed on single currency Euro that capped further upside movement of EUR/USD pair on Thursday.

From the U.S. side, at 17: 30 GMT, the Challenger Job Cuts for the year from the U.S. came in as 60.4% in comparison to the previous 185.9%. At 18:30 GMT, the Unemployment Claims for the last week were rushed to 751K against the estimated 740K and weighed on the U.S. dollar added further in the gins of EUR/USD pair. The Prelim Nonfarm Productivity for the quarter surged to 4.9% against the predicted 3.6% and weighed on the U.S. dollar. At 18:32 GMT, the Prelim Unit Labor Costs for the quarter came in as -8.9% against the expected -10.0% and supported the U.S. dollar that capped further gains in EUR/USD pair.

Meanwhile, the European Commission reduced its economic growth prediction for next year after governments’ reintroduced lockdowns to control the coronavirus infections. On Thursday, the E.U. executive in Brussels anticipated Eurozone growth of 4.2 percent in 2021, down from 6.1 percent anticipated in July. For 2020, it expects the economy to shrink by 7.8 percent.

Furthermore, the ECB Governing Council member and Bundesbank President, Jens Weidmann, said that it was important for the ECB’s monetary policy to remain expansionary on Thursday. These dovish comments from ECB’s governing council member also added further pressure to cap the gains in EUR/USD. However, investors’ focus remained on the U.S. Presidential election as a winner has not been announced. As few states were still counting votes while the U.S. President Donald Trump is already disputing some results in court. It weighed heavily on the U.S. dollar and pushed the EUR/USD pair higher on board.

Daily Technical Levels

Support    Resistance

1.1733      1.1881

1.1648      1.1944

1.1585     1.2029

Pivot point: 1.1796

EUR/USD– Trading Tip

The EUR/USD pair is trading sideways between a narrow trading range of 1.1859 – 1.1759 amid a weaker dollar. A bearish breakout of the 1.1759 level may extend the selling trend until the 1.1727 level. Simultaneously, the bullish crossover of the 1.1859 area can lead the EUR/USD pair until 1.1895. Breakout highly depends upon the U.S. NFP data today.

GBP/USD – Daily Analysis

The GBP/USD pair was closed at 1.31502 after placing a high of 1.31545 and a low of 1.29309. The British Pound remained in demand and moved higher on Thursday against the U.S. dollar as the chances of Biden victory increased with the counting of votes.

The Bank of England announced on Thursday that it would expand its bond-buying structure by £150 billion to £895 billion, more than the estimates of a more modest £100 boost. Moreover, the BoE also renounced from setting negative interest rates that prompted investors to price that contrary development out.

Meanwhile, on late night Thursday, the Federal Reserve decision on interest rate did just like expected and left rates and bond-buying unchanged. The emphasis was on easing an additional stimulus required from the U.S. government and weighing on the greenback throughout this week.

The U.S. Dollar Index slipped to its lowest of 92.4880 on Thursday and gave strength to the rising GBP/USD pair. On the other hand, the Bank of England’s Monetary Policy Committee unanimously voted to maintain its benchmark bank rate at 0.1%. The market attention was captured by the changes to their Quantitative Easing and economic estimates mentioned in the monetary policy report.

The committee told that the rapid rise in COVID infection rates and subsequent restrictions across the U.K. forced it to respond by increasing its asset purchasing program by 150 billion British Pound to a total of 95 billion Pound surpassed the majority of market expectations of just a 100 billion increase.

The program will last until the end of 2021 beyond the summer, and instead of declining, the British Pound increased as the U.S. dollar was also declining on the day amid the election uncertainty. This added support to the GBP/USD pair that rose above the 1.31500 level on Thursday.

On the data front, the Asset Purchase Facility was increased to 895B against the expected 845B. The official bank rate from the Bank of England remained at 0.10%. At 14:30 GMT, the Construction PMI from Britain also declined to 53.1 against the forecasted 55.0.

From the U.S. side, at 17: 30 GMT, the Challenger Job Cuts for the year from the U.S. came in as 60.4% in comparison to the previous 185.9%. At 18:30 GMT, the Unemployment Claims for the last week advanced to 751K against the projected 740K and weighed on the U.S. dollar that added further to the GBP/USD pair’s gains. The Prelim Nonfarm Productivity for the quarter rose to 4.9% against the projected 3.6% and weighed on the U.S. dollar that added strength to the GBP/USD pair. At 18:32 GMT, the Prelim Unit Labor Costs for the quarter came in as -8.9% against the estimated -10.0% and supported the U.S. dollar.

Meanwhile, the U.S. dollar was also weak due to Biden’s chances of victory that would allow the issuance of a massive stimulus package after the election results. These hopes also weighed on the U.S. dollar and supported the GBP/USD pair’s upward trend.

Daily Technical Levels

Support    Resistance

1.2997      1.3222

1.2851      1.3301

1.2771      1.3448

Pivot point: 1.3076

GBP/USD– Trading Tip

Just like the EUR/USD, the GBP/USD is also trading sharply bullish, having violated the narrow trading range of 1.3122 – 1.2940 area. The Cable has recently broken the double top resistance level of 1.3017 level and now heading further higher until the 1.3158 resistance area. Above this level, the odds of buying remain strong today. On the higher side, the Sterling may find next resistance around 1.3182 while the bearish breakout of 1.3037 may lead the Cable towards the 1.3005 level. Price action highly depends upon the U.S. NFP data today.

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 103.514 after placing a high of 104.547 and a low of 103.441. The USD/JPY pair dropped to its lowest level since March 2020 on the back of a weak U.S. dollar due to increasing hopes for Biden recovery. On Thursday, the Federal Reserve kept its benchmark interest rate unchanged at 0-0.25% range along with its target for asset purchases. According to the monetary policy statement, the economic activity and the employment levels have continued recovering, although they remain at levels well below those at the beginning of the year. The Federal Reserve also warned that the weaker consumer demand and the falling oil prices were holding down consumer inflation.

The comments from Fed chair Jerome Powell remained dovish as he affirmed that the pace of improvement has moderated. He also said that the economic activity continued to recover; he also warned about the highly uncertain path ahead that might have increased negative pressure on the U.S. dollar and added in the USD/JPY pair’s losses.

The U.S. dollar reversed its direction on Thursday from the previous day on the back of expectations of Joe Biden’s recovery as the counting of votes was in his favor so far. However, U.S. President Donald Trump has already filed lawsuits for recounting that could delay the results of the U.S. Presidential election.

On the data front, at 17: 30 GMT, the Challenger Job Cuts for the year came in as 60.4% in comparison to the previous 185.9% from the U.S. At 18:30 GMT, the Unemployment Claims for the last week rose to 751K against the expected 740K and weighed on the U.S. dollar and added in the USD/JPY pair’s losses. The Prelim Nonfarm Productivity for the quarter raised to 4.9% against the estimated 3.6% and weighed on the U.S. dollar. At 18:32 GMT, the Prelim Unit Labor Costs for the quarter came in as -8.9% against the projected -10.0% and supported the U.S. dollar.

The main driver of the USD/JPY pair on Thursday was Biden’s chances of winning the U.S. election 2020 as he will issue a massive stimulus package, which would cause a decline in the U.S. dollar strength.

Daily Technical Levels

Support    Resistance

103.09      104.22

102.70 104.95

101.97 105.34

Pivot point: 103.83

USD/JPY – Trading Tips

The USD/JPY has violated the descending triangle pattern at 104.149 area, and on the lower side, it’s heading towards the next support area of 103.300 level. Violation of these ranges may determine the next trend in the USD/JPY pair. A bullish breakout of 104.149 level can extend the buying trend until 104.880. Conversely, the bearish breakout of 103.300 can lead the USD/JPY pair towards the 102.530 area. The MACD is also showing bearish bias among investors; therefore, let’s wait for a breakout before taking the next position in the USD/JPY. Good luck! 

Categories
Forex Signals

AUD/USD Bounces off Support 0.7155 – Good time to go long?

The AUD/USD pair was closed at 0.71864 after placing a high of 0.72218 and a low of 0.70484. The pair AUD/USD rose to its highest since 12th October on Wednesday amid the U.S. political uncertainty after the election results seemed tighter than expected.

The AUD/USD pair was closed at 0.71864 after placing a high of 0.72218 and a low of 0.70484. The pair AUD/USD rose to its highest since 12th October on Wednesday amid the U.S. political uncertainty after the election results seemed tighter than expected.

The AUD/USD pair was closed at 0.71864 after placing a high of 0.72218 and a low of 0.70484. The pair AUD/USD rose to its highest since 12th October on Wednesday amid the U.S. political uncertainty after the election results seemed tighter than expected.

The AUD/USD pair first declined sharply on Wednesday amid the recent decision of RBA to cut its interest rates to 0.10% from the 0.25% and weighed on Aussie. The RBA also announced its plans to buy A$200 billion government bonds with maturities of around 5-10 years over the next six months.

However, the losses in AUD/USD pair were reversed, and the par started to post gains as the U.S. dollar started losing its gains in late trading session as the U.S. election results delayed and raised uncertainty. The markets started moving with the threats of lawsuits and recounting of votes that would go on for a couple of days and delay the final election results.

The declining U.S. dollar helped the AUD/USD pair to raise its prices and move in the upward direction on Wednesday. On the data front, at 02:30 GMT, the AIG Construction Index for October raised to 52.7 against the previous 45.2. At 05:30 GMT, the Retail Sales for September came in as -1.1% against the forecasted -1.5% and supported the Australian dollar that added strength to AUD/USD pair.

At 18:15 GMT, the ADP Non-Farm Employment Change for October plunged to 365K against the predictable 650K and weighed on the U.S. dollar that ultimately supports the AUD’s upward momentum/USD pair. At 18:30 GMT, the Trade Balance from the U.S. for October remained flat with the anticipations of -63.9B. 

At 19:45 GMT, the Final Services PMI for October rose to 56.9 from the estimated 56.0 and supported the U.S. dollar. At 20:00 GMT, the ISM Services PMI for October fell to 56.6 from the predictable 57.4 and weighed on the U.S. dollar that added further strength to AUD/USD pair.


Daily Technical Levels

Support Resistance

0.7066 0.7215

0.6972 0.7270

0.6917 0.7364

Pivot point: 0.7121

The AUD/USD continues trading sideways, facing immediate resistance at the 0.7160 level along with a support area of 0.7140. The bullish breakout of the 0.7190 level can extend the buying trend until the 0.7220 level. Conversely, the bearish breakout of the 0.7140 level can drive selling bias until 0.7060. Eyes stay on the U.S. elections outcome. Good luck! 

Categories
Forex Signals

USD/CAD Testing Triple Bottom – Is It Good time to go Long? 

The USD/CAD pair was closed at 1.31332 after placing a high of 1.32991 and a low of 1.30953. The USD/CAD pair rose to a daily high of 1.3300 during the Asian session on Wednesday but reversed in the late session and converted gains into modest losses.

The USD/CAD pair was closed at 1.31332 after placing a high of 1.32991 and a low of 1.30953. The USD/CAD pair rose to a daily high of 1.3300 during the Asian session on Wednesday but reversed in the late session and converted gains into modest losses.

The USD/CAD pair was closed at 1.31332 after placing a high of 1.32991 and a low of 1.30953. The USD/CAD pair rose to a daily high of 1.3300 during the Asian session on Wednesday but reversed in the late session and converted gains into modest losses.

The US election results were expected to end with a blue wave and were weighing on the US dollar in previous days, but on Wednesday, the tables turned after the results were tightened. The hopes faded away that democrats will be controlling the Senate, and the expectations of divided government increased that started supporting the US dollar.

The strong US dollar pushed the USD/CAD pair higher; however, the market sentiment reversed after the specter of recounts, appeals to the Supreme Court, and lawsuits emerged and delayed the election results. These uncertainties weighed on market sentiment, and the pair USD/CAD reversed its direction and turned its gains into losses.

On the data front, at 18:30 GMT, the Trade Balance for September dropped to -3.3B against the expected -2.2B and weighed on the Canadian Dollar and supported the upward trend in the earlier session.

From the US side, at 18:15 GMT, the ADP Non-Farm Employment Change for October fell to 365K against the anticipated 650K and weighed on the US dollar and added in USD/CAD losses pair. 

At 18:30 GMT, the Trade Balance from the US for October remained flat at -63.9B. At 19:45 GMT, the Final Services PMI for October rose to 56.9 from the estimated 56.0 and supported the US dollar. At 20:00 GMT, the ISM Services PMI for October plunged to 56.6 from the projected 57.4 and weighed on the US dollar and supported the USD/CAD pair’s bearish trend.

On WTI crude oil front, the prices rose above $39 per barrel on Wednesday and gave strength to the commodity-linked Loonie that ultimately added pressure on the USD/CAD pair and declined its prices.


Daily Technical Levels

Support Resistance

1.3075 1.3209

1.3020 1.3290

1.2940 1.3344

Pivot point: 1.3155

The USD/CAD pair is trading with a neutral bias at the 1.3102 level, holding right below an immediate support area of 1.3100 level. It’s a triple bottom level. Therefore we can expect the Loonie pair to bounce off over this level to target the 1.3219 area. On the higher side, the USD/CAD may find support at the 1.3377 level. Let’s wait for a signal to enter a trade! 

Categories
Forex Market Analysis

Daily F.X. Analysis, November 05 – Top Trade Setups In Forex – Eyes on U.S. Election Results! 

On the news front, the eyes will remain on the outcome of the U.S. elections, although Joe seems to be the next president of the United States considering the voting lead against Trump so far. Besides, the Monetary Policy decision from the Bank of England will remain in highlights. The BOE isn’t expected to make any changes in the policy; however, the press conference will be worth watching. The muted impact is expected on the news. Lastly, the Unemployment Claims from the U.S. may support the U.S. dollar today.

On the news front, the eyes will remain on the outcome of the U.S. elections, although Joe seems to be the next president of the United States considering the voting lead against Trump so far. Besides, the Monetary Policy decision from the Bank of England will remain in highlights. The BOE isn’t expected to make any changes in the policy; however, the press conference will be worth watching. The muted impact is expected on the news. Lastly, the Unemployment Claims from the U.S. may support the U.S. dollar today.

On the news front, the eyes will remain on the outcome of the U.S. elections, although Joe seems to be the next president of the United States considering the voting lead against Trump so far. Besides, the Monetary Policy decision from the Bank of England will remain in highlights. The BOE isn’t expected to make any changes in the policy; however, the press conference will be worth watching. The muted impact is expected on the news. Lastly, the Unemployment Claims from the U.S. may support the U.S. dollar today.

Economic Events to Watch Today  

 

EUR/USD – Daily Analysis

The EUR/USD pair was closed at 1.17227 after placing a high of 1.17706 and a low of 1.16025. After falling to its lowest since mid-July, the EUR/USD pair reversed and started to rise and ended Wednesday with gains. The EUR/USD pair has been having a highly volatile week so far as uncertainty around the U.S. 2020 Presidential Election intensifies. Results have been tighter than the market’s expectations, and investors felt hesitant to sell the safe-haven U.S. dollar.

On Wednesday, the U.S. dollar rally kept the EUR/USD pair under pressure and made it hard to sustain gains Wednesday as both share a negative correlation. Moreover, the Eurozone’s coronavirus situation also worsened as the pandemic’s second wave raised across the bloc and forced many major economies, including Germany and France, to re-introduce fresh restrictions and lockdown measures.

In turn, the ECB has been signaling that it could introduce a new monetary policy stimulus that only added in the weakness of Euro currency and kept the gains in EUR/USD pair limited on Wednesday.

On the data front, at 13:00 GMT, the Spanish Unemployment Change for October came in as 49.6K compared to the previous -26.3K. At 13:15 GMT, the Spanish Services PMI for October raised to 41.1 from the forecasted 40.0 and supported Euro and added further in EUR/USD air’s gains. AT 13:45 GMT, the Italian Services PMI for October declined to 46.7 against the forecasted 47.4 and weighed on Euro.

 At 13:50 GMT, the French Final Services PMI remained flat at 46.5. At 13:55 GMT, the German Final Services PMI raised to 49.5 against the forecasted 48.9 and supported the single currency Euro. At 14:00 GMT, the Final Services PMI from the whole bloc for October also surged to 46.9 against the forecasted 46.2 and supported the single currency Euro and added further upside momentum to EUR/USD pair.

From the U.S. side, at 18:15 GMT, the ADP Non-Farm Employment Change for October dropped to 365K against the estimated 650K and weighed on the U.S. dollar that added strength to the upward momentum of the EUR/SD pair. At 18:30 GMT, the Trade Balance from the U.S. for October came in line with the expectations of -63.9B. At 19:45 GMT, the Final Services PMI for October surged to 56.9 from the projected 56.0 and supported the U.S. dollar and capped further gains in EUR.USD pair.

At 20:00 GMT, the ISM Services PMI for October fell to 56.6 from the anticipated 57.4 and weighed on the U.S. dollar and provided support to the rising EUR/USD pair.

The U.S. dollar is a safe-haven currency that tends to rise during uncertain environment and in the U.S. 2020 Presidential Election, the fears that election result could be close or contested, it led to a rise in the safe-haven demand and the U.S. dollar, that ultimately added pressure on EUR/USD pair.

Daily Technical Levels

Support    Resistance

1.1650      1.1757

1.1588      1.1802

1.1543      1.1864

Pivot point: 1.1695

EUR/USD– Trading Tip

The EUR/USD is trading sideways, with a wide trading range of 1.1615 to 1.1760 area as the U.S. elections keep the markets on the move. On the lower side, the bearish breakout of the 1.1615 area can extend selling until the next support area of the 1.1591 level. The release of European services PMI data may support the pair; elsewhere, the outcome of elections may drive further market movement. The MACD is entering the selling zone, but we may not see further selling until the 1.1615 level gets violated. 

GBP/USD – Daily Analysis

The GBP/USD pair was closed at 1.29142 after placing a high of 1.31401 and a low of 1.29839. The broad-based U.S. dollar strength added pressure on GBP/USD pair and kept it on the bearish track on Wednesday.

The uncertainty surrounding the U.S. election results increased after the race to White House became tighter than anticipation. However, the results from key battle states like Wisconsin, Michigan, and Pennsylvania were delayed. This uncertainty forced investors to hold onto their U.S. dollar positions and weighed on GBP/USD pair.

