Tag: Technical Outlook

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Forex Market Analysis

Daily F.X. Analysis, June 3 – Top Trade Setups In Forex – Brace for Advance NFP Figures! 

On Wednesday, the market is likely to exhibit sharp price actions in the wake of series of high impact economic events such as Final Services PMI, G7 Meeting, ADP Non-farm payroll, and Canadian monetary policy meetings. Most of the price action is expected to be driven by Advance Non-farm payroll figures, which are expected to perform slightly better than the previous month. It can drive buying in the U.S. dollar.

On Wednesday, the market is likely to exhibit sharp price actions in the wake of series of high impact economic events such as Final Services PMI, G7 Meeting, ADP Non-farm payroll, and Canadian monetary policy meetings. Most of the price action is expected to be driven by Advance Non-farm payroll figures, which are expected to perform slightly better than the previous month. It can drive buying in the U.S. dollar.

On Wednesday, the market is likely to exhibit sharp price actions in the wake of series of high impact economic events such as Final Services PMI, G7 Meeting, ADP Non-farm payroll, and Canadian monetary policy meetings. Most of the price action is expected to be driven by Advance Non-farm payroll figures, which are expected to perform slightly better than the previous month. It can drive buying in the U.S. dollar.

Economic Events to Watch Today

 

 

EUR/USD – Daily Analysis

The EUR/USD pair was closed at 1.11687 after placing a high of 1.11958 and a low of 1.11149. Overall the movement of the EUR/USD pair remained bullish throughout the day. The EUR/USD pair extended its bullish rally for the 7th straight day on Tuesday due to risk-on market sentiment and made the risk-sensitive Euro to outperform the U.S. dollar. The pair rose to its highest since mid-march near 1.1196.

At 11:45 GMT, the Budget Balance from the French government was issued, which showed a deficit of 92.1B. AT 12:00 GMT, the Spanish Unemployment Change was decreased to 26.6K from the expected 230.3K and supported Euro, which ultimately raised EUR/USD prices on Tuesday.

The U.S. dollar weakened against its rivals, and the U.S. Dollar Index dropped to its lowest level in12 weeks at 97.43. The weakened U.S. dollar also gave support to EUR/USD gains on Tuesday.

On Wednesday, for Euro traders, the unemployment data will be looked upon for fresh impetus. While on Thursday, the European Central Bank will announce its monetary policy decision, which will be under close watch by the investors. 

It is widely expected that ECB would extend the PEPP program to a total of 1 Trillion euros. If that happens, it would further add in the EUR/USD gains. Furthermore, on Tuesday, the European Commission started a process that could lead to reforms of drug manufacturing pharmaceuticals to limit shortages of vaccines and antibiotics and the availability of medicine more easily.

The move came in after the E.U. faced many difficulties in fighting the COVID-19 pandemic related to the healthcare shortcomings due to dependency of the bloc on foreign supplies of essential drugs and chemicals from India and China.

According to the European Commission, there was a need to build a holistic patient-centered pharmaceutical Strategy that could cover the whole life cycle of pharmaceutical products i,e from its scientific discovery to authorization and patients access.

Daily Support and Resistance

  • R3 1.129
  • R2 1.1243
  • R1 1.1208

Pivot Point 1.1161

  • S1 1.1125
  • S2 1.1079
  • S3 1.1043

EUR/USD– Trading Tip

The bullish bias of the EUR/USD pair continues to drive an upward trend in the market, as it leads to EUR/USD prices to 1.1204. The pair is likely to find immediate support around 1.1150 level, while resistance holds around 1.1236 level. The overall trend is bullish, but we can expect a slight retracement until 1.1180 level before seeing additional buying.

GBP/USD – Daily Analysis

The GBP/USD was closed at 1.25514 after placing a high of 1.25758 and a low of 1.24782. Overall the movement of GBP/USD remained bullish throughout the day. The GBP/USD pair continued its bullish track and rose for the 4th consecutive day on Tuesday and crossed a level of 1.25700 on the back of broad-based U.S. dollar weakness. Another factor in the upward rally of GBP/USD, along with the U.S. dollar weakness, was Pound’s strength due to renewed optimism in Brexit developments.

According to Brussels sources reported in The Times, U.K. was expected to signal compromises on fisheries and some trade rules if the E.U. agreed to back down from its demand for regulatory alignment and fishing access.

After this statement came into the market, the demand for British Pound increased, which raised the bars for GBP/USD pair across the board. However, the rally was on its way to posting remarkable gains but was dragged down after U.K.’s Prime Minister dismissed the report for compromising on key sticking points that have paused the progress in the post-Brexit deal.

The U.K. rather expressed its desire to take control over access to its waters and fish after the transition period ends. U.K. showed disagreement to stick with the E.U.’s Common Fisheries Policy in which fishing quotas for E.U. member states are fixed.

The official spokesman of Prime Minister Boris Johnson said that the reports suggesting that the U.K. was ready to compromise on fishing and its waters were only “wishful thinking by E.U.” The remarks added to the growing concerns over the lack of progress on negotiations. The final round of detailed negotiations took effect from today, and results will be under close observation by British Pound traders. It should be noted that if both parties failed to secure a deal or agree on a point, it would demand an extension in the transition period. But Johnson has promised not to extend this period, which will lead to no-deal Brexit.

Boris Johnson has suggested the country would accept a no-deal Brexit if London and Brussels failed to agree on new trade rules by December 31.

On the economic data front, at 11; 00 GMT, the Nationwide HPI dropped to -1.7% against the expected drop by-1.0%. 

At 13:30 GMT, the Mortgage Approvals from the U.K. came in as 16K against the expected 34K and weighed on Pound. The Net Lending to Individuals came in negative as -6.9B against the expected 1.7B. A sharp fall in U.K. Mortgage approvals in April and House price suffering kept a lid on additional gains of GBP/USD.

Daily Support and Resistance

  • R3 1.2691
  • R2 1.2634
  • R1 1.2592

Pivot Point 1.2535

  • S1 1.2493
  • S2 1.2436
  • S3 1.2395

GBP/USD– Trading Tip

The GBP/USD continues trading bullish as it has violated the double top resistance area around 1.2545 level, and now it’s testing the upward channel, which extends resistance around 1.2603. Bullish crossover of 1.2603 level is now likely to extend the buying trend until 1.2690. While the support level stays at 1.2550 today. On the 4-hour timeframe, the 50 EMA is suggesting bullish bias, and now the MACD is suggesting buying trend in the GBP/USD pair as the histograms are forming above zero levels. Consider taking buying trades over 1.2605 and selling below the same level today.

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 108.675 after placing a high of 108.770 and a low of 107.512. Overall the movement of USD/JPY remained bullish throughout the day. The pair USD/JPY moved beyond 108.00 level and extended its gains to the fresh seven weeks high of 108.77. The increased risk appetite caused the upbeat movement of USD/JPY after the easing of lockdown measures from across the globe, which raised optimism about the quick economic recovery.

Despite the broad-based U.S. dollar weakness, the pair USD/JPY took its pace on the upside due to underpinned demand for safe-haven Japanese Yen in the risk-on market sentiment. On the other hand, the U.S. Dollar Index, which measures the value of the U.S. dollar against the basket of six currencies, fell 0.30% around 97.5 level on Tuesday.

President Donald Trump vowed to use military action against the increasing protests near the White House, which raised fears for even more disruptive economy of the United States. The protests were against the killing of an unarmed black man George Floyd in police custody two weeks ago. Other than that, China halted the purchases of U.S. Soybeans and pork on Tuesday against U.S. decision to revoke the special status of Hong Kong, which increased the ongoing tensions between the world’s two largest economies. China’s move could also lead towards the cancellation of phase one trade deal, which both parties signed in January.

On the data front, there was no economic report released by the United States on Tuesday, which left the pair at the mercy of market risk sentiment, which eventually drove the pair to 7 weeks’ highest level.

However, on Japan front, at 4:50 GMT, the Monetary Base for the year from Japan was increased to 3.9% from the forecasted 2.6% and supported the Japanese Yen. Traders will be waiting for the U.S. response against the move by China to halting the purchases of U.S. agricultural goods.

Daily Support and Resistance    

  • R3 108.33
  • R2 108.1
  • R1 107.84

Pivot Point 107.61

  • S1 107.36
  • S2 107.12
  • S3 106.87

USD/JPY – Trading Tips

The USD/JPY bullish bias violated the series of resistance levels to lead the USD/JPY currency pair towards 108.770 level. The closings of bullish engulfing and three white soldiers candlestick patterns are likely to drive further buying until 109.125 level today. On the 4 hour timeframe, the USD/JPY pair has crossed over 50 EMA and has closed a few candles above resistance become support area of 108.350, which is supporting bullish bias among traders. The USD/JPY pair may find support at 108.350 and resistance at 109.125 level while the breakout of this range will determine the next trend in the pair. Today let’s consider buying over 108.35. All the best for today! 

 

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Forex Market Analysis

Daily F.X. Analysis, June 2 – Top Trade Setups In Forex – Risk Sentiment Remains Mixed!

The U.S. dollar after this lost demand in the market and Wall Street’s main indexes started to move in positive territory. The U.S. Dollar Index dropped below 98, which further pushed the rising prices of EUR/USD pair on Monday.

The U.S. dollar after this lost demand in the market and Wall Street’s main indexes started to move in positive territory. The U.S. Dollar Index dropped below 98, which further pushed the rising prices of EUR/USD pair on Monday.

The U.S. dollar after this lost demand in the market and Wall Street’s main indexes started to move in positive territory. The U.S. Dollar Index dropped below 98, which further pushed the rising prices of EUR/USD pair on Monday.

On the news side, the economic calendar isn’t likely to have any high impact on economic events. Therefore, the market will wait for ADP figures tomorrow and NFP figures by the end of the week.

Economic Events to Watch Today

 

 

EUR/USD – Daily Analysis

The EUR/USD pair was closed at 1.11337 after placing a high of 1.11539 and a low of 1.11003. Overall the movement of the EUR/USD pair remained bullish throughout the day. On Monday, the EUR/USD pair rose for the 6th consecutive day, extended its previous day gains, and moved above 1.11500 level, which was highest since March 17.

Most major European markets were closed due to Whit Monday, which limited the trading activity for a large part of the day. Data from the United States showed that ISM Manufacturing PMI in May came in worse than expectations and weighed on the U.S. dollar. The ISM Manufacturing PMI was expected to rise by 43.6pints, but instead, it came as 43.1.

The U.S. dollar after this lost demand in the market and Wall Street’s main indexes started to move in positive territory. The U.S. Dollar Index dropped below 98, which further pushed the rising prices of EUR/USD pair on Monday.

The European Commission has approved Latvia’s support program to support tourism operators worth 800,000 euros. The tourism operators cover travelers’ repatriation costs in the context of the coronavirus outbreak. The Latvia support program was approved on March 19 and was amended on April 3 and May 8.

Furthermore, the European Commission also launched a dialogue initiative with the financial sector. The first roundtable meeting between the European Commission and the European financial sector, including business and consumer representatives, has launched. This meeting was conducted to find out the best practices to support E.U. citizens & businesses.

At the data front, at 12:15 GMT, the Spanish Manufacturing PMI came in line with the expectations of 38.3. The Italian Manufacturing PMI at 12:45 GMT exceeded the expectations of 35.5 and came in as 45.4.

Daily Support and Resistance

  • R3 1.122
  • R2 1.1187
  • R1 1.1161

Pivot Point 1.1128

  • S1 1.1101
  • S2 1.1069
  • S3 1.1042

EUR/USD– Trading Tip

The bullish bias of the EUR/USD continues to prevail in the market as the EUR/USD is heading north towards the next target level of 1.1150 level. A bullish breakout of 1.1150 level may lead the pair towards 1.1220 level today while support holds around 1.1080 level. Bullish bias seems dominant today. Consider taking buying trades over 1.1140 level to target 1.1199. 

GBP/USD – Daily Analysis

The GBP/USD was closed at 1.24884 after placing a high of 1.25064 and a low of 1.23236. Overall the movement of GBP/USD pair remained bullish throughout the day. The British Pound rose to near one month high against the U.S. dollar on Monday, ahead of Brexit talks, which are scheduled on Tuesday. Market participants are cautious and fear that the U.K. and E.U. might fail to make progress on upcoming trade talks. Sterling rose above 1.2500 level, which is its highest since May 5.

The chances for any real progress in negotiations between the E.U. and U.K. are very low, and that is why GBP/USD was raised on Monday on the back of increased risk sentiment. Time for agreeing to extend the transition period by June 30 deadline is running out when the U.K. had already denied extending the transition period, the risk for no-deal Brexit increased and made investors cautious.

Market participants are buying Sterling with hope for failure in the next round of talks and catching big moves on Tuesday, and this large buying on Monday gave a push to GBP/USD pair. No-deal Brexit would further harm the already disturbed economy of Great Britain due to the coronavirus crisis, and it would make the recovery even more difficult.

Some market participants think that the increased economic growth concerns have made Britain’s bargaining power a little less, and they are waiting to place any big move. 

On the data front, at 13:30 GMT, The Final Manufacturing PMI from Britain in the month of May came in line with the expectations of 40.7. The U.S. dollar was weak across the board due to the poor-than-expected ISM Manufacturing PMI release, which came in short of expected 43.5 as 43.1 and weighed on the U.S. dollar. The weak U.S. dollar further added in the upward trend of GBP/USD on Monday.

Daily Support and Resistance

  • R3 1.2744
  • R2 1.2626
  • R1 1.256

Pivot Point 1.2441

  • S1 1.2375
  • S2 1.2256
  • S3 1.219

GBP/USD– Trading Tip

The GBP/USD continues trading bullish as it has violated the double top resistance area around 1.2545 level. Bullish crossover of this level is now likely to extend the buying trend until 1.2600, but on the way, the upward channel’s upward trendline is expected to provide resistance around 1.2560, while the support level stays at 1.2480 today. On the 4-hour timeframe, the 50 EMA is suggesting bullish bias, and now the MACD is suggesting buying trend in the GBP/USD pair as the histograms are forming above zero levels. Consider taking buying trades over 1.2510 and selling below the same level today.

USD/JPY – Daily Analysis

The USD/JPY was closed at 107.587 after placing a high of 107.855 and a low of 107.376. Overall the movement of USD/JPY remained bearish throughout the day. The pair USD/JPY started its week on the back foot as the U.S. dollar faced pressure due to increased protests across the U.S. The U.S. Dollar Index extended its losses and moved below the handle of 98.

Thousands of protesters came out to the streets of cities around the U.S. despite curfew orders on Monday. The protests were against the killing of George Floyd, a black man in police custody. Angry protests continued nationwide a week after George Floyd’s death. Reports of looting, destruction, and firing came in from across the cities. On Monday, police used tear gas to clear a path for Donald Trump to visit a damaged church. Thousands of arrests have been made, and five deaths and millions of dollars in property damage were reported, which made investors sell the U.S. dollar, and hence, the U.S. dollar became weak across the board.

On the US-China front, the news conference of Donald Trump failed to entertain the hopes of new sanctions on China on Friday. Trump refrained from imposing new sanctions on China against the new security law on Hong Kong rather than announced to halt the U.S. relationship with WHO.

The threats of revoking phase-one trade deal, which was signed in January, are increasing day by day with the increasing tensions between China & the United States.

On the data front, at 4:50 GMT, the Capital Spending for the quarter from Japan was increased by 4.3% against the declined forecast of 5.1% and gave strength to JPY. At 5:30 GMT, the Final Manufacturing PMI for May came in line with the expectations of 38.4 from Japan. The stronger than expected data from Japan gave strength to the Japanese Yen and added in the downward pressure of the USD/JPY pair.

At 18:45 GMT, the Final Manufacturing PMI for May came in line with the expectations of 39.8. At 19:00 GMT, the closely watched ISM Manufacturing PMI fell short of expected 43.5 and released as 43.1 and weighed on the U.S. dollar.

The Construction Spending for the month fell less than expected -6.5% as -2.9% and supported the U.S. dollar. The ISM Manufacturing Prices rose to 40.8against the 40.0 of expectations and supported the U.S. dollar.

The closely watched and long-awaited ISM Manufacturing PMI fell short of expectations and weighed on the U.S. dollar resulted in a downward trend of USD/JPY at the starting day of the week.

Daily Support and Resistance    

  • R3 108.33
  • R2 108.1
  • R1 107.84

Pivot Point 107.61

  • S1 107.36
  • S2 107.12
  • S3 106.87

USD/JPY – Trading Tips

On Tuesday, the USD/JPY pair continues to trade sideways, maintaining the same trading range of 107.950 – 107.400. On the 4 hour timeframe, the USD/JPY pair has crossed below 50 EMA and has also formed a bearish engulfing candle supporting bullish bias among traders. The USD/JPY pair may find support at 107.425 and resistance at 107.900 level while the breakout of this range will determine the next trend in the pair. Today let’s consider buying over 107.400 and resistance around 107.900. All the best for today! 

 

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Forex Market Analysis

Daily F.X. Analysis, June 01 – Top Trade Setups In Forex – ISM Manufacturing PMI In Highlights

On Monday, the fundamentals side is likely to drive no major movement during the European session. Still, the U.S. session may offer some price action on the release of ISM manufacturing PMI figures today.

On Monday, the fundamentals side is likely to drive no major movement during the European session. Still, the U.S. session may offer some price action on the release of ISM manufacturing PMI figures today.

On Monday, the fundamentals side is likely to drive no major movement during the European session. Still, the U.S. session may offer some price action on the release of ISM manufacturing PMI figures today.

Economic Events to Watch Today

 

EUR/USD – Daily Analysis

The EUR/USD pair was closed at 1.11032 after placing a high of 1.11450 and a low of 1.10676. Overall the movement of the EUR/USD pair remained bullish throughout the day. The EUR/USD continued its previous trend and finally crossed above 1.11 level on Friday and rose for the 5th consecutive day this week. The pair showed the longest run since late March at the end of this week on the back of Euro’s strength.

At 11:00 GMT, the German Import Prices for April were released as -1.8% against the -1.5% forecasted and weighed on Euro. The German Retail Sales dropped less than expected 12% as5.3% in April and supported single currency Euro. At 11:45 GMT, the French Consumer Spending for April was declined by 20.2% against the forecasted 14.5% and weighed on Euro. The French Prelim CPI for May dropped by0.05 from the expected drop of 0.1% and weighed on Euro.

However, the French Prelim GDP for the quarter dropped less than the expectations of 5.8% decline and came in as 5.3% and supported shared currency Euro. At 13:00GMT, the M3 Money Supply for the whole bloc surged to 8.3% from the forecasted 8.1% and supported Euro.

The Private Loans from the whole bloc for the year dropped to 3.0%from the forecasted 3.5%. At 14:00 GMT, the CPI Flash estimate for the year for the whole Eurozone came in line with the expectations of 0.1%.  

However, the Core CLPI Flash estimate of the whole bloc for the year increased to 0.9% from the expected 08% and supported Euro. The Italian CPI for May came in line with the expectations of -0.1%.

Better than expected GDP and CPI data from Eurozone gave strength to the Euro against the U.S. dollar and supported the upward trend of EUR/USD pair on Friday.

On the other hand, the United States’ economic data was gloomy and weighed on the U.S. dollar, which added in the upward movement of EUR/USD pair. At 17:30 GMT, the Core PCE Price Index for April was dropped more than the expected -0.3% as -0.4% and weighed on the U.S. dollar. Personal Spending also declined more than expectations of 12.6% decline as 13.6% in April and weighed on the U.S. dollar. The Goods Trade Balance for April showed a deficit of 69.7B against the forecasted deficit of 64.8B and weighed on the U.S. dollar. The Prelim Wholesale Inventories for April surged to 0.4% from the expected -0.5% and added in U.S. dollar weakness.

The Chicago PMI at 18:45 GMT came in as 32.3 points against 40.1 of expectations and weighed the U.S. dollar. The Revised Consumer Sentiment from the University of Michigan for May dropped to 72.3 from the expected 73.7 and weighed on the U.S. dollar. The Revised Inflation Expectations from the University of Michigan for May were reported as 3.2% from the previous 3.0%.


Daily Support and Resistance

  • R3 1.1158
  • R2 1.1141
  • R1 1.1129

Pivot Point 1.1113

  • S1 1.1101
  • S2 1.1085
  • S3 1.1073

EUR/USD– Trading Tip

The bullish bias of the EUR/USD continues to prevail in the market as the EUR/USD is heading north towards the next target level of 1.1150 level. A bullish breakout of 1.1150 level may lead the pair towards 1.1220 level today while support holds around 1.1080 level. Bullish bias seems dominant today. Consider taking buying trades over 1.1140 level to target 1.1199. 

GBP/USD – Daily Analysis

The GBP/USD pair was closed at 1.23459 after placing a high of1.23940 and a low of 1.22902. Overall the movement of GBP/USD pair remained bullish throughout the day. The pair GBP/USD reached above its two-week high level on Friday near 1.2400 level but could not stay there and dropped back to 1.2300 level. The drop in sterling was caused by the awaiting speech of U.S. President Donald Trump.

Sterling started its day on firm tone and extended its previous day’s gains on the back of broad-based U.S. dollar weakness due to poor than expected U.S. economic data release. The decline in U.S. Treasury bond yields also added to the fault of the U.S. dollar. The Chicago PMI for May dropped to 32.3 from the expected 40.1 and weighed on the U.S. dollar. The Revised Consumer Sentiment from the University of Michigan for May also dropped to 72.3 against the expected 73.7 and added negative pressure on USD.

Other than economic data, the comments from Fed Chair Jerome Powell also exerted pressure on the U.S. dollar. Powell said that the U.S. economy had crossed many red lines that had never crossed before. He also stated that the Fed was launching Main Street Lending Program, which had not used since the Great Depression. After these comments, the GBP/USD pair started to move upward.