On the previous day, the markets were moving on Biden recovery expectations, but as results from different states were announced, the election results became tighter. Chances for a divided government increased, and the blue wave decreased that raised the U.S. dollar onboard and weighed on GBP/USD pair.

On the data front, at 14:30 GMT, the Final Services PMI for October fell to 51.4 against the estimated 52.3 and weighed on British Pound. From the U.S. side, at 18:15 GMT, the ADP Non-Farm Employment Change for October fell to 365K against the expected 650K and weighed on the U.S. dollar. At 18:30 GMT, the Trade Balance from the U.S. for October came in line with the anticipations of -63.9B. At 19:45 GMT, the Final Services PMI for October rushed to 56.9 from the estimated 56.0 and supported the U.S. dollar and weighed on GBP/USD pair. At 20:00 GMT, the ISM Services PMI for October declined to 56.6 from the projected 57.4 and weighed on the U.S. dollar.

In the U.K., the lawmakers approved a one-month lockdown for England as the coronavirus cases were continuously increasing. On Wednesday, the U.K. reported 25,177 new cases in a single day against Tuesday’s 20,018. The British Pound came under fresh pressure after these depressing highlights from the U.K. and added further losses in GBP/USD pair.

The Bank of England will release its monetary policy decision on Thursday. The uncertainty about the decision of BoE also increased with the escalated version of the coronavirus pandemic. The Bank is expected to keep rates stable, but as the lockdowns are re-introduced banks could change its decision and announce further easing. These uncertainties also kept the local currency under pressure and kept weighing on GBP/USD pair.

Daily Technical Levels

Support   Resistance

1.2913      1.2941

1.2898      1.2954

1.2884      1.2969

Pivot point; 1.2926

GBP/USD– Trading Tip

Just like the EUR/USD, the GBP/USD is also trading sideways in between a narrow trading range of 1.3122 – 1.2940 area. The Cable has recently violated the downward channel, supporting the GBP/USD pair around the 1.2940 level. Above this level, the odds of buying remain strong today. On the higher side, the Sterling may find next resistance around 1.3122 while the bearish breakout of 1.2940 may lead the Cable towards the 1.2855 level. A choppy session is expected today. 

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 104.517 after placing a high of 105.343 and a low of 104.149. The USD/JPY pair moved upward towards its 11-days highest level on Wednesday but it lost most of its daily gains in the late trading session.

The primary driver of the USD/JPY pair was the USD’s market valuation on Wednesday. As the early election results showed that the blue wave was un-likely, it supported the safe-haven U.S. dollar and pushed the USD/JPY pair higher. The U.S. Dollar Index (DXY) also rose on Wednesday and moved to the 94.30 level.

As the markets were moving in previous days over the chances of Biden victory, after tighter election results, the chances for divided government increased and weighed on market sentiment. The hopes for larger stimulus also faded away with the declining hopes of the blue wave and the U.S. dollar gained through it and supported a strong bullish move on Wednesday.

However, on late night Tuesday, when it was clear that there will not be a winner, President Trump falsely claimed victory when millions of votes were still uncounted in the tight presidential race. This weighed on the U.S. dollar and the pair USD/JPY started to rise.

On the data front, at 18:15 GMT, the ADP Non-Farm Employment Change for October dropped to 365K against the projected 650K and weighed on the U.S. dollar. At 18:30 GMT, the Trade Balance from the U.S. for October remained flat with the expectations of -63.9B. At 19:45 GMT, the Final Services PMI for October raised to 56.9 from the projected 56.0 and supported the U.S. dollar. At 20:00 GMT, the ISM Services PMI for October dropped to 56.6 from the expected 57.4 and weighed on the U.S. dollar.

Meanwhile, the Bank of Japan released its monetary policy meeting of September on Wednesday that showed that some policymakers called for deeper scrutiny on how to address the fallout from the coronavirus pandemic as the economic outlook remained highly uncertain.

Many in the nine-member board agreed that it was sufficient to maintain the current ultra-loose monetary policy, for now, to cushion the economic blow from the pandemic. But some saw the need to debate how the BOJ could re-shape its policy in an era where the population must balance the need to contain the virus and sustain economic activity.

The Bank of Japan Governor Haruhiko Kuroda has said that the central bank’s focus will be on providing liquidity to cash-strapped firms hit by the pandemic. He has also indicated that deeper debate on how to achieve its 2 percent inflation target will be put on the back burner—these added strengths in the Japanese Yen and capped gains in the USD/JPY pair on Wednesday.

Daily Technical Levels

Support   Resistance

104.32      104.71

104.19      104.95

103.94      105.09

Pivot point: 104.57

USD/JPY – Trading Tips

The USD/JPY is trading choppy in between a wide trading range of 105.64 to 104.420 level. Violation of these ranges may determine the next trend in the USD/JPY pair. A bullish breakout of 105.062 level can extend the buying trend until 105.590. Conversely, the bearish breakout of 104.426 can lead the USD/JPY pair towards the 104 area. The MACD is also showing mixed bias among investors; therefore, let’s wait for a breakout before taking the next position in the USD/JPY. Good luck! 

Categories
Forex Market Analysis

Daily F.X. Analysis, November 04 – Top Trade Setups In Forex – Eyes on U.S. Election Results! 

On the news front, the market is exhibiting mixed but sharp movements in the wake of U.S. elections. Democratic party’s Joe Biden seems to take the lead so far, and his winning remains solid. The market is exhibiting safe-haven appeal in the wake of election results. Besides, the European economy is due to release Services PMI figures that may drive some price action in the market, but most of it is likely to be overshadowed by the U.S. election outcome. 

On the news front, the market is exhibiting mixed but sharp movements in the wake of U.S. elections. Democratic party’s Joe Biden seems to take the lead so far, and his winning remains solid. The market is exhibiting safe-haven appeal in the wake of election results. Besides, the European economy is due to release Services PMI figures that may drive some price action in the market, but most of it is likely to be overshadowed by the U.S. election outcome. 

On the news front, the market is exhibiting mixed but sharp movements in the wake of U.S. elections. Democratic party’s Joe Biden seems to take the lead so far, and his winning remains solid. The market is exhibiting safe-haven appeal in the wake of election results. Besides, the European economy is due to release Services PMI figures that may drive some price action in the market, but most of it is likely to be overshadowed by the U.S. election outcome. 

Economic Events to Watch Today  

 


 

EUR/USD – Daily Analysis

The EUR/USD pair was closed at 1.17198 after placing a high of 1.17396 and a low of 1.16297. The EUR/USD pair surged on Tuesday and recovered some of its previous daily losses of 6 consecutive sessions. The pair climbed to 1.1739 level on U.S. Election Day as the U.S. dollar was down by 0.83% on the day, and the U.S. Dollar Index was trading at a six-day lower level under 93.40. The improvement in the market sentiment could be attributed to the declining expectations of any outcome of a disputed election that could result in a legal battle, political and social tension.

The rise in EUR/USD pair’s prices was also because of the anticipations of a so-called Blue wave outcome of the U.S. election. As the victory of Joe Biden would have a negative impact on the U.S. dollar amid his intentions to deliver a massive stimulus package after his victory, the EUR/USD pair gained further and rose to its three days highest level on Tuesday.

Apart from the U.S. election, rally in EUR/USD pair continued on the day due to risk appetite after European Central Bank reported that Pandemic Emergency Purchase Programme (PEPP) would likely remain the main instrument to increase the stimulus at the next meeting as the ECB has already committed to act in December and has not ruled out using all available instruments. However, the virus spread and the subsequent lockdowns could weigh on EUR/USD pair in the coming days.

On Tuesday, France reported the highest death toll since April, and both Netherlands and Hungary announced new virus lockdowns. These concerning situations in Eurozone related to the coronavirus pandemic kept the gains in EUR/USD pair limited on Tuesday.

On the data front, the French GOV Budget Balance was released at 12:45 GMT that came in as -161.6B for September compared to Previous -165.7B. From the U.S. side, the Wards Total Vehicle Sales dropped to 16.2M from the expected 16.5M and weighed on the U.S. dollar that ultimately added further gains in EUR/USD pair on Tuesday.

The main driver of the EUR/USD pair remained the U.S. dollar on the U.S. Election Day on Tuesday that was under pressure in the uncertain environment and continued supporting the EUR/USD pair’s upward momentum,

Daily Technical Levels

Support Resistance

1.1624     1.1657

1.1607     1.1673

1.1591     1.1690

Pivot point: 1.1640

EUR/USD– Trading Tip

The EUR/USD is trading sideways, with a wide trading range of 1.1615 to 1.1760 area as the U.S. elections keep the markets on the move. On the lower side, the bearish breakout of the 1.1615 area can extend selling until the next support area of the 1.1591 level. The release of European services PMI data may support the pair; elsewhere, the outcome of elections may drive further market movement. The MACD is entering the selling zone, but we may not see further selling until the 1.1615 level gets violated. 

GBP/USD – Daily Analysis

The GBP/USD pair was closed at 1.30635 after placing a high f 1.30787 and a low of 1.29073. The GBP/USD pair reached its five-day highest level on Tuesday amid broad-based U.S. dollar weakness during the U.S. Election Day.

The Americans were heading to the polls, and the market participants were shrugging off the risk aversion by anticipating a clear Democratic victory that would open the way for a larger fiscal stimulus package and, thus, weakened the U.S. dollar, ultimately added in the gains of GBP/USD pair.

Meanwhile, the lack of any news from the Brexit negotiations that have limited period left as the December 31 deadline was near, along with the introduction of a one-month lockdown in the U.K. to curb the traders ignored the effects of COVID-19 infections on Tuesday that could have capped further gains in the currency pair GBP/USD.

Despite there was no news related to Brexit progress from the ongoing talks between the E.U. and the U.K., the hopes for a last-minute deal helped prop up the British Pound. These hopes, combined with the U.S. dollar weakness, added additional gains in GBP/USD pair. The U.S. dollar index fell sharply to below 93.50 level, and it was down by 0.75%.

On the data front, the U.S. Factory Orders for September came in as 1.1% from the expected 1.0%, and the U.S. Wards Total Vehicle dropped to 16.2M from the anticipated 16.5 M weighed on the U.S. dollar that helped the British Pound to U.S. dollar exchange rate.

On the Brexit front, the reports indicated that talks were stuck between both parties on a level playing field and fisheries, the two main issues that stalled progress a month ago. However, other areas like social security saw progress and raised bars for a Brexit deal before the transition period. Both top negotiators Michel Barnier and David Frost will report on the progress of recent talks on Wednesday, and traders are keenly awaiting it.

The pair GBP/USD likely continue trading alongside risk-related sentiment during the upcoming sessions. As well as British Pound will not ignore any Brexit-related headlines once the picture of the U.S. election became clear.  

Daily Technical Levels

Support Resistance

1.2913     1.2941

1.2898     1.2954

1.2884     1.2969

Pivot point; 1.2926

GBP/USD– Trading Tip

Just like the EUR/USD, the GBP/USD is also trading sideways in between a narrow trading range of 1.3122 – 1.2940 area. The Cable has recently violated the downward channel, supporting the GBP/USD pair around the 1.2940 level. Above this level, the odds of buying remain strong today. On the higher side, the Sterling may find next resistance around 1.3122 while the bearish breakout of 1.2940 may lead the Cable towards the 1.2855 level. A choppy session is expected today. 

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 104.497 after placing a high of 104.799 and a low of 104.431. After placing gains for three consecutive sessions, the pair reversed and posted losses on Tuesday. The U.S. dollar was under pressure on the day and was moving below 93.49 level on the back of expectations of a sweeping Democratic Party victory. The so-called blue-wave where the Joe-Biden with Democrats will take both Houses of Congress would indicate that further stimulus was on the way.

Since markets started to price in a global economic recovery, the U.S. dollar was on the back foot, a coronavirus vaccine, and ongoing fiscal and central bank stimulus in anticipation of renewed reflationary momentum.

The uncertainty over the vote’s outcome kept the safe-haven appeal in demand and continued supporting the Japanese Yen due to its safe-haven status and weighed on the USD/JPY pair. The uncertainty further escalated after Trump showed his willingness to challenge any unfavorable outcome to him legally. It came in response to the Initial polls that suggested that Biden was in the lead, and there will be a Blue/Democratic wave in the election. However, the revised readings showed that the gap between Trump and Biden was tightened.

Biden accused Trump of mishandling the COVID-19 pandemic and deserting safety precautions, including the mandated mask-use that could have saved countless lives from the crisis. Trump refuted that the American economy would be shattered under Biden, who wanted to raise most wealthy taxes.

If Biden wins the election, expectations are high that he will issue a massive stimulus package that would weigh on the U.S. dollar and ultimately drag the USD/JPY pair on the downside. Because of the stimulus package, traders started pricing it and kept selling the USD/JPY pair on Tuesday.

Meanwhile, on the data front, there was no macroeconomic release from Japan due to Bank Holiday. From the U.S., at 20:00 GMT, the Factory Orders in September elevated to 1.1% from the estimated 1.0%. The Wards Total Vehicle Sales for October weakened to 16.2 against the anticipated 16.5M and weighed on the U.S. dollar that ultimately added pressure on the USD/JPY pair on Tuesday.

Daily Technical Levels

Support Resistance

104.56     104.92

104.40     105.12

104.20     105.28

Pivot point: 104.76

USD/JPY – Trading Tips

The USD/JPY is trading choppy in between a wide trading range of 105.64 to 104.420 level. Violation of these ranges may determine the next trend in the USD/JPY pair. A bullish breakout of 105.062 level can extend the buying trend until 105.590. Conversely, the bearish breakout of 104.426 can lead the USD/JPY pair towards the 104 area. The MACD is also showing mixed bias among investors; therefore, let’s wait for a breakout before taking the next position in the USD/JPY. Good luck! 

Categories
Forex Signals

USD/CAD Extended Overnight Gains & Hit the Intra-Day – Elections In Play! 

Today in the Asian trading session, the USD/CAD currency pair managed to stop its three-day downtrend and witnessed some heavy buying around above mid-1.3200 level, mainly due to the broad-based U.S. dollar strength. However, the bullish sentiment around the U.S. dollar was being supported by President Donald Trump’s victory in Florida, which pushed the currency pair intraday high. 

Today in the Asian trading session, the USD/CAD currency pair managed to stop its three-day downtrend and witnessed some heavy buying around above mid-1.3200 level, mainly due to the broad-based U.S. dollar strength. However, the bullish sentiment around the U.S. dollar was being supported by President Donald Trump’s victory in Florida, which pushed the currency pair intraday high. 

Today in the Asian trading session, the USD/CAD currency pair managed to stop its three-day downtrend and witnessed some heavy buying around above mid-1.3200 level, mainly due to the broad-based U.S. dollar strength. However, the bullish sentiment around the U.S. dollar was being supported by President Donald Trump’s victory in Florida, which pushed the currency pair intraday high. 

On the contrary, the upticks in the oil prices, backed by the bigger-than-expected draw in the U.S. crude stockpiles, became the key factor that kept the lid on any additional crude gains oil prices. Moreover, the bullish sentiment around the crude oil prices was also supported by the reports suggesting that OPEC and its allies (OPEC+) maintaining current production restrictions, which tend to ease oversupply fears and contribute to oil prices. Currently, the USD/CAD currency pair is currently trading at 1.3234 and consolidating in the range between 1.3093 – 1.3278.

As we all know, the market risk sentiment has been flashing mixed signals since the day started amid U.S. election polls. However, the expectations of a blue wave in the U.S. Congress weakened quickly after President Donald Trump won Florida’s key battleground state. Conversely, the Arizona governor said that it was too early to call the state for Biden. As per Fox News, the tally on the electoral College now stands at 233 for both Joe Biden and Donald Trump, indicating that the race is tighter than expected.

At the USD front, the broad-based U.S. dollar managed to keep its gains throughout the day as the traders still cheering President Donald Trump’s victory in Florida. Put, the bid tone around the safe-haven greenback seems to have increased in response to betting markets having President Trump as the favorite to win elections. However, the U.S. dollar gains seem rather unaffected by the risk-on market sentiment. Thus, the gains in the U.S. dollar become the key factor that kept the currency pair higher. Meantime, the U.S. Dollar Index that tracks the greenback against a bucket of other currencies rose to 93.898.

 At the crude oil front, the crude oil prices succeeded in gaining positive traction and surged to the $38.80 mark after a surprise draw of -8.01M, against 4.55M prior, in private inventory data published by the American Petroleum Institute (API) on Tuesday. This, in turn, boosted crude oil prices by over 3% overnight. Furthermore, the sentiment around crude oil was improved further after the reports concluded that the Organization of the Petroleum Exporting Countries (OPEC) and its allies maintained current production restrictions, which tend to ease oversupply fears and contribute to the oil prices. Thus, the rise in oil prices underpinned demand for the commodity-linked currency the loonie and became the major factor that capped the pair’s further gains.

In the absence of significant data/events on the day, the market traders will keep their eyes on the continuous drama surrounding the U.S. elections and updates about the U.S. stimulus package. 


Daily Support and Resistance

S1 1.2899

S2 1.3029

S3 1.3083

Pivot Point 1.3158

R1 1.3213

R2 1.3288

R3 1.3418

The USD/CAD is trading with a bullish bias at the 1.3278 level, having violated the immediate resistance level of 1.3223. it’s the same level extended by an upward channel, which got violated a couple of days ago. On the higher side, we can expect the USD/CAD pair to continue trading bullish until the 1.3323 level, as the MACD is also in support of the buying trend. The recent bullish engulfing is in support of buying; however, the election results may drive some volatility in the market. Let’s wait for a trading signal! 

Categories
Forex Signals

AUD/USD Reverse Overnight Bearish Moves – Eyes on 0.7206 Resistance! 

The AUD/USD currency pair succeeded to stop its overnight declining streak and drew some modest bids around above mid-0.7000 level mainly due to the risk-on market sentiment, which tends to underpin the perceived risk currency Australian dollar and contributes to the currency pair gains. Hence, the market trading sentiment was being supported by upbeat activity data from the U.S., China, and Europe, which rekindled economic recovery hopes and underpinned the market risk-tone. 

The AUD/USD currency pair succeeded to stop its overnight declining streak and drew some modest bids around above mid-0.7000 level mainly due to the risk-on market sentiment, which tends to underpin the perceived risk currency Australian dollar and contributes to the currency pair gains. Hence, the market trading sentiment was being supported by upbeat activity data from the U.S., China, and Europe, which rekindled economic recovery hopes and underpinned the market risk-tone. 

The AUD/USD currency pair succeeded to stop its overnight declining streak and drew some modest bids around above mid-0.7000 level mainly due to the risk-on market sentiment, which tends to underpin the perceived risk currency Australian dollar and contributes to the currency pair gains. Hence, the market trading sentiment was being supported by upbeat activity data from the U.S., China, and Europe, which rekindled economic recovery hopes and underpinned the market risk-tone. 

Apart from this, the market trading sentiment was further bolstered by the updates suggesting continuous progress of Brexit talks between the U.K. and the European Union (E.U.), which extended further support to the currency pair. Across the pond, the broad-based U.S. dollar selling bias, triggered by the marker risk-on sentiment, also played its major role in supporting the currency pair. Moreover, the losses in the U.S. dollar was further bolstered by the intensifying doubts over the U.S. economic recovery ahead of the U.S. presidential elections. 

On the contrary, the long-lasting coronavirus woes globally, as well as delays in the U.S. covid stimulus, keep challenging the upbeat market sentiment, which becomes the key factor that kept the lid on any additional gains in the currency pair. In the meantime, the gains in the currency pair were further capped by the reports suggesting that the RBA is expected to cut the benchmark rate and announce more Q.E. At this time, the AUD/USD currency pair is currently trading at 0.7057 and consolidating in the range between 0.7044 – 0.7063.

Despite the concern about the second wave of coronavirus infections, which leads the lockdown measures, the market trading sentiment remained positive during the early Asian session amid positive developments surrounding the Brexit talks between the U.K. and the European Union (E.U.), which in turn, underpinned the perceived risk currency Australian dollar and contributed to the currency pair gains. 

Across the ocean, bullish sentiment around the equity market was further bolstered by the upbeat activity numbers from the U.S., China, and Europe, which rekindled economic recovery hopes and underpinned the market trading sentiment. As per the latest report, the ISM manufacturing index jumped to the highest in more than two years.

As in result, the S&P 500 futures succeeded to extend its overnight positive momentum and remain bullish on the day, which tends to undermine the demand for the safe-haven U.S. dollar and extended support to the currency pair. Despite the upbeat U.S. data, the broad-based U.S. dollar failed to erase its overnight losses and remained under pressure on the day mainly due to the marker risk-on tone. Apart from this, the resurgence of coronavirus keeps fueling the fears that the U.S. economic recovery could be halt, which also keeps the greenback under pressure. However, the losses in the U.S. dollar could be considered as the major factor that kept the currency pair higher. Meanwhile, the U.S. Dollar Index that tracks the greenback against a bucket of other currencies dropped to 93.977.

On the contrary, the intensifying coronavirus woes across the globe, as well as, intensifying lockdowns restrictions in Europe keep challenging the upbeat market sentiment and become the key factor that kept the lid on any additional gains in the currency pair. As per the latest report, Europe declared this weekend second lockdowns amid surging coronavirus cases. It is worth recalling that the market and industry professionals were not expecting renewed lockdowns for whole countries. Late last week, Austria announced a second lockdown until the end of November, including closing hotels for tourism, as well as restaurants except for takeaway and delivery. Apart from froths, the U.K., one of the largest economies in Europe, is also imposing lockdown restrictions while Belgium also returned to a nationwide lockdown. 

Elsewhere, the growing probabilities that the RBA will cut interest rates in November could also be considered as one of the key factors that kept the lid on any additional gains in the currency pair. It is worth recalling that the benchmark interest rate likely cut to 0.10% from 0.25%. 

In the absence of the major data/events on the day, the market traders will keep their eyes on the monetary policy meeting of the RBA and the U.S. presidential election for fresh directions. In the meantime, the risk catalyst like geopolitics and the virus woes, not to forget the Brexit, will also be key to watch.


Daily Support and Resistance

S1 0.69

S2 0.6966

S3 0.7008

Pivot Point 0.7033

R1 0.7075

R2 0.71

R3 0.7166

The AUD/USD has traded sharply bullish amid weaker U.S. dollar, as the pair crossed over 0.7150 level. On the higher side, the AUD/USD pair may head further higher until the next resistance area of 0.7199 level. The MACD and RSI are extremely overbought, and however, we have to wait for bearish reversal candles ahead of opening a sell trade in Aussie. On the lower side, the Aussie can find support at 0.7150 and 0.7105 mark. Let’s wait for the U.S. elections before opening any further trades today. Good luck!  

Categories
Forex Elliott Wave Forex Market Analysis

EURJPY: Can we Profit Short-Term?

Overview

Overview

Overview

The EURJPY cross advances in a corrective sequence that began on September 01st; this corrective movement looks incomplete. The short-term Elliott wave outlook foresees a limited recovery prior to its a coming decline corresponding to its fifth wave.

Technical Big Picture

The EURJPY cross, in its 12-hour chart, illustrates an incomplete downward sequence that began on September 01st when the price found fresh sellers at level 127.075. 

The previous figure exposes an upwards structural series subdivided into three-wave identified in Minute degree and labeled in black, which began on the May 06th low located at 114.397 and ended on the September 01st high when the price topped 127.075. 

Once the price found fresh sellers at 127.075, the cross started to retrace, developing a three-wave sequence identified in the Minuette degree labeled in blue. Until now, wave (c) doesn’t show bullish reversal signals, which lead us to expect further declines.

The short-term key supports and resistance levels are as follows:

  • Resistance 1: 123.160
  • Resistance 2: 124.233
  • Resistance 3: 124.999
  • Pivot Level: 122.377
  • Support 1: 121.144
  • Support 2: 120.271
  • Support 3: 119.311

Technical Outlook

The short-term outlook for EURJPY illustrated in its 3-hour chart reveals the intraday consolidation, which coincides with the progress of its fourth wave of Subminuette degree labeled in green.

In this regard, the market participants could mostly drive the price toward the supply zone between 122.550 and 122.890, from where the EURJPY cross could start developing the next decline corresponding to its fifth wave identified in green.

The potential target zone of the next decline locates between 121.038 and 120.051, which coincides with the base-line of the descending channel that extends from the September 01st high to date. 

Finally, the invalidation level of the downward scenario locates at 123.402.

Categories
Forex Market Analysis

Daily F.X. Analysis, November 03 – Top Trade Setups In Forex – U.S. Presidential Election in Highlights!

On the news front, eyes will remain on the U.S. Presidential Election. The voters will elect the 46th President of the United States. The winner will likely be projected before the official vote count is announced, based on early vote counts and exit polling. Besides, the U.S. Factory Orders m/m are also due, but their impact is likely to be overshadowed by the U.S. elections. 

On the news front, eyes will remain on the U.S. Presidential Election. The voters will elect the 46th President of the United States. The winner will likely be projected before the official vote count is announced, based on early vote counts and exit polling. Besides, the U.S. Factory Orders m/m are also due, but their impact is likely to be overshadowed by the U.S. elections. 

On the news front, eyes will remain on the U.S. Presidential Election. The voters will elect the 46th President of the United States. The winner will likely be projected before the official vote count is announced, based on early vote counts and exit polling. Besides, the U.S. Factory Orders m/m are also due, but their impact is likely to be overshadowed by the U.S. elections. 

Economic Events to Watch Today  

 

EUR/USD – Daily Analysis

The EUR/USD pair was closed at 1.16399 after placing a high of 1.16554 and a low of 1.16218. EUR/USD pair extended its losses and dropped for the 6th consecutive session on Monday amid the rising safe-haven appeal and coronavirus situation in Europe. The EUR/USD pair ended its day with modest losses as the currency pair’s bearish momentum was somehow cooled down because of the positive PMI data from European nations. Meanwhile, the U.S. dollar was also strong onboard due to its safe-haven status as well as due to the strong macroeconomic data on Monday.

At 13:15 GMT, the Spanish Manufacturing PMI for October raised to 52.5 against the expected 51.0 and supported the single currency Euro. At 13:45 GMT, the Italian Manufacturing PMI for October remained flat with a forecast of 53.9. At 13:50 GMT, the French Final Manufacturing PMI for October also came in as expected 51.3. At 13:55 GMT, the German Final Manufacturing PMI came in line with the anticipations of 58.0. At 14:00 GMT, the Final Manufacturing PMI for the whole bloc in October raised to 54.8 from the expected 54.4 and supported the single currency Euro.

Europe’s positive PMI data gave some support to Euro that ultimately capped further losses in EUR/USD pair.

From the U.S. side, at 19:45 GMT, the Final Manufacturing PMI for October remained flat at 53.4. At 20:00 GMT, the ISM Manufacturing PMI for October rushed to 59.3 from the estimated 55.6 and supported the U.S. dollar. The Construction Spending for September fell to 0.3% from the projected 1.0% and weighed on the U.S. dollar. The ISM Manufacturing Prices for October also elevated to 65.6 against the anticipated 60.5 and supported the U.S. dollar.

On Monday, the positive data from the U.S. made the U.S. dollar even stronger and supported the downside movement of the EUR/USD pair.

Furthermore, the U.S. dollar was set to lose its bullishness in the days ahead as markets were keenly waiting for the U.S. presidential elections’ results. Although the uncertainty persists in the market regarding the election’s outcome, this is the critical time to enter or place any position in the market. This is the reason behind the consolidated movement of the EUR/USD pair on Monday.

Furthermore, both the U.S. election candidates, Biden and Trump, have said that they would deliver a big stimulus package after the election. So, it means the next round of stimulus packages will be delivered regardless of the winner. These hopes kept weighing in the U.S. dollar and capped further losses in EUR/USD pair.

On the other hand, the renewed lockdown restrictions in France, Germany, Italy, and Belgian to curb the effect of coronavirus pandemic raised the concerns for Eurozone economic recovery and kept weighing on single currency that kept the EUR/USD pair on the downside.

Daily Technical Levels

Support Resistance

1.1637     1.1651

1.1631     1.1659

1.1623     1.1665

Pivot point: 1.1645

EUR/USD– Trading Tip

The EUR/USD traded with a bearish bias, having dropped below the support area of 1.1653. At the moment, the EUR/USD is likely to face the resistance at the same level of 1.1653. On the higher side, a bullish crossover of 1.1653 increases the odds of continuing an upward trend, and it may lead the EUR/USD price towards 1.1700. Further bullish crossover of this area can lead the pair towards the 1.1758 level. Conversely, a bearish crossover of 1.1653 support level has opened additional room for selling until the 1.1613 area as a double bottom support area extends the level.  

GBP/USD – Daily Analysis

The GBP/USD pair was closed at 1.29180 after placing a high of 1.29426 and a low of 1.28539. The British Pound started to decline against the U.S. dollar at the starting day of the week as the hopes raised for further monetary easing by the Bank of England this week following the second lockdown in England.

Over the weekend, the U.K. announced that it would enter a second national lockdown for a month to control the rise in coronavirus infections. On Monday, the coronavirus cases fell to 18,950 in comparison to 10,900 cases a week ago. The expectations for further easing came on board after the Britain government made this announcement on the weekend.

The new lockdown measures in the U.K. demand the people stay at home unless there is an essential purpose like education, medical reason, or shopping for groceries. However, economists have warned that country would enter a double-dip recession if it enters another lockdown as it will dent the economic growth in the final quarter of the year. These concerns kept the risk sentiment under pressure and weighed on British Pound that ultimately added the GBP/USD pair’s losses.

On the data front, at14:30 GMT, the Final Manufacturing PMI from Great Britain was raised to 53.7against the expected 53.3 and supported British Pound and capped further losses in GBP/USD pair. From the U.S. side, at 19:45 GMT, the Final Manufacturing PMI for October came in line with the anticipations of 53.4. At 20:00 GMT, the ISM Manufacturing PMI for October raised to 59.3 from the forecasted 55.6 and supported the U.S. dollar. The Construction Spending for September plunged to 0.3% from the forecasted 1.0% and weighed on the U.S. dollar. The ISM Manufacturing Prices for October also rose to 65.6 against the estimated 60.5 and supported the U.S. dollar.

The positive PMI data from the U.S. gave strength to the U.S. dollar and added further pressure on GBP/USD pair. On the Central Bank front, the BOE will have its monetary policy meeting on Thursday, and the hopes are that it will refrain from announcing negative rates, and the bank could also introduce another easing for supporting the economy.

On the Brexit front, the Brexit-talks continue in Brussels as the U.K. and the E.U. were working to avoid a no-deal Brexit. However, no fresh headlines were seen regarding this matter on Monday that kept the currency pair under the mercy of a strong U.S. dollar across the board.

Daily Technical Levels

Support Resistance

1.2913     1.2941

1.2898     1.2954

1.2884     1.2969

Pivot point; 1.2926

GBP/USD– Trading Tip

The GBP/USD is trading sharply bearish to trade over the double bottom support area of 1.2910 level. On the 2 hour timeframe, the GBP/USD pair has formed a downward channel, and bearish trend continuation can lead the pair further lower towards the next support area of 1.2830 level. However, to see that kind of selling, the Cable needs to violate the immediate support area of 1.2910. The MACD and 50 EMA support selling; therefore, we should look for a selling trade below the 1.2910 level today. 

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 104.749 after placing a high of 104.947 and a low of 104.514. The USD/JPY pair rose and posted gains for the third consecutive session on Monday amid the broad-based U.S. dollar strength. The U.S. dollar pushed higher in the early European session on Monday as European nations imposed more lockdowns on the back of an incessant rise in coronavirus cases. The uncertainty surrounding the upcoming U.S. elections also weighed on market sentiment and kept the USD/JPY pair higher.

The U.K. joined Germany and France over the weekend and re-introduced partial lockdowns to curb the coronavirus’s spread. Europe crossed the 10 million total cases of coronavirus infections and supported the safe-haven appeal that added further strength to the U.S. dollar.

The Bank of England will hold its monetary policy meeting on Thursday, and investors believe that the bank will increase the asset purchases by 150-200 billion British Pounds. These hopes forced the investors to stick with the U.S. currency in these uncertain times, but the ranges were tight as the markets were under pressure ahead of Tuesday’s U.S. presidential election.

The U.S. dollar was also strong because of the rising hopes for the victory of Joe Biden in the upcoming election as he has maintained a healthy lead over his competitor Donald Trump in national polls over the weekend before elections. Furthermore, some of the gains in the USD/JPY pair were lost in the late trading session as the traders were also waiting for the upcoming Federal Reserve monetary policy meeting on Thursday.

On the data front, at 05:30 GMT, the Final Manufacturing PMI from Japan for October raised to 48.7 from the forecasted 48.0 and supported the Japanese Yen that capped further upside in USD/JPY pair. From the U.S. side, at 19:45 GMT, the Final Manufacturing PMI from the U.S. for October remained flat at 53.4. At 20:00 GMT, the ISM Manufacturing PMI from the U.S. advanced to 59.3 from the estimated 55.6 in October and supported the U.S. dollar. The Construction Spending for September fell to 0.3% from the predicted 1.0% and weighed on the U.S. dollar. The ISM Manufacturing Prices for October also raised to 65.6 against the projected 60.5 and supported the U.S. dollar. The U.S. dollar was further supported by the positive results from the macroeconomic data, and it helped the USD/JPY pair to post gains on Monday.

Daily Technical Levels

Support Resistance

104.51     104.66

104.45     104.75

104.35     104.81

Pivot point: 104.60

USD/JPY – Trading Tips

The USD/JPY is trading slightly bullish at the 104.745 level, having crossed over the immediate resistance area of the 104.600 mark. On the 2 hour timeframe, the USD/JPY has violated the downward trendline at 104.550 level, and now the same level is likely to support the USD/JPY pair. The closing of candles over 104.650 level is supporting strong odds of bullish trend continuation until 105.049 level. Further bullish trend continuation can also lead the USD/JPY pair towards the 105.800 level. Good luck! 

Categories
Forex Signals

EUR/USD Regression Channel Continues to Drive Selling – Update on Signal! 

The EUR/USD pair was closed at 1.16445 after placing a high of 1.17041 and a low of 1.16398. The EUR/USD pair extended its losses for the 5th consecutive day on Friday and remained bearish throughout the day. The main driver behind the steepest fall in Euro currency this week was the market concerns about the rising number of coronavirus infections in Europe and the effects of the social distancing measures to curb them. 

The EUR/USD pair was closed at 1.16445 after placing a high of 1.17041 and a low of 1.16398. The EUR/USD pair extended its losses for the 5th consecutive day on Friday and remained bearish throughout the day. The main driver behind the steepest fall in Euro currency this week was the market concerns about the rising number of coronavirus infections in Europe and the effects of the social distancing measures to curb them. 

The EUR/USD pair was closed at 1.16445 after placing a high of 1.17041 and a low of 1.16398. The EUR/USD pair extended its losses for the 5th consecutive day on Friday and remained bearish throughout the day. The main driver behind the steepest fall in Euro currency this week was the market concerns about the rising number of coronavirus infections in Europe and the effects of the social distancing measures to curb them. 

The latest lockdown restrictions introduced by France and Germany and the tighter restrictions applied in Italy and Spain raised alarms about their impact on the fragile economic recovery and weighed on the single currency Euro that ultimately added pressure on EUR/USD pair. 

Furthermore, the European Central Bank hinted to unleash new stimulus measures in December to counteract the pandemic’s negative impact and weighed on the Euro currency that added further losses in EUR/USD pair on Friday.

Meanwhile, on the data front, at 11:30 GMT, the French Consumer Spending for September was dropped to -5.1% against the expected -1.5% and weighed on Euro. The French Flash GDP for the quarter raised to 18.2% against the expected 15.0% and supported Euro. At 12:00 GMT, German Retail Sales for September dropped to -2.2% from the forecasted -0.6% and weighed on Euro. At 12:45 GMT, the French Prelim CPI for October fell to -0.1% against the forecasted 0.0% and weighed on Euro. At 13:00 GMT, the Spanish Flash GDP for the quarter surged to 16.7% after placing a high of 13.5% and supported Euro. 