Investors became cautious before U.S. President Donald Trump’s speech on Friday and started selling Sterling, who made the pair lose its early daily gains. However, after his speech, the pair continued its bullish trend and ended its day with a bullish candle. The heat between China and the United States was enhanced after the strong response from U.S. President Donald Trump over the new security bill in Hong Kong by China, which was highly awaited as Trump had announced it before earlier this week.

Daily Support and Resistance

  • R3 1.2388
  • R2 1.2371
  • R1 1.2358

Pivot Point 1.2341

  • S1 1.2328
  • S2 1.2311
  • S3 1.2298

GBP/USD– Trading Tip

The GBP/USD continues trading bullish as it has violated the double top resistance area around 1.2364 level. Bullish crossover of this level is now likely to extend the buying trend until 1.2458, but on the way, the upward channel’s upward trendline is likely to provide resistance around 1.2410, while the support level stays at 1.2370 today. 

On the 4-hour timeframe, the 50 EMA is suggesting bullish bias, and now the MACD is suggesting buying trend in the GBP/USD pair as the histograms are forming above zero levels. Consider taking buying trades over 1.2370 and selling below the same level today.

USD/JPY – Daily Analysis

The USD/JPY was closed at 107.767 after placing a high of 107.894 and a low of 107.077. Overall the movement of USD/JPY remained bullish throughout the day. At 4:30 GMT, the Tokyo Core CPI for the year came in as 0.2% against -0.2% and supported the Japanese Yen. The Unemployment Rate from Japan also decreased in April to2.6% from the expectations of 2.7% and supported Yen.

However, the Prelim Industrial Production for April dropped by 9.1% against the expected drop of 5.5% and weighed on Yen at 4:50 GMT. The Retail Sales for the year from Japan also dropped by 13.7% against the expected drop of 11.2% and weighed on Yen. At 10:00 GMT, the Housing Starts for the year dropped by 12.9% against the drop of 12% expected and weighed on Yen. At 10:02 GMT, the Consumer Confidence for April increased to 24.0 from the expected 213 and supported Yen.

The increased confidence in Japan’s economy and better than expected CPI and Unemployment Rate supported Yen and made it stronger against the U.S. dollar, which dragged the USD/JPY currency pair in earlier Asian trading session on Friday.

 The pair dropped to its two weeks lowest level on Friday at 107.077 on the back of increased demand for safe-haven Yen amid escalating tensions between the U.S. and China. On Friday, the President of the United States, Donald Trump announced to revoke its relationship with WHO due to its mishandling of coronavirus pandemic. The U.S. had warned the WHO to be independent of China, change its reforms, and give it 30 days to do so. However, when on Friday, 30 days ended, and no response came back from WHO, the U.S. declared to end its relationship with it.

Trump said that the U.S.’s funds to transfer to WHO will be given to more deserving other nations where urgent help will be required. The decision came in after China issued and passed a new security bill on Hong Kong, and the U.S. said that it would retaliate.

Continue reading “Daily F.X. Analysis, June 01 – Top Trade Setups In Forex – ISM Manufacturing PMI In Highlights”
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Daily F.X. Analysis, May 29 – Top Trade Setups In Forex – Fed Chair Powell Speech in Focus! 

The European Commission will post May CPI (+0.1% on-year expected). The European Central Bank will publish the eurozone’s M3 money supply in April (+8.2% on-year expected). The German Federal Statistical Office will report April retail sales (-12.0% on month expected). France’s INSEE will release final readings of 1Q GDP (-5.4% on year expected) and May CPI (+0.3% on-year expected). The U.S. Commerce Department will post April wholesale inventories (-0.7% on month expected), advance goods trade balance (65 billion dollars deficit expected), personal spending (-12.8% on month expected), and personal income (-6.0% on month expected). The Market News International will release May Chicago PMI (40.0 expected). The University of Michigan will report its final data of the May Consumer Sentiment Index (74.0 expected).

The European Commission will post May CPI (+0.1% on-year expected). The European Central Bank will publish the eurozone’s M3 money supply in April (+8.2% on-year expected). The German Federal Statistical Office will report April retail sales (-12.0% on month expected). France’s INSEE will release final readings of 1Q GDP (-5.4% on year expected) and May CPI (+0.3% on-year expected). The U.S. Commerce Department will post April wholesale inventories (-0.7% on month expected), advance goods trade balance (65 billion dollars deficit expected), personal spending (-12.8% on month expected), and personal income (-6.0% on month expected). The Market News International will release May Chicago PMI (40.0 expected). The University of Michigan will report its final data of the May Consumer Sentiment Index (74.0 expected).

The European Commission will post May CPI (+0.1% on-year expected). The European Central Bank will publish the eurozone’s M3 money supply in April (+8.2% on-year expected). The German Federal Statistical Office will report April retail sales (-12.0% on month expected). France’s INSEE will release final readings of 1Q GDP (-5.4% on year expected) and May CPI (+0.3% on-year expected). The U.S. Commerce Department will post April wholesale inventories (-0.7% on month expected), advance goods trade balance (65 billion dollars deficit expected), personal spending (-12.8% on month expected), and personal income (-6.0% on month expected). The Market News International will release May Chicago PMI (40.0 expected). The University of Michigan will report its final data of the May Consumer Sentiment Index (74.0 expected).

Economic Events to Watch Today

 

EUR/USD – Daily Analysis

The EUR/USD pair was closed at 1.10771 after placing a high of 1.10934 and a low of 1.09915. Overall the movement of the EUR/USD pair remained bullish throughout the day.

The EUR/USD pair continued its bullish streak for the 4th consecutive day on Thursday and rose near 1.1100level, highest since March 30. On Wednesday, the European Commission proposed an additional $18.2Billion for the European Union’s foreign spending as part of its COVID-19 recovery package. The proposed package gave relief to NGOs that had feared further rate cuts.

This proposal by the European Commission must be approved by E.U. states and would allocate 86 billion euros to the bloc’s development for 2021-2027. The additional resources would be drawn from the 750 billion euro recovery fund, which was also announced on Wednesday, which will be raised by borrowing on financial markets.

On the data front, the German Preliminary Consumer Price Index for May declined by -0.1% against the expected 0.1% and weighed on single currency Euro. While at 12:00 GMT, the Spanish Flash Consumer Price Index for the year came in line with the expectations of -1.0%.

The European Commission indicated that the Consumer Confidence Index in Eurozone edged higher to -18.8 from -22. Still, the Business Climate Index fell to -2.43 from -1.99 and stopped the shared currency from gathering strength against its rivals.

However, the risk-on market sentiment of the market continued to support the EUR/USD pair and weighing on the U.S. dollar. The potential coronavirus vaccines, reopening of economies across the globe, and potential risk for the second wave of corona kept the risk appetite in the market and continued weighing on the U.S. dollar. The weakness of the U.S. dollar gave a push to EUR/USD pair.

On American economic docket, the poor than expected data also kept the U.S. dollar under pressure on Thursday. The jobless claims from the United States for last week rose to 2.123M from the expected 2.1M and weighed on the U.S. dollar. At 19:00 GMT, the Pending Home Sales for April dropped more than expectations and weighed on the U.S. dollar. The actual figure came in as -21.8% against the expected -15%. The closely watched Prelim GDP for the quarter from the United States also weighed on the U.S. dollar when it was released as -5.0% against the expected -4.8%. The EUR/USD pair rose to its 12 weeks highest level on the back of broad-based U.S. dollar weakness on Thursday.

Daily Support and Resistance

  • R3 1.122
  • R2 1.1157
  • R1 1.1117

Pivot Point 1.1054

  • S1 1.1014
  • S2 1.0951
  • S3 1.0911

EUR/USD– Trading Tip

The bullish bias of the EUR/USD continues to prevail in the market as the EUR/USD is heading north towards the next target level of 1.1150 level. The pair have already violated the triple top resistance level of 1.09985, and bullish crossover of 1.1146 level may lead the EUR/USD prices further higher towards 1.12118 level. The closing of three white soldiers in the daily timeframe is also supporting an upward trend in the market.

GBP/USD – Daily Analysis

The GBP/USD pair was closed at 1.23222 after placing a high of 1.23443 and a low of 1.22336. Overall the movement of GBP/USD pair remained bullish throughout the day.

According to the policymaker of Bank of England, Michael Saunders, easing too much rather than easing a little by Bank of England was easier in response to the coronavirus pandemic. He said that the U.K. was at risk of relatively slow recovery than other countries from the coronavirus crisis, and it could prove damaging to the U.K.’s economy.

On Thursday, Saunders added that if Bank of England failed to add more stimulus measures in the economy, than it could slip the economy into an “inflation trap.” Saunders was one of two policymakers of BoE that wanted an expansion inn asset purchases in May. While the other majority wanted to wait, though accepted, more stimulus would be required.

The first speech of Saunders after COVID-19 was encouraging the central bank to cut interest rates to a record low of 0.1%, increase the bond-buying, and boost the capital. However, in response to his speech, British Pound came under pressure on Thursday and fell by 0.2%. On the other hand, the U.S. dollar also remained weak during the day because of risk-on market sentiment along with the poor economic data. The broad-based U.S. dollar weakness overshadowed the drop in GBP and raised the GBP/USD pair.

The closely watched Prelim GDP for the second quarter from the United States was dropped by -5.90% against the expected drop by -4.8% and weighed on the U.S. dollar. At 17:30 GMT, the Unemployment Claims from last weeks also reported higher than expectations of 2100K as 2123K and weighed on the U.S. dollar. At 19:00 GMT, the Pending Home Sales for April also declined by 21.8% against the expected decline by 15%.

Despite reopening all 50 states from coronavirus induced lockdowns, unemployment claims still showed higher than expected figures, which resulted in the broad-based U.S. dollar weakness on Thursday.

On Brexit front, the final round of talks between the U.K. & E.U. before a summit in June will be held next week. Because of the last negotiations that went bad after the exchange of letters between the British negotiator, David Frost, and his E.U. counterpart, Michel Barnier, the hopes for the success of final round talks have decreased. This has raised the bars for no-deal Brexit possibility.

U.K. Prime Minister, Boris Johnson will travel to Brussels for talks with European leaders next month to attempt to revive the negotiations. The two sides were still far apart on fisheries, and the U.K. has said that it would abandon the talks if “shape of a deal” has not emerged by the end of June. The U.K. traders will keep an eye onus data and Brexit updates for further actions.

Daily Support and Resistance

  • R3 1.259
  • R2 1.2477
  • R1 1.2405

Pivot Point 1.2292

  • S1 1.222
  • S2 1.2107
  • S3 1.2035

GBP/USD– Trading Tip

On Friday, the GBP/USD is trading with a slightly bullish bias, facing a double top resistance area around 1.2364 level. Bullish crossover of this level may extend the buying trend until 1.2458. On the 4-hour timeframe, the 50 EMA is suggesting bullish bias, and now the MACD is suggesting buying trend in the GBP/USD pair as the histograms are forming above zero levels. 

Today, the Sterling may find immediate support around 1.2245 levels along with resistance at 1.2360 while the closing of candles above the 1.2360 level may drive buying until 1.2450 level. The violation of support is likely to push the cable further lower until 1.2160 level. Consider taking buying trades over 1.2162 and selling below the same level today.

USD/JPY – Daily Analysis

The USD/JPY currency pair extended its previous 2-days winning streak. They rose to 107.90 marks mainly due to the risk-on market sentiment, which undermined the Japanese yen’s safe-haven demand and exerted some bullish impact on the currency pair. On the other hand, the broad-based U.S. dollar weakness turned out to be one of the main factors that kept a lid on any additional gains in the pair. At this particular time, the USD/JPY currency pair is currently trading at 107.83 and consolidating in the range between 107.69 and 107.91.

However, the reason for the upbeat market sentiment could be attributed to the recent optimism about a possible COVID-19 vaccine and hopes of a global economic recovery, which eventually sent the currency pair higher.

Despite the bullish trend in the currency pair, the USD/JPY pair held well within a near two-week-old trading range. The reason behind the confined trading range could be the escalating tensions between the U.S. and China relations, which kept investors cautious about placing any strong position.

The intensifying tension between the United States and China was further bolstered by the U.S. Secretary of State Mike Pompeo’s statement in which he denied Hong Kong’s special status and said that it was no longer autonomous from China. 

At the USD front, the broad-based U.S. dollar erased its previous day gains and slipped 0.16% to 98.900 on the day due to the rise in Asian shares and U.S. stock futures, which eventually limited the additional gains in the pair. Whereas, The U.S. Dollar Index that tracks the greenback against a basket of other currencies dropped 0.16% to 98.900 by 11:26 AM ET (4:26 GMT). 

Daily Support and Resistance    

  • R3 108.39
  • R2 108.16
  • R1 107.86

Pivot Point 107.63

  • S1 107.33
  • S2 107.1
  • S3 106.79

USD/JPY – Trading Tips

The safe-haven Japanese yen continues to gain bullish momentum in the wake of increased safe-haven appeal for JPY, and it’s dragging the USD/JPY pair lower at 107.120. The odds of selling in pair remains strong as the pair is likely to drop towards the next support level of 106.850. The recent strong selling candle also suggests odds of further selling in the USD/JPY pair today. 

All the best for today! 

Categories
Forex Market Analysis

Daily F.X. Analysis, May 28 – Top Trade Setups In Forex – Prelim GDP In Highlights!  

On the news front, the U.S. GDP figures will remain the main highlight of the day. It’s expected to be weak, which may drive weakness in the U.S. dollar. The durable goods orders are also likely to come out during the U.S. session and may drive bullish bias in gold and bearish trend in USD.

On the news front, the U.S. GDP figures will remain the main highlight of the day. It’s expected to be weak, which may drive weakness in the U.S. dollar. The durable goods orders are also likely to come out during the U.S. session and may drive bullish bias in gold and bearish trend in USD.

On the news front, the U.S. GDP figures will remain the main highlight of the day. It’s expected to be weak, which may drive weakness in the U.S. dollar. The durable goods orders are also likely to come out during the U.S. session and may drive bullish bias in gold and bearish trend in USD.

Economic Events to Watch Today

 

 

 

EUR/USD – Daily Analysis

The EUR/USD pair was closed at 1.10090 after placing a high of 1.10307 and a low of 1.09337. Overall the movement of the EUR/USD pair remained bullish throughout the day. The EUR/USD pair followed its previous day’s move and posted gains on Wednesday for the 3rd consecutive day on the back of new plans of European Union to borrow 750 billion euro to aid economic recovery. The pair EUR/USD climbed to its highest level of 1.10307 since early April on Wednesday.

The European Union unveiled its plans for a 750 billion euros recovery fund, which would help the region to face the worst economic crisis since the 1930s. The total of 750 billion euros includes 500 billion euros in grant and 250 billion euros in loans to member states. However, this plan still requires the backing of all 27 member states, which is more than the Franco-German proposal worth 500 billion euros that was revealed last week.

If member states approve the proposal, some funds will take effect from 2020, but the most significant portion of the proposal would come next year when the first bonds were issued. However, some market participants raised concerns about the lack of details on how the bonds issued will finance the funds.

The proposal was announced ahead of the European Central Bank’s monetary policy meeting, which is due next week, which will provide the bloc’s economic outlook in coronavirus crisis. The proposal lifted the demand for a single currency across the board and supported EUR/USD prices.

Furthermore, on Wednesday, the President of European Central Bank, Christine Lagarde, said that the 19 member euro area economy would likely contract by 8%-12% this year. She said that the previously estimated contraction in the Eurozone economy was recorded as 5%, which has probably become outdated now. She added that Eurozone might be somewhere between medium and severe scenarios.

In April, ECB estimated that the euro area’s GDP could fall by between 5% and 12% in 2020 due to the coronavirus pandemic, which had medium scenario as 8% contraction. This was depended on the duration of containment measures and the effectiveness of policies and measures to diminish the crisis.

Lagarde also announced that European Central Bank would soon publish a fresh forecast about GDP in early June. On the other and, U.S. dollar faced some pressure on Wednesday, and after dropping to its lowest level in 23 days at 98.72, the U.S. dollar Index raised beyond 99.00 and settled there in late session.

The U.S. economic data showed that the Richmond Fed Manufacturing Index advanced to -27 in May from -53 of April and beat the market expectations of-47. This supported the U.S. dollar across the board ad limited the EUR/USD pair’s gains on Wednesday.

Daily Support and Resistance

  • R3 1.1126
  • R2 1.1061
  • R1 1.1021

Pivot Point 1.0956

  • S1 1.0915
  • S2 1.0851
  • S3 1.081

EUR/USD– Trading Tip

The EUR/USD pair continued to exhibit bullish bias, having violated the triple top resistance level of 1.1004 level. Bullish crossover of the triple top-level is likely to drive more buying in the pair. On the higher side, the EUR/USD prices may head further towards 1.1056 resistance while the next resistance holds around 1.1139. The EUR/USD pair may find immediate support at 1.0995 and 1.0975 level.

GBP/USD – Daily Analysis

The GBP/USD pair was closed at 1.22601 after placing a high of 1.23538 and a low of 1.22041. Overall the movement of GBP/USD pair remained bearish throughout the day. The GBP/USD pair dropped sharply on Wednesday on the back of speculations over Bank of England, potentially cutting interest rates into negative territory and lost near 1% on the day after reaching a high of 1.2353. 

Sterling’s mood was generally soured after the comments of chief economist Andy Haldane and Governor Andrew Bailey, who seemed to put the possibility of negative interest rates on the table.

According to Haldane, the consequences of Britain’s banks and lenders’ negative interest rates were the key factors for the Bank of England to consider before making any decision. Haldane said that reviewing and doing were different things, and Bank of England was currently in review phase and has not reached on doing phase yet.

Last week, Governor Andrew Bailey also said that he was less opposed to the negative interest rates given the coronavirus crisis’s circumstances. He also said that there were mixed reviews in the market about the experience of other central banks’ negative interest rates.

On Tuesday, Haldane said that some of the data came in just a shade better than the “scenario for the economy,” which was published by BoE earlier this month. Haldane added that risks remained there that the recovery could be slower as companies and consumers were still cautious because of the possible second wave of coronavirus.

Apart from possible negative interest rates, the Brexit trade agreement’s lack of progress also added to the downward movement of Pound on Wednesday. The United Kingdom has refused to extend the transition period beyond the end of the year, which has increased the odds of a no-deal Brexit, which has exerted negative pressure on British Pound.

However, there were reports on Tuesday that the E.U. might give up its demand for access to the U.K.’s fishing waters to push the paused trade negotiations between the U.S. & E.U. On the U.S. dollar front, the U.S. Dollar Index rose beyond 99.00 and settled there in late session on Wednesday and added the daily losses of GBP/USD pair.

Daily Support and Resistance

  • R3 1.259
  • R2 1.2477
  • R1 1.2405

Pivot Point 1.2292

  • S1 1.222
  • S2 1.2107
  • S3 1.2035

GBP/USD– Trading Tip

The GBP/USD slipped lower after facing resistance around 1.2360 level, which was extended by an upward channel. On the 4-hour timeframe, the 50 EMA is still bullish, but the MACD is suggesting odds of selling bias in the GBP/USD pair as the histograms are forming below zero levels. Today, the Sterling may find immediate support around 1.2225 level while the closing of candles above this level may drive buying until 1.2300 and 1.2360 level. While the violation of support is likely to push the cable further lower until 1.2160 level. Consider taking buying trades over 1.2162 and selling below the same level today.

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 107.714 after placing a high of 107.945 and a low of107.364. Overall the movement of the USD/JPY pair remained bullish throughout the day. The USD/JPY pair surged on Wednesday on the back of the increased mixed market sentiment; the market participants were caught between the opening up of global economy from COVID-19 lockdown and the pressure of the second wave of the virus, emerging trade wars and the long term effects of Hong Kong fight.

On Wednesday, the cold war between China & the U.S. escalated after U.S. Secretary of State; Mike Pompeo reported the U.S. congress that Trump administration no longer consider the status of Hong Kong autonomous from China.

The decision to revoke the Hong Kong autonomous status from China by the United States came in against the new security law introduced by China recently. The law will be presented to the Chinese Parliament on Thursday for approval.

The relation between China and the United States was already disturbed due to the U.S. allegations on China about the spread of coronavirus pandemic and pressuring WHO to refrain it from taking any early action to combat the virus. China has denied such allegations and blamed them back on the U.S. that it was covering its failure to contain the virus by blaming it on China. The safe-haven demand increased after this news, and Japanese Yen gained traction, which kept a lid on any additional gains of the pair USD/JPY.

Daily Support and Resistance    

  • R3 108.39
  • R2 108.16
  • R1 107.86

Pivot Point 107.63

  • S1 107.33
  • S2 107.1
  • S3 106.79

USD/JPY – Trading Tips

The USD/JPY prices continue to trade sideways within a narrow trading range of 107.899 – 107.650 level. We may see further trends in the USD/JPY pair as soon as this trading range gets violated. On the higher side, a bullish breakout of 108.450 level while bearish breakout of 107.650 level can lead USDJPY prices lower to 107.350. Let’s look for choppy trading until the trading range gets violated. 

All the best for today! 

Categories
Forex Market Analysis

Daily F.X. Analysis, May 27 – Top Trade Setups In Forex – ECB President Lagarde Speaks! 

The U.S. dollar, which behaves like a safe-haven asset during political uncertainty & market turmoil, rose to a one-week high against the basket of 6 currencies, but it started to erase its daily gains in late London Session. Tensions between U.S. &China have increased since the coronavirus outbreak, over which both countries have exchanged accusations of cover-ups and lack of transparency with the world. The signs for easing tensions between the two biggest economies of the world are decreasing day by day and have created an uncertain environment in the market weighing on the market.