The Italian Monthly Unemployment Rate declined to 9.6% from the forecasted 10.1% and weighed on Euro. At 14:00 GMT, German Prelim GDP for the quarter raised to 8.2% from the forecasted 7.3% and supported Euro. The Italian Prelim GDP for the quarter also raised to 16.1% from the forecasted 11.1% and supported Euro. At 14:58 GMT, the Italian Prelim CPI for October remained flat with the expectations of 0.2%.

Support Resistance

1.1798 1.1789

1.1672 1.1834

1.1626 1.1870

Pivot point: 1.1753


The EUR/USD traded with a bearish bias, having dropped below the support area of 1.1653. At the moment, the EUR/USD is likely to face the resistance at the same level of 1.1653. On the higher side, a bullish crossover of 1.1653 increases the odds of continuing an upward trend, and it may lead the EUR/USD price towards 1.1700. Further bullish crossover of this area can lead the pair towards the 1.1758 level. Conversely, a bearish crossover of 1.1653 support level has opened additional room for selling until the 1.1613 area as a double bottom support area extends the level.  

Entry Price – Buy 1.1646

Stop Loss – 1.1686

Take Profit – 1.1606

Risk to Reward – 1:1.25

Profit & Loss Per Standard Lot = -$400/ +$500

Profit & Loss Per Micro Lot = -$40/ +$50

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Forex Signals

USD/CAD Upward Channel to Support the pair – Brace for Buy Trade! 

The USD/CAD pair was closed at 1.33219 after placing a high of 1.33483 and a low of 1.32795. On Friday, the currency pair USD/CAD remained confined in a consolidated range throughout the day. The USD/CAD pair dropped in an earlier trading session on Friday amid the strong Canadian GDP and other economic data. However, the pair started falling in late session due to the declining crude oil prices on the day. Meanwhile, the US dollar was strong over the board ahead of the US Presidential elections and the strong macroeconomic data on the day.

The USD/CAD pair was closed at 1.33219 after placing a high of 1.33483 and a low of 1.32795. On Friday, the currency pair USD/CAD remained confined in a consolidated range throughout the day. The USD/CAD pair dropped in an earlier trading session on Friday amid the strong Canadian GDP and other economic data. However, the pair started falling in late session due to the declining crude oil prices on the day. Meanwhile, the US dollar was strong over the board ahead of the US Presidential elections and the strong macroeconomic data on the day.

The USD/CAD pair was closed at 1.33219 after placing a high of 1.33483 and a low of 1.32795. On Friday, the currency pair USD/CAD remained confined in a consolidated range throughout the day. The USD/CAD pair dropped in an earlier trading session on Friday amid the strong Canadian GDP and other economic data. However, the pair started falling in late session due to the declining crude oil prices on the day. Meanwhile, the US dollar was strong over the board ahead of the US Presidential elections and the strong macroeconomic data on the day.

On the data front, at 17:30 GMT, the Gross Domestic Product for August raised to 1.2% from the forecasted 0.9% and supported the Canadian dollar. The IPPI for September declined to -0.1% from the anticipated 0.1% and weighed on the Canadian dollar. The RMPI for September dropped to -2.2% from the forecasted 0.3% and weighed on the Canadian dollar.

The rise in Canadian dollar demand after the release of GDP started to lose its momentum on Friday after the investors realized that the economic growth in Canada would not persist for long as the coronavirus cases were spreading and hitting the economic growth recovery.

From the US side, at 17:30 GMT, the Core PCE Price Index for September came in line with the expectations of 0.2% from the US. Personal Spending from the US surged to 1.4% from the estimated 1.0% and supported the US dollar. The Employment Cost Index for the quarter remained the same at 0.5%. The Personal Income for September rose to 0.9% from the projected 0.3% and supported the US dollar. 

At 18:45 GMT, the Chicago PMI for October surged to 61.1 against the expected 58.2 and supported the US dollar. At 19:00 GMT, the Revised UoM Consumer Sentiment for October also advanced to 81.8 against the forecasted 81.2 and supported the US dollar. The Revised UoM Inflation Expectations for October came as 2.6% in comparison to September’s 2.7%.

Most of the macroeconomic figures from the US came in favor of the local currency that added strength in the USD/CAD pair on the day.

Furthermore, the gains were extended in the late session as the crude oil prices declined on Friday and remained low till $41.0 per day. The declining crude oil prices weighed on commodity-linked Loonie and forced the US dollar to move higher and push the USD/CAD pair. Another factor involved in the upward trend of the USD/CAD pair was the latest decision by the Federal Reserve on Friday to decrease the minimum limit of short-term and medium-term loans to $100,000 from the previous $250,000 to support the small & medium-sized businesses.


Daily Technical Levels

Support Resistance

1.3269 1.3385

1.3214 1.3446

1.3153 1.3501

Pivot point: 1.3330

The USD/CAD is trading with a selling bias falling from 1.3338 level to 1.3242 level, and it’s pretty much likely to drop further until the next support area of 1.3200 level. It’s the level that’s been extended by an upward trendline. The MACD histograms have also started forming below 0 supporting selling bias in the market. I will be looking to take a buy trade at this level of 1.3200 with a stop loss below the 1.3165 area and take profit level of 1.3340 mark. Good luck! 

Categories
Forex Market Analysis

Daily F.X. Analysis, November 02 – Top Trade Setups In Forex – Series of Manufacturing PMI Ahead! 

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 the 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 the 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 the lift of lockdown. Price action will depend upon any surprise changes in the PMI figures.

Economic Events to Watch Today  

 


 

EUR/USD – Daily Analysis

The EUR/USD pair was closed at 1.16445 after placing a high of 1.17041 and a low of 1.16398. The EUR/USD pair extended its losses for the 5th consecutive day on Friday and remained bearish throughout the day.

The main driver behind the steepest fall in Euro currency this week was the market concerns about the rising number of coronavirus infections in Europe and the effects of the social distancing measures to curb them. 

The latest lockdown restrictions introduced by France and Germany and the tighter restrictions applied in Italy and Spain raised alarms about their impact on the fragile economic recovery and weighed on the single currency Euro that ultimately added pressure on EUR/USD pair. Furthermore, the European Central Bank hinted to unleash new stimulus measures in December to counteract the pandemic’s negative impact and weighed on the Euro currency that added further losses in EUR/USD pair on Friday.

Meanwhile, on the data front, at 11:30 GMT, the French Consumer Spending for September was dropped to -5.1% against the expected -1.5% and weighed on Euro. The French Flash GDP for the quarter raised to 18.2% against the expected 15.0% and supported Euro. At 12:00 GMT, German Retail Sales for September dropped to -2.2% from the forecasted -0.6% and weighed on Euro. At 12:45 GMT, the French Prelim CPI for October fell to -0.1% against the forecasted 0.0% and weighed on Euro.

At 13:00 GMT, the Spanish Flash GDP for the quarter surged to 16.7% after placing a high of 13.5% and supported Euro. The Italian Monthly Unemployment Rate declined to 9.6% from the forecasted 10.1% and weighed on Euro. At 14:00 GMT, German Prelim GDP for the quarter raised to 8.2% from the forecasted 7.3% and supported Euro. The Italian Prelim GDP for the quarter also raised to 16.1% from the forecasted 11.1% and supported Euro. At 14:58 GMT, the Italian Prelim CPI for October remained flat with the expectations of 0.2%.

At 15:00 GMT, the CPI Flash Estimate for the year remained flat at -0.3%. The Core CPI Flash Estimate for the year also came in line as expected, 0.2%. The Prelim Flash GDP for the quarter raised to 12.7% from the forecasted 9.5% and supported Euro. The Unemployment Rate from the whole bloc raised to 8.3% from the forecasted 8.2% and weighed on Euro.

After the release of economic data, the single currency Euro came under fresh pressure amid the rising fears of investors’ that strong quarterly economic growth in Germany, which raised to 8.2% in the third quarter, will be temporary as the virus spread in the region has picked up the pace. This added further pressure on EUR/USD pair on Friday.

From the U.S. side, at 17:30 GMT, the Core PCE Price Index for September came in line with the anticipations of 0.2%. The Personal Spending for September rose to 1.4% against the projected 1.0% and supported the U.S. dollar and added pressure on EUR/USD pair. The Employment Cost Index for the quarter came in line with the expectations of 0.5%. The Personal Income for September also surged to 0.9% from the estimated 0.3% and supported the U.S. dollar and add losses in EUR/USD pair.

 At 18:45 GMT, the Chicago PMI for October upraised to 61.1 against the predictable 58.2 and supported the U.S. dollar. At 19:00 GMT, the Revised UoM Consumer Sentiment for October also elevated to 81.8 against the estimated 81.2 and supported the U.S. dollar that supported the losses on EUR/USD pair on Friday. The Revised UoM Inflation Expectations for October were reported as 2.6% compared to September’s 2.7%.

Daily Technical Levels

Support Resistance

1.1798     1.1789

1.1672     1.1834

1.1626     1.1870

Pivot point: 1.1753

EUR/USD– Trading Tip

The EUR/USD traded with a bearish bias, having dropped below the support area of 1.1653. At the moment, the EUR/USD is likely to face the resistance at the same level of 1.1653. On the higher side, a bullish crossover of 1.1653 increases the odds of continuing an upward trend, and it may lead the EUR/USD price towards 1.1700. Further bullish crossover of this area can lead the pair towards the 1.1758 level. Conversely, a bearish crossover of 1.1653 support level has opened additional room for selling until the 1.1613 area as a double bottom support area extends the level.  

GBP/USD – Daily Analysis

The GBP/USD pair was closed at 1.29464 after placing a high of 1.29879 and a low of 1.28989. After placing losses for two consecutive days, the GBP/USD pair raised on Friday and posted gains. The GBP/USD pair rose on Friday despite the strength of the U.S. dollar, improved risk-averse market sentiment, and the rising number of coronavirus cases in Great Britain. The rising number of coronavirus cases in the U.K. showed that the imposed restrictions might be insufficient, and the country should follow the steps of Europe and France.

On the U.S. Presidential election front, the polls after the presidential debate showed that former vice president Joe Biden was leading over President Donald Trump. The chances for a blue wave in the U.S. gave pressure on local currency and supported the gains of the GBP/USD pair on Friday. On the data front, at 11:52 GMT, the Nationwide House Price Index for October raised to 0.8% from the forecasted 0.4% and supported British Pound that added further gains in GBP/USD pair.

From the U.S. side, at 17:30 GMT, the Core PCE Price Index for September came as anticipated by 0.2%. The Personal Spending for September surged to 1.4% against the anticipated 1.0% and supported the U.S. dollar. The Employment Cost Index for the quarter came as expected of 0.5%. The Personal Income for September also raised to 0.9% from the projected 0.3% and supported the U.S. dollar.

At 18:45 GMT, the Chicago PMI for October surged to 61.1 against the anticipated 58.2 and supported the U.S. dollar. At 19:00 GMT, the Revised UoM Consumer Sentiment for October also rose to 81.8 against the forecasted 81.2 and supported the U.S. dollar. The Revised UoM Inflation Expectations for October came as 2.6% in comparison to September’s 2.7%. Despite the better than expected macroeconomic figures from the U.S., the U.S. dollar remained lower ahead of upcoming elections and weighed on GBP/USD pair on Friday.

Furthermore, the Brexit developments also helped the GBP/USD pair to stay higher in such circumstances this week. The Chief EU Negotiator Michel Barnier extended his stay in London to discuss the Brexit deal with his U.K. counterpart. The fact that he has delayed his stay also gave some hope that progress has been made in Brexit proves and supported GBP/USD pair.

The reports also suggested that both sides have almost reached an agreement over the state aid issue, and the only sticking point in the UK-EU deal left was the fisheries. These Brexit developments in depressing circumstances supported the GBP/USD pair on Friday.

Daily Technical Levels

Support Resistance

1.2909     1.3057

1.2839     1.3135

1.2762     1.3205

Pivot point: 1.2987

GBP/USD– Trading Tip

The GBP/USD is trading sharply bearish to trade over the double bottom support area of 1.2910 level. On the 2 hour timeframe, the GBP/USD pair has formed a downward channel, and bearish trend continuation can lead the pair further lower towards the next support area of 1.2830 level. However, to see that kind of selling, the Cable needs to violate the immediate support area of 1.2910. The MACD and 50 EMA support selling; therefore, we should look for a selling trade below the 1.2910 level today. 

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 104.673 after placing a high of 104.740and a low of 104.123. The USD/JPY pair extended its previous daily gains and rose for the second consecutive session on Friday.

The U.S. dollar was moving back and forth on Friday within the previous ranges, however, was unable to find a significant recovery. The second round of lockdown in Europe and the cautious market mood ahead of the U.S. Presidential elections kept the pair higher as the risk-averse market sentiment was gaining traction.

On the macroeconomic front, at 04:30 GMT, the Tokyo Core CPI for the year remained flat at -0.5%. The Unemployment Rate from Japan declined to 3.0% in September from the forecasted 3.1% and supported the Japanese Yen. At 04:50 GMT, the Prelim Industrial Production for September also raised to 4.0% from the expected 3.0% and supported the Japanese Yen. At 10:00 GMT, the Housing Starts from Japan for September dropped to -9.9% from the forecasted -8.6% and weighed on the Japanese Yen and supported the upside momentum in the USD/JPY pair.

From the U.S. side, at 17:30 GMT, the Core PCE Price Index for September remained flat at 0.2%. The Personal Spending for September advanced to 1.4% from the expected 1.0% and supported the U.S. dollar. The Employment Cost Index for the quarter came in line with the expectations of 0.5%. The Personal Income for September raised to 0.9% from the forecasted 0.3% and supported the U.S. dollar.

 At 18:45 GMT, the Chicago PMI for October surged to 61.1 against the expectable 58.2 and supported the U.S. dollar. At 19:00 GMT, the Revised UoM Consumer Sentiment for October also advanced to 81.8 against the anticipated 81.2 and helped the U.S. dollar. The Revised UoM Inflation Expectations for October came as 2.6% in comparison to September’s 2.7%.

The stronger than expected data from the U.S. side also supported the USD/JPY pair’s upside movement on Friday. Meanwhile, the market mood was inclined towards the U.S. dollar demand in safe-haven as the growing number of infections in Europe forced the governments to impose lockdowns, which raised concerns over the global economic recovery when the economies were already struggling.

Furthermore, on Friday, the Federal Reserve declared that it will amend its main street lending program to support better small businesses that were still fighting the crisis of coronavirus pandemic. The central bank revealed that it would reduce the minimum amount that can be borrowed by the small & medium-sized businesses from $250,000 to $100,000. The Federal Reserve said that the change in the main-street lending program had been made to support pandemic-hit small companies. These announcements from the Fed weighed on the U.S. dollar and kept the gains in USD.JPY pair limited on Friday.

Daily Technical Levels

Support Resistance

104.07     104.53

103.86     104.78

103.62     104.99

Pivot point: 104.32

USD/JPY – Trading Tips

The USD/JPY is trading slightly bullish at the 104.745 level, having crossed over the immediate resistance area of the 104.600 mark. On the 2 hour timeframe, the USD/JPY has violated the downward trendline at 104.550 level, and now the same level is likely to support the USD/JPY pair. The closing of candles over 104.650 level is supporting strong odds of bullish trend continuation until 105.049 level. Further bullish trend continuation can also lead the USD/JPY pair towards the 105.800 level, but, I’m afraid, traders will wait for the U.S. Elections and the U.S. NFP later this Friday. Good luck! 

Categories
Forex Signals

AUD/USD Choppy Session Continues – Brace for Breakout Signal! 

The AUD/USD pair was closed at 0.70309 after placing a high of 0.70757 and a low of 0.70021. The AUD/USD pair extended its previous daily losses on Thursday and dropped further below towards its lowest level since May 19th. The decline in the AUD/USD pair was understandable ahead of the next week’s massive risk events. The Reserve Bank of Australia and the US election on the same day. The currency pair started rushing towards the crucial support at the 0.700 handle due to the strength of the US dollar.

The AUD/USD pair was closed at 0.70309 after placing a high of 0.70757 and a low of 0.70021. The AUD/USD pair extended its previous daily losses on Thursday and dropped further below towards its lowest level since May 19th. The decline in the AUD/USD pair was understandable ahead of the next week’s massive risk events. The Reserve Bank of Australia and the US election on the same day. The currency pair started rushing towards the crucial support at the 0.700 handle due to the strength of the US dollar.

The AUD/USD pair was closed at 0.70309 after placing a high of 0.70757 and a low of 0.70021. The AUD/USD pair extended its previous daily losses on Thursday and dropped further below towards its lowest level since May 19th. The decline in the AUD/USD pair was understandable ahead of the next week’s massive risk events. The Reserve Bank of Australia and the US election on the same day. The currency pair started rushing towards the crucial support at the 0.700 handle due to the strength of the US dollar.

The US dollar was strong across the board ahead of the US Presidential election on November 3rd due to many factors including the latest uncertainty over the next round of US stimulus measures. The House Speaker Nancy Pelosi has weighed on market hopes for the successive CARES package by saying that the Trump administration would have to answer her on many critical issues before getting a consensus on the US stimulus package.

The investors that were waiting for elections to come next week and after that a stimulus measure will be passes, were disappointed after these comments and their hopes vanished that the same stalemate will continue even after the elections. These concerns weighed on market sentiment and dragged the AUD/USD pair on the downside.

On the data front, at 05:30 GMT, the Import Prices for the quarter dropped to -3.5% from the projected -2.1% and weighed on the Australian dollar and added in the losses of AUD/USD pair. The NAB Quarterly Business Confidence came in as -10 against the previous -15 in the third quarter.

From the US side, at 17:30 GMT, the Advanced GDP for the quarter rose to 33.1% from the forecasted 32.0% and supported the US dollar. The Unemployment Claims for the previous week fell to 751K from the projected 773K and supported the US dollar. At 17:32 GMT, the Advance GDP Price Index for the quarter surged to 3.6% from the forecasted 2.9% and supported the US dollar. At 19:00 GMT, the Pending Home Sales for September was chopped down to -2.2% from the anticipated 3.1% and weighed on the US dollar.

Most of the macroeconomic data from the US like GDP and Unemployment Claims came in better than expected and supported the US dollar that ultimately weighed on AUD/USD pair on Thursday.