The U.S. dollar, which behaves like a safe-haven asset during political uncertainty & market turmoil, rose to a one-week high against the basket of 6 currencies, but it started to erase its daily gains in late London Session. Tensions between U.S. &China have increased since the coronavirus outbreak, over which both countries have exchanged accusations of cover-ups and lack of transparency with the world. The signs for easing tensions between the two biggest economies of the world are decreasing day by day and have created an uncertain environment in the market weighing on the market.

The U.S. dollar, which behaves like a safe-haven asset during political uncertainty & market turmoil, rose to a one-week high against the basket of 6 currencies, but it started to erase its daily gains in late London Session. Tensions between U.S. &China have increased since the coronavirus outbreak, over which both countries have exchanged accusations of cover-ups and lack of transparency with the world. The signs for easing tensions between the two biggest economies of the world are decreasing day by day and have created an uncertain environment in the market weighing on the market.

Economic Events to Watch Today

 

 

EUR/USD – Daily Analysis

The EUR/USD pair was closed at 1.09821 after placing a high of 1.09956 and a low of 1.08913. Overall the movement of EUR/USD remained bullish throughout the day. On Tuesday, EUR/USD prices surged and recovered its previous three days’ losses and regained strength in the market on the back of the renewed risk-on market sentiment. The risk appetite after easing of lockdown throughout the world gave strength to the riskier assets like EUR/USD pair and rose them across the board.

The rising hopes for potential coronavirus vaccine added in the risk sentiment and increased expectations for a quick economic recovery. A bid pharmaceutical company, which was the first to make the Ebola vaccine revealed its plans on Tuesday and said that it was working on two potential vaccines and one drug to cure the virus’s infection. The CEO of the company was cautious that it might take a long time to deliver vaccines across the globe.

This raised optimism around the market and raised the bars for riskier assets and moved EUR/USD pairs to recover its previous day’s losses.

On the other hand, in the economic docket, EUR found extra support after the German Consumer Climate from Gfk came in as -18.9 against the expectations of -19.1.

Furthermore, the European Central Bank said that the coronavirus pandemic had amplified the existing vulnerabilities of the financial sector, which will make Eurozone banks face significant losses.

ECB reported that the pandemic had caused one of the sharpest economic contraction in recent history. Still, a wide range of policy measures has been proved helpful in averting a financial meltdown.

Daily Support and Resistance

  • R3 1.1126
  • R2 1.1061
  • R1 1.1021

Pivot Point 1.0956

  • S1 1.0915
  • S2 1.0851
  • S3 1.081

EUR/USD– Trading Tip

On the 4 hour timeframe, the EUR/USD pair is testing triple top level, which is providing resistance around 1.0995 level. Closing of candles below this level may drive selling trades until 38.2% Fibonacci retracement level of 1.0970, and below this, the next support holds around 1.0920, which marks 61.8% Fibonacci area. Overall, 1.0995 is a crucial trading level as above this; the EUR/USD pair may lead it’s prices further higher towards 1.1137. Bullish bias seems dominant today.

GBP/USD – Daily Analysis

The GBP/USD pair was closed at 1.23373 after placing a high of 1.23630 and a low of 1.21807. Overall the movement of GBP/USD pair remained bullish throughout the day. The Pound outperformed on Tuesday and rose to a level 1.236 highest since May 12 on the back of raised optimism about the EU-UK trade deal.

The next round of Brexit talks are due next week, and there have been headlines revolving that British negotiators could seal their first victory in next talks with the E.U. Reports suggested that the European Union was willing to shift its stance on fisheries in the next round of talks with Great Britain next week. If that happens, it would be a significant concession from the bloc in talks with the U.K. on their new relationship after Brexit.

The fisheries were important to the E.U. as most of the fishing takes place in U.K. waters, but the catch goes to E.U. fishers. U.K. wanted to ensure that after Brexit, which will take effect from next year, the U.K. as a newly independent coastal state could be solely in control of its waters and fish.

So far, the European Union has been reluctant to give up U.K. waters and demanded the things to remain the same as they were before in fisheries. However, on Tuesday, an E.U. official said that the bloc’s executive committee, which will negotiate with the U.K. in the name of all 27 E.U. member states, could ease its demand if the U.K. were to move as well.

According to Michel Barnier, surrendering the access to Britain’s fishing waters would be just one of the costs the British government must pay for a trade deal with the bloc. However, he faced pressure from other officials not to surrender to Britain too soon.

Daily Support and Resistance

  • R3 1.259
  • R2 1.2477
  • R1 1.2405

Pivot Point 1.2292

  • S1 1.222
  • S2 1.2107
  • S3 1.2035

GBP/USD– Trading Tip

The GBP/USD prices traded sharply bullish soaring from 1.2200 level to place a high around 1.2360 level. The resistance level of 1.2360 is extended by an upward channel, which can be seen on the 4-hour timeframe. The 50 EMA is bullish, but the MACD is suggesting odds of selling bias in the GBP/USD pair, perhaps because the Sterling is in the overbought zone. Bullish crossover of 1.2360 level may lead Sterling prices further higher towards 1.2460, while support is likely to be found around 1.2289 and 1.2165. Consider taking buying trades over 1.2292 and selling below the same level today.

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 107.539 after placing a high of 107.921 and a low of 107.399. Overall the movement of the USD/JPY pair remained bearish throughout the day. The USD/JPY pair showed a bearish trend on Tuesday but consolidated in a range between 107.3 and 107.9.

At 18:00 GMT, the Housing Price Index for March from the United States was dropped to 0.1% against the forecasted 0.6% and weighed on the U.S. dollar. The S&P/CS Composite-20 HPI for the year advanced to 3.9% against the expectations of 3.4% and supported the U.S. dollar. At19:00 GMT, the Consumer Confidence from Conference Board for May decreased to 86.6 from the forecasted 87.1 and weighed on the U.S. dollar. The New Home Sales for April were recorded as 623K against the expected 429K and supported the U.S. dollar.

The closely watched Consumer Confidence from the United States declined and made the U.S. dollar weak across the board and ultimately dragged the USD/JPY pair on Tuesday. From the Japanese side, at 4:50 GMT, the Services Producer Price Index (SPPI) for the year was dropped to 1.0% against the forecasted 1.3%and weighed on Japanese Yen. At 9:30 GMT, All Industrial activities for March came in line with the expectations of -3.8%. At 10:00 GMT, the Core CPI for the year from Bank of Japan also dropped to -0.1% from the expected 0.0% and weighed on Japanese Yen.

The Governor of Bank of Japan, Haruhiko Kuroda, said that the central bank was ready to ease monetary policy further. To add more stimulus measures, the bank decided to expand its loan programs, cut the rates further, and ramp up the risky asset purchases. In his semiannual testimony to parliament, Kuroda said that Bank of Japan was ready to do whatever it can to ensure markets were stable. He added that the stability of markets was its first importance now because once the pandemic was over, Japan’s economy could resume a solid recovery path.

Daily Support and Resistance    

  • R3 108.39
  • R2 108.16
  • R1 107.86

Pivot Point 107.63

  • S1 107.33
  • S2 107.1
  • S3 106.79

USD/JPY – Trading Tips

The USD/JPY pair continues to trade choppy sessions within the same trading 107.950 – 107.350. Above 107.950 level, we may see USD/JPY prices heading towards the next resistance level of 108.330. The 50 EMA is currently supporting the USD/JPY around 107.350. Breakout of USD/JPY support area of 107.35 can lead the USD/JPY prices towards 106.850. So let’s consider taking buying trades over 107.63 and selling below the same level today. 

All the best for today! 

Categories
Forex Market Analysis

Daily F.X. Analysis, May 26 – Top Trade Setups In Forex – CB Consumer Confidence Ahead

The U.S. dollar, which behaves like a safe-haven asset during political uncertainty & market turmoil, rose to a one-week high against the basket of 6 currencies, but it started to erase its daily gains in late London Session. Tensions between U.S. &China have increased since the coronavirus outbreak, over which both countries have exchanged accusations of cover-ups and lack of transparency with the world. The signs for easing tensions between the two biggest economies of the world are decreasing day by day and have created an uncertain environment in the market weighing on the market.

The U.S. dollar, which behaves like a safe-haven asset during political uncertainty & market turmoil, rose to a one-week high against the basket of 6 currencies, but it started to erase its daily gains in late London Session. Tensions between U.S. &China have increased since the coronavirus outbreak, over which both countries have exchanged accusations of cover-ups and lack of transparency with the world. The signs for easing tensions between the two biggest economies of the world are decreasing day by day and have created an uncertain environment in the market weighing on the market.

The U.S. dollar, which behaves like a safe-haven asset during political uncertainty & market turmoil, rose to a one-week high against the basket of 6 currencies, but it started to erase its daily gains in late London Session. Tensions between U.S. &China have increased since the coronavirus outbreak, over which both countries have exchanged accusations of cover-ups and lack of transparency with the world. The signs for easing tensions between the two biggest economies of the world are decreasing day by day and have created an uncertain environment in the market weighing on the market.

Economic Events to Watch Today

 

   

EUR/USD – Daily Analysis

The EUR/USD pair was closed at 1.08964 after placing a high of 1.09144 and a low of 1.08702. Overall, the EUR/USD pair showed a null movement on Monday as the open and closed levels were almost the same.

On Monday, the EUR/USD pair moved in a tight range between 1.087 to 1.089 while managed to cut earlier losses and touched 1.091 level. The upbeat movement in the previous trading session on Monday for the pair was due to the German IFO Business Climate, which came in favor of EUR for May. 

At 11:00 GMT, the German Final GDP for the quarter came in line with the expectations of -2.2% and had null-effect on the currency pair. However, at 13:00 GMT, the German IFO Business Climate, which measures the business conditions and expectations from Eurozone, was released as 79.5 against the expectations of 78.3 and April’s 74.2. The Index rebounded from the expectations and recovered from its worst decline in April on the reopening of Europe’s largest economy, which boosted corporate hopes.

At 17:56 GMT, the Belgian NBB Business Climate was dropped by 34.4 points against the expected decline of 29.7 and April’s 36.1. The more than expected decline in Belgian Business Climate weighed on EUR currency and dragged down the pair EUR/USD in late sessions.

In the meantime, the pair kept looking at U.S. dynamics for near term directions with the latest US-China & Hong Kong conflict which has reduced the importance of coronavirus development as the primary driver of global price action.

In this time, when investors are cautious about adding to their equity holdings because of the uncertain conditions of the post-lockdown world, Germany’s IFO institute survey for May granted some relief to them.

The lockdown measures introduced in mid-March have put the global economy on track for a recession this year. In recent weeks, the world’s market has only been held up due to the stimulus measures taken by central banks. 

EUR remained steady on Monday near 1.09 level and recovered from earlier losses, as the focus of market participants shifted to the proposal the European Commission will release on Wednesday.

On Wednesday, the European Central Bank’s president Christine Lagarde will speak, and traders will be looking at it for fresh bids along with the EMU’s Consumer Confidence & Advanced Inflation data from Eurozone. On Tuesday, Consumer Confidence by the Conference Board is due to release. The Claims & Durable Goods Orders will be published on Thursday later this week.

Daily Support and Resistance

  • R3 1.0965
  • R2 1.094
  • R1 1.092

Pivot Point 1.0895

  • S1 1.0875
  • S2 1.085
  • S3 1.0829

EUR/USD– Trading Tip

The EUR/USD pair is on a bullish run, trading over 1.0914 level, having violated the horizontal resistance level of 1.0914 level. Above 1.0914, we may see the EUR/USD prices heading further higher towards the next resistance area of 1.0590. The EUR/USD pair had completed 50% Fibonacci retracement at 1.0885 and has bounced off over this level. For now, the pair is holding over 50 EMA, which is also suggesting the chances of a bullish trend continuation. We should consider taking buying positions over 1.0894 today while selling should be preferred only below this level. 

GBP/USD – Daily Analysis

The GBP/USD pair was closed at 1.21752 after placing a high of 1.22034 and a low of 1.21637. Overall the movement of GBP/USD pair remained flat throughout the day. The GBP/USD pair remained flat and moved on a consolidating range on Monday as investors were cautious about the relaxation of lockdown measures, which gave a push to equities while ding the U.S. dollar demand.

On Monday, the Prime Minister of the U.K. instructed officials to draw up plans to reduce the involvement of Huawei Technologies Co in the U.K.’s fifth-generation mobile networks in the wake of the COVID 19 outbreak.

Johnson gave his officials instructions to draw up plans for reducing China’s involvement in the 5G infrastructure of the U.K. to a scale of zero by 2023. It looks like China’s pandemic handling has triggered calls from U.K.’s PM to rethink having closer ties with China.

In January, the U.K.’s government decided to give Huawei a limited role in 5G wireless networks and fiber. PM Johnson has amicable ties with U.S. President Donald Trump, and it looks like Johnson has taken this step to improve his relationship with the U.S.

Furthermore, on Brexit front, the trade negotiations between E.U. & U.K. have been negative for Sterling throughout the session and will likely remain the same in the coming days. The chances for hard-Brexit have increased as the UK-EU transition period is coming closer day by day, and there are no signs of any deal happening sooner. However, calls to extend the transition period have made due to pandemic; this decision will have to be made by June 30. But PM Johnson and negotiating team from the U.K. has so far been unequivocal that no extension would be made.

Johnson had articulated the Brexit deal with a clear timeline and has promised not to make any changes or compromise or bow to pressure for an extension. The deadline to call for an extension is coming up next month, and this has exerted downside pressure on GBP.

In the absence of any macroeconomic data from the U.K. and U.S. side due to bank holiday, the pair GBP/USD remained flat on Monday and continued its previous moves.

Daily Support and Resistance

  • R3 1.225
  • R2 1.2227
  • R1 1.2209

Pivot Point 1.2186

  • S1 1.2167
  • S2 1.2145
  • S3 1.2126

GBP/USD– Trading Tip

On Tuesday, the GBP/USD prices continue to trade in line with our previous forecast as the sideways trading range remains intact. The overall trading range remains 1.2170 – 1.2270. In the 4 hour timeframe, we can see a symmetric triangle pattern, which is exhibiting indecision among traders. On the downside, the GBP may gain support against the U.S. dollar around 1.2170 level, and violation of this level may extend selling until the next support area of 1.2080. Consider taking buying trades over 1.2186 and selling below the same level today.  

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 107.704 after placing a high of 107.780 and a low of 107.556. Overall the movement of the USD/JPY pair remained bullish throughout the day. The USD/JPY pair fluctuated in a tight range of 15 pips because of the absence of American traders for Memorial Day.

On Monday, Japanese Prime Minister Shinzo Abe lifted the coronavirus state of emergency in Tokyo and other areas. The nationwide end of restrictions and reopening of businesses were to take effect as of Monday.

The Japanese PM also introduced a new plan for a new stimulus package to support the businesses and Japan’s economy hit by the COVID-19 pandemic. Abe said that Japan has managed to bring the epidemic under control, and the exit from it was in sight. However, this announcement from Abe had little to no impact on JPY’s movement against its rival currencies.

Meanwhile, on the US-China relation front, China’s move to impose a new security law on Hong Kong has escalated concerns about the stability of the city and global trade prospects, which upset the United States and thus, US-Sino relation worsen even more.

The U.S. dollar, which behaves like a safe-haven asset during political uncertainty & market turmoil, rose to a one-week high against the six currencies. Still, it started to erase its daily gains in the late London Session. Tensions between U.S. &China have increased since the coronavirus outbreak, over which both countries have exchanged accusations of cover-ups and lack of transparency with the world. The signs for easing tensions between the two biggest economies of the world are decreasing day by day and have created an uncertain environment in the market weighing on the market.

Furthermore, the USD/JPY pair moved very little on Monday amid thin trading conditions. At the same time, the U.S. dollar Index remained flat near 99.80 level throughout the day as investors showed no interest in the greenback. Moreover, the market participants will be looking at the release of the Corporate Service Price Index and All Industry Activity Index from Japan on Tuesday. From the American side, the Fed National Activity Index and New Homme Sales & C.B. Consumer Confidence data will be under consideration.

Daily Support and Resistance    

  • R3 108.03
  • R2 107.91
  • R1 107.8

Pivot Point 107.68

  • S1 107.57
  • S2 107.45
  • S3 107.35

USD/JPY – Trading Tips

On Tuesday, the USD/JPY continues following the same technical setups that we spoke about on a previous day. The pair is still trading choppy, but it’s peaking out of tight trading range of 107.630 – 107.350. Above 107.650 level, we may see USD/JPY prices heading towards the next resistance level of 108.130. The ascending triangle pattern was already violated, and the upward trendline is expected to keep the USD/JPY supported around 107.350. Breakout of USD/JPY support area of 107.35 can lead the USD/JPY prices towards 106.850. So let’s consider taking buying trades over 107.68 today. 

All the best for today! 

Categories
Forex Market Analysis

Daily F.X. Analysis, May 25 – Top Trade Setups In Forex – Memorial Day Holiday! 

On Monday, the U.S. stock markets will be closed to observe the Memorial Day holiday. The U.K. stock markets will be closed for the Spring Bank Holiday. The German Federal Statistical Office will post final readings of 1Q GDP (-2.3% on year expected). Germany’s IFO Business Climate Index for May will be released (78.5 expected).

On Monday, the U.S. stock markets will be closed to observe the Memorial Day holiday. The U.K. stock markets will be closed for the Spring Bank Holiday. The German Federal Statistical Office will post final readings of 1Q GDP (-2.3% on year expected). Germany’s IFO Business Climate Index for May will be released (78.5 expected).

On Monday, the U.S. stock markets will be closed to observe the Memorial Day holiday. The U.K. stock markets will be closed for the Spring Bank Holiday. The German Federal Statistical Office will post final readings of 1Q GDP (-2.3% on year expected). Germany’s IFO Business Climate Index for May will be released (78.5 expected).

Economic Events to Watch Today

 

 

EUR/USD – Daily Analysis

The EUR/USD dropped 0.4% to 1.0902. European Central Bank’s latest monetary policy accounts showed that officials agreed that “a swift V-shaped recovery could probably already be ruled out at this stage” and “the Governing Council would have to stand ready to adjust the Pandemic Emergency Purchase Program and potentially other instruments if it saw that the scale of the stimulus was falling short of what was needed.”

During the previous week, the FOMC minutes failed to impress the market as there was no surprise element in the presentation of the Powell presentation and was ignored by market participants. It was widely expected that the coronavirus outbreak would continue to weigh on the economy, and the economic outlook would remain somewhat pessimistic. Greenback holds onto its losses as there was no room for surprises in the minutes of the meeting. 

The U.S. Dollar Index (DXY) fell about 0.25% on the day to post the lowest close since May. Powell said that Fed might need to introduce more stimulus measures if the economic lockdown remains there for a long time. He also added that banks should prepare themselves for the bankruptcies of nonfinancial companies.

Furthermore, the latest Franco-German proposal for a 500 euros fund to fight coronavirus crisis helped EUR pair to gain traction in the market and remain stronger than other currencies; this ultimately supported the upward trend of EUR/USD pair.

Later today, the U.S. stock markets will be closed to observe the Memorial Day holiday. The U.K. stock markets will be closed for the Spring Bank Holiday. The German Federal Statistical Office will post final readings of 1Q GDP (-2.3% on year expected). Germany’s IFO Business Climate Index for May will be released (78.5 expected).

Daily Support and Resistance

  • R3 1.1067
  • R2 1.1038
  • R1 1.0994

Pivot Point 1.0965

  • S1 1.092
  • S2 1.0892
  • S3 1.0847

EUR/USD– Trading Tip

The EUR/USD prices are holding at 1.0840 as these were facing strong resistance around 1.0993, which marks the triple top resistance level and can trigger selling in the pair. Conversely, the EUR/USD pair may find support around 1.0853, as the 1.0993 level is already violated. The MACD is recently forming selling candles, which suggests the trend of the sale in the pair. So the overall trading range can be from 1.0924 level to 1.0856. Today, we can look for selling trades under 1.0915 for 40/50 pips profit. 

GBP/USD – Daily Analysis

The GBP/USD lost 0.5% to 1.2166. Official data showed that U.K. retail sales declined 18.1% on month in April (-15.5% expected). The GBP/USD pair continued to follow its previous day’s trend of downward movement and dropped during the previous week. The decline in currency pair could be attributed to the increasing speculations that the Bank of England will consider to ease monetary policy further. The Governor of Bank of England, Andrew Bailey, said that he had changed his position into negative interest rates given the crisis.

On the other hand, the broad-based U.S. dollar posted major weight on the GBP. As the U.S. dollar flashed green and took bids due to multiple reasons, most were concerned with global trade relations. The U.S. and China trade tussle further fueled by China’s action to impose new Hong Kong security law. Whereas, The U.S. Dollar Index that tracks the greenback against a basket of other currencies was up 0.19% to 199.593 by 11:44 PM ET (4:44 AM GMT). The U.S. dollar will likely continue its bullish bias during the weekend if the geopolitical tensions remain the same, keeping the currency pair under pressure.

The BoE Governor Andrew Bailey hinted on Wednesday that the Bank of England was thinking about introducing negative interest rates in more than 300 years of history, which instantly weighed on the GBP and turned out to be one of the major factors that kept a lid on any gains in the pair.

Looking forward, the U.S. stock markets will be closed to observe the Memorial Day holiday. The U.K. stock markets will be closed for the Spring Bank Holiday.

Daily Support and Resistance

  • R3 1.232
  • R2 1.2285
  • R1 1.2255

Pivot Point 1.222

  • S1 1.219
  • S2 1.2155
  • S3 1.2124

GBP/USD– Trading Tip

On Monday, the Cable is finding hurdle around 1.2269 marks, and it extends to form a doji and bearish engulfing beneath 1.2269 zones, which has lead a bearish correction in the Cable. On the downside, the GBP may gain support against the U.S. dollar around 1.2170 level. The MACD and 50 EMA are supporting selling bias in the pair. The bullish breakout of 1.2270 level can lead the Sterling prices towards 1.2360. While breakout of the support level of 1.2169 may lead the Sterling pair towards the 1.2080 support zone. 