Daily Technical levels

Support Resistance

0.7002 0.7122

0.6959 0.7201

0.6881 0.7243

Pivot point: 0.7080

The AUD/USD pair is trading with a bearish bias below 0.7047 level, the resistance level that’s extended downward trendline support area of 0.7047 level. Continuation of a selling trend in the AUD/USD pair may lead the AUD/USD price towards the support area of 0.7005, and below this, the AUD/USD pair may find next support around 0.6967. I will consider opening a selling trade below 0.7069 area today. Good luck! 

Categories
Forex Signals

USD/CAD Choppy Session Continues – Brace for Breakout Signal! 

The USD/CAD pair was closed at 1.33195 after placing a high of 1.33896 and a low of 1.32777. On Thursday, the USD/CAD pair moved higher in the early trading session due to the rising demand for the U.S. dollar and declining crude oil prices on the day. However, the gains in USD/CAD failed to remain until the end of the day, and the pair lost all of its gains at the late trading session on Thursday and provided a flat movement for the session.

The USD/CAD pair was closed at 1.33195 after placing a high of 1.33896 and a low of 1.32777. On Thursday, the USD/CAD pair moved higher in the early trading session due to the rising demand for the U.S. dollar and declining crude oil prices on the day. However, the gains in USD/CAD failed to remain until the end of the day, and the pair lost all of its gains at the late trading session on Thursday and provided a flat movement for the session.

The USD/CAD pair was closed at 1.33195 after placing a high of 1.33896 and a low of 1.32777. On Thursday, the USD/CAD pair moved higher in the early trading session due to the rising demand for the U.S. dollar and declining crude oil prices on the day. However, the gains in USD/CAD failed to remain until the end of the day, and the pair lost all of its gains at the late trading session on Thursday and provided a flat movement for the session.

The USD/CAD pair closed its day at the same level it started its day with at 1.33195 on Thursday. The rise in the USD/CAD pair was due to the strength of the U.S. dollar onboard. The U.S. Dollar Index rose to 94 levels on Thursday to its highest level in a month and supported the upward momentum of the USD/CAD pair. The U.S. dollar was also strong as the House Speaker Nancy Pelosi killed the hopes that a U.S. stimulus package will be delivered after the U.S. elections. These uncertainties raised the risk sentiment and helped the risk perceived USD/CAD pair to rise on Thursday.

Furthermore, the heavy selling pressure surrounding the WTI crude oil prices provided a boost to USD/CAD prices in the early trading session. The concerns over the negative impact of the rising number of coronavirus cases globally have been causing an uneven recovery in energy demand. The increasing number of countries imposing restrictions raised concerns for energy demand and the WTI Crude oil prices suffered on Thursday and fell below the $35 level to $34.92 per barrel. The sharp decline in WTI crude oil prices weighed on commodity-linked Loonie and supported the upward momentum of the USD/CAD pair.

On the data front, from the U.S. side, at 17:30 GMT, the Advanced GDP for the quarter rose to 33.1% from the expected 32.0% and supported the U.S. dollar. The Unemployment Claims for the previous week declined to 751K from the estimated 773K and supported the U.S. dollar. At 17:32 GMT, the Advance GDP Price Index for the quarter rose to 3.6% from the projected 2.9% and supported the U.S. dollar. At 19:00 GMT, the Pending Home Sales for September fell to -2.2% from the anticipated 3.1% and weighed on the U.S. dollar.

The strong GDP and unemployment claim data from the US-supported US dollar and added strength to the USD/CAD pair on Thursday. While from the Canadian side, the Building Permits for September came in as 17.0% against August’s 1.4% and supported the Canadian dollar that kept the gains in the USD/CAD pair limited. The pair USD/CAD started losing all of its daily gains in late trading session as profit-taking started in the market. The USD/CAD pair rose to its one-month highest level but failed to remain there and dropped to give flat movement for Thursday.


Daily Technical levels

Support Resistance

1.3219 1.3377

1.3119 1.3435

1.3061 1.3535

Pivot point: 1.3277

The USD/CAD pair is trading choppy session within 1.3339 – 1.3300 as traders seem to wait for a solid reason to trigger a breakout. In any case, a bearish breakout of 1.3300 level can extend selling bias until 1.3240 level, and below this, the double bottom level is likely to provide next support at 1.3112. Conversely, the bullish breakout of 1.3340 level is likely to target the 1.3420 mark. The MACD and RSI are in support of bullish bias; however, the signal isn’t that strong yet. Let’s brace to trade the breakout pattern today. Good luck! 

Categories
Forex Market Analysis

Daily F.X. Analysis, October 30 – Top Trade Setups In Forex – Series of GDP Ahead! 

On the news front, the economic calendar is due to a report series of CPI and GDP figures from the European economy. These events are likely to be overshadowed by the U.S. Personal Pending, Chicago PMI, and Revised UoM Consumer Sentiment, which are expected to slightly worse than beforehand. This may add further bearish bias for the U.S. dollar today.

On the news front, the economic calendar is due to a report series of CPI and GDP figures from the European economy. These events are likely to be overshadowed by the U.S. Personal Pending, Chicago PMI, and Revised UoM Consumer Sentiment, which are expected to slightly worse than beforehand. This may add further bearish bias for the U.S. dollar today.

On the news front, the economic calendar is due to a report series of CPI and GDP figures from the European economy. These events are likely to be overshadowed by the U.S. Personal Pending, Chicago PMI, and Revised UoM Consumer Sentiment, which are expected to slightly worse than beforehand. This may add further bearish bias for the U.S. dollar today.

Economic Events to Watch Today  

 

Economic Calendar by TradingView

EUR/USD – Daily Analysis

The EUR/USD pair’s prices were closed at 1.16742 after placing a high of 1.17587 and a low of 1.16500. The EUR/USD pair extended its previous daily losses and continued its bearish streak for the 4th consecutive session on Thursday. EUR/USD pair dropped to its more than one month lowest level on Thursday amid the broad-based U.S. dollar strength along with the rising number of lockdown restrictions in Europe.

The sharp decline in Euro against the U.S. dollar was derived by the European Central Bank’s decision on Thursday to hold its interest rates but gave signals that another monetary policy tool remains, and the bank would recalibrate its policy tools in December. As per the President of the European Central Bank, Christine Lagarde, it was necessary to cushion the European economy through pandemic and recalibrate its instruments at their next Governing Council meeting.

Lagarde refrained from expressing that the bank was looking at using all instruments rather than just topping up the 1.35 trillion euros PEPP at its upcoming Dec.10th meeting. Lagarde warned that the risks to the Eurozone recovery were tilted to the downside and suggested the pace to recovery or lack thereof would largely depend on the efforts of the economic bloc to contain the virus spread.

The growth of the Eurozone economy has come under pressure as the two biggest economies of the European Union, France, and Germany, have been forced to re-impose lockdown measures and raised the urgency to deliver more easing at the end of the year.

The Euro currency remained under pressure on Thursday after Lagarde’s comments and the central bank’s decision that ultimately added pressure on EUR/USD pair.

For October, the German Prelim CPI raised to 0.1% from the forecasted 0.0% and supported the single currency Euro on the data front. At 13:00 GMT, the Spanish Flash CPI for the year declined to -0.9% from the forecasted -0.4% and weighed on the single currency Euro that added pressure on EUR/USD pair. At 13:55 GMT, the German Unemployment Change for September came in as -35K against the forecasted -5K and supported the single currency Euro.

At 17:30 GMT, the Advanced GDP for the quarter raised to 33.1% from the estimated 32.0% and supported the U.S. dollar from the U.S. side. The Unemployment Claims for the previous week slipped to 751K from the anticipated 773K and supported the U.S. dollar. At 17:32 GMT, the Advance GDP Price Index for the quarter surged to 3.6% from the projected 2.9% and supported the U.S. dollar. At 19:00 GMT, the Pending Home Sales for September dropped to -2.2% from the projected 3.1% and weighed on the U.S. dollar. Most of the US-supported data weighed on EUR/USD pair towards the downside and added in the losses of the currency pair on Thursday.

Daily Technical Levels

Support Resistance

1.1798 1.1789

1.1672 1.1834

1.1626 1.1870

Pivot point: 1.1753

EUR/USD– Trading Tip

The EUR/USD traded with a bearish bias, having dropped to the support area of 1.1653. Above this, the pair has strong odds of taking a bullish turn until the 1.1700 area. Continuation of an upward trend may lead the EUR/USD price towards 1.1758, and bullish crossover of this area can lead the pair towards the 1.1820 level. Conversely, a bearish crossover of 1.1653 support level can extend selling until the 1.1613 area as a double bottom support area extends the level.  

GBP/USD – Daily Analysis

The GBP/USD pair was closed at 1.29126 after placing a high of 1.30255 and a low of 1.28806. The GBP/USD pair extended its previous daily losses and remained bearish on Thursday. The GBP/USD pair moved to its lowest level in almost 2-weeks and then recovered some of its losses in the late trading session on Thursday. The strength of the U.S. dollar drove the decline in the GBP/USD pair.

The U.S. dollar was strong due to the emerging risk-averse market sentiment and the strong macroeconomic data for the day. The delayed U.S. stimulus measure also helped the U.S. dollar to remain strong in the market. The U.S. Dollar Index (DXY) climbed above 94.00 level, its highest in almost a month, on Thursday as the risk-averse market sentiment emerged. The strong U.S. dollar added pressure on GBP.USD pair and dragged them to its 10-days lowest level.

On the data front, at 14:30 GMT, the M4 Money Supply for September raised 0.9% from the forecasted 0.3% and supported British Pound. At 14:32 GMT, the Mortgage Approvals raised to 91K from the forecasted 76K and supported British Pound. The Net Lending to Individuals came in line with the expectations of 4.2B. Britain’s data supported the local currency Sterling that capped further losses in the GBP/USD pair on Thursday.

From the U.S. side, at 17:30 GMT, the Advanced GDP for the quarter surged to 33.1% from the projected 32.0% and supported the U.S. dollar. The Unemployment Claims for the previous week fell to 751K from the estimated 773K and supported the U.S. dollar. At 17:32 GMT, the Advance GDP Price Index for the quarter advanced to 3.6% from the anticipated 2.9% and supported the U.S. dollar. At 19:00 GMT, the Pending Home Sales for September fell to -2.2% from the expected 3.1% and weighed on the U.S. dollar. The better than expected data from the U.S. supported the local currency U.S. dollar that added pressure on the declining GBP/USD pair’s prices.

On the Brexit front, the negotiations between the E.U. and U.K. were in progress with no headlines for the time being. However, the hopes were high that a deal could be reached this time as both sides were eager to solve the impasse given the limited time left for the end of the transition period. If a deal is reached, then British Pound will see a sharp rise in prices; however, analysts believe that a Brexit deal would likely offer only temporary relief for British Pound. They believe that Sterling’s near-term outlook will continue to be dominated by the late-stage Brexit negotiations that would include the significant trade frictions, the threat of tariffs and quotas.

It means that a Brexit deal between the E.U. and U.K. would not remove all the risks for British Pound and that sterling will still have to face further difficulties even after an agreement is reached.

Daily Technical Levels

Support Resistance

1.2909 1.3057

1.2839 1.3135

1.2762 1.3205

Pivot point: 1.2987

GBP/USD– Trading Tip

The GBP/USD is trading sharply bearish since the violation of the symmetric triangle pattern at the 1.3017 level, and the formation of bearish candles below the 1.3017 level has driven strong selling until the 1.2913 support area. For the moment, the Cable my lead GBP/USD price towards 1.3046 level for the sake of bullish correction. Conversely, the GBP/USD pair may find immediate support at 1.2913, and a bearish breakout of this level can be captured until the 1.2840 level.  

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 104.593 after placing a high of 104.725 and a low of 104.023. The USD/JPY pair rose on Thursday and posted gains after falling for two consecutive sessions on the back of the strong U.S. dollar and the better than expected macroeconomic data from the U.S., along with the disappointing data from Japan.

At 04:50 GMT, the Retail Sales from Japan for September dropped to -8.7% from the forecasted -7.5% and weighed on the Japanese Yen that added strength to the USD/JPY pair. At 10:00 GMT, the Consumer Confidence for October in Japan declined to 33.6 from the forecasted 35.2 and weighed on the Japanese Yen that supported the USD/JPY pair’s bullish move.

From the U.S. side, at 17:30 GMT, the Advanced GDP for the quarter advanced to 33.1% from the estimated 32.0% and supported the U.S. dollar. The Unemployment Claims for the previous week slipped to 751K from the anticipated 773K and supported the U.S. dollar. At 17:32 GMT, the Advance GDP Price Index for the quarter raised to 3.6% from the estimated 2.9% and supported the U.S. dollar. At 19:00 GMT, the Pending Home Sales for September declined to -2.2% from the projected 3.1% and weighed on the U.S. dollar.

The better than expected data from the U.S. gave strength to the U.S. dollar that ultimately added further gains to the USD/JPY pair on Thursday. Meanwhile, the U.S. dollar was also strong due to the comments from the Head of Congress and White House that signaled a tough road ahead for a coronavirus stimulus even after the next week’s U.S. election.

The U.S. Congress delivered a Coronavirus Aid, Relief, and Economic Security (CARES) stimulus worth about $3 trillion. Since then, the Democrats and the Republicans have been locked in a stalemate on a successive package to CARES. The differences have been over the size of the next relief bill among both parties. Over the last two weeks, the hopes that a coronavirus relief package will be delivered before elections faded away despite the months of negotiations between Democrats & Republicans. The investors thought that a deal might be reached after the election, regardless of the winner.

However, the Speaker of the House of Representatives, Nancy Pelosi, revealed on Thursday that these hopes that a package will be delivered after the elections without any difficulty were not right as Republicans were yet to answer her on funding for several critical areas. The uncertainty and lack of hopes that a stimulus will be delivered even after elections raised the U.S. dollar and added further gains in the USD/JPY pair on Thursday. However, the USD/JPY currency pair’s gains were limited due to the emerging risk-averse market sentiment in the market on Thursday.

Daily Technical Levels

Support Resistance

104.07 104.53

103.86 104.78

103.62 104.99

Pivot point: 104.32

USD/JPY – Trading Tips

The bearish bias in the USD/JPY continues to extend the bearish bias; however, it’s trading within a choppy trading range now. The choppy range may provide resistance at 104.505 to 104.200 area. Violation of this range can trigger further selling until the 103.900 level. The MACD and RSI support selling bias today; therefore, we will be looking to enter a selling trade below 104.24 today. A violation of this level has high odds of leading the USD/JPY pair further lower towards the 103.900 level. Good luck! 

Categories
Forex Market Analysis

Daily F.X. Analysis, October 29 – Top Trade Setups In Forex – Eyes on ECB Policy Rate! 

The focus will remain on the U.S. Advance GDP figures. GDP data expected to perform better than before as the data represents the economic activity of the lockdown period. Besides this, the major focus will remain on the ECB Monetary policy decision, where the ECB is expected to keep the interest rate unchanged. However, the increased number of  Covid-19 cases may trigger a dovish sentiment on the European official bank rate, and it may place bearish pressure on the single currency Euro. 

The focus will remain on the U.S. Advance GDP figures. GDP data expected to perform better than before as the data represents the economic activity of the lockdown period. Besides this, the major focus will remain on the ECB Monetary policy decision, where the ECB is expected to keep the interest rate unchanged. However, the increased number of  Covid-19 cases may trigger a dovish sentiment on the European official bank rate, and it may place bearish pressure on the single currency Euro. 

The focus will remain on the U.S. Advance GDP figures. GDP data expected to perform better than before as the data represents the economic activity of the lockdown period. Besides this, the major focus will remain on the ECB Monetary policy decision, where the ECB is expected to keep the interest rate unchanged. However, the increased number of  Covid-19 cases may trigger a dovish sentiment on the European official bank rate, and it may place bearish pressure on the single currency Euro. 

Economic Events to Watch Today  

 

EUR/USD – Daily Analysis

The EUR/USD pair was closed at 1.17460 after placing a high of 1.17879 and a low of 1.17176. The EUR/USD pair dropped to its one week lowest level and remained bearish throughout the day. The Euro fell against the U.S. dollar on Wednesday ahead of the European Central Bank meeting amid the rising fears that the Eurozone’s economic recovery will be hard as Germany and France introduced fresh lockdown measures to control the spread of coronavirus infections.

A four-week lockdown was introduced by German Chancellor Angela Merkel on Wednesday for the country to control the spread of the virus. The partial lockdown will start from Monday, and under the restrictions, the hospital sector will likely ease as restaurants, bars, gyms, cinemas will be closed while schools, daycare centers, and kindergartens will remain open.

France that is already under curfew, will announce a nationwide lockdown on Friday. The President of France Emmanuel Macron has said that the measures they had taken to control the spread did not work out and were insufficient to counter the second wave of coronavirus affecting all of Europe.

Both Germany and France have seen a rise in coronavirus cases, with France expected to experience 100,000 new cases per day in the coming days. These fears that the lockdown measures will greatly impact the emerging European economic recovery weighed heavily on a single currency on Wednesday.

At 12:00 GMT, German Import Prices raised in September to 0.3% from the forecasted -0.3% and supported Euro currency on the data front. At 17:30 GMT, the Goods Trade Balance for September came in as -79.4B against the projected -84.8B and supported the U.S. dollar that weighed on EUR/USD prices. The Prelim Wholesale Inventories from the U.S. in September were reported as -0.1% against the expected 0.4% and supported the U.S. dollar added in the losses of EUR/USD pair on Wednesday.

On the U.S. dollar front, the United States also saw records high numbers of coronavirus cases; however, the U.S. dollar remained strong across the board. It seems like investors chose to invest in the greenback in these uncertain times due to its safe-haven status. The strong U.S. dollar weighed further on EUR.USD pair on Wednesday, and the prices continued moving in downside momentum.

Daily Technical Levels

Support Resistance

1.1779     1.1825

1.1762     1.1856

1.1732     1.1872

Pivot Point: 1.1809

EUR/USD– Trading Tip

The EUR/USD traded with a bearish bias, having dropped to the support area of 1.1745. Above this, the pair has strong odds of taking a bullish turn until the 1.1790 area. Continuation of an upward trend may lead the EUR/USD price towards 1.1790, and bullish crossover of this area can lead the pair towards the 1.1820 level. Conversely, a bearish crossover of 1.1745 support level can extend selling until the 1.1694 area. 