USD/JPY – Daily Analysis

The USD/JPY was flat at 107.63. The Bank of Japan announced plans to start a new 75 trillion yen lending program in June, to support coronavirus-hit businesses while keeping its benchmark rate at -0.1% and 10-year government bond yield target at about 0% unchanged. Meanwhile, it is reported that the Japanese government is finalizing a new Y100 trillion coronavirus relief package.

While explaining the key factor behind the risk-off market sentiment, the already intensified conflict between the United States and China further bolstered by the Zhang Yesui warning to the United States that China will strongly defend its U.S. does anything to undermine China’s core interests. Besides, China’s decision to impose new Hong Kong security law further fueled concerns about a major US-China tussle that underpinned Japan’s safe-haven status and excreted downside pressure on the currency pair.

On the other hand, the upticks in the safe-haven Japanese yen were further bolstered by the Bank of Japan’s decision to leave its monetary policy unchanged during the unscheduled meeting held this Friday. As well as, the Japanese central bank announced targeted loans for small and mid-sized firms in order to control the negative impact caused by the coronavirus pandemic.

However, the broad-based U.S. dollar is performing the pair’s role and helping the pair to limit its losses. After using the very harsh word from US-China, investors turned to the safe-haven dollar, which tried to exert some positive impact on the currency pair. Whereas, The U.S. Dollar Index that tracks the greenback against a basket of other currencies was up 0.19% to 199.593 by 11:44 PM ET (4:44 AM GMT). Moving on, the U.S. dollar will likely continue its bullish bias during the weekend if the geopolitical tensions remain the same.

Daily Support and Resistance    

  • R3 108.21
  • R2 108.04
  • R1 107.83

Pivot Point 107.65

  • S1 107.44
  • S2 107.26
  • S3 107.05

USD/JPY – Trading Tips

The USD/JPY continues trading sideways in between 107.630 – 107.350. Above 107.650 level, we may see USD/JPY prices heading towards the next resistance level of 108.130. The ascending triangle pattern was already violated, and the upward trendline is expected to keep the USD/JPY supported around 107.350. Breakout of USD/JPY support area of 107.35 can lead the USD/JPY prices towards 106.850. So let’s consider taking buying trades over 107.350 today. 

All the best for today! 

Categories
Forex Market Analysis

Daily F.X. Analysis, May 22 – Top Trade Setups In Forex – ECB Monetary Policy Meeting Accounts Ahead! 

The U.S. Dollar Index (DXY) fell about 0.25% on the day to post the lowest close since May. Powell said that Fed might need to introduce more stimulus measures if the economic lockdown remains there for a long time. He also added that banks should prepare themselves for the bankruptcies of nonfinancial companies. Let’s keep an eye on U.K. Retail sales and ECB Monetary Policy Meeting Minutes.

The U.S. Dollar Index (DXY) fell about 0.25% on the day to post the lowest close since May. Powell said that Fed might need to introduce more stimulus measures if the economic lockdown remains there for a long time. He also added that banks should prepare themselves for the bankruptcies of nonfinancial companies. Let’s keep an eye on U.K. Retail sales and ECB Monetary Policy Meeting Minutes.

The U.S. Dollar Index (DXY) fell about 0.25% on the day to post the lowest close since May. Powell said that Fed might need to introduce more stimulus measures if the economic lockdown remains there for a long time. He also added that banks should prepare themselves for the bankruptcies of nonfinancial companies. Let’s keep an eye on U.K. Retail sales and ECB Monetary Policy Meeting Minutes.

Economic Events to Watch Today

 

 

 

EUR/USD – Daily Analysis

The EUR/USD prices were closed at 1.09777 after placing a high of 1.09988 and a low of 1.09185. Overall the movement of EUR/USD remained bullish throughout the day. The EUR/USD pair remained near 1.1000 after the release of FOMC meeting minutes. The surge in the EUR/USD pair suggested that the pair might break its 7-week range and move further to earn more gains.

The FOMC minutes failed to impress the market as there was no surprise element in Powell’s presentation and was ignored by market participants. It was widely expected that the coronavirus outbreak would continue to weigh on the economy, and the economic outlook would remain somewhat pessimistic. Greenback holds onto its losses as there was no room for surprises in the minutes of the meeting. 

The U.S. Dollar Index (DXY) fell about 0.25% on the day to post the lowest close since May. Powell said that Fed might need to introduce more stimulus measures if the economic lockdown remains there for a long time. He also added that banks should prepare themselves for the bankruptcies of nonfinancial companies.

On the data front, at 13:00 GMT, the Current Account Balance from the Eurozone showed a balance of 27.4B during March against 37.8B of February. At 14:00 GMT, the Final CPI from Eurozone for the year declined to 0.3% against the expectations of 0.4% and weighed on EUR. The Final Core CPI for the year came in line with the hopes of 0.9%. 

At 19:00 GMT, the Consumer Confidence on the Eurozone economic condition showed a decline to 19 forms the forecasted decline of 23 and supported EUR. The market participants ignored the poor than expected CPI from Eurozone, and EUR got its support after the release of consumer confidence, which showed less decline than expected.

Furthermore, the latest Franco-German proposal for a 500 euros fund to fight coronavirus crisis helped EUR pair to gain traction in the market and remain stronger than other currencies; this ultimately supported the upward trend of EUR/USD pair.

Daily Support and Resistance

  • R3 1.1067
  • R2 1.1038
  • R1 1.0994

Pivot Point 1.0965

  • S1 1.092
  • S2 1.0892
  • S3 1.0847

EUR/USD– Trading Tip

On Friday, the EUR/USD prices are holding at 1.0940 as these were facing strong resistance around 1.0993, which marks the triple top resistance level and can trigger selling in the pair. Conversely, the EUR/USD pair may find support around 1.0883, once the 1.0993 level gets violated. The MACD is recently forming selling candles, which suggests the trend of the sale in the pair. So the overall trading range can be from 1.0994 level to 1.0886. On Friday, we can look for selling trades under 1.0965 for 40/50 pips profit. 

GBP/USD – Daily Analysis

The GBP/USD pair was closed at 1.22225 after placing a high of 1.22495 and a low of 1.21855. Overall the movement of GBP/USD pair remained bearish throughout the day. The GBP/USD pair continued to follow its previous day’s trend of downward movement and dropped on Thursday as well. The decline in currency pair could be attributed to the increasing speculations that the Bank of England will consider to ease monetary policy further. The Governor of Bank of England, Andrew Bailey, said that he had changed his position into negative interest rates given the crisis.

He added that more easing measures from the Bank of England were more likely, but the interest rates were below on his priorities. He said that though it was not the time for negative interest rates, they could not be excluded from options.

Furthermore, on the lack of progress on trade talks with the European Union, the U.K. was driving its way towards no-deal Brexit. This raised fear amongst investors and raised uncertainty about the future relationship of Great Britain with E.U., making GBP weaker on the board. In the current context of coronavirus shutdown, the U.K. economy was already disturbed, and chances for an unfriendly exit from E.U. along with coronavirus would impact highly negative on the common currency. 

On the data front, at 13:30 GMT, the Flash Manufacturing PMI from Great Britain showed a surge in Index with 40.6 points against the 35.1 of forecast and supported GBP. Sterling was also supported by Flash Services PMI, which exceeded the expectations of 24.1 and came in as 27.8. From the U.S. side, the increased Jobless Claims last week by 2.43M weighed on the U.S. dollar. However, the Flash Manufacturing PMI, which was key data on Thursday from the American side, came in support of the U.S. dollar when released as 39.8 against the expectations of 39.3.

The strong U.S. dollar on Thursday amid better than expected PMI data added in the downfall of GBP/USD pair.

Daily Support and Resistance

  • R3 1.232
  • R2 1.2285
  • R1 1.2255

Pivot Point 1.222

  • S1 1.219
  • S2 1.2155
  • S3 1.2124

GBP/USD– Trading Tip

The GBP/USD continues to trade within the same technical levels, which we discussed a day before. The Cable is facing resistance around 1.2269 level, and it continues to develop doji and bearish engulfing candles below 1.2269 zones, which has driven a bearish retracement in the Cable. On the lower side, the Sterling may find support against the U.S. dollar around 1.2170 level. The MACD and 50 EMA are supporting selling bias in the pair. Today, the release of U.K. Retail Sales m/m may help drive further movement in the market. Therefore, the bullish breakout of 1.2270 level can lead the Sterling prices towards 1.2360. While breakout of the support level of 1.2169 may lead the Sterling pair towards the 1.2080 support zone. 

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 107.604 after placing a high of 107.847 and a low of 107.415. Overall the movement of the USD/JPY pair remained bullish throughout the day. At 4:50 GMT, Japan’s Merchandise Trade Balance for April showed a deficit of 1.0 Trillion Japanese Yen on Thursday. At 5:30 GMT, the Flash Manufacturing PMI came in as 38.4 during May compared to 41.9 of April.

The exports from Japan showed a decline of 21.9% and imports by 7.2%, while overall trade balance showed a deficit and weighed on Japanese Yen. The weak JPY gave strength to the USD/JPY pair on Thursday.

On the American side, the U.S. jobless Claims for the past week exceeded over 2.43M from the expectations of 2.4M and weighed on the U.S. dollar at 17:30 GMT. The Philly Fed Manufacturing Index for May declined by 43.1 against 40.0 expected and weighed on the U.S. dollar.

However, at 18:45 GMT, the Flash manufacturing PMI from the U.S. for the month of May surged to 39.8 against the expected 39.3 and supported the U.S. dollar. The Flash Services PMI for May also exceeded to 36.9 from 32.6 of expectations. 

The C.B. Leading Index for April was expected to be declined by 5.5%, but in actual, it showed a decline of 4.4% and supported the U.S. dollar. The Existing Home Sales remain flat with expectations of 4.33M.

Better than expected economic data from the United States gave strength to the U.S. dollar and moved USD/JPY pair in an upward direction to post daily gains. On the other hand, Fed Chairman Jerome Powell showed concerns about the economic indicators to hit their bleakest levels since the Great Depression. He said that the U.S. economy was facing a whole new level of uncertainty amid the coronavirus crisis. 

Daily Support and Resistance    

  • R3 108.21
  • R2 108.04
  • R1 107.83

Pivot Point 107.65

  • S1 107.44
  • S2 107.26
  • S3 107.05

USD/JPY – Trading Tips

On Friday, the USD/JPY continues trading sideways in between 107.630 – 107.350. Above 107.650 level, we may see USD/JPY prices heading towards the next resistance level of 108.130. The ascending triangle pattern was already violated, and the upward trendline is expected to keep the USD/JPY supported around 107.350. Breakout of USD/JPY support area of 107.35 can lead the USD/JPY prices towards 106.850. So let’s consider taking buying trades over 107.350 today. 

All the best for today! 

Categories
Forex Market Analysis

Daily F.X. Analysis, May 21 – Top Trade Setups In Forex – Services & Manufacturing PMI! 

On the news front, the EUR, GBP, and USD remain in the highlight due to manufacturing and services. The PMI figures are expected to improve all of the economies, perhaps due to smart lockdown strategy, which may have driven some business activity during the last month.

On the news front, the EUR, GBP, and USD remain in the highlight due to manufacturing and services. The PMI figures are expected to improve all of the economies, perhaps due to smart lockdown strategy, which may have driven some business activity during the last month.

On the news front, the EUR, GBP, and USD remain in the highlight due to manufacturing and services. The PMI figures are expected to improve all of the economies, perhaps due to smart lockdown strategy, which may have driven some business activity during the last month.

 

Economic Events to Watch Today

 

 

EUR/USD – Daily Analysis

The EUR/USD prices were closed at 1.09777 after placing a high of 1.09988 and a low of 1.09185. Overall the movement of EUR/USD remained bullish throughout the day. The EUR/USD pair remained near 1.1000 after the release of FOMC meeting minutes. The surge in the EUR/USD pair suggested that the pair might break its 7-week range and move further to earn more gains.

The FOMC minutes failed to impress the market as there was no surprise element in Powell’s presentation and was ignored by market participants. It was widely expected that the coronavirus outbreak would continue to weigh on the economy, and the economic outlook would remain somewhat pessimistic. Greenback holds onto its losses as there was no room for surprises in the minutes of the meeting. 

The U.S. Dollar Index (DXY) fell about 0.25% on the day to post the lowest close since May. Powell said that Fed might need to introduce more stimulus measures if the economic lockdown remains there for a long time. He also added that banks should prepare themselves for the bankruptcies of nonfinancial companies.

On the data front, at 13:00 GMT, the Current Account Balance from the Eurozone showed a balance of 27.4B during March against 37.8B of February. At 14:00 GMT, the Final CPI from Eurozone for the year declined to 0.3% against the expectations of 0.4% and weighed on EUR. The Final Core CPI for the year came in line with the hopes of 0.9%. 

At 19:00 GMT, the Consumer Confidence on the Eurozone economic condition showed a decline to 19 forms the forecasted decline of 23 and supported EUR. The market participants ignored the poor than expected CPI from Eurozone, and EUR got its support after the release of consumer confidence, which showed less decline than expected.

Furthermore, the latest Franco-German proposal for a 500 euros fund to fight coronavirus crisis helped EUR pair to gain traction in the market and remain stronger than other currencies; this ultimately supported the upward trend of EUR/USD pair.


Daily Support and Resistance

  • R3 1.1097
  • R2 1.1048
  • R1 1.1014

Pivot Point 1.0966

  • S1 1.0932
  • S2 1.0884
  • S3 1.0849

EUR/USD– Trading Tip

The EUR/USD prices are facing strong resistance around 1.0993, which marks the triple top resistance level and can trigger selling in the pair. Conversely, the EUR/USD pair may find support around 1.09512, and below this, the next support is likely to be seen around 1.0910. The bearish bias remains strong today. On the downside, the EUR/USD has odds of bouncing off above 1.0933. 

GBP/USD – Daily Analysis

The GBP/USD pair was closed at 1.22375 after placing a high of 1.22875 and a low of 1.22212. Overall the movement of GBP/USD pair remained bearish throughout the day. The GBP/USD pair remained in a consolidation phase on Wednesday and showed a slight bearish movement amid poor than expected economic data from Great Britain. The CPI, RPI & PPI data showed a decline in the month of April and provided a weak economic outlook and weighed on GBP, which ultimately dragged the GBP/USD pair on Wednesday.

At 11:00 GMT, the Consumer Price Index (CPI) for the year from the United Kingdom fell short of expected 0.9% ad came in as 0.8% and weighed on GBP. The PPI Input in the month of April showed a decline of 5.1% against the expected decline of 4.2% and weighed on Pound. The PPI output of April also declined by 0.7% from the forecasted decline of 0.5% and weighed on GBP.

At 11:02 GMT, the Core CPI for the year from the United Kingdom came in line with the expectations of 1.4%. The RPI for the year from Britain also declined to 1.5% from 1.6% of expectations and weighed on GBP. At 13:30 GMT, the HPI for the year from Great Britain exceeded the expectations of 1.5% and came in as 2.1% and supported Pound.

Apart from economic data, news about considering negative rates as an option by BoE added in the pressure on GBP on Wednesday. According to Governor Andrew Bailey, the Bank of England studied how low U.K. interest rates can be cut even more to cope with the coronavirus crisis and did not exclude the idea of lowering borrowing costs below zero.

Daily Support and Resistance

  • R3 1.2346
  • R2 1.2317
  • R1 1.2279

Pivot Point 1.225

  • S1 1.2211
  • S2 1.2183
  • S3 1.2144

GBP/USD– Trading Tip

After exhibiting sharp bullish trends, the GBP/USD faced resistance around 1.2269 level. As we can see on the 4-hour chart, the pair has closed doji and bearish engulfing candles below 1.2269 zones, which has driven a bearish retracement in the Cable. On the lower side, the Sterling may find support against the U.S. dollar around 1.2170 level. The MACD and 50 EMA are supporting selling bias in the pair. Today, the release of UK PMI figures may help drive further movement in the market. Therefore, the bullish breakout of 1.2270 level can lead the Sterling prices towards 1.2360. While breakout of the support level of 1.2169 may lead the Sterling pair towards the 1.2080 support zone. 

USD/JPY – Daily Analysis

The USD/JPY was closed at 107.535 after placing a high of 107.982 and a low of 107.335. Overall the movement of the USD/JPY pair remained bearish throughout the day. After posting gains for the previous two sessions, the USD/JPY pair starting to lose on Wednesday amid broad-based U.S. dollar weakness and renewed safe-haven demand. 

The U.S. dollar remained weak on Wednesday after Federal Reserve failed to provide any surprising element in its April meeting minutes. The Fed Chairman Jerome Powell said that risk remained on the downside and held the interest rates on the same level.

Powell said that the second wave of coronavirus would impact on U.S. economy with more intensity, and the lockdown in that time would be stricter and for the longer time period, which would cause massive destruction of U.S. economy.

Powell showed his concerns about the impact of the second wave of coronavirus, which was still onboard due to no improvement in vaccine trials. Powell said that the lower-income households would suffer more due to another wave of the virus if it happened. 

However, adding in the U.S. dollar weakness, the uncertainty about the potential coronavirus vaccine emerged in the market. After the trails of the Moderna vaccine in 6 monkeys, it was reported that all six monkeys out of which 3 received the vaccine were tested positive for COVID-19. The virus was found in the noses on all monkeys who participated in animal trials for that vaccine. This report decreased the risk sentiment in the market and added uncertainty.

Daily Support and Resistance    

  • R3 108.57
  • R2 108.28
  • R1 107.91

Pivot Point 107.62

  • S1 107.25
  • S2 106.96
  • S3 106.59

USD/JPY – Trading Tips

The USD/JPY mostly remains mostly bearish following a bullish breakout of the choppy trading range of 107.480 – 107.029 level. For now, the pair is holding at 107.630, having immediate support around 107.500. Above this level, we may see USD/JPY prices heading towards the next resistance level of 108.130. The ascending triangle pattern has already been violated, and it’s expected to kee the USD/JPY supported around 107.500. So let’s consider taking buying trades over 107.500 today. 

All the best for today! 

Categories
Forex Market Analysis

Daily F.X. Analysis, May 20 – Top Trade Setups In Forex – European CPI Figures Ahead! 

The U.S. Federal Reserve will release its latest FOMC meeting minutes. The European Commission will post the May Consumer Confidence Index (-23.7 expected) and final readings of April CPI (+0.4% on-year expected). The U.K. Office for National Statistics will release April CPI (+0.9% on-year expected).

The U.S. Federal Reserve will release its latest FOMC meeting minutes. The European Commission will post the May Consumer Confidence Index (-23.7 expected) and final readings of April CPI (+0.4% on-year expected). The U.K. Office for National Statistics will release April CPI (+0.9% on-year expected).

The U.S. Federal Reserve will release its latest FOMC meeting minutes. The European Commission will post the May Consumer Confidence Index (-23.7 expected) and final readings of April CPI (+0.4% on-year expected). The U.K. Office for National Statistics will release April CPI (+0.9% on-year expected).

Economic Events to Watch Today 

 

 

 

EUR/USD – Daily Analysis

The EUR/USD prices were closed at 1.09228 after placing a high of 1.09759 and a low of 1.09020. Overall the movement of the EUR/USD pair remained bullish throughout the day. After gaining almost 100 pips on Monday, the EUR/USD pair rose to near its highest level in 2 weeks of 1.0976 level on Tuesday. The upbeat market mode was derived by the Franco-German recovery fund proposal, which was announced on Monday and provided a boost to the single currency EUR. 

The Vice President of the European Commission, Valdis Dombrovskis, said that the European Stability Mechanism (E.S.) strongly supported the Franco-German proposal. Commission was also looking forward to presenting the proposal in the upcoming European summit on May 27.

Following the previous day’s gains, the EUR/USD pair continued to rise and was further supported by the better than expected economic data release on Tuesday.

At 14:00 GMT, the ZEW Economic Sentiment from the European Union showed that the economic outlook of the Eurozone in the view of institutional investors and analysts increased to 46.0 from the expected27.4 and supported EUR. 

The German ZEW Economic Sentiment also showed an improved economic outlook after releasing as 51.0 against the expected 30.0 during the month of May and supported EUR.

The better than the expected economic outlook of the whole bloc, along with Germany even in the lockdown time, gave a sudden push to the already prevailing bullish trend in EUR/USD and rose its prices above two weeks high. However, pair failed to hold its gains and started to drop in late-session but managed to end its day with a bullish candle.

On the other hand, the greenback lost its demand in the absence of any significant economic data. Only Housing Starts in the month of April were released from the U.S. on Tuesday, which declined to 0.89M against the 0.95 forecasted and weighed on the U.S. dollar.

Meanwhile, the Fed Chair Jerome Powell also refrained from providing any specific surprising remarks about the economy or policy outlook and hence kept the U.S. dollar under pressure. He said that the Fed would remain committed to using its all tools to recover the U.S. economy from a corona-induced crisis. U.S. Dollar Index fell near 99.50 level on that day.

Daily Support and Resistance

  • R3 1.1089
  • R2 1.1008
  • R1 1.0961

Pivot Point 1.088

  • S1 1.0833
  • S2 1.0752
  • S3 1.0705

EUR/USD– Trading Tip

The technical outlook for EUR/USD pair seems bullish as the pair is trading at 1.0938, having formed a bullish engulfing pattern above an immediate support level of 1.0918 level. On the 4 hour timeframe, the pair is also forming a higher high and higher low pattern, which can drive further buying trends in the EUR/USD pair. The MACD is bullish, while the 50 EMA is also supporting the bullish bias among traders. The pair has the potential to trade towards north to target 1.0993 triple top area while support holds at 1.0918 and 1.08850 level today.

GBP/USD – Daily Analysis

The GBP/USD prices were closed at 1.22482 after placing a high of 1.22961 and a low of 1.21839. Overall the movement of GBP/USD pair remained bullish throughout the day. The GBP/USD pair rose for 2nd consecutive day on Tuesday amid the broad-based U.S. dollar weakness and better than expected employment data from the U.K. 

The U.S. dollar was already under pressure the previous day after the announcement of the Franco-German recovery fund proposal, which consists of 500 Billion euros. The increased risk appetite in the market also made the U.S. dollar weaker on Tuesday. 

Furthermore, better than expected U.K. employment data on Tuesday gave strength to GBP and raised GBP/USD prices. The office for National Statistics reported that U.K. Unemployment Rate in April dropped to 3.9% from the expected 4.4% and supported GBP.

Despite the decreased unemployment rate, around 857K people filed for jobless claims in April against the forecasted 675K. The decreased unemployment rate, which covers three months to March, showed that unemployment might have fallen sharply during April considering the increased numbers of jobless claims that month.

Meanwhile, U.K. announced a new tariff regime for Brexit that will remove tariffs on 30 billion pounds worth of imports or about 60% worth of trading coming into the U.K. The latest tariff named U.K. Global Tariff (UKCT) will become effective from January 2021 when the transition period will end.

AT 11:00 GMT, the Claimant Count Change for April showed that almost 856.5K people applied for jobless benefit claims against the expectations of 675.0K and weighed on Sterling. At 11:02 GMT, the Average Earning Index for the quarter showed a decline to 2.4% from the expected 2.7% and weighed on U.S. Dollar. However, the Unemployment rate for March showed a decline to 3.9% against the anticipated 4.4% and supported Pound.

Daily Support and Resistance

  • R3 1.2411
  • R2 1.2319
  • R1 1.2257

Pivot Point 1.2166

  • S1 1.2104
  • S2 1.2013
  • S3 1.195

GBP/USD– Trading Tip

On Wednesday, the GBP/USD traded sharply bullish to trade at 1.2245 level despite the release of worse than expected Labor market reports from the U.K. At the moment, Cable faces resistance around 50 EMA, which holds at 1.2255 level. The closing of candles below 1.2260 can drive selling. Still, considering the recent bullish engulfing and long histograms of GBP/USD pair, we may see a continuation of a bullish trend in the Sterling. On the upper side, the violation of 1.2246 level may lead Sterling towards 1.2318 today.  

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 107.700 after placing a high of 108.086 and a low of 107.261. Overall the movement of the USD/JPY pair remained bullish throughout the day. The pair USD/JPY moved above 108.00 level on Tuesday, which was the one-month top-level amid increased risk-on market sentiment. The safe-haven Japanese Yen was under pressure after the latest optimism related to the encouraging initial results of coronavirus vaccine trials. Weaker Yen moved the USD/JPY pair in the opposite direction and made it to post gains above 108.00 level.

The intraday selling bias towards the Japanese Yen increased after the Bank of Japan called out for an unscheduled meeting on Friday. This fueled speculations that Bank would announce more easing measures.

The strong positive momentum due to weakened Yen lifted the USD/JPY prices to its highest level since April 13. However, the rally remained limited due to the rising concerns about the US-China relationship.

Another reason behind the limited rally on Tuesday was the fears about the second-wave of coronavirus. Senators questioned the Fed Chair Jerome Powell and the U.S. Treasury Secretary Steven Mnuchin about their stewardship of specific aspects of the $2 trillion package on Tuesday.

The Senate Banking Committee held its first look at spending under the package announced in March to assist people affected by the coronavirus pandemic. Mnuchin and Powell showed different perspectives on the economic outlook. Mnuchin remained optimistic and said that in the second half of 2020, the economy would see an upturn, while Powell suggested that congress might need more than trillions to aid the economy.

Daily Support and Resistance    

  • R3 108.04
  • R2 107.78
  • R1 107.56

Pivot Point 107.3

  • S1 107.09
  • S2 106.82
  • S3 106.61

USD/JPY – Trading Tips

On Wednesday, the USD/JPY mostly remains mostly bearish following a bullish breakout of the choppy trading range of 107.480 – 107.029 level. For now, the pair is holding at 107.630, having immediate support around 107.500. Above this level, we may see USD/JPY prices heading towards the next resistance level of 108.130. The ascending triangle pattern has already been violated, and it’s expected to kee the USD/JPY supported around 107.500. So let’s consider taking buying trades over 107.500 today. All the best for today! 

Categories
Forex Signals

Gold Trades Within Sideways Range – Buckle Up for A Breakout Setup! 

The safe-haven-metal prices flashed green and erased its previous session losses mainly due to intensifying trade war tensions between the US-China. However, the yellow metal hit its highest level since December of 2012 at $1,765 on Monday, but after that, the gold prices dropped sharply during the American trading session. The reason for the sharp decline could be attributed to the positive news about the COVID-19 vaccine. 

The safe-haven-metal prices flashed green and erased its previous session losses mainly due to intensifying trade war tensions between the US-China. However, the yellow metal hit its highest level since December of 2012 at $1,765 on Monday, but after that, the gold prices dropped sharply during the American trading session. The reason for the sharp decline could be attributed to the positive news about the COVID-19 vaccine. 

The safe-haven-metal prices flashed green and erased its previous session losses mainly due to intensifying trade war tensions between the US-China. However, the yellow metal hit its highest level since December of 2012 at $1,765 on Monday, but after that, the gold prices dropped sharply during the American trading session. The reason for the sharp decline could be attributed to the positive news about the COVID-19 vaccine. 

At this moment, the yellow-metal prices are currently trading at 1,733.71 and are consolidating in the range between 1,732.05 –and 1,740.38, while representing 0.18% gains and having hit the high of $1,735.84. Moreover, the broad-based US dollar modest weakness kept a lid on any additional losses in the gold and contributed to the pair’s bullish moves.

Gold futures were higher by 0.27% at $1,739.35 by 12:43 AM ET (5:43 AM GMT). Stocks, which normally have an inverse relationship with gold, were also up on Tuesday. Despite the optimism surrounding the market about Moderna (NASDAQ: MRNA) reports of positive results on Monday from its phase one experiment for its COVID-19 vaccine, the investors preferring into safe-haven yellow metal manly because the US-China trade tussle was getting worse day by day. 

Trump warned about stopping US funds to WHO if the United Nations body will not be able to show bigger improvements and independence from China in the next 30 days. The reason behind the high preference of gold in the market could be the report that the NASDAQ stock exchange set to implement new restrictions on Chinese IPOs.


Daily Support and Resistance

S1 1666.87

S2 1704.45

S3 1718.73

Pivot Point 1742.02

R1 1756.3

R2 1779.6

R3 1817.17

On the technical side, the yellow metal gold is trading sideways below 1,739 resistance and above the support level of 1,726 level. In between this range, the market is likely to offer choppy trading sessions, until the trading range gets violated. We may see an extension of a bullish trend upon the bullish breakout of 1,739, which may open further room for buying until the next target level of 1,750 and 1,759. Below 1,726 old prices can drop until 1,716 level. Let’s wait for a breakout, and then we will open a position accordingly. Good luck! 

Categories
Forex Market Analysis

Daily F.X. Analysis, May 19 – Top Trade Setups In Forex – Buckle Up for Fed Chair Powell Testimony!  

On Tuesday, eyes will be on the U.K. Jobless claims data, which are coming out shortly. COVID could badly impact the news release, and it may drive selling bias in the Sterling pairs. Besides, the G7 meeting and Fed Chair Powell testimony will also remain in the highlights today.

On Tuesday, eyes will be on the U.K. Jobless claims data, which are coming out shortly. COVID could badly impact the news release, and it may drive selling bias in the Sterling pairs. Besides, the G7 meeting and Fed Chair Powell testimony will also remain in the highlights today.

On Tuesday, eyes will be on the U.K. Jobless claims data, which are coming out shortly. COVID could badly impact the news release, and it may drive selling bias in the Sterling pairs. Besides, the G7 meeting and Fed Chair Powell testimony will also remain in the highlights today.

Economic Events to Watch Today 

 

 

EUR/USD – Daily Analysis

The EUR/USD prices were closed at 1.09141 after placing a high of 1.09268 and a low of 1.07966. Overall the EUR/USD pair remained strongly bullish throughout the day. The EUR/USD pair surged to its highest since May 5 on the back of a proposal, which was announced by France & Germany on Monday. Both countries joined to provide $543 in recovery fund, which would offer grants to regions of the bloc, which were highly affected by coronavirus pandemic. 

They also proposed to allow the European Commission to borrow more money on markets to finance the fund. The president of the European Central Bank, Christine Lagarde, has been urging more fiscal measures and welcomed and targeted the Franco-German proposal. She said that monetary policy transmission was as important as the policy, and there was no risk to the euro currency, which was irreversible.

Single currency euro gained on Monday due to the jointly raised debt from France & Germany. The pair EUR/USD rose above 1.0900 level and gave a robust bullish move on that day. The U.S. dollar, on the other hand, remained weaker due to increased risk appetite in the market after the hopes for a possible COVID019 vaccine increased in the market. The optimism raised after the first trial of the vaccine gave early reports positively and increased the demand for riskier assets like EUR/USD pair.

The markets were fueled by the increased hopes for a vaccine and the rising risk-appetite in the market along with the announcement of a recovery fund worth 500 billion euros by German Chancellor Merkel and French President Macron. The fund was introduced to reduce the effect of coronavirus pandemic on the region’s economy.

Across Europe, many measures have been taken to reduce the coronavirus impact on the economy, including PEPP bond purchases by ECB, the 55billio package from Italy government, and the extension of job retention scheme from the U.K.’s Chancellor. Apart from the measures mentioned above to recover the eurozone’s economy, more measures might include more asset purchases in June.


Daily Support and Resistance

  • R3 1.1089
  • R2 1.1008
  • R1 1.0961

Pivot Point 1.088

  • S1 1.0833
  • S2 1.0752
  • S3 1.0705

EUR/USD– Trading Tip

The EUR/USD is trading at 1.0817, trading below 50 periods EMA resistance at 1.0838 level. Last week, the pair bounced off over the double bottom support level of 1.07756. The direct currency pair is consolidating in a sideways range of 1.09070 – 1.09250, and violation of this will determine further trends in the market. On the higher side, the EUR/USD pair may head upward until the next target level of 1.0956 level while support holds at 1.08850 today.

GBP/USD – Daily Analysis

The GBP/USD pair was closed at 1.21952 after placing a high of 1.22272 and a low of 1.20752. Overall the movement of GBP/USD pair remained bullish throughout the day. The pair GBP/USD spiked to fresh daily gains around 1.2200 level during early American sessions on the back of broad-based U.S. dollar weakness and increased risk appetite.

GBP was dropping continuously in previous sessions on the back of delayed Brexit talks, which could result in no-deal Brexit. Still, on Monday, it showed a recovery after the renewed U.S. dollar selling bias. The Sterling was supported by the weak U.S. dollar on Monday and was forced to move upward.

In recent months, the trade talks between the U.K. & E.U. has shown no progress due to increased frustrations over each other’s ideological approach and lack of understanding. Diplomats & officials had forecasted that before the deadline of June 30, the questions would be raised in the market for companies about future trade between U.K. & E.U. Before coronavirus, the total amount of trade between the world’s fifth-biggest economy and its biggest trading bloc accounted for 650 billion pounds.

The negotiation between U.K. & E.U. has been affected due to video-conferencing; officials suggested that if they had to conduct meeting in a face-to-face environment, then results would have been different. 

Britain left the European Union on January 31, and both sides now run under a tight schedule to sign a deal before 2021, when on 31st December U.K. will leave E.U. with or without a deal. U.K. wanted a free trade agreement with E.U. just like Canada has with E.U. or Japan while E.U. has been arguing for a wider agreement, including Britain’s proximity to the bloc.

Daily Support and Resistance

  • R3 1.2411
  • R2 1.2319
  • R1 1.2257

Pivot Point 1.2166

  • S1 1.2104
  • S2 1.2013
  • S3 1.195

GBP/USD– Trading Tip

The GBP/USD traded sharply bullish to trade at 1.2245 level despite the release of worse than expected Labor market reports from the U.K. At the moment, the cable is facing resistance around 50 EMA level, which holds at 1.2255 level. The closing of candles below 1.2260 can drive selling. Still, considering the recent bullish engulfing and long histograms of GBP/USD pair, we may see a continuation of a bullish trend in the Sterling. On the upper side, the violation of 1.2246 level may lead Sterling towards 1.2318 today.  

USD/JPY – Daily Analysis

The USD/JPY was closed at 107.327 after placing a high of 107.503 and a low of 107.058. Overall the movement of the USD/JPY pair remained bullish that day. Despite U.S. dollar weakness, USD/JPY pair rose on Monday to touch a fresh daily high above 107.500 level and posted gains of 0.32% on that day.

The risk-on market sentiment on that day weighed on safe-haven Japanese Yen after the hopes about quick global economic recovery re-emerged in the market. A coronavirus vaccine trial gave hopes to the possible cure for the virus and revived optimism in the market to raise stock indexes.

A company named Moderna has announced that its first human trials for its coronavirus vaccine reported more or similar blood levels, which include virus-fighting antibodies in participants than the recovered patients of COVID-19. It reported that the vaccine could help improve the immune system.

According to the New York Times, A phase 1 study by Moderna has developed the vaccine in collaboration with the National Institute of Allergy, and Infectious Diseases has gone very well. Phase 2 of the study has been granted an expected enroll of 600 volunteers half older than 55 to provide additional immunogenicity data. Phase 3 will begin in July, which will aim at proving that vaccines could actually prevent the viral disease.

Meanwhile, the risk-sensitive currencies like EUR and GBP gained a lot of traction in the market against the U.S. dollar, which weighed on the U.S. dollar and decreased its demand on Monday. The U.S. dollar index, which measures the value of the U.S. dollar against the basket of six currencies, lost more than 0.5% on Monday and fell near 99.80 level.

Daily Support and Resistance    

  • R3 108.04
  • R2 107.78
  • R1 107.56

Pivot Point 107.3

  • S1 107.09
  • S2 106.82
  • S3 106.61

USD/JPY – Trading Tips

The technical side of the USD/JPY mostly remains the same as the pair continues to exhibit choppy sessions in between 107.480 – 107.029 level. Overall, the pair has formed an ascending triangle pattern, and it’s been trading within the same triangle pattern. Bullish crossover of 107.485 level may extend buying until the next resistance level of 107.650, and violation of this could determine the actual trend in the pair. So far, the traders seem confused over the market sentiments. On the lower side, the pair is facing support by the upward trendline, which holds around 107 mark. Let’s trade choppy until the violation occurs. 

All the best for today! 

Categories
Forex Market Analysis

Daily F.X. Analysis, May 18 – Top Trade Setups In Forex – Sideways Trading In Play!

On the news front, the economic calendar remains busy on Friday. Today’s releases may trigger some price action in the Euro and U.S. related pairs, especially on the release of German GDP, Eurozone Flash GDP, and U.S. core retail sales figures, which are due to come out during European and U.S. session respectively.

On the news front, the economic calendar remains busy on Friday. Today’s releases may trigger some price action in the Euro and U.S. related pairs, especially on the release of German GDP, Eurozone Flash GDP, and U.S. core retail sales figures, which are due to come out during European and U.S. session respectively.

On the news front, the economic calendar remains busy on Friday. Today’s releases may trigger some price action in the Euro and U.S. related pairs, especially on the release of German GDP, Eurozone Flash GDP, and U.S. core retail sales figures, which are due to come out during European and U.S. session respectively.

Economic Events to Watch Today 

 

 

EUR/USD – Daily Analysis

During the early Asain trading session, the EUR/USD pair was closed at 1.08181 after placing a high of 1.08509 and a low of 1.07887. Overall the movement of the EUR/USD pair remained bullish throughout the day.

EUR/USD pair gained on Friday after falling for two consecutive days and recovered some of its weekly losses at the ending day of the week. 

The pair recovered its upward trend on the back of stronger EUR against weaker USD. Euro remained robust due to better than expected economic data from the whole bloc, and the U.S. dollar was ineffective due to poor than expected data on Friday. At 11:00 GMT, the German Purchasing Price Index for April was released, which showed a decline of 0.7% against the expected decline of 0.6% and weighed on single currency Euro. At 11:45 GMT, the French Final CPI for April came in as 0.0% against the expected 0.1% and weighed on Euro. 

At 13:00 GMT, the German Prelim GDP for the quarter came in line with the expectations of -2.2%. At 14:00 GMT, the Flash Employment Change for the quarter came in as -0.2% against the expectations of -2.0% and supported Euro. The Flash GDP for the whole bloc during the quarter came in line with the expected -3.8%. The Trade Balance for the whole bloc showed a surplus by 23.5B against the expected 17.2B and supported Euro.

Better than expected Employment data and Trade Balance from the whole bloc gave strength to the single currency and moved the pair towards the upside. On the other hand, the U.S. dollar was weaker against EUR due to poor than expected Retail Sales and Industrial Production data on Friday. The headline U.S. Retail Sales dropped by 16.4% during the month of April and weighed on the U.S. dollar while the Core Retail Sales were dropped by 17.2%, which added in the weakness of the dollar against Euro and moved the pair EUR/USD on the upside direction.

The U.S. Industrial Production showed a decline by 11.2% in the month of April against the forecasted decline by 11.5%, despite falling under the expected figure, the drop in U.S. industrial production gave an impact of weak U.S. economy and weighed on U.S. dollar. Stronger Euro against U.S. dollar and weaker dollar combined gave a push to EUR/USD pair on Friday to place a high of 1.08509.

Daily Support and Resistance

  • S1 1.0673
  • S2 1.0758
  • S3 1.079

Pivot Point 1.0843

  • R1 1.0874
  • R2 1.0928
  • R3 1.1013

EUR/USD– Trading Tip

The EUR/USD is trading at 1.0817, trading below 50 periods EMA resistance at 1.0838 level. Last week, the pair bounced off over the double bottom support level of 1.07756. On the 4 hour chart, the EUR/USD is closing candles within a symmetric triangle pattern, which drives mixed sentiment in the market. Extension of selling below 1.0843 level may lead the EUR/USD prices towards 1.07782 level, and below this, the next support is likely to be found around 1.0730. Consider staying bullish above and bearish below 1.0770 level today.

GBP/USD – Daily Analysis

The GBP/USD pair was closed at 1.21040 after placing a high of 1.22386 and a low of 1.31013. Overall the movement of pair remained bearish throughout the day. The GBP/USD pair was dropped to its fresh seven-week lowest level near 1.2100 on Friday on the back of the sudden pickup in demand for the U.S. dollar at last hours. Despite poor than expected Retail Sales data from the United States on Friday, the pair GBP/USD was dropped to its multi-week low level at the ending day of the week.

The growing fears of second-wave of coronavirus faded the hopes for quick global economic recovery and weighed on the U.S. dollar. The already weaker trend was then escalated after the relationship between the United States and China started to become even worse. The Sino-US relation headed towards a renewed trade war, especially after the U.S. commerce department cited security concerns against China on Friday. The U.S. Commerce Dept. took another step to cut off Chinese telco Huawei from the overseas chip manufacturing companies. 

The U.S. also accused Huawei of building backdoors in network infrastructure to help the Chinese government spying efforts. Huawei repeatedly denied this accusation of spying efforts by Trump’s administration. Chinese officials have said they would respond to this, which decreased the risk appetite and gave a push to the greenback’s perceived safety-haven status. This ultimately dragged down the pair GBP/USD on Friday as there was no economic data to be released from the United Kingdom. The pair’s movement was solely dependent on the greenback’s demand.

Furthermore, over the weekend, the Cabinet Office Minister Michael Gove said that Brexit negotiations were going well, but E.U. needed to show some flexibility. He added that very little progress was made after the third Brexit talks, which were conducted on Friday. Both sides have shown frustration over the slow progress in trade talks, and the U.K. has geared up its preparations to leave the block without any deal. The U.K. has already said that it will not extend the negotiations process beyond December 31. 

The sticking point during the negotiations has been the access to fishing waters. E.U. wanted to have the same access they had to the U.K.’s fishing water, but Britain was not allowing it. If no-deal Brexit happened then, both parties would have to follow the rules of the World Trade Organization. On the other side, E.U.’s top negotiator, Mr. Barnier, has said that the U.K. could not have the best of both worlds, and if it were meant to be No-deal Brexit, then E.U. would step up to prepare for no-deal outcomes. 

The E.U. has also denied that the U.K. was wrong to think that slowing the process of talks would end up E.U. accepting the deal at any price. Growing fears of No-deal Brexit also caused GBP’s weakness against the U.S. dollar and dragged the pair to its lowest for seven weeks.

Daily Support and Resistance

  • R3 1.2137
  • R2 1.2123
  • R1 1.2104
  • Pivot Point 1.209
  • S1 1.2071
  • S2 1.2057
  • S3 1.2038

GBP/USD– Trading Tip

The GBP/USD fell into the oversold zone to trade at 1.2070 level, but the recent closing of Doji candle and bullish engulfing above 1.2076 support zone is likely to drove bullish correction in the market. On the higher side, the GBP/USD is likely to provide resistance around 1.2177, while the support level continues to hold around 1.2070. Below this, the next support could be found around 1.2040, which is extended by the bottom of the downward channel and can be seen on the 4-hour chart. Let’s consider staying bullish above 1.2070 today. 