GBP/USD – Daily Analysis

The GBP/USD pair was closed at 1.29877 after placing a high of 1.30636 and a low of 1.29163. The GBP/USD pair dropped and posted losses on Wednesday. The GBP/USD pair dropped to its seven days lowest level on Wednesday amid broad-based U.S. dollar strength and the rising number of coronavirus cases in the U.K. The Brexit impasse, along with the U.S. elections uncertainty, also weighed on GBP/USD pair on Wednesday.

The U.S. dollar was strong across the board on Wednesday as the global coronavirus spread raised the greenback’s safe-haven allure. The British Pound lost as much as 1% against the U.S. dollar on Wednesday as investors withdraw due to decreased hopes for global economic recovery and increased risk-aversion market sentiment.

The uncertainties surrounding the U.S. elections were already weighing on the market sentiment, and the resurgence of coronavirus cases in Europe and the United States emerged that escalated the concerns. In the past week, the rate of deaths in Europe rose by almost 40%, and it challenged the narrative that the virus was relatively harmless that had encouraged the easing of lockdown measures for the sake of local economies.

Both Germany and France announced new lockdown measures to control coronavirus spread, and the U.K. was also expected to impose Tier-3 restrictions. These fears weighed heavily on the local currency British Pound that ultimately dragged the GBP/USD pair’s prices on Wednesday to its one-week lowest level.

On the data front, t 05:01 GMT, BRC Shop Price Index for October came in as -1.2% compared to -1.6%. Whereas, from the U.S. side, at 17:30 GMT, the Goods Trade Balance for September was reported as -79.4B against the expected -84.8B and supported the U.S. dollar that weighed on GBP/USD prices. The Prelim Wholesale Inventories from the U.S. in September came in as -0.1% against the anticipated 0.4% and supported the U.S. dollar that weighed on GBP/USD pair on Wednesday.

On the Brexit front, Britain and the European Union have just over two months to reach a trade agreement before the status-quo transition period ends on December 31. The E.U.’s chief negotiator, Michel Barnier, is in London for negotiations, and it is believed that progress has been made over some sticking points.

The sentiment has raised hopes that this time a deal will be reached between the U.K. and the E.U. by early November. According to Bloomberg, both sides have begun work on the text of the agreement on the level competitive playing field and were close to finalizing a joint document covering state aid.

These developments regarding Brexit-deal gave some ease to the market sentiment and capped further losses in the GBP/USD pair on Wednesday.

Furthermore, the Bank of England has shown willingness to go for negative rates that had been partially priced in the market and had kept the British Pound under pressure. Therefore, any such action by the bank would not come as a surprise in the upcoming meeting, and it means that a negative interest rate effect could be of secondary importance for GBP traders than a shock of Brexit in the coming days.

Daily Technical Levels

Support Resistance

1.3001     1.3081

1.2961     1.3121

1.2921     1.3161

Pivot Point: 1.3041

GBP/USD– Trading Tip

The GBP/USD has violated the symmetric triangle pattern at the 1.3017 area, and closing of candles below the 1.3017 level has driven strong selling until the 1.2915 support area. On the higher side, the Cable my lead GBP/USD price towards 1.3046 level. For now, the GBP/USD pair may find an immediate resistance at 1.3046 are, and below this, selling can be captured until 1.2980 and 1.2919 level.  

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 104.307 after placing a high of 104.554 and a low of 104.111. The USD/JPY pair remained bearish and placed losses on Wednesday. The USD/JPY pair has posted slight losses on Wednesday despite the broad-based U.S. dollar strength. The Japanese Yen has gained about 1.2% throughout the last three weeks in October and has weighed on the USD/JPY pair. The USD/JPY pair dropped on Wednesday to its lowest level since September 21.

The U.S. dollar was strong on Wednesday as its safe-haven status got attention after European nations started re-imposing lockdown measures to control the virus’s spread. However, the U.S. dollar’s strength could not reverse the USD/JPY pair’s movement on Wednesday as traders were focused more on the Bank of Japan’s decision in its upcoming monetary policy meeting on Thursday.

Bank of Japan is up to hold its monetary policy meeting on Thursday, and investors were pricing the potential moves by it ahead of the meeting. The Bank of Japan is expected to keep its rates unchanged at -10bps while maintaining a 10-year JGB yield target at 0.0%. The Bank of Japan has extended a deadline for two virus linked funding programs and enlarged asset purchases. As mentioned by the quarterly assessment report, the central bank has downgraded this fiscal year’s economic and inflation outlooks.

As the outlook reviews have already been priced in the market, any hint over additional monetary easing through Q.E. in December on Thursday could have a major impact on the Japanese yen and ultimately on the USD/JPY pair. Furthermore, the coronavirus cases in the United States were rising day by day and weighed on local currency as the chances for a fresh lockdown increased with the increased number of COVID-19 infections. Over the last seven days, the U.S. reported about half a million new coronavirus cases, and it has raised both economic and health-related concerns that have weighed on the local currency U.S. dollar. The USD/JPY pair also followed these rising concerns and kept moving in the downward direction on Wednesday.

On the data front, from the U.S. side, at 17:30 GMT, the Goods Trade Balance for September came in as -79.4B against the anticipated -84.8B and supported the U.S. dollar. The Prelim Wholesale Inventories from the U.S. in September came in as -0.1% against the projected 0.4% and supported the U.S. dollar. The strong U.S. dollar failed to reverse the USD/JPY pair’s negative momentum on Wednesday, and the pair kept falling towards its multi-week lowest level.

Daily Technical Levels

Support Resistance

104.22     104.73

104.05     105.07

103.70     105.25

Pivot point: 104.56

USD/JPY – Trading Tips

The bearish bias in the USD/JPY continues to extend the bearish bias; however, it’s trading within a choppy trading range now. The choppy range may provide resistance at 104.505 to 104.200 area. Violation of this range can trigger further selling until the 103.900 level. The MACD and RSI support selling bias today; therefore, we will be looking to enter a selling trade below 104.24 today as a violation of this level has high odds of leading the USD/JPY pair further lower towards the 103.900 level. Good luck! 

Categories
Forex Signals

USD/JPY Takes Dip Amid Downward Channel – Brace for Selling! 

During the Europen session, the USD/JPY continues trading lower amid a downward channel at 102.298 level. The USD/JPY pair moved in a bearish direction and posted big losses on Tuesday. The USD/JPY pair was down on Tuesday amid the broad-based U.S. dollar weakness along with the rising risk-averse market sentiment on the back of fresh tensions between the U.S. and China. The safe-haven appeal was also supported by the rising number of coronavirus cases and lockdowns that drove the stock market on the downside and weighed on the USD/JPY pair as well.

During the Europen session, the USD/JPY continues trading lower amid a downward channel at 102.298 level. The USD/JPY pair moved in a bearish direction and posted big losses on Tuesday. The USD/JPY pair was down on Tuesday amid the broad-based U.S. dollar weakness along with the rising risk-averse market sentiment on the back of fresh tensions between the U.S. and China. The safe-haven appeal was also supported by the rising number of coronavirus cases and lockdowns that drove the stock market on the downside and weighed on the USD/JPY pair as well.

During the Europen session, the USD/JPY continues trading lower amid a downward channel at 102.298 level. The USD/JPY pair moved in a bearish direction and posted big losses on Tuesday. The USD/JPY pair was down on Tuesday amid the broad-based U.S. dollar weakness along with the rising risk-averse market sentiment on the back of fresh tensions between the U.S. and China. The safe-haven appeal was also supported by the rising number of coronavirus cases and lockdowns that drove the stock market on the downside and weighed on the USD/JPY pair as well.

The U.S. Dollar Index that measures the value of the greenback against the basket of six currencies dropped by 0.3% to 92.8 level on Tuesday that weighed on the U.S. dollar and dragged the USD/JPY pair prices.

On the coronavirus front, the United States, Russia, France, Italy, Netherland, Spain, and many other nations across the globe set a new record for the number of daily coronavirus cases. The U.S. reported more than 74,300 new cases in a single day, France reported more than 52,000 daily cases over the weekend. The global record for the infections was recorded as 43.4 million on Tuesday by the Johns Hopkins University.

The rising number of coronavirus cases urged governments to re-impose lockdown measures to curb the virus’s spread. These lockdowns in a situation where economies were still under recovery phase from the previous lockdown effects raised a high appeal for the safe-haven market sentiment in the market. The risk-averse sentiment supported the safe-haven Japanese Yen that ultimately weighed on the USD/JPY pair on Tuesday.

Meanwhile, on the data front, at 09:59 GMT, the BOJ Core CPI for the year dropped to -0.1% from the forecasted 0.0% and weighed on the Japanese Yen that failed to reverse the negative movement of the USD/JPY pair. At 18:00 GMT, August’s Housing Price Index rose to 1.5% from the anticipated 0.7% and supported the U.S. dollar. The S&P/CS Composite-20 HPI for the year also advanced to 5.2% from the projected 4.2% and supported the U.S. dollar. At 18:59 GMT, the Richmond Manufacturing Index for October raised to 29 against the expected 18 and supported the U.S. dollar but failed to impress investors; thus, the USD/JPY pair continued moving in the downward momentum on Tuesday.

However, at 19:00 GMT, the C.B. Consumer Confidence for October was dropped to 100.9 from the anticipated 102.1 and weighed on the U.S. dollar that added further pressure on the USD/JPY pair. The U.S. dollar failed to cheer the positive macroeconomic data on Tuesday because of the stalled talks for the next round of the U.S. stimulus package. The stalemate between the White House and the House of Representative Speaker Nancy Pelosi over the U.S. stimulus aid package’s size led to delayed talks till November 3rd election results and weighed on the U.S. dollar.

The USD/JPY continues to extend its bearish momentum as the pair trades at the 104.298 level. On the 4 hour timeframe, the USD/JPY has formed a downward channel that’s driving bearish movement in the market, and it may support the pair around 104.300 and 104.007 area. Conversely, the continuation of an upward movement is likely to drive the buying trend until the 104.778 level. Check out the sell setup below…


Categories
Forex Signals

USD/CAD Continues Trading Bullish – Upward Channel In Play! 

The USD/CAD pair was closed at 1.31832 after placing a high of 1.32119 and a low of 1.31420. The USD/CAD pair reversed its previous day move and fell on Tuesday to post losses. The USD/CAD pair dropped on Tuesday amid the broad-based US dollar weakness and the rising crude oil prices. However, the USD/CAD pair’s losses were recovered in the late American session after the release of American macroeconomic data and ahead of the Bank of Canada’s interest rate decision.

The USD/CAD pair was closed at 1.31832 after placing a high of 1.32119 and a low of 1.31420. The USD/CAD pair reversed its previous day move and fell on Tuesday to post losses. The USD/CAD pair dropped on Tuesday amid the broad-based US dollar weakness and the rising crude oil prices. However, the USD/CAD pair’s losses were recovered in the late American session after the release of American macroeconomic data and ahead of the Bank of Canada’s interest rate decision.

The USD/CAD pair was closed at 1.31832 after placing a high of 1.32119 and a low of 1.31420. The USD/CAD pair reversed its previous day move and fell on Tuesday to post losses. The USD/CAD pair dropped on Tuesday amid the broad-based US dollar weakness and the rising crude oil prices. However, the USD/CAD pair’s losses were recovered in the late American session after the release of American macroeconomic data and ahead of the Bank of Canada’s interest rate decision.

The USD/CAD pair failed to capitalize on the previous session’s strong positive move of around 100 pipis and started moving in the downward direction as the US dollar was weak across the board. The US Dollar Index fell to 92.8 level by 0.3% on Tuesday and weighed on the greenback that ultimately exerted pressure on the USD/CAD pair.

The US dollar was also weak because of the US political environment where chances of a blue wave in the upcoming US Presidential elections that will be held on November 3rd, were increasing as the national polls suggested.

Meanwhile, the US also reported 74,300 new coronavirus cases in a single day that also raised bars for fresh lockdowns. These depressing situations kept weighing on the US dollar that was already under pressure due to the stalled talks over the next round of the US stimulus package. As the coronavirus cases were increasing day by day and the governments were forced to impose restrictions again, economic recovery concerns raised even more as the government funding had dried up, and the talks for further measures have stalled till elections. These concerns kept the market sentiment under pressure, and the USD/CAD pair suffered due to it.

However, on the data front, at 18:00 GMT, the Housing Price Index for August from the US was raised to 1.5% from the expected 0.7% and supported the US dollar. The S&P/CS Composite-20 HPI for the year also advanced to 5.2% from the projected 4.2% and supported the US dollar. At 18:59 GMT, the Richmond Manufacturing Index for October surged to 29 against the expected 18 and supported the US dollar that recovered its earlier losses in the USD/CAD pair.

However, at 19:00 GMT, the CB Consumer Confidence for October was dropped to 100.9 from the projected 102.1 and weighed on the US dollar that added further pressure on the USD/CAD pair. The USD/CAD pair reversed its movement after the US economic data release amid the US dollar started to pick its demand as durable goods orders had recovered to their pre-pandemic levels, which was an encouraging sign.

Meanwhile, the WTI crude oil prices raised above the $39 level on Tuesday and gave strength to commodity-linked Loonie that ultimately added pressure on the USD/CAD prices and added further in the losses of pair on the day. Investors will keep a close eye on the Bank of Canada on Wednesday when the central bank will hold its monetary policy meeting. The interest rates are currently at the 0.25% level slashed in March and have not been changed until then. The rate statement could impact USD/CAD prices tomorrow as investors will be interested in the view of BoC related to the health of the economy. 


Entry Price – Buy 1.31941

Stop Loss – 1.31541

Take Profit – 1.32441

Risk to Reward – 1:1.25

Profit & Loss Per Standard Lot = -$400/ +$500

Profit & Loss Per Micro Lot = -$40/ +$50

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Forex Market Analysis

Daily F.X. Analysis, October 28 – Top Trade Setups In Forex – Bank of Canada Policy! 

On the news front, the Bank of Canada Overnight Rate rate and Rate Statement will be in focus, and it may drive some price action in Canadian pairs. Elsewhere, we don’t have any major event that can drive sharp movements in the U.S. dollar related pairs. Let’s focus on technical levels.

On the news front, the Bank of Canada Overnight Rate rate and Rate Statement will be in focus, and it may drive some price action in Canadian pairs. Elsewhere, we don’t have any major event that can drive sharp movements in the U.S. dollar related pairs. Let’s focus on technical levels.

On the news front, the Bank of Canada Overnight Rate rate and Rate Statement will be in focus, and it may drive some price action in Canadian pairs. Elsewhere, we don’t have any major event that can drive sharp movements in the U.S. dollar related pairs. Let’s focus on technical levels.

Economic Events to Watch Today  

 

EUR/USD – Daily Analysis

The EUR/USD closed at 1.17872 after placing a high of 1.18385 and a low of 1.17821. The EUR/USD pair moved lower and posted losses on Tuesday to extend the previous bearish trend. The EUR/USD pair extended its losses on Tuesday and fell for 2nd consecutive day despite the broad-based U.S. dollar weakness. The decline in the EUR/USD pair was due to the rising number of coronavirus cases and the increased numbers of lockdown in European nations to curb the COVID-19 crisis’s effects.

The EUR/USD pair moved in upward momentum during the first half of Tuesday and recovered most of its previous daily losses on the back of broad-based U.S. dollar weakness. The U.S. Dollar Index was down to 92.8 level by 0.3% on Tuesday as the uncertainty over the next round of U.S. stimulus package and the upcoming U.S. Presidential election weighed on the greenback.

The risk-averse market sentiment emerged in the market due to an increased number of coronavirus cases worldwide, especially in the European nations. The United States reported more than 74,300 new coronavirus cases on Monday that pushed the country’s daily average over the past week above 71,000. Meanwhile, in Europe, France prepared for a fresh lockdown as new daily confirmed coronavirus cases hit the highest ever at above 52,000 on a single day.

Italy and the Netherlands also reported a new record high of cases over the weekend. Spain declared a national emergency and imposed a night-time curfew for six months. All these reports from across the globe weighed on risk sentiment and dragged the riskier asset like EUR/USD pair on the downside. Meanwhile, the risk sentiment was further affected by the latest news from one of the vaccine developers, Pfizer, that said that getting early results by October for coronavirus vaccine shots would be nearly impossible. These comments added further to the downside momentum of EUR.USD pair on Tuesday.

On the data front, at 13:00 GMT, the Spanish Unemployment Rate for September raised to 16.3% against the forecasted 16.0% and weighed on the single currency Euro that added further to the losses of EUR/USD pair. At 14:00 GMT, the M3 Money Supply for the year was advanced to 10.4% from the forecasted 9.6% and supported Euro currency. The Private Loans for the year from Eurozone remained flat at 3.1%.

At 18:00 GMT, August’s Housing Price Index raised to 1.5% from the projected 0.7% and supported the U.S. dollar. The S&P/CS Composite-20 HPI for the year also elevated to 5.2% from the projected 4.2% and supported the U.S. dollar. At 18:59 GMT, the Richmond Manufacturing Index for October surged to 29 from the anticipated 18 and supported the U.S. dollar added in the additional losses in EUR/USD pair on Tuesday.

However, at 19:00 GMT, the C.B. Consumer Confidence for October dropped to 100.9 from the projected 102.1 and weighed on the U.S. dollar that capped further losses in EUR/USD prices on Tuesday. Furthermore, the risk sentiment was deteriorated by the latest tensions between the U.S. & China over the potential sales of American made missiles to Taiwan. This raised the market’s safe-haven appeal and weighed on the riskier EUR/USD pair for the day.

Daily Technical Levels

Support Resistance

1.1787     1.1845

1.1766     1.1882

1.1729     1.1904

Pivot point: 1.1824

EUR/USD– Trading Tip

The EUR/USD traded with a bearish bias, falling from the 1.1800 level to test the support area of the 1.1770 mark. Violation of the 1.1770 level can drive further selling until the 1.1733 support level, which is extended by an upward trendline. However, the MACD and RSI are supporting selling bias; therefore, the EUR/USD may exhibit a selling trend below an intraday pivot point level of 1.1824 level. Buying can be seen over the 1.1700 level today. 