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 107.086 after placing a high of107.434 and a low of 106.855. Overall the movement of the USD/JPY pair remained bearish throughout the day. The decreased appetite for the risk helped the safe-haven JPY to gather strength in the early American trading session and dragged the USD/JPY pair prices on Friday below the 107 level. However, the pair USD/JPY managed to erase some of its daily losses after gaining traction in the late trading session.

 At 4:50 GMT, the Purchasing Price Index for the year from Bank of Japan was released, which dropped to -2.3% against the forecasted decline by -1.4% and weighed on JPY. From the American side, the closely watched Retail Sales data was released, which came in poor than expectations and weighed on the U.S. dollar. At 17:30 GMT, the Core Retail Sales for April dropped by 17.2% compared to -8.6% forecasted. The Retail Sales from the United States also declined in April by 16.4% while it was expected to be decreased by 12%.

More than expected decline in the total value of sales at the retail level from the United States during the previous month showed a decline in consumer spending and gave the negative impact of the U.S. economy, which in turn weighed on U.S. currency. Weak USD dragged the USD/JPY pair along with it below the 107 level on Friday.

The Empire State Manufacturing Index showed a decline to 48.5 against the expected reduction of 65.0. At 18:15 GMT, the Capacity Utilization Rate, which measures the capacity by which raw-material was used by manufacturers during April increased to 64.9% from the forecasted 63.9% and supported USD.

The Industrial Production in April also dropped by 11.2% but remained less than the forecasted decline of 11.3%. At 19:00 GMT, the Consumer Sentiment from the University of Michigan showed an improvement in consumers’ confidence over the U.S. economy when released as 73.7 against 68.0 in May. 

Daily Support and Resistance    

  • R3 109.37
  • R2 108.57
  • R1 108.12

Pivot Point 107.33

  • S1 106.88
  • S2 106.09
  • S3 105.64

USD/JPY – Trading Tips

On Monday, the USD/JPY traded bearishly to trade below the support level of 107, which marked the 50% Fibonacci retracement level. The USD/JPY is holding at 107.05, where the 50 EMA is supporting the pair, and it may drop further below the 107 level. At the moment, the 4-hour candle appears to close below 107 support become resistant, and this may drive more selling in the USD/JPY pair. The pair may extend selling until 106.600 level, whereas the closing of buying candles above 107 can trigger bullish bias until 107.50. By the way, bearish bias seems solid today. All the best for today! 

Categories
Forex Market Analysis

Gold Holds Below Top Triple Pattern – Can Retail Sales Drive Breakout?

The safe-haven-metal prices extend its 3-winning streak and take bids near 3-weeks high around $1,733 while representing 0.12% increase on the day as US-China tension keeps traders in a cautious mode. As well as, investors turned into the safe-haven-metal after mixed Chinese industrial production and retail sales data, as well as Thursday’s U.S. jobless claims data. 

The safe-haven-metal prices extend its 3-winning streak and take bids near 3-weeks high around $1,733 while representing 0.12% increase on the day as US-China tension keeps traders in a cautious mode. As well as, investors turned into the safe-haven-metal after mixed Chinese industrial production and retail sales data, as well as Thursday’s U.S. jobless claims data. 

The safe-haven-metal prices extend its 3-winning streak and take bids near 3-weeks high around $1,733 while representing 0.12% increase on the day as US-China tension keeps traders in a cautious mode. As well as, investors turned into the safe-haven-metal after mixed Chinese industrial production and retail sales data, as well as Thursday’s U.S. jobless claims data. 

Earlier in the morning, the yellow-metal erases some gains in the wake of Increasing odds of no negative rates. While the possibility of another stimulus recently favored the market risk-tone before the China data. At this moment, the yellow-metal prices are currently trading at 1,735.55 and consolidate in the range between the 1,728.84 – 1,738.61.

China showed a confusing picture of its recovery from the COVID-19 virus as it’s said that industrial production in April rose 3.9% year-on-year, higher than the 1.5% predicted by analyst forecasts. Whereas, it also said that retail sales in the same month slipped 7.5% year-on-year, against analyst estimates of a 7% drop. The U.S. showed that 2.981 American citizens lost their jobs during the past week, Anyhow, the number of unemployment has been declining gradually over six weeks, but 36 million claims have been filed so far since late March.

On the other hand, the market risk sentiment got some support during the earlier morning from the increasing odds of another stimulus from the U.S., as well as, the reason for the risk-on market sentiment could also be attributed to the statement from the Fed policymakers about ruled out negative Fed rates.

Apart from these, the yellow-metal bullish moves also bolstered by the bill, which is recently passed by U.S. Senate about enabling the administration to fresh levy sanctions on Chinese officials involved in the Xinjiang case.


Support Resistance
1722.44 1752.94
1703.97 1764.97
1691.94 1783.44
Pivot Point 1734.47

Gold prices continue to hold below the triple top resistance level of 1,740. Bullish crossover of this level may drive more buying in gold, leading to its prices towards the next resistance level of 1,748. The support continues to hold around 1,728 and 1,722 level today, while the MACD is showing neutral sentiments ahead of the release of U.S. retail sales data. Besides this, the 50 EMA is also supporting the gold’s bullish bias today. Let’s keep an eye on 1,740 as selling can be seen below this, and buying above the same level today. Good luck! 

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Forex Market Analysis

Daily F.X. Analysis, May 15 – Top Trade Setups In Forex – U.S. Retail Sales in Highlights!

On the news front, the economic calendar remains busy on Friday. Today’s releases may trigger some price action in the Euro and U.S. related pairs, especially on the release of German GDP, Eurozone Flash GDP, and U.S. core retail sales figures, which are due to come out during European and U.S. session respectively.

On the news front, the economic calendar remains busy on Friday. Today’s releases may trigger some price action in the Euro and U.S. related pairs, especially on the release of German GDP, Eurozone Flash GDP, and U.S. core retail sales figures, which are due to come out during European and U.S. session respectively.

On the news front, the economic calendar remains busy on Friday. Today’s releases may trigger some price action in the Euro and U.S. related pairs, especially on the release of German GDP, Eurozone Flash GDP, and U.S. core retail sales figures, which are due to come out during European and U.S. session respectively.

Economic Events to Watch Today 

 

 

 

EUR/USD – Daily Analysis

During the early Asain trading session, the EUR/USD currency pair flashing green, but remains trading in the confined range around above the 1.0800 level ahead of Germany’s preliminary gross domestic product (GDP) for the first quarter. The broad-based U.S. dollar modest weakness helping the currency pair to stay positive and kept a lid on any additional losses, at least for now. For example, the currency pair is looking directionless as the S&P 500 is sidelined, and the Asian stocks are adding in a mixed performance. 

The EUR/USD is trading at 1.0806 and consolidates in the range between the 1.0798 – 1.0809. However, the traders are keenly awaiting Germany’s preliminary gross domestic product ahead of a strong position.

At the data front, Germany’s preliminary gross domestic product (GDP) for the first quarter, which is scheduled to publish at 06:00 GMT, is anticipated to show the old continent’s biggest economy declined by 2.2%, having increased by 0.4% in the final 3-months of 2019. It should be noted that the GDP prints of -2.2% or lower would be considered the worst reading since the ist-quarter of 2009. 

Germany had declared a secure national lockdown on March 22, which meant the economic activity came to a stop only in the last 8 or 9 of the 1st-quarter. In contrast, Germany is dependent on the dragon nation, which had already faced a sharp recession in the activity in the first two months of the year, mainly due to the coronavirus pandemic.

Therefore, there are many chances that Germany reporting a bigger-than-expected recession in the first quarter will not be rejected. As we already mentioned, the economists are expecting a 2.2% decrease, as per Germany’s DIW economic institute, the economy expected declined by 2% in the first quarter. Alternatively, the DIW expects a 10% decline in the GDP in the second quarter. 

Moving on, the EUR/USD currency pair may not pay any significant attention if the GDP prints in line with estimates as the market already priced in the worst condition of significant economies during the March and more so in April caused by coronavirus outbreak.

The currency pair could be able to take bids only if prints would be a surprise beat on expectations, but the gains would be temporary or short-lived if the risk sentiment turns heavy. Looking forward, market participants now look forward to Germany’s preliminary gross domestic product (GDP) for the first quarter, which is scheduled to publish at 06:00 GMT. The trade/virus updates could also entertain market traders.

Daily Support and Resistance

  • S1 1.0673
  • S2 1.0758
  • S3 1.079
  • Pivot Point 1.0843
  • R1 1.0874
  • R2 1.0928
  • R3 1.1013

EUR/USD– Trading Tip

On Friday, the EUR/USD is trading at 1.0807, bouncing off over the double bottom support level of 1.07756. On the 4 hour chart, the EUR/USD is closing bullish candles above upward channel trendline, but at the same time, the 50 EMA and horizontal resistance seem to drive bearish sentiment for the EUR/USD pair. Extension of selling below 1.0843 level may lead the EUR/USD prices towards 1.07782 level, and below this, the next support is likely to be found around 1.0730. Consider staying bullish above and bearish below 1.0770 level today. 

GBP/USD – Daily Analysis

The GBP/USD currency pair failed to stop its 5-day losing streak and dropped below the 1.2210 level while representing 0.15% losses on the day mainly due to the Brexit worries and coronavirus crisis. The broad-based U.S. dollar over-all bullish sentiment also weighed on the currency pair and kept the pair down. The GBP/USD is trading at 1.2208 and consolidates in the range between the 1.2203 – 1.2237. However, the traders are cautious about placing any strong position as they are keenly awaiting today’s U.S. consumer-centric data.

At the Brexit front, the European Union (E.U.) and the United Kingdom moderators are still pushing to cancel Brexit talk, which decided to happen through video conferences. At the same time, the European Commission’s (E.C.) took legal action against the U.K., which made talks tougher to happen. The European Commission initiated legal proceedings against the U.K. on Thursday, while accusing the U.K. about failing to comply with E.U. law on free movement which eventually keeps the cable currency under pressure and contributes to the pair’s declines.

On the flip side, the UK PM Boris Johnson keeps its preference high toward border checks at the Northern Ireland (N.I.) while the N.I. Secretary Brandon Lewis has repeatedly said there shall not be a border down the Irish Sea.

At the coronavirus front, the infected cases by coronavirus reached around 233 thousand overall in England, including 25 thousand in London,

as per the latest research by the Public Health England (PHE) and Cambridge University. In the meantime, the United Kingdom is talking with Swiss drugmaker Roche Holding AG about to buy an accurate COVID-19 antibody test after getting preliminary approval by the European Union and the United States.

Apart from this, the Bank Of England governor Andrew Bailey showed a willingness to take further action but denied rate cuts. The reason for the pairs bearish moves could also be attributed to the statement of the British central bank’s citizen panel in which they expect COVID-19 to have a large and enduring influence on the economy and society more broadly.

At the USD front, the broad-based U.S. dollar bolsters by the receding expectations of negative Fed rate and the increased probabilities of further stimulus from the government. While the Dollar Index (DXY), a gauge of the greenback versus significant currencies, remains mildly bid around 100.30 by the press time.

Daily Support and Resistance

  • R3 1.2577
  • R2 1.2508
  • R1 1.2422

Pivot Point 1.2353

  • S1 1.2268
  • S2 1.2198
  • S3 1.2113

GBP/USD– Trading Tip

On the last trading day of the week, the GBP/USD is trading sideways at 1.2200 after breaking below the narrow trading range of 1.2320 – 1.2245. The Cable has formed a new range of 1.2245 – 1.2186, however it’s still holding below 50 EMA, which is extending resistance around 1.2260 level today. On the 4 hour chart, the GBP/USD is gaining support at 1.2180 level while the 50 EMA and horizontal resistance stay at a level of 1.2245. 

The violation of the sideways trading range of 1.2245 – 1.2180, and the release of U.S. retail sales may help drive breakout in the GBP/USD pair. 

The GBP/USD pair may lead its prices towards an immediate support level of 1.2190 and 1.2150 in case of positive date; elsewhere, the GBP/USD pair may soar towards 1.2240 and 1.2310. 

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 107.224 after placing a high of 107.363 and a low of 106.773. Overall the movement of the USD/JPY pair remained bullish throughout the day. After dropping below 107 level on Thursday, the USD/JPY pair regained its strength and posted gains for the day on the back of the improved market sentiment. The increased claims for jobless benefits from the United States during the last week failed to weigh on the U.S. dollar. A total of 2.9M Americans applied for unemployment benefits in the previous week against the expected 2.5M.

At 17:30 GMT, the Unemployment Claims for last week exceeded the expectations of 2500K and came in as 2981K and weighed on the U.S. dollar. The Import Prices for April were declined by 2.6% against the forecasted decline by 3.1% and supported the U.S. dollar.

The U.S. Dollar Index ignored the job data from the United States and moved above 100.40 level on Thursday, which helped USD/JPY pair to stretch its gains. Another factor adding in the upward trend of the USD/JPY pair was the comments from Donald Trump in support of the dollar. He said that a strong dollar was a great thing that could help in fast economic recovery after the coronavirus, this triggered the U.S. dollar buying wave and extended USD/JPY pair’s gains.

From the Japan side, at 4:50 GMT, The M2 Money Stock for the year from Japan was recorded as 3.7% against the forecast of 3.4% and supported Japanese Yen. At 10:59 GMT, the Prelim Machine Tool Orders for the year showed a decline of -48.3% in comparison to the previous -40.7%. 

Daily Support and Resistance    

  • R3 109.37
  • R2 108.57
  • R1 108.12

Pivot Point 107.33

  • S1 106.88
  • S2 106.09
  • S3 105.64

USD/JPY – Trading Tips

The safe-haven Japanese yen continues to trade in line with our previous forecasts. On Friday, the USD/JPY traded bearishly to trade below the support level of 107, which marked the 50% Fibonacci retracement level. The USD/JPY is holding at 107.05, where the 50 EMA is supporting the pair, and it may drop further below the 107 level. At the moment, the 4-hour candle appears to close below 107 support become resistant, and this may drive more selling in the USD/JPY pair. The pair may extend selling until 106.600 level, whereas the closing of buying candles above 107 can trigger bullish bias until 107.50. By the way, bearish bias seems solid today. All the best for today! 

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Forex Market Analysis

USD/CAD on a Bullish Mode – Forms Higher’s High & Highers Low Pattern In Play!

During Thursday’s Asian trading hours, the WTI crude oil prices looking directionless despite Wednesday’s decrease US inventory report. However, the crude oil prices trading mostly unchanged on the day near the $25.40. Technically, the 4-hour chart shows prices are confined between the tight price range outlined by the trendlines from May 7 and May 13 highs and May 6 and May 7 lows. 

During Thursday’s Asian trading hours, the WTI crude oil prices looking directionless despite Wednesday’s decrease US inventory report. However, the crude oil prices trading mostly unchanged on the day near the $25.40. Technically, the 4-hour chart shows prices are confined between the tight price range outlined by the trendlines from May 7 and May 13 highs and May 6 and May 7 lows. 

During Thursday’s Asian trading hours, the WTI crude oil prices looking directionless despite Wednesday’s decrease US inventory report. However, the crude oil prices trading mostly unchanged on the day near the $25.40. Technically, the 4-hour chart shows prices are confined between the tight price range outlined by the trendlines from May 7 and May 13 highs and May 6 and May 7 lows. 

The reason for the confined trading could be attributed to the risk-off market sentient and second wave of coronavirus, which turned out to be one of the key factors that kept a lid on any gains in oil prices. The WTI crude oil is trading at 25.82 and consolidate in the range between the 25.20 – 26.00.

A range breakout would indicate a continuation of the recovery rally from lows below $10 observed in April. However, a bearish reversal would be confirmed if the range is breached to the downside. 

Thus, the breakout can’t be rejected because the US inventory report released Wednesday showed the 1st-decline in outputs since January. The US crude inventories dropped by 745,000 barrels last week, the Energy Information Administration said, compared with analysts’ expectations in a Reuters poll for a 4.1 million-barrel rise.

Support Resistance 

1.4032       1.4144

1.3962       1.4186

1.3919       1.4256

Pivot Point 1.4074

For the time being, the investors are cautious about placing any strong position mainly due to the fear of coronavirus second wave caused y easing lockdowns. As well as, the reason for the risk-off market sentiment could also be attributed to the renewed concerns concerning the economic slowdown. 

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Forex Market Analysis

Daily F.X. Analysis, May 14 – Top Trade Setups In Forex – U.S. Jobless Claims in Focus! 

The reason for the risk-off market sentiment could be attributed to the latest disagreeability about negative rates showed by Fed Chair Powell as well as Powell’s comments on the economy keep the market risk-tone heavy and helping the greenback to take bids. Let’s wait for the U.S. Jobless claims to predict further price action in the market. 

The reason for the risk-off market sentiment could be attributed to the latest disagreeability about negative rates showed by Fed Chair Powell as well as Powell’s comments on the economy keep the market risk-tone heavy and helping the greenback to take bids. Let’s wait for the U.S. Jobless claims to predict further price action in the market. 

The reason for the risk-off market sentiment could be attributed to the latest disagreeability about negative rates showed by Fed Chair Powell as well as Powell’s comments on the economy keep the market risk-tone heavy and helping the greenback to take bids. Let’s wait for the U.S. Jobless claims to predict further price action in the market. 

Economic Events to Watch Today 

 

 

EUR/USD – Daily Analysis

The EUR/USD currency pair flashing red and dropped from 1.0896 to 1.0812 on Wednesday while representing 0.10% losses on the day and currently drawing offers near below 1.0810 mainly due to the broad-based U.S. dollar strength in the wake of risk-off market sentiment. The reason for the risk-off market sentiment could be attributed to the latest disagreeability about negative rates showed by Fed Chair Powell as well as Powell’s comments on the economy keep the market risk-tone heavy and helping the greenback to take bids. The EUR/USD pair is trading at 1.0808 and consolidates in the range between the 1.0804 – 1.0825. However, traders are keenly awaiting the U.S. key data ahead of placing any strong position.

As we already mentioned that the market participants avoided risker assets and started buying the U.S. dollar mainly due to the risk-off market sentiment in the wake of renewed growth concerns. The Federal Reserve’s chairman gave warning on Wednesday about the scope and speed of the ongoing economic downturn while compared the slowdown pace with the World War II recession. Whereas, the Fed Chair Powell hints that the ongoing recession could be for the long-term if Congress fails to provide additional fiscal support.  

Moreover, the Fed Chair Powell said we are not looking forward to keeps the negative rates. As well as, the Cleveland Federal Reserve President Loretta Mester said, “Negative rates not a tool we think we would use to support the economy. The reasons for the heavy risk-tone could also be attributed to the US-China tussle. It should be noted that the recent fire shots of words from China came after the U.S. President Trump ended Federal retirement savings fund from diversifying into the Chinese stocks.

On the other hand, the final German Consumer Price Index for April, which is scheduled to release at 06:00, could fail to leave any strong impact on the market until or unless the number prints significantly below estimates. As in result, the shared currency may face stronger bearish moves. At the coronavirus front, the number of confirmed coronavirus cases increased to 172,239, with a total of 7,723 deaths reported according to the latest figures from the German disease and epidemic control center, Robert Koch Institute (RKI).

On the other hand, from the United States, the PPI data came in poor than expected and was almost ignored by the market traders. The Producer Price Index from the U.S. for April was dropped by -1.3% against the forecasted -0.5%. The Core PPI from the U.S. for April also dropped to -0.3% against the expectations of -0.1%. The U.S. dollar ignored the data and was supported by Powell’s speech on Wednesday, so the strong U.S. dollar dragged down the upward movement of EUR/USD pair on Wednesday and ended the pair’s day with a bearish candle. 

Market participants look forward to the key U.S. data, which highlights the U.S. Initial Jobless Claims, scheduled to release at 12:30 GMT, and final German Consumer Price Index for April, which is scheduled to release at 06:00, as these key data could influence the market moves. The trade/virus updates also will be key to watch.

Daily Support and Resistance

  • S1 1.0722
  • S2 1.0783
  • S3 1.0811

Pivot Point 1.0843

  • R1 1.0871
  • R2 1.0904
  • R3 1.0964

EUR/USD– Trading Tips

On Thursday, the EUR/USD price dropped to test the support level of 1.0800, which is extended bu the upward channel. On the chart, the EUR/USD os closing a Doji above upward channel trendline, but at the same time, the 50 EMA and horizontal resistance seems to drive bearish sentiment for the EUR/USD pair. Continuation of selling until 1.0778 level may lead the EUR/USD prices towards 1.07782 level, and below this, the next support is likely to be found around 1.0730. 

GBP/USD – Daily Analysis

During Thursday’s early Asian trading hours, the GBP/USD currency pair failed to stop its 4-day losing rally and dropped around 1.2200 while representing 0.26% losses on the day mainly due to the Wednesday’s downbeat performance of the U.K. data. The Brexit and coronavirus fears also weighed on the British Pound. Moreover, the broad-based U.S. dollar bullish trend in the wake of risk-off market sentiment keeps the currency under pressure. At the press time, the GBP/USD currency pair is currently trading at 1.2189 and consolidates in the range between the 1.2187 – 1.2242. However, traders are keenly awaiting the U.S. Jobless Claims for near-term direction in the greenback.

As we already mentioned that the reason for the pair’s declines could be attributed to the multiple factors, like downbeat U.K. fundamentals, comprising sluggish data, coronavirus outbreak, Brexit worries, and most impactful is U.S. dollar strength.

The broad-based U.S. dollar is taking bids due to its safe-haven demand in the wake of risk-off market sentiment. Also, the Federal Reserve’s latest disagreeability from the negative rates bolstered the U.S. dollar strength. As well as, the ongoing uncertainty about coronavirus and the US-China trade war also keeps the market risk-tone heavy, which also contributed to the greenback’s gains. The U.S. Dollar Index that tracks the greenback against a basket of other currencies gained 0.03% to 100.317 by 11:47 AM ET (4:47 AM GMT).

However, the risk-off market sentiment further bolstered by the second wave of virus spread in major economies as well as the US-China tussle. At the U.K. data front, yesterday’s downbeat performance of the U.K. data urged the British Chancellor Rishi Sunak to say that there are many chances that the Uk economy will suffer in the deeper recession this year, and we’re already in the middle of that as we speak.

Powell said that Fed would continue using its tools in the betterment of economic recovery; however, it would need White House and Congress by its side for new fiscal aid. Powell stressed that the outlook of the economy was still uncertain, and risks remain downside. He did not give any signals about the negative interest rates and said that the need for them has not yet come. The pair dropped to 1.2210 level after Powell’s speech on the back of U.S. dollar strength on Wednesday and ended its day with a bearish candle.

Daily Support and Resistance

  • R3 1.2577
  • R2 1.2508
  • R1 1.2422

Pivot Point 1.2353

  • S1 1.2268
  • S2 1.2198
  • S3 1.2113

GBP/USD– Trading Tip

The GBP/USD bearish at 1.2200 after breaking below the narrow trading range of 1.2320 – 1.2245. The Cable is still holding below 50 EMA, which is extending resistance around 1.2350 level today. On the 4 hour chart, the GBP/USD is gaining support at 1.2185 level while the 50 EMA and horizontal resistance stay at 1.2365 level. Today, the U.S. jobless claims may drive the selling trend in the GBP/USD pair to lead its prices towards an immediate support level of 1.2190 and 1.2150. Conversely, the worse than expected Jobless Claims will lead the GBP/USD pair towards 1.2240 and 1.2310. 

USD/JPY – Daily Analysis

The USD/JPY pair was closed at 107.025 after placing a high of 107.275 and a low of 106.741. Overall the movement of USD/JPY remained Bearish throughout the day. The USD/JPY extended its previous day’s losses and continued its downward movement on Wednesday to post losses for the 2nd trading session. 

The pair followed the previous bearish trend in the early trading session, but after the speech from Jerome Powell, pair started to recover some of its daily losses and move in the reverse direction. However, the pair USD/JPY failed to reverse its direction due to poor than expected PPI reports from the U.S.

At 4:50 GMT, Japan’s Bank Lending figure for the year exceeded the expectations of 2.0% and came in as 3.0% in favor of Japanese Yen. The Current Account Balance from Japan’s Ministry of Finance showed a decline to 0.94T against the forecasted 1.29T for March. At 10:02 GMT, the Economy Watchers Sentiment dropped to a low of 7.9 against the forecasted 10.1 and showed that current economic conditions were not right.

Furthermore, Safe-haven Yen was also supported by the growing fears of the second wave of coronavirus along with the increased tensions between China &US, which weighed on the U.S. dollar.

From the American side, the Core Purchasing Price Index (PPI) for April showed a decline to -0.3% against the forecasted decline by -0.1% and weighed on U.S. dollar, which in turn added in the downfall of USD/JPY pair. The pair USD/JPY further dropped after the release of PPI, which also declined to -1.3% against the forecasted -0.5%.

Daily Support and Resistance    

  • R3 109.37
  • R2 108.57
  • R1 108.12

Pivot Point 107.33

  • S1 106.88
  • S2 106.09
  • S3 105.64

USD/JPY – Trading Tips

The USD/JPY traded bearishly to trade below the support level of 107, which marked the 50% Fibonacci retracement level. Currently, the USD/JPY is holding at 106.875, where the 50 EMA is resisting the pair, and it may drop further below the 107 level. At the moment, the 4-hour candle seems to close below 107 support become resistant, and this may drive more selling in the USD/JPY pair. The pair may extend selling until 106.600 level, whereas the closing of buying candles above 107 can trigger bullish bias until 107.50. By the way, bearish bias seems solid today. All the best for today! 

Categories
Forex Market Analysis

Daily F.X. Analysis, April 24 – Top Trade Setups In Forex – Retail Sales & Business Climate Ahead! 

The U.S. dollar soared versus major currencies despite bounce off in the crude oil prices, at the same time, the U.K. Brent also made some bullish recovery. The U.S. House of Representatives assumes to establish a nearly $500 billion coronavirus relief bill, which once again can trigger safe-haven demand of the U.S. dollar. 

The U.S. dollar soared versus major currencies despite bounce off in the crude oil prices, at the same time, the U.K. Brent also made some bullish recovery. The U.S. House of Representatives assumes to establish a nearly $500 billion coronavirus relief bill, which once again can trigger safe-haven demand of the U.S. dollar. 

The U.S. dollar soared versus major currencies despite bounce off in the crude oil prices, at the same time, the U.K. Brent also made some bullish recovery. The U.S. House of Representatives assumes to establish a nearly $500 billion coronavirus relief bill, which once again can trigger safe-haven demand of the U.S. dollar. 

During the Asian session, the U.S. dollar is headed for its best week since early April, as plunging oil prices pressures on commodity currencies and division over Europe’s emergency fund dragged on the euro. The market will mostly move based upon U.K. retail sales and German business climate figures today. 

Economic Events to Watch Today     

 

 

 

EUR/USD – Daily Analysis

The EUR/USD has traded bearishly at 1.0771 level after having violated the symmetric triangle pattern, which was supporting it around 1.0850. A daily close under 1.0783 level is likely to drive more sell-off below this level. Traders seem worries about potential recession since the release of worse than expected PMI figures. 

The drop in business activity not only in Germany but also in overall Europe has expanded in April, with both services and manufacturing witnessing a historic dip in output as a consequence of the COVID-19 pandemic and subsequent lockdown.

The headline Flash Germany Composite PMI recorded 17.1 in April, down distinctly from 35.0 in March, and by far, it’s the lowest reading since comparable figures were first collected more than 22 years ago. The preliminary figures were based on replies received between April 7-22. Shutdowns caused by the COVID-19 did not influence the survey response rate.

There remains some uncertainty that Europe is still not ready to deepen fiscal integration, and the finance ministers will likely be unable to give an appropriate fiscal stimulus. As in result, the peripheral bond spreads may widen, which may booster further losses in the EUR/USD currency pair.

The eurozone economy experienced the sheerest declines in business activity and employment ever registered during April as a consequence of actions taken to restrain the coronavirus break, according to provisional PMI survey figures. Later today, the focus will remain on the German Ifo Business Climate figures to determine further trends in the EUR/USD pair.

Daily Support and Resistance

  • R3 1.0917
  • R2 1.0881
  • R1 1.0828

Pivot Point 1.0792

  • S1 1.0739
  • S2 1.0703
  • S3 1.065

EUR/USD– Trading Tips

On Friday, the EUR/USD pair continues trading in a selling mode around 1.0773, perhaps due to weaker manufacturing and services PMI figures. The overall trading bias continues to be bearish as the EUR/USD prices are holding below 50 EMA, which is extending resistance around 1.0837 level.

On the 4-hour chart, the EUR/USD has violated the symmetric triangle pattern, which is driving the selling trend in the pair. Currently, it’s holding the pair over 1.077, which is the triple bottom level. Above this, a slight bullish recovery can be seen until 1.0850 level. While bearish breakout of 1.0765 level can drive selling until 1.0649 level today, let’s look for selling trades below 1.0770 level today.  

GBP/USD – Daily Analysis

The GBP/USD price is consolidating in a narrow trading range of 1.2424 – 1.2300. Sterling’s overall bias remains bearish since the release of manufacturing data. General business shutdowns at local and international levels in reply to the coronavirus infection 2019 (COVID-19) pandemic unsurprisingly ended in a speedy decline in U.K. private-sector production during April. 

The latest Markit report on Flash U.K. manufacturing PMI signaled by far the most robust drop in business activity since comparable figures were first collected over two decades ago. The latest Markit Flash U.K. Manufacturing PMI was recorded between 7-21 April 2020, and shutdowns did not influence the survey response rate in place due to the COVID-19 break.

The United States President Donald Trump continues to push for the economic re-start, whereas giving worse warnings to Iran. He indicated a decrease in the further coronavirus outbreak. The GBP/USD currency pair flashing buy and sell, now holding at 1.2345 while reporting 0.07% losses on the day, probably due to the Tory government growing criticism about the mishandling coronavirus crisis.  

Daily Support and Resistance

  • R3 1.0917
  • R2 1.0881
  • R1 1.0828

Pivot Point 1.0792

  • S1 1.0739
  • S2 1.0703
  • S3 1.065

GBP/USD– Trading Tip

The GBP/USD showed a slight bullish reversal to place a high around 1.2414, but the bullish trend wasn’t long enough as prices recorded soon. At the moment, the Cable is trading at 1.2347 area, which is also a resistance level extended by the downward channel. The 50 periods EMA also extend resistance at the same level 1.2368. A bullish breakout of 1.2368 level can extend the buying trend until 1.2420 level today. Elsewhere, the support continues to hold around 1.2258 level. The 50 EMA and MACD are both are suggesting selling bias in the Cable. So let’s look for selling trades below 1.2399 and bullish above 1.2420 level today. 

USD/JPY – Daily Analysis

On Friday, the USD/JPY is consolidating in a narrow trading range of 108.00 level to 107.500 level, mainly due to the risk-on market sentiment keeps the safe-haven Japanse lower and providing support to the currency pair. The U.S. announced 4.427 million initial jobless claims for the preceding week overnight, with an unparalleled 26 million people dropping their jobs since late March.

At the USD front, the U.S. dollar took bids due to mixed risk sentiment, which is starting to dominate the markets and caused the bearish pressure to remain intact. The U.S. Dollar Index, which dropped below the 100 marks earlier in the day, is up 0.12% on the day at 100.47 and stays on track to close the 4th-straight day in the positive area.

The latest pullback of the U.S. dollar kept a lid on bullish moves in the pair. Currently, the USD/JPY is trading at 107.67 and consolidates in the range between the 107.66 – 107.86. However, investors are cautious and waiting for a fresh catalyst before placing any position.

Whereas, the multiple diverging factors failed to provide any meaningful direction or assist the pair in breaking through a narrow trading band held since the beginning of this week. The reason behind the risk-on market sentiment is the report regarding the passage of another $484 billion U.S. economic support package by the U.S. Senate. While the latest modest recovery in crude oil prices also keeps the market sentiment calm. 

Looking ahead, the eyes will remain on the Core Durable Goods Orders m/mas that’s due during the U.S. session in order to forecast further trends in the USD related pairs. 

Daily Support and Resistance    

  • S1 105.92
  • S2 106.84
  • S3 107.44

Pivot Point 107.76

  • R1 108.36
  • R2 108.69
  • R3 109.61

USD/JPY – Trading Tips

The USD/JPY is mostly trading sideways within a narrow trading range of 108.020 – 107.300 zones. At the moment, it’s holding at 107.597, having formed a descending triangle pattern on the 4-hour timeframe. The triangle pattern is extending resistance around 107.850, along with support around 106.980. If USD/JPY manages to violate the descending triangle pattern, we may see pair dropping towards 106.200. While on the upper side, a bullish breakout of 108 can lead USD/JPY prices towards 109.100. The leading indicator, such as MACD and 50 EMA, are supporting bearish bias in the market today. 

All the best for today! 

Categories
Forex Signals

EUR/CHF Set to Test Major Resistance – Is It Good Time to Short? 

 

 

 

The EUR/CHF is trading at 1.05935 after testing the 61.8% Fibonacci support around 1.0570. Closing of candles above this level may drive buying in the market until 1.06060 and 1.06235 resistance areas. On the lower side, a bearish breakout of 1.0570 level can lead the EUR/CHF prices towards the next support level of 1.0530.

EUR currency may not find buyers due to intensifying recession fears. Moreover, the European Central Bank’s decision to launch a fresh EUR 750 billion worth of QE program could keep the EUR buyers quiet.


EUR/CHF- Daily Technical Levels

Support Resistance 

1.0563 1.0635

1.0527 1.0672

1.0455 1.0745

Pivot Point 1.06

Technically, EUR/CHF is keeping the bearish bias as the pair has closed a bearish engulfing candle below 1.0602 support become resistance area, and the MACD is also in the selling zone. Both support the sentiment that the pair has the potential to go after further lower towards 1.0560 soon. 

Entry Price: Sell at 1.05868

Take Profit 1.05468

Stop Loss 1.06268

Risk/Reward 1.00

Profit & Loss Per Standard Lot = -$410/ +$410

Profit & Loss Per Micro Lot = -$41/ +$41

Categories
Forex Market Analysis

Daily F.X. Analysis, March 30 – Top Trade Setups In Forex – German Inflation Figures Ahead! 

The U.S. Dollar Index slid 0.9% on the day to 98.36 on Friday, wiping out most of its gains made in the prior week. During the day ahead, eyes will be on the European Commission will report the Eurozone’s March Economic Confidence Index (93.1 expected) and final readings of the Consumer Confidence Index (-11.6 previously).

The U.S. Dollar Index slid 0.9% on the day to 98.36 on Friday, wiping out most of its gains made in the prior week. During the day ahead, eyes will be on the European Commission will report the Eurozone’s March Economic Confidence Index (93.1 expected) and final readings of the Consumer Confidence Index (-11.6 previously).

The U.S. Dollar Index slid 0.9% on the day to 98.36 on Friday, wiping out most of its gains made in the prior week. During the day ahead, eyes will be on the European Commission will report the Eurozone’s March Economic Confidence Index (93.1 expected) and final readings of the Consumer Confidence Index (-11.6 previously).

The German Federal Statistical Office will post March CPI (+1.4% on-year expected). The Bank of England will release the number of mortgage approvals in February (68,200 expected) and the M4 money supply.

Economic Events to Watch Today    

 

 

EUR/USD – Daily Analysis

The EUR/USD jumped 1.0% to 1.1142, posted a five-day rally. Later today, the eurozone’s March Economic Confidence Index (93.1 expected) and German CPI (+1.4% on-year estimated) will be reported.

A series of economic fundamentals drove the pair, and even today market is likely to move on news. In particular, the U.S. initial jobless claims are expected to have risen to 1,000K from the preceding week’s 281K figure in the week ended March 20. The European Union’s upcoming emergency meeting to discuss further steps to combat the virus will be essential to watch. 

Global equities recovered last week, as in result, the greenback weakened its bid tone and helped EUR/USD rise from 1.0636 to 1.1148. That was mainly due to the US Federal Reserve declaring an open-ended asset purchase program, and the US Senate passed a special $2 trillion fiscal relief package. 

At the coronavirus front, Italy marked as the second-highest country of confirmed cases in the world after the United States (105,470). Total cases are 92,472 confirmed, marking up the highest death rate in the world. 

Looking forward, the traders will keep their eyes on the Eurozone consumer and business sentiment indices, which are scheduled to release along with the preliminary German Consumer Price index for March. Apart from this, the eyes will be on the Pending Home Sales and the Dallas Fed Manufacturing Index for taking near-term directions.

Daily Support and Resistance

  • S1 1.0673
  • S2 1.0835
  • S3 1.0935

Pivot Point 1.0997

  • R1 1.1097
  • R2 1.1159
  • R3 1.1321

EUR/USD– Trading Tips

On Monday, the direct currency pair EUR/USD is trading slightly bearish at 1.1025, having an immediate support level of around 1.0947. The major currency pair has formed a bullish channel which is supporting the EUR/USD pair around 1.1060, and below this, the next support is likely to be found around 1.1000. 

On the higher side, the EUR/USD pair is facing resistance at 1.1150 area. Bullish crossover of 1.1150 area can open further room for buying until 1.1195 level. Whereas, the chances of a bearish bias will remain strong if the pair continues to break below 1.1060 level today. On the lower side, the target is likely to stay at 1.0947 and 1.0885. 

GBP/USD– Daily Analysis

The GBP/USD surged 2.1% to a two-week high of 1.2457. The Bank of England (BOE) failed to offer any fireworks due to a lack of resources while disappointing U.K. Retail Sales, to 0.0% from 0.8% YoY forecast, also couldn’t recall the bears.

Guardian indicates the risk for the European Union citizens who have made their houses in the UK illegally. Whereas, Dr. Jenny Harries, deputy chief medical officer for England, said during his daily press conference on Sunday that the current limitations and lockdowns in the UK could continue for six months.

On the other hand, the United States President Donald Trump expects the virus figures to grow sharply in the next 2-weeks if they do not take lockdown seriously. As in result, the market’s risk-tone continues to flash red, with the US 10-year treasury yields declining below 0.70% and most Asian stocks marking losses by the press time.

Looking forward, the U.S. Dallas Fed Manufacturing and Pending Home Sales will be a key watch. Besides, the traders will also keep eyes on the virus headlines.

Daily Support and Resistance

  • S1 1.1678
  • S2 1.2019
  • S3 1.2234

Pivot Point 1.236

  • R1 1.2576
  • R2 1.2701
  • R3 1.3042

GBP/USD– Trading Tip

Technically, the GBP/USD is trading sideways around within a narrow trading range of 1.2275 – 1.2425. Since the Sterling has already crossed over 1.2275 resistance area, this is now going to work as a support. The MACD is still heading into the bullish zone, suggesting strong chances of buying the GBP/USD pair.

On the 4 hour timeframe, the GBP/USD pair is pretty much likely to find resistance around 1.2520, along with support around 1.2278. In the case of market breaks bellow 1.2278, we may see GBP/USD prices heading into the selling zone until 1.2100 and 1.2005. Whereas, the chances of buying remains solid over 1.2275 until 1.2520.

USD/JPY – Daily Analysis

The USD/JPY currency pair just started to flashing green and rose above 108.00 level at the press time, mainly due to the broad-based greenback recovery. However, China’s rate cut by 20 basis points on early Monday and infusion of $7 billion liquidity into the banking system started to giving some support to the equity market and turns the market risk-off tone into risk-on. 

The USD/JPY pair is currently trading at 108.08 and consolidates in the range between the 107.14 – 108.20. The USD/JPY pair was recently trading near 107.25 and was representing a 0.60% loss on the day, having hit a session low of 107.12 a few minutes before press time, but now the pair got boost after slight recovery came in the equity market.

The People’s Bank of China cut the seven-day reverse repo rate to 2.2% from 2.4% and injected $7 billion or 50 billion Japanese yuan into the banking system, which recently gave some support to the equity market.

Before some time, the action by China had failed to put a bid under the risky assets. The futures on the S&P 500 were keeping losses and was reporting a 1% decline on the day. Stocks in Asia were also feeling the pull of gravity with Japan’s Nikkei index was dropping 3.4%. As a result, the safe-haven Japanese yen was getting bid as safe-haven demand.

Looking forward, the currency pair may drop to their lowest level in the future, mainly due to the fears about the Japanese government may declare a state of emergency due to intensifying coronavirus fears. 

Daily Support and Resistance

  • S1 106.51
  • S2 108.16
  • S3 108.75

Pivot Point 109.8

  • R1 110.4
  • R2 111.45
  • R3 113.09

USD/JPY – Trading Tips

The USD/JPY is trading at 107.570, heading towards testing double bottom support around 107.615. For now, the pair is stuck in a narrow range, where the upper limit is 108.500, and the lower limit stays at 107.050. The USD/JPY is facing a bearish pressure in the wake of an increased number of coronavirus cases around the globe which are driving safe-haven appeal in the market.  

Consequently, the bearish breakout of 108.150 support level can lead the USD/JPY prices lower towards 105.950 level. Until then, we should look for doing choppy trading by selling below 108.400 and buying over 108.250. All the best for today!  

Categories
Forex Market Analysis

Daily F.X. Analysis, March 26 – Top Trade Setups In Forex – U.K. Monetary Policy In Focus! 

The greenback weakened against its major rivals, with the U.S. Dollar Index dropping 0.7% on the day to 100.94, down for a fourth straight session. For now, the focus shifts to the major economic events which will be releasing through the day. 

The greenback weakened against its major rivals, with the U.S. Dollar Index dropping 0.7% on the day to 100.94, down for a fourth straight session. For now, the focus shifts to the major economic events which will be releasing through the day. 

The greenback weakened against its major rivals, with the U.S. Dollar Index dropping 0.7% on the day to 100.94, down for a fourth straight session. For now, the focus shifts to the major economic events which will be releasing through the day. 

The Bank of England (BOE) will hold its monetary policy meeting, after a rate cut and additional bonds purchase announced last Thursday (March 19). The European Central Bank will publish the Eurozone’s M3 money supply in February (+5.2% on-year expected).

Germany’s GfK Consumer Confidence Index for April will be released (7.5 expected). France’s INSEE will release March indicators on business confidence (97 expected) and manufacturing confidence (93 expected).

Economic Events to Watch Today    

 

 

EUR/USD – Daily Analysis

The EUR/USD jumped 0.9% to 1.0888, posting a three-day rebound. Most of the moment, the pair was driven by a series of economic fundamentals, and even today market is likely to move on news. In particular, the U.S. initial jobless claims are expected to have risen to 1,000K from the preceding week’s 281K figure in the week ended March 20. 

If jobless claims fall in the 2 to 3 million range, which seems fairly possible, we will likely see a notable sell-off in the greenback. In that case, the EUR/USD currency pair could find a bid over the 50-day moving average at 1.10. On the other hand, the EUR/USD currency pair will also take cues from the Kansas Fed Manufacturing Activity index for March. 

Meanwhile, the European Union’s upcoming emergency meeting to discuss further steps to combat the virus will be essential to watch. Markets are assuming that the Eurozone is going for a deep slowdown, and they need aggressive stimulus to stop the fallout from the virus outbreak.

Looking forward, the European Central Bank will release its monthly Economic Bulletin while the weekly Initial Jobless Claims, Goods Trade Balance, and Q4 Gross Domestic Product (GDP) data from the U.S. will be key to watch.