GBP/USD – Daily Analysis

The GBP/USD pair was closed at 1.30414 after placing a high of 1.30793 and a low of 1.30007. The GBP/USD pair reversed on Tuesday and started moving in a bullish track. The GBP/USD pair rose and broke it’s 4 days bearish streak on Tuesday amid the broad-based U.S. dollar weakness and the rising optimism surrounding the Brexit process. The U.S. dollar was weak across the board amid the fallen U.S. yields and rising concerns over the U.S. stimulus package and upcoming U.S. election.

The U.S. dollar also failed to cheer the positive macroeconomic figures from the economic docket on Tuesday as investors’ focus shifted towards other developments. The Wall Street stocks were mixed during the day as the resurgence in COVID-19 cases was creating concerns among the market participants. The market’s risk sentiment was also affected by the latest dispute between the U.S. & China, along with the increased number of coronavirus cases and the slowdown of economies throughout the globe. The deteriorated risk sentiment weighed heavily on the risk perceived British Pound and GBP/USD pair gains remained limited for the day.

The British investors were more focused on the Brexit process’s optimism as the Chief EU negotiator Michel Barnier extended his stay in London for ongoing talks. This raised the hopes that both parties will soon reach a consensus over the Brexit-deal key points as the negotiations were extended. The silence around the talks matter was seen as a positive sign between the investors, and they started buying British Pound against the U.S. dollar.

Meanwhile, the PM Boris Johnson has also said that he was not waiting for the U.S. elections to deal with the E.U. He added that resolving the issues of state aid and fisheries was more critical at the time, and the markets started moving on the positive side for British Pound as U.K. was eager to strike a deal with the E.U.

On the data front, at 16:00 GMT, the CBI Realized Sales for October came in as -23 against the expectations of -1 and weighed on British Pound and capped further gains in GBP/USD pair. At 18:00 GMT, the Housing Price Index for August surged to 1.5% from the expectations of 0.7% and supported the U.S. dollar. The S&P/CS Composite-20 HPI for the year also surged to 5.2% from the forecasted 4.2% and helped the U.S. dollar. At 18:59 GMT, the Richmond Manufacturing Index for October raised to 29 against the expectations of 18 and supported the U.S. dollar that limited further gains in GBP/USD prices.

However, at 19:00 GMT, the C.B. Consumer Confidence for October fell to 100.9 from the expected 102.1 and weighed on the U.S. dollar that pushed the GBP/USD pair further on the upside. As for the U.S. Presidential elections, the uncertainty surrounding the question that who will win the election kept the U.S. dollar weak across the board on Tuesday. Some polls were suggesting a blue wave while others were in favor of re-electing president Donald Trump. Along with the stalled talks for the next round of the U.S. stimulus package before November 3, these uncertainties weighed on the U.S. dollar and supported the GBP/USD pair’s gains on Tuesday.

Daily Technical Levels

Support Resistance

1.2985     1.3067

1.2947     1.3113

1.2902     1.3150

Pivot point: 1.3030

GBP/USD– Trading Tip

The GBP/USD is trading sideways, holding within a symmetric triangle pattern extending neutral with a narrow trading range of 1.3071 – 1.3007 level. Violation of 1.3007 level can open additional room for selling until the 1.2965 area, which extends support due to an upward trendline on the 4-hour timeframe. The MACD and RSI are in support of selling bias today. Consider opening sell trades below the 1.3075 level today. On the other hand, the violation of 1.3071 can drive upward movement until the 1.3165 level today. 

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 104.475 after placing a high of 104.888 and a low of 104.386. The USD/JPY pair moved in a bearish direction and posted big losses on Tuesday. The USD/JPY pair was down on Tuesday amid the broad-based U.S. dollar weakness along with the rising risk-averse market sentiment on the back of fresh tensions between the U.S. and China. The safe-haven appeal was also supported by the rising number of coronavirus cases and lockdowns that drove the stock market on the downside and weighed on the USD/JPY pair as well.

The U.S. Dollar Index that measures the value of the greenback against the basket of six currencies dropped by 0.3% to 92.8 level on Tuesday that weighed on the U.S. dollar and dragged the USD/JPY pair prices.

On the coronavirus front, the United States, Russia, France, Italy, Netherland, Spain, and many other nations across the globe set a new record for the number of daily coronavirus cases. The U.S. reported more than 74,300 new cases in a single day, France reported more than 52,000 daily cases over the weekend. The global record for the infections was recorded as 43.4 million on Tuesday by the Johns Hopkins University.

The rising number of coronavirus cases also urged governments to re-impose lockdown measures to curb the virus’s spread. These lockdowns in a situation where economies were still under recovery phase from the previous lockdown effects raised a high appeal for the safe-haven market sentiment in the market. The risk-averse sentiment supported the safe-haven Japanese Yen that ultimately weighed on the USD/JPY pair on Tuesday.

Meanwhile, on the data front, at 09:59 GMT, the BOJ Core CPI for the year dropped to -0.1% from the forecasted 0.0% and weighed on the Japanese Yen that failed to reverse the negative movement of the USD/JPY pair. At 18:00 GMT, August’s Housing Price Index rose to 1.5% from the anticipated 0.7% and supported the U.S. dollar. The S&P/CS Composite-20 HPI for the year also advanced to 5.2% from the projected 4.2% and supported the U.S. dollar. At 18:59 GMT, the Richmond Manufacturing Index for October raised to 29 against the expected 18 and supported the U.S. dollar but failed to impress investors; thus, the USD/JPY pair continued moving in the downward momentum on Tuesday.

However, at 19:00 GMT, the C.B. Consumer Confidence for October was dropped to 100.9 from the anticipated 102.1 and weighed on the U.S. dollar that added further pressure on the USD/JPY pair. The U.S. dollar failed to cheer the positive macroeconomic data on Tuesday because of the stalled talks for the next round of the U.S. stimulus package. The stalemate between the White House and the House of Representative Speaker Nancy Pelosi over the U.S. stimulus aid package’s size led to delayed talks till November 3rd election results and weighed on the U.S. dollar.

Furthermore, the Biden victory bets were started to weigh on the U.S. dollar as the polls suggested a blue wave in the upcoming Presidential elections. The weak U.S. dollar on Tuesday caused the USD/JPY pair to move on the downside. Moreover, the U.S. and China tensions came on-board after a long pause on Tuesday when news suggested a potential $2.4 billion sale of U.S. anti-ship missiles to Taiwan. In response to this news, China slapped sanctions on U.S. companies over national security interests. These fresh tensions between the U.S. and China raised safe-haven appeal and supported the safe-haven Japanese Yen that ultimately added weight on the USD/JPY pair on Tuesday.

Daily Technical Levels

Support Resistance

104.18     105.35

103.68     106.00

103.02     106.51

Pivot point: 104.84

USD/JPY – Trading Tips

The USD/JPY continues to extend its bearish momentum as the pair trades at the 104.298 level. On the 4 hour timeframe, the USD/JPY has formed a downward channel that’s driving bearish movement in the market, and it may support the pair around 104.300 and 104.007 area. Conversely, the continuation of an upward movement is likely to drive the buying trend until the 104.778 level. The MACD and RSI are supporting selling bias today; therefore, we will be looking to enter a selling trade below 104.84 today. Good luck! 

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Forex Signals

AUD/CAD Breaking Below Upward Channel – Is there a Sell Trade?

The USD/CAD extended its previous session bullish bias and hit the session high around above 0.9416 level. However, the bullish sentiment around the currency pair was being supported by a modest pickup in the ongoing drop in crude oil prices, which tend to undermine demand for the commodity-linked currency – the loonie. Hence, the broad-based U.S. dollar managed to gain some positive traction on the day amid growing market worries about surging coronavirus cases in Europe and the United States, which keeps the market trading sentiment under pressure and undermined the greenback. 

The USD/CAD extended its previous session bullish bias and hit the session high around above 0.9416 level. However, the bullish sentiment around the currency pair was being supported by a modest pickup in the ongoing drop in crude oil prices, which tend to undermine demand for the commodity-linked currency – the loonie. Hence, the broad-based U.S. dollar managed to gain some positive traction on the day amid growing market worries about surging coronavirus cases in Europe and the United States, which keeps the market trading sentiment under pressure and undermined the greenback. 

The USD/CAD extended its previous session bullish bias and hit the session high around above 0.9416 level. However, the bullish sentiment around the currency pair was being supported by a modest pickup in the ongoing drop in crude oil prices, which tend to undermine demand for the commodity-linked currency – the loonie. Hence, the broad-based U.S. dollar managed to gain some positive traction on the day amid growing market worries about surging coronavirus cases in Europe and the United States, which keeps the market trading sentiment under pressure and undermined the greenback. 

In addition to this, the long-lasting impasse over the next round of the U.S. fiscal stimulus measures added further burden on investors’ sentiment and benefitted the USD’s status as the global reserve currency. Across the pond, the reason for the currency pair bullish bias could also be attributed to the weaker crude oil prices, which undermined the demand for the commodity-linked currency the loonie and contributed to the currency pair gains. As of writing, the AUD/CAD currency pair is currently trading at 0.9396 and consolidating in the range between 0.9416 – 9330.

Despite the optimism over a potential treatment/vaccine for the highly infectious virus, the market risk sentiment remains depressive with Wall Street hugging the sellers and S&P 500 Futures flashing losses amid a combination of factors. Be it the worrisome headlines concerning Brexit or the tension between the US-China, not to forget the coronavirus issues, the market trading sentiment has been flashing red since the week started, which ultimately keeps the safe-haven assets supportive on the day. 

At the coronavirus front, the prevalent worries over the resurgence of the coronavirus pandemic raised fears of global economic recovery, which keeps the market trading sentiment under pressure. The coronavirus COVID-19 cases continue to climb in Europe, U.K., and the U.S. As per the latest report, the U.S. has witnessed its highest ever number of new COVID-19 cases over the weekend, while France is also reporting new case records and Spain announced a state of emergency. As in result, the imposition of stricter lockdown measures to stop the second wave of COVID-19 cases, along with receding hopes for a pre-election fiscal deal also weighed on market trading sentiment.

This, in turn, the broad-based U.S. dollar succeeded to extend its early-day gains and remained well bid on the day as investors turned to the safe-haven in the wake of risk-off market sentiment. However, the gains in the greenback could be temporary due to the worries that the economic recovery in the U.S. could be stopped because of the reappearance of coronavirus cases. Besides this, the gains in the U.S. dollar were further boosted by a lack of progress toward a U.S. stimulus package, which puts traders in a cautious mood. However, the gains in the U.S. dollar kept the currency pair higher. Whereas, the U.S. Dollar Index that tracks the greenback against a basket of other currencies rose to 93.028.

Across the pond, the crude oil prices failed to stop its last week losing streak and remained depressed around below the $38.50 mark. However, the reason for the bearish bias around the crude oil prices could be attributed to the ever-increasing COVID-19 worries, which raised fears of renewed lockdown measures and depressed hopes for a swift recovery in the fuel demand. Across the pond, the anticipation of a rise in Libyan crude supply also played its major role in undermining crude oil. 


Entry Price – Sell 0.9389

Stop Loss – 0.9429

Take Profit – 0.9329

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 Breaking Below Intra-day Support – Brace for Selling!


Entry Price – Sell 123.855

Stop Loss – 124.255

Take Profit – 123.455

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

AUD/USD Breaking Below Upward Channel – Is there a Sell Trade?

The AUD/USD pair was closed at 0.71185 after placing a high of 0.71461 and a low of 0.71025. The AUD/USD pair fell on Monday and gave a bearish candle for the day. The AUD/USD pair struggled to find a direction throughout Monday however it pared to its losses amid the broad-based US dollar strength in late American hours. The risk-averse market sentiment after the rising number of coronavirus cases across the globe and the deadlock over the US stimulus package caused a surge in the greenback due to its safe-haven status.

The AUD/USD pair was closed at 0.71185 after placing a high of 0.71461 and a low of 0.71025. The AUD/USD pair fell on Monday and gave a bearish candle for the day. The AUD/USD pair struggled to find a direction throughout Monday however it pared to its losses amid the broad-based US dollar strength in late American hours. The risk-averse market sentiment after the rising number of coronavirus cases across the globe and the deadlock over the US stimulus package caused a surge in the greenback due to its safe-haven status.

The AUD/USD pair was closed at 0.71185 after placing a high of 0.71461 and a low of 0.71025. The AUD/USD pair fell on Monday and gave a bearish candle for the day. The AUD/USD pair struggled to find a direction throughout Monday however it pared to its losses amid the broad-based US dollar strength in late American hours. The risk-averse market sentiment after the rising number of coronavirus cases across the globe and the deadlock over the US stimulus package caused a surge in the greenback due to its safe-haven status.

The US Dollar Index was up by 0.30% to above 93 levels on Monday that ultimately weighed on AUD/USD pair. The US dollar was gaining on the back of increasing cases of coronavirus from Europe and other nations. Europe was hit hardest by the second wave of coronavirus as most European nations started re-imposing restrictions to curb the effects of the coronavirus crisis.

France reported more than 50,000 cases in a single day over the weekend and introduced a nationwide curfew. Spain also introduces a curfew for six months on Monday along with Italy. The rising number of countries introducing restrictive measures to control the damage of coronavirus raised questions on the economic recovery as the economies were still struggling through the previous effects of lockdowns.

These rising uncertainties increased the appeal for safe-haven that ultimately diminished the risk sentiment in the market and weighed on riskier Aussie that dragged the AUD/USD pair on the downside. On the data front, at 19:00 GMT, the US economic docket released the New Home Sales that dropped to 959K from the expected 1025K and weighed on US dollar that capped further losses in AUD/USD pair on Monday.

The Australian Dollar was also under pressure because of the last week’s latest decision of the Reserve Bank of Australia (RBA) to cut its cash rate to 0.1%, the lowest in history. The bank decided to cut its interest rates to the lowest level as the country was struggling to fight the coronavirus crisis impact on its economy. The strength of Aussie and the local economic downturn after Victoria’s lockdown pushed RBA to cut its cash rates to 0.1%.

As the Australian Dollar was already under pressure, the strength of the US dollar along with the dampened risk sentiment in the market weighed on AUD.USD pair on Monday and dragged its prices below 0.72000 level.

Daily Technical Levels

Support Resistance

0.7118 0.7145

0.7103 0.7157

0.7091 0.7171

Pivot point: 0.7130

The AUD/USD is trading with a selling bias at the 0.7120 level, facing an immediate resistance around the 0.7149 area. Below 0.7149, we may see AUD/USD pair to drop until the next support area of 0.7105 as the MACD and EMA are in support of selling. Checkout a trading plan below… 

Entry Price – Sell 0.71293

Stop Loss – 0.71693

Take Profit – 0.70893

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, October 27 – Top Trade Setups In Forex – C.B. Consumer Confidence in Play! 

On the news side, the eyes will remain on the economic events coming out of the U.S. economy. The Core Durable Goods Orders m/m and Durable Goods Orders m/m are expected to report mixed data that may or may not drive price action in dollar related events. While the C.B. Consumer Confidence will be the major highlight of the day, economists expect a slight movement on consumer confidence from 101.8 to 102.1 that may underpin the U.S. dollar today. 

On the news side, the eyes will remain on the economic events coming out of the U.S. economy. The Core Durable Goods Orders m/m and Durable Goods Orders m/m are expected to report mixed data that may or may not drive price action in dollar related events. While the C.B. Consumer Confidence will be the major highlight of the day, economists expect a slight movement on consumer confidence from 101.8 to 102.1 that may underpin the U.S. dollar today. 

On the news side, the eyes will remain on the economic events coming out of the U.S. economy. The Core Durable Goods Orders m/m and Durable Goods Orders m/m are expected to report mixed data that may or may not drive price action in dollar related events. While the C.B. Consumer Confidence will be the major highlight of the day, economists expect a slight movement on consumer confidence from 101.8 to 102.1 that may underpin the U.S. dollar today. 

Economic Events to Watch Today  

 


 

EUR/USD – Daily Analysis

The EUR/USD pair was closed at 1.18-93 after placing a high of 1.18596 and a low of 1.18031. The EUR/USD pair moved in a bearish trend on Monday and lost most of its previous day gains. The EUR/USD pair fell on Monday amid the strong U.S. dollar and the rising number of coronavirus infections through Europe. The market turned risk-averse and weighed on the riskier EUR/USD pair that reversed its movement on Monday.

The rising number of coronavirus cases in Europe kept the shared currency under bearish pressure at the starting day of the week. Spain declared a state of emergency on Sunday for six-months and imposed a national curfew to control the spread of coronavirus. France has already placed a curfew, and it reported more than 50,000 new infections in a single day. On Monday, Italy also announced a national curfew to curb the coronavirus spread. Germany will reportedly introduce more restrictions later in the week.

On Monday, as the coronavirus situation was out of control in Europe, Germany’s DAX 30 and the Euro Stoxx 50 indexes lost more than 2%, reflecting the risk-off market sentiment that ultimately weighed on EUR/USD pair. Another factor involved in the market’s dismal sentiment was the lack of progress in the U.S. stimulus aid package. The U.S. advisor Larry Kudlow said that talks were slowed but not ended as the chances of a deal before the election were null, but investors were awaiting the post-election stimulus.

On the data front, at 14:00 GMT, the German Ifo Business Climate for October dropped to 92.7 from the projected 93.1 and weighed on single Currency Euro that added in the losses n EUR/USD pair on Monday. At 19:00 GMT, the New Home Sales from the U.S. also declined to 959K against the expected 1025K and weighed on the U.S. dollar that ultimately helped to limit the losses of the EUR/USD pair. The U.S. dollar was strong on Monday as the U.S. Dollar Index was up to 93 levels due to its safe-haven nature. The greenback rose on Monday as the global COVID-19 cases continue to soar and weigh on market sentiment. Furthermore, the rising number of infections in China decreased the appetite of risky assets like EUR/USD pair as the world’s second-largest economy could suffer a setback.

Looking forward, the Euro traders will await tomorrow for the release of the European Central Bank’s Lending Survey, and the U.S. dollar investors will be looking to September’s U.S. Durable Goods Orders report. The fresh developments surrounding the coronavirus outbreak in the continent will also remain under observation by EUR/USD pair’s investors.

Daily Technical Levels

Support Resistance

1.1839      1.1861

1.1828      1.1872

1.1817      1.1882

Pivot point: 1.1850

EUR/USD– Trading Tip

The EUR/USD is trading with a slightly bearish bias at the 1.1836 level, holding mostly below an immediate resistance level of 1.1865 area. Closing of candles below the 1.1866 level may drive selling bias until the 1.1811 level that marks 38.2% Fibonacci retracement level. Continuation of a selling bias may lead the EUR/USD pair further lower until 1.1770, the 50% Fibo level. Conversely, the bullish breakout of the 1.1866 area can open further room for buying until the 1.1910 level today. 

GBP/USD – Daily Analysis

The GBP/USD pair was closed at 1.30230 after placing a high of 1.30749 and a low of 1.29928. The GBP/USD pair dropped and continued its previous bearish trend. The GBP/USD pair extended its losses on Monday and continued its bearish streak for the 4th consecutive day, dropping below 1.3000 level despite the Brexit deal optimism in the market mainly due to the broad-based U.S. dollar strength on the day.

The British Pound held steady against the rising U.S. dollar on Monday and shrugged off the renewed demand for the safe-haven greenback on expectations that the U.K. and the E.U. will eventually reach a Brexit deal after both sides agreed to push out the deadline to reach a consensus.

Last Thursday, Brexit talks were resumed and were extended to comping Wednesday when E.U. Brexit negotiator Michel Barnier is expected to attempt to bridge some of the differences between the U.K. and E.U.

It is also assumed that Barnier’s efforts to clinch a deal could revive hopes that German Chancellor Angela Merkel might be able to persuade French President Emmanuel Macron to ease his stance on one of the key sticking points of fishing rights. The United Kingdom has stressed that it would take control over the access to its waters after the Brexit transition period ends. On the other hand, Macron fears that a softer stance over fisheries will sacrifice the French fishermen.

On the other hand, the optimism on progress this week had been mitigated somewhat following reports that the U.K. was waiting until after the U.S. election to reveal its negotiation strategy as a blue wave could weaken Britain’s negotiation stance. Joe Biden has previously said that a UK-US deal would depend on Britain securing a deal with the E.U. These concerns also weighed on British Pound and GBP/USD. However, the British Prime Minister Boris Johnson said that Brexit and the U.S. election results were entirely separate.

On the data front, at 19:00 GMT, the U.S. economic docket released the report of New Home Sales that dropped to 959K from the anticipated 1025Kand weighed on the U.S. dollar that eventually helped GBP/USD pair in capping further losses. Moreover, the GBP/USD pair’s losses could be attributed to the rising number of coronavirus cases in the U.K. As well as the rising fears of the second wave of coronavirus and its impact globally raised the safe-haven demand for greenback that ultimately added pressure on GBP/USD pair on Monday.

The developments surrounding the U.S. stimulus package also kept the U.S. dollar stronger as the package will not be delivered before the election. The stronger U.S. dollar weighed further on the GBP/USD pair on the day.

Daily Technical Levels

Support Resistance

1.3040      1.3064

1.3028      1.3076

1.3016      1.3088

Pivot point: 1.3052

GBP/USD– Trading Tip

The GBP/USD traded with a selling bias below an immediate resistance area of 1.3075. Below this, Cable has closed a bearish engulfing candle that may drive selling bias until the 1.3013 level. Violation of 1.3013 level can open further room for selling until 1.2965 area, the level that’s extending support due to upward trendline on the 4-hour timeframe. The MACD and RSI are in support of selling bias today. Consider opening sell trades below the 1.3075 level today. 

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 104.866 after placing a high of 105.053 and a low of 104.651. The USD/JPY pair remained bullish on Monday and recovered most of the previous daily losses. The USD/JPY pair rose to its highest level in five days above 105 level on Monday. However, it erased a large portion of its gains on the day during the American session.

The broad-based U.S. dollar strength caused the rise in the USD/JPY pair on the day due to its safe-haven status. The selling pressure surrounding the major European currencies on concerns over the rising number of coronavirus cases in the continent also helped the U.S. dollar outperform its rivals. The U.S. Dollar Index that was dropped 1% last week posted a decisive recovery on the starting day of this week and was up by 0.32% on the day at 93.04.

The rising U.S. dollar Index pushed the USD/JPY pair above the 105 level on Monday. However, investors saw this as a selling opportunity regardless of the U.S. dollar strength, and hence, the pair started losing most of its daily gains in the late trading hours. On the data front, at 04:50 GMT, the SPPI for the year from Japan raised to 1.3% against the forecasted 1.0% and supported the Japanese Yen that capped further gains in the USD/JPY pair on Monday.

At 19:00 GMT, the New Home Sales from the U.S. for September fell to 959K from the forecasted 1025K and weighed on the U.S. dollar that also limited further upside in the USD/JPY pair on the day.

The U.S. dollar was also strong on Monday as the talks for the next round of U.S. stimulus measures were stalled till the election. Both parties were moving forward to reach a consensus over the stimulus aid package’s size, but they delayed the delivery of major measures after the election. This raised the U.S. dollar on board and pushed the USD/JPY pair even higher on Monday. Other than that, the U.S. dollar was also up due to rising demand for its safe-haven nature amid the rising number of coronavirus cases globally. France reported 50,000 new cases in a single day and introduced a curfew to curb the virus’s spread. 

Just like that, many European nations, including Italy and Spain, also introduced curfews and restrictive measures. Germany was set to impose restrictions this week and not only in European nations, but the second wave of coronavirus was also spreading worldwide. These concerns weighed on market risk sentiment and raised demand for the greenback that ultimately added strength to the USD/JPY pair on Monday.

Looking forward, the investors will await the release of Durable Goods Orders and the Conference Board’s Consumer Confidence data that will release on Tuesday.

Daily Technical Levels

Support Resistance

104.18      105.35

103.68      106.00

103.02      106.51

Pivot point: 104.84

USD/JPY – Trading Tips

The oversold USD/JPY pair is taking a bullish turn now, perhaps to complete Fibonacci retracement at 104.900 level. A 38.2% Fibonacci retracement level extends this level, and it may extend resistance to the USD/JPY pair today. Continuation of a bullish bias over the 104.900 level can lead the USD/JPY pair further higher until the 105.225 level. The MACD and RSI are also supporting bullish bis in the USD/JPY pair today. However, the pair seems to have formed a bearish flag on the 4-hour timeframe that typically breakout on the lower side; if that happens, we may see USD/JPY price dropping until the 104.350 mark. Good luck! 

Categories
Forex Signals

USD/CAD Bullish Channel Breakout – Potential Buying Trade! 

The USD/CAD pair was closed at 1.31379 after placing a high of 1.31771 and a low of 131235. The USD/CAD pair remained flat throughout the day as it ended its day at the same level it started its day at 1.31378.

The USD/CAD pair was closed at 1.31379 after placing a high of 1.31771 and a low of 131235. The USD/CAD pair remained flat throughout the day as it ended its day at the same level it started its day at 1.31378.

The USD/CAD pair was closed at 1.31379 after placing a high of 1.31771 and a low of 131235. The USD/CAD pair remained flat throughout the day as it ended its day at the same level it started its day at 1.31378.

The on-again-off-again talks for the US stimulus package between Republicans and Democrats confused the traders and caused a flat movement in the USD/CAD pair on Thursday. The House of Representative Speaker Nancy Pelosi and the US Treasury Secretary Steven Mnuchin held talks on Thursday, but the prospect of a deal before elections were dimmed.

If a deal was reached tomorrow, the stimulus package will still not be implemented until after the election. For US President Trump who has pushed for a larger stimulus, it will be good news, but for Republicans senators who have their election campaigns to worry about, it will be bad news. A massive stimulus spending package before elections will not win many votes among conservative voters. Given this situation, the hopes for a stimulus measure package before elections faded away and raised bars for the US dollar that pushed the pair USD/CAD on the upside.

On the data front, the macroeconomic releases from the US on Thursday were also in favor of the US dollar. At 17:30 GMT, the Unemployment Claims from the US reduced to 787K from the anticipated 860K and supported the US dollar. While at 19:00 GMT, the CB Leading Index dropped to 0.7% from 0.8%of expectations and weighed on the US dollar. The Existing Home Sales from the US also raised to 6.45M from the expected 6.20M and supported the US dollar.

The US dollar was even stronger from the macroeconomic data release and pushed the USD/CAD pair even higher to 1.31771 level on Thursday. Whereas, the USD/CAD pair failed to remain on the bullish side as the crude oil prices rose on Thursday.

The rise in WTI crude oil prices above the $41 level gave strength to commodity-linked Loonie that ultimately weighed on USD/CAD pair, and the pair started to lose its early daily gains and ended its day on the same level it started its day with and the pair gave flat movement for the day.


Daily Technical Levels

Support Resistance

1.3110 1.3167

1.3087 1.3201

1.3052 1.3224

Pivot point: 1.3144

The USD/CAD is trading with a bullish bias, especially after violating the upward channel that was enlarging resistance at 1.3203 level. On the lower side, the USD/CAD may find next support at 1.3203 area, and violation of this mark can drive the Loonie price towards the next support mark of 1.3172. The MACD is in a buying zone; therefore, we should look for a buying trade over 1.3203 level. Good luck!

Categories
Forex Market Analysis

Daily F.X. Analysis, October 26 – Top Trade Setups In Forex – New Home Sales in Play! 

On Monday, the market is likely to exhibit thin trading volume and volatility in the wake of the Labor day holiday in New Zealand, while the other economies are expecting to release low impact events that may keep the market unchanged. Most of the focus will stay on the U.S. New Home Sales data that may help drive some market volatility today. 

On Monday, the market is likely to exhibit thin trading volume and volatility in the wake of the Labor day holiday in New Zealand, while the other economies are expecting to release low impact events that may keep the market unchanged. Most of the focus will stay on the U.S. New Home Sales data that may help drive some market volatility today. 

On Monday, the market is likely to exhibit thin trading volume and volatility in the wake of the Labor day holiday in New Zealand, while the other economies are expecting to release low impact events that may keep the market unchanged. Most of the focus will stay on the U.S. New Home Sales data that may help drive some market volatility today. 

Economic Events to Watch Today  

 

EUR/USD – Daily Analysis

The EUR/USD pair was closed at 1.18562 after placing a high of 1.18646 and a low of 1.17865. The movement of the EUR/USD pair was bullish on Friday. Things in European nations were getting out of control and led the governments to impose further restrictions to curb coronavirus’s effect on the economy. France, Italy, and Spain reported a record rise in the daily infection cases that urged their governments to impose curfews and lockdowns.

However, the single currency managed to remain bullish on Friday despite the rising number of coronavirus cases in Europe as the focus of traders shifted more towards the U.S. dollar. The coronavirus condition in the U.S. was also not better as the country reported a record-high number of 82,668 cases in a single day and weighed on the U.S. dollar that ultimately supported the bullish trend of the EUR/USD pair on Friday.

On the data front, at 12:15 GMT, the French Flash Services PMI for October dropped to 46.5 against the forecasted 47.0 and the previous 47.5 and weighed on Euro. The French Flash Manufacturing PMI came in as 51.0 against the expected 51.3 and previous 51.2. AT 12:30 GMT, the German Flash Manufacturing PMI raised to 58.0 against the expected 55.0 and previous 56.4 and supported the single currency. Simultaneously, the German Flash Services PMI raised to 48.9 against the expected 49.6 and previous 50.6 and weighed on the single currency Euro.

At 13:00 GMT, the Flash Manufacturing PMI from Eurozone for October raised to 54.4 against the projected 53.0 and previous 53.7 and supported the single currency Euro. Whereas the Flash Services PMI from the whole bloc dropped to 46.2 from the anticipated 47.1 and the previous 48.0, it also weighed on the single currency Euro. At 17:59 GMT, the Belgian NBB Business Climate from Europe came in as -8.5 against the forecasted -11.2 and supported the single currency. The Eurozone’s macroeconomic data was mixed and failed to provide any meaningful direction to the currency pair EUR/USD on Friday.

From the U.S. side, at 18:45 GMT, the Flash Manufacturing PMI came in line with the expectations of 53.5 for October. The Flash Services PMI from the U.S. for October advanced to 56.0 from the projected 54.7 and supported the U.S. dollar that ultimately capped further gains in EUR/USD pair.

Another factor that kept the additional gains in EUR/USD pair supported was the improved risk sentiment as President Donald Trump and Democratic Joe Biden took part in the final debate of the presidential election campaign in Nashville, Tennessee. The final debate was far more civilized than the previous one, and it potentially led to an additional tightening in the polls that raised the risk sentiment in the market and supported the EUR/USD pair.

Daily Technical Levels

Support Resistance

1.1796     1.1853

1.1776     1.1888

1.1740     1.1909

Pivot point: 1.1832

EUR/USD– Trading Tip

The EUR/USD is trading with a slightly bearish bias at the 1.1836 level, holding mostly below an immediate resistance level of 1.1865 area. Closing of candles below the 1.1866 level may drive selling bias until the 1.1811 level that marks 38.2% Fibonacci retracement level. Continuation of a selling bias may lead the EUR/USD pair further lower until 1.1770, the 50% Fibo level. Conversely, the bullish breakout of the 1.1866 area can open further room for buying until the 1.1910 level today. 

GBP/USD – Daily Analysis

The GBP/USD pair was closed at 1.30400 after placing a high of 1.31221 and a low of 1.30189. Overall the movement of the GBP/USD pair remained bearish throughout the day. The GBP/USD pair was down on Friday as the U.S. dollar gained traction on board and made GBP/USD pair weak. As well As, the retreat inequity and risk sentiment also hit the Pound that dropped to fresh lows.

Wall Street’s equity prices went lower on Friday and raised the greenback on board that ultimately dragged GBP/USD pair on the downside. The Dow Jones was down by 0.10%, and NASDAQ was down by 0.18%. The expectations for a new round of fiscal stimulus by the U.S. government before elections faded away and supported the U.S. dollar that ultimately weighed on GBP/USD pair.

Meanwhile, the Chief EU Brexit negotiator Michel Barnier will provide his weekly assessment of the talks and could point to a lack of meaningful progress despite intensifying talks. The British Brexit negotiator, David Frost, could also do that, and these concerns kept the British Pound under pressure at the ending day of the week.

However, the cautious optimism was prevailing in the market as the E.U. and U.K. had resumed talks related to the Brexit deal. The French President has said to the local fishing industry to brace for an impact that indicated a close deal. Whereas the investors were still cautious as talks could be bent on either side, British Pound remained under pressure ahead of the talks’ results. Moreover, the rising number of coronavirus cases in the United Kingdom pressured the authorities to impose a new full lockdown; however, some were refusing to do so as it had already cost the economy too much. These tensions in the local country also kept the British Pound under pressure.

On the data front, at 04:01 GMT, the GfK Consumer Confidence from Great Britain dropped to -31 against the expected -28and weighed on British Pound and added losses in GBP/USD pair. At 13:30 GMT, the Flash Manufacturing PMI for October remained flat with the anticipated 53.3, and the Flash Services PMI dropped to 52.3 against the projected 53.4 and weighed on British Pound and pulled the pair GBP/USD even lower.

From the U.S. side, at 18:45 GMT, the Flash Manufacturing PMI came in line with the anticipations of 53.5 for October. The Flash Services PMI from the U.S. for October raised to 56.0 from the expected 54.7 and supported the U.S. dollar that ultimately dragged the GBP/USD pair on the downside on Friday.

Daily Technical Levels

Support Resistance

1.3049     1.3129

1.3021     1.3179

1.2970     1.3208

Pivot point: 1.3100

GBP/USD– Trading Tip

The GBP/USD traded with a selling bias below an immediate resistance area of 1.3075. Below this, the cable has closed a bearish engulfing candle that may drive selling bias until 1.3013 level. Violation of 1.3013 level can open further room for selling until 1.2965 area, the level that’s extending support due to upward trendline on the 4-hour timeframe. The MACD and RSI are in support of selling bias today. Consider opening sell trades below the 1.3075 level today. 

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 104.695 after placing a high of 104.934 and a low of 104.545. The USD/JPY pair moved in a bearish trend throughout Friday. The USD/JPY pair fell on Friday after the final presidential debate between U.S. President Donald Trump and Joe Biden before the November 3rd election.

The Final debate between two presidential candidates took place in Nashville, Tennessee. This final debate was more restrained than the first one. The center of the discussion was on policy rather than a personal attack.

It looked like investors were closing their long positions ahead of the elections and were hesitant to place any big position ahead of November 3 as polls before the final debate turned, so it became difficult to project the outcome of elections.

Investors were also keeping a close eye on the negotiations between House of Representative Speaker Nancy Pelosi and the U.S. Treasury Secretary Steven Mnuchin over the next round of U.S. stimulus package. Pelosi has expressed optimism that a consensus could be reached. In contrast, the expectations that a U.S. stimulus package could be delivered before elections faded away as the date of the election has come closer.

These hopes that a stimulus relief bill could not be delivered ahead of elections, whether both parties agreed on the package’s size as the election was only a week away, supported the U.S. dollar and capped further losses in the USD/JPY pair on Friday.

On the data front, at 04:30 GMT, the National Core CPI from Japan for the year came in as -0.3% against the forecasted -0.4% and supported the Japanese Yen that added in the USD/JPY’s losses. At 05:30 GMT, the Flash Manufacturing PMI dropped to 48.0 from the projected 48.4 and weighed on the Japanese Yen.

Daily Technical Levels

Support Resistance

104.18     105.35

103.68     106.00

103.02     106.51

Pivot point: 104.84

USD/JPY – Trading Tips

The oversold USD/JPY pair is taking a bullish turn now, perhaps to complete Fibonacci retracement at 104.900 level. This level is extended by a 38.2% Fibonacci retracement level, and it may extend resistance to the USD/JPY pair today. Continuation of a bullish bias over the 104.900 level can lead the USD/JPY pair further higher until the 105.225 level. The MACD and RSI are also supporting bullish bis in the USD/JPY pair today. However, the pair seems to have formed a bearish flag on the 4-hour timeframe that typically breakout on the lower side; if that happens, we may see USD/JPY price dropping until the 104.350 mark. Good luck!