Daily Support and Resistance

  • S1 1.0531
  • S2 1.0673
  • S3 1.0742

Pivot Point 1.0815

  • R1 1.0885
  • R2 1.0957
  • R3 1.11

EUR/USD– Trading Tips

On Thursday, the EUR/USD is trading bullish at 1.0935, having an immediate support level of around 1.0890. The bullish channel that you can see in the chart above is also supporting the bullish bias in the EUR/USD pair, and it’s supporting the direct currency pair at 1.0890. 

Closing of the bullish engulfing candle and three bearish two-hourly candles above 1.0890 support is signifying a bullish breakout, which can lead the pair towards 1.0959 resistance level. While the bearish breakout of 1.0890 can lead the EUR/USD prices towards 1.0780. Let’s consider staying bullish above 1.0890 today with an initial target of 1.0950. 

GBP/USD– Daily Analysis

The GBP/USD climbed 0.6% to 1.1833. Official data showed that U.K. CPI grew 1.7% on year in February as expected, compared with a 1.8% growth in January. Later today, the Bank of England will hold its monetary policy meeting, after a rate cut and additional bonds purchase announced last Thursday. Also, U.K. retail sales data for February will be released (+0.2% on month estimated).

The policymakers could be called with the 24-hour prior notice to vote on the coronavirus support package on Friday. On the U.S. front, the coronavirus fears in the U.S. also increased with the death losses crossed 1,000 figures and an increase of 12,000 cases recorded in the single day on Wednesday.

Later in the day, the Bank of England will hold its monetary policy meeting, after a rate cut and additional bonds purchase announced last Thursday (March 19). While the U.K. Retail Sales are expected to remain unchanged at 0.80% YoY but any major chances likely offer a new direction to the GBP/USD prices. The U.K. Office for National Statistics will report February retail sales (+0.2% on month expected).

Daily Support and Resistance

  • S1 1.1339
  • S2 1.1535
  • S3 1.1662

Pivot Point 1.1731

  • R1 1.1858
  • R2 1.1927
  • R3 1.2122

GBP/USD– Trading Tip

The GBP/USD has violated a broad trading range of 1.1400 – 1.1885, and the pair now trades around 1.1930, the level which is marked as a triple top. The Bank of England’s rate decision today will play a major role in determining it’s a trend. Today, the bullish breakout of the 1.1930 level can open the buying trend until the next resistance level of 1.2185 (38.2% Fibo level) and 1.2300 level, which accounts for a 50% retracement. On the lower side, the Cable can find support around 1.1665 and 1.1445. Let’s look for buying trades over the 1.1945 resistance level and selling below the same today. 

USD/JPY – Daily Analysis

During Thursday’s early Asian session, the USD/JPY dropped to a session low of 110.45 from the high of 111.30 after the market sentiment shifts, mainly due to the United States Congress, which failed to come together and agree on relief package plan after facing recent hurdles. While the broad-based USD weakness also undermines the currency pair. 

At the moment, the USD/JPY is trading at 110.52 and consolidates in the range between the 110.38 – 111.31. However, the safe-haven Japanese yen is continuing its bullish move, which seen in early Asia sessions due to fresh losses in the U.S. stock futures.

The risk-off market sentiment strengthened, pushing the futures tied to the S&P 500 futures lower. At press time, the index futures are reporting a 1% decline. On the other hand, the coronavirus outbreak is not showing any sign of slowing down in the U.S., Japan, and European countries. 

There was a sharp rise in cases in Tokyo and gave a warning about the lockdown, which eventually strengthing the risk-off market sentiment and boosting the safe-haven Japanese yen.

Daily Support and Resistance    

  • S1 107.85
  • S2 109.43
  • S3 110.32

Pivot Point 111.02

  • R1 111.91
  • R2 112.6
  • R3 114.19

USD/JPY – Trading Tips

The intensified safe-haven demand has started driving the bearish trend in the USD/JPY currency pair as it trades at 110.350, down from 111 level. On the 4 hour chart, the USD/JPY was trading in a bullish channel, which supported the USD/JPY prices around 110.650. Since this level has already been violated, now it’s going to work as a resistance for the USD/JPY. 

 

As forecasted earlier, a bearish breakout of 110.600 can lead its prices toward 109.600 level, and that’s what the market is trying to do now. The USD/JPY prices are heading towards the next support level of 109.850, and around this level, we can expect USD/JPY to bounce off a bit. However, in case of a bearish breakout of 109.850 level, the pair may drop further until 108.450. 

All the best for today!  

Categories
Forex Market Analysis

Daily F.X. Analysis, March 25 – Top Trade Setups In Forex – Brace for U.K. Inflation Figures! 

The U.S. stocks soared on news of Congress is close to passing a substantial coronavirus relief bill. The sentiment was further boosted by President Donald Trump’s comments that he would like the U.S. economy to reopen by Easter in mid-April. The Dow Jones Industrial Average surged 2113 points (+11.4%) to 20,704, its biggest one-day percentage gain since 1933. The S&P 500 jumped 209 points (+9.4%) to 2,447, and the Nasdaq 100 rose 546 points (+7.8%) to 7,553. 

The U.S. stocks soared on news of Congress is close to passing a substantial coronavirus relief bill. The sentiment was further boosted by President Donald Trump’s comments that he would like the U.S. economy to reopen by Easter in mid-April. The Dow Jones Industrial Average surged 2113 points (+11.4%) to 20,704, its biggest one-day percentage gain since 1933. The S&P 500 jumped 209 points (+9.4%) to 2,447, and the Nasdaq 100 rose 546 points (+7.8%) to 7,553. 

The U.S. stocks soared on news of Congress is close to passing a substantial coronavirus relief bill. The sentiment was further boosted by President Donald Trump’s comments that he would like the U.S. economy to reopen by Easter in mid-April. The Dow Jones Industrial Average surged 2113 points (+11.4%) to 20,704, its biggest one-day percentage gain since 1933. The S&P 500 jumped 209 points (+9.4%) to 2,447, and the Nasdaq 100 rose 546 points (+7.8%) to 7,553. 

Later today, February durable goods orders (preliminary reading, -1.0% on month expected) will be reported. 

Economic Events to Watch Today    

 

 

EUR/USD – Daily Analysis

The EUR/USD advanced 0.8% to 1.0809. The Markit Eurozone Manufacturing PMI slid to 44.8 in March (39.0 expected) from 49.2 in February and Services PMI sank to 28.4 (39.5 expected) from 52.6. 

The EUR/USD currency could drop below the 1.08 if the coming German IFO Expectations Index for March disappoints expectation of 82, strengthening recession fears. Apart from this, U.S. Durable Goods data for February is also scheduled to release. 

The traders need progress soon in the global market; otherwise, the risk assets may suffer another selloff, boosting haven demand for the U.S. dollar. At press time, the S&P 500 futures are reporting a 1.4% drop. 

The U.S. dollar continues trading in the red territory against majors, as shown by the 0.3% drop in the dollar index. Federal Reserve’s unlimited quantitative easing plan has decreased pressure in funding markets and bought time for the politicians. 

The headlines regarding coronavirus and stimulus package by the Federal Reserve will be key to watch. Eyes will be on the German IFO Expectations Index for taking new directions.

Daily Support and Resistance 

  • S1 1.0531
  • S2 1.0673
  • S3 1.0742

Pivot Point 1.0815

  • R1 1.0885
  • R2 1.0957
  • R3 1.11

EUR/USD– Trading Tips

On Wednesday, the EUR/USD is trading sideways, forming higher’s high and higher’s a low pattern, which indicates stronger chances of a bullish bias in the market. The EUR/USD is trading around 1.0815, and it’s forming neutral candles while trading in an upward channel, which may support the pair around 1.0775. 

On the higher side, the EUR/USD pair may face resistance around 1.0880, and above this, the pair has the potential to target the next resistance level of 1.0930 while the EUR/USD has odds of staying bearish below 1.0920 to target 1.0805.

GBP/USD– Daily Analysis

The GBP/USD surged 2.1% to 1.1789 after the U.K. government ordered lockdown measures to stop coronavirus spreading. On the other hand, the Markit U.K. Manufacturing PMI fell to 48.0 in March (45.0 expected) from 51.7 in February, and Services PMI dipped to 35.7 (45.0 estimated) from 53.2.

The GBP/USD currency pair may drop to their lowest level if the UK CPI data releases sluggish while a surprise positive figures could help the pair extend its fresh recovery rally from the multi-year low.

The Consumer Price Index published by the Office for National Statistics is a gauge of price moves by the comparison among the retail prices goods and services. The purchasing power of GBP is slowed down by inflation.

The CPI is a leading indicator to measure inflation and show changes in purchasing trends. Usually, a high figure is understood as positive (or bullish) for the GBP, while a sluggish figure is seen as negative (or Bearish). Let’s look at the technical side of the market. 

Daily Support and Resistance

  • S1 1.1339
  • S2 1.1535
  • S3 1.1662

Pivot Point 1.1731

  • R1 1.1858
  • R2 1.1927
  • R3 1.2122

GBP/USD– Trading Tip

The direct currency pair GBP/USD maintains a broad trading range of 1.1400 – 1.1885 for another day as traders seem to wait for the U.K. Inflation today and Bank of England’s rate decision tomorrow. Today, the bullish breakout of the 1.1889 level can open the buying trend until the next resistance level of 1.2185 (38.2% Fibo level) and 1.2300 level, which accounts for a 50% retracement. On the lower side, the Cable can find support around 1.1665 and 1.1445.

A bearish breakout of 1.1425 level can lead the Cable towards the next support area of 1.1050. The MACD is tossing above and below zero as investors are unable to determine the trend of the market. 

USD/JPY – Daily Analysis

During the Wednesday early Asian session, the USD/JPY currency pair found on the bullish track and hit the session high near 111.58, mainly due to the recovery in the market risk sentiment because the United States policymakers agreed on COVID-19 bill. The USD/JPY is trading at 111.48 and consolidates in the range between the 110.75 – 111.56. 

After the two-days of disappointment, the Senate Democrats and Republicans ultimately agreed on the Trump administration-backed stimulus package plan. However, the raised expectations of the expected $2 trillion package to control the deadly virus impact and fresh strategy of reducing coronavirus (COVID-19) cases from Italy also improved the market risk sentiment.

Whereas, the United States 10-year treasury yields rose 4-basis points (bps) to 0.853% while the U.S. stock futures also decreased earlier losses. The Asian stocks flashing green and marked slight gains by the press time, which show’s drop in demand for safe-haven assets such as gold and Japanese yen.

For the time being, the traders are keenly awaiting the details of the voting as well as the times of the package for taking additional direction. However, the U.S. Durable Goods Orders for January and additional coronavirus headlines will be key to watch.


Daily Support and Resistance    

  • S1 107.85
  • S2 109.43
  • S3 110.32

Pivot Point 111.02

  • R1 111.91
  • R2 112.6
  • R3 114.19

USD/JPY – Trading Tips

Technically, the safe-haven currency pair USD/JPY hasn’t changed a lot as it continues to consolidate around 111.300. On the 4 hour chart, the USD/JPY has formed a bullish channel that is still intact, and it’s pretty much likely to support the USD/JPY prices around 110.650. 

A bearish breakout of 110.600 can lead its prices toward 109.600 level. The USD/JPY prices towards the next support level of 108.350, and around this level, we can expect USD/JPY to bounce off again. Conversely, the pair faces resistance around 111 and 112.190 today. Let’s stay bullish above 109.650 and bearish below the same level today. 

All the best for today!  

Categories
Forex Market Analysis

Daily FX. Analysis, March 18 – Top Trade Setups In Forex – Inflation Figures Under the Spotlight! 

The US dollar strengthened against its major peers, with the ICE Dollar Index jumping 1.3% to a three-week high of 99.38. Later in the day, the European Commission will post final readings of February CPI (+1.2% on-year expected) and January trade balance (19.2 billion euros surplus expected).

The US dollar strengthened against its major peers, with the ICE Dollar Index jumping 1.3% to a three-week high of 99.38. Later in the day, the European Commission will post final readings of February CPI (+1.2% on-year expected) and January trade balance (19.2 billion euros surplus expected).

The US dollar strengthened against its major peers, with the ICE Dollar Index jumping 1.3% to a three-week high of 99.38. Later in the day, the European Commission will post final readings of February CPI (+1.2% on-year expected) and January trade balance (19.2 billion euros surplus expected).

During the US session, the eyes will be on the US Commerce Department, which is due to report February housing starts (1.5 million units expected) and building permits (1.5 million units expected).

Economic Events to Watch Today    

 

 

EUR/USD – Daily Analysis

The EUR/USD plunged from 1.5% to 1.1015. The ZEW German Current Situation Index dropped to -43.0 in March (-30.0 estimated) from -15.7 in February and Expectations Index dipped to -49.5 (-30.0 expected) from 8.7. It is worth to mention that the Eurozone’s powerhouse Germany has closed all borders, schools, public places, and unnecessary shops in the wake of intensifying coronavirus. As a result, the continuous decline in the economy could take the speed in the near term, which may add bearish pressures around the EUR.

Looking forward, the traders will keep their eyes on the broader market sentiment. If the global equities flash red, the USD will likely find buyers. At press time, the futures on the S&P 500 are reporting a 3 % decline.

The Federal Reserve and other major central banks have recently delivered rate cuts to ease the economic shock of the coronavirus pandemic. Meanwhile, the Fed has also launched a quantitative easing program worth $700 billion. Other major central banks have also played roles by cutting rates. 

The Trump administration announced on Tuesday that Trump administration is planning to give checks directly to Americans in the shape of a $1 trillion stimulus program. Moving ahead, the EUR/USD currency pair may return and possibly break below Tuesday’s low of 1.0955 if the stocks cheer the heavy monetary and fiscal stimulus.

Daily Support and Resistance

  • S1 1.0882
  • S2 1.1024
  • S3 1.1096

Pivot Point 1.1166

  • R1 1.1239
  • R2 1.1309
  • R3 1.1451

EUR/USD– Trading Tips

On Wednesday, the major currency pair EUR/USD continues to trade mostly lower after violating the horizontal support level pf 1.1095. The EUR/USD is currently trading around 1.0970, and it’s forming a lower-lows pattern on the 4-hour chart, which mostly drives a continuation of a selling trend. 

On the lower side, a continuation of a bearish bias can extend sell-off until 1.0920 and 1.0865. While the bullish breakout of 1.1096 can drive more buying until 1.1240 area. Consider staying bearish below 1.0970 today. 

GBP/USD– Daily Analysis

The GBP/USD sank 1.2% to 1.2118. Official data showed that the UK jobless rate for the three months to January climbed to 3.9% (steady at 3.8% expected). The US continues to struggle from every level, as well as the Federal Reserve, also doing the same to make sure that the world’s largest economy doesn’t getting infected due to the deadly virus. 

At the USD front, the greenback got support from the moves on Tuesday; the early-day decline could have taken clues from US Treasury Secretary Steve Mnuchin that the lack of action could send the Unemployment Rate to 20%.

Later today, the US Commerce Department will report February housing starts (1.5 million units expected) and building permits (1.5 million units expected), which may help determine further trends in the GBP/USD pair.  

The investors will keep their eyes on virus headlines and take clues from the coronavirus relating headlines while the US Senate voting on President Donald Trump’s major stimulus plan as well as the UK PM’s action will be essential to watch. 

Daily Support and Resistance

  • S1 1.1938
  • S2 1.211
  • S3 1.2189

Pivot Point 1.2282

  • R1 1.2362
  • R2 1.2454
  • R3 1.2626

GBP/USD– Trading Tip

A day before, the GBP/USD fell sharply to trade around 1.2060 level and has closed a bearish engulfing candle followed by Doji candles. It’s suggesting the odds of more selling in the market. The Cable has immediate support around 1.2170 level, and above this, the Cable can extend the continuation of a bullish bias until 1.1980 level and 1.1805. The MACD is consistently forming bearish histograms below zero, supporting the selling trend in the GBP/USD pair, which is why we should consider selling below 1.2100 today to target 1.1985 at first.  

USD/JPY – Daily Analysis

The USD/JPY rebounded 1.4% to 107.35. The USD/JPY currency pair dropped below the 107.00 and hit the fresh session lows in the last hours, mainly due to fresh risk catalysts boosted the safe-haven demand. As of writing, the USD/JPY currency pair is currently trading at 107.17 and consolidates in the range between the 106.77 – 107.72. However, the currency pair trading bearish despite the Fed’s continued action mode and downbeat comments from the US policymakers as well as doubt between Japanese firms.

As we know, the currency pair failed to continue its previous day’s strong intraday positive move of over 200 pips and faced some fresh supply during the Asian session on Wednesday, mainly due to improving demand for traditional safe-haven assets.

Despite organized struggles by global central banks and many government stimulus measures to balance the negative economic impact from the coronavirus pandemic, the fears of an expected global slowdown continued losing the investor’s confidence. 

It should be noted that the major reason behind the pair’s decline is the benefitted Japanese yen, which got support as perceived safe-haven status and turned out to be one of the key factors that leave some fresh downward pressure on the pair.

Daily Support and Resistance    

  • S1 101.97
  • S2 104.1
  • S3 105.19

Pivot Point 106.23

  • R1 107.32
  • R2 108.37
  • R3 110.5

USD/JPY – Trading Tips

The USD/JPY is trading at 107.800 and continues to face double top resistance around 108.065. Below this, the USD/JPY is exhibiting a correction which is likely to lead the USD/JPY prices towards 105.960. Closing of 4-hour candle above this level has confirmed the chances of further buying in the pair until 108. Whereas, below 105.950, we may see further selling until 103.750. On the leading indicator’s front, the USD/JPY is in a bullish mode, and we should consider buying trades over 105. All the best for today!  

Categories
Forex Market Analysis

Daily F.X. Analysis, March 16 – Top Trade Setups In Forex – G7 Meetings In Highlights! 

During Asian trading hours on Monday, the ICE U.S. Dollar Index dropped 1.1% to 97.67, giving up most of its gains made in the prior session, as the Fed slashed interest rates over the weekend. The U.K. house price grew 1.0% on month in March (+0.8% in February), according to the home-listing website Rightmove.

During Asian trading hours on Monday, the ICE U.S. Dollar Index dropped 1.1% to 97.67, giving up most of its gains made in the prior session, as the Fed slashed interest rates over the weekend. The U.K. house price grew 1.0% on month in March (+0.8% in February), according to the home-listing website Rightmove.

During Asian trading hours on Monday, the ICE U.S. Dollar Index dropped 1.1% to 97.67, giving up most of its gains made in the prior session, as the Fed slashed interest rates over the weekend. The U.K. house price grew 1.0% on month in March (+0.8% in February), according to the home-listing website Rightmove.

In the U.S., the New York Federal Reserve will publish March Empire Manufacturing Index (4.9 expected).

Economic Events to Watch Today    

 

 

EUR/USD – Daily Analysis

On Monday, the European Union finance ministers plan to agree on an economic acknowledgment to the coronavirus pandemic, with the European Commission forecasting the consequences of the virus could drive the European Union into a recession.

The central bank kept rates unchanged on Thursday and raised its asset purchase program by EUR120B. They introduced a new program of cheap loans that would necessarily pay banks up to 0.75% to give to small businesses. However, the EUR traders were not impressed, as indicated by the long-tail (seller exhaustion) attached to Thursday’s candle. 

Whereas, the broad market recession fears continue to increase the progress into the U.S. bonds, which translates into lower returns on the bonds, ultimately keep the greenback under pressure. The U.S. dollar index trades around 98.25, down 0.50% on the day, having stopped its recovery just shy of 98.50. 

Looking forward, the markets now keep their eyes on the European Union (E.U.) Finance Ministers’ and G7 leaders’ economic response to the virus outbreak, which is due later on Monday for taking fresh near-term trading opportunities in the main currency pair. 

    

Daily Support and Resistance

  • S1 1.0654
  • S2 1.0918
  • S3 1.1045

Pivot Point 1.1182

  • R1 1.1309
  • R2 1.1447
  • R3 1.1711

EUR/USD– Trading Tips

The EUR/USD has traded mostly lower, bouncing off the double bottom support level of 1.1095 level. The EUR/USD is currently trading around 1.1165, and it’s forming a lower-lows pattern on the 4-hour chart, which mostly drives a continuation of a selling trend. On the lower side, a continuation of a bearish bias can extend sell-off until 1.1100 and 1.1095. While the bullish breakout of 1.1350 can drive more buying until 1.1454 area. Consider staying bullish over 1.1182 and bearish below the same level today. 

GBP/USD– Daily Analysis

The GBP/USD dropped to 1.2321. Over the weekend, the global coronavirus pandemic worsened, particularly in Europe. Italy saw the number of coronavirus cases surge past 24,700 (1809 deaths), while Spain reported over 7,800 cases in total, Germany over 5,800 cases and France over 5,400 cases. In the U.S., the number of cases jumped to nearly 3,600 (68 deaths).

On Sunday, U.S. Federal Reserve slashed interest rates to near zero percent while announcing plans to purchase 700 billion dollars in bonds and securities to stabilize financial markets and support the economy. 

It is worth mentioning that the global markets remain sluggish despite the Fed, and the RBNZ announced an unscheduled rate cut while the BOJ is in the pipeline. As in result, the risk-tone remains on the back foot with the U.S. treasury yields falling almost 30 basis points while markets in Asia also flash losses by the press time.

Looking forward, the coronavirus headlines and the central bank updates will be the key to watch for near-term direction, while the traders will keep their eyes on the EU-UK disputes regarding Brexit.

On Monday open, U.S. stock futures dropped nearly 5% to their daily limit.

U.K. house price grew 1.0% on month in March (+0.8% in February), according to the home-listing website Rightmove.

Daily Support and Resistance

  • S1 1.1957
  • S2 1.2295
  • S3 1.2436

Pivot Point 1.2633

  • R1 1.2774
  • R2 1.297
  • R3 1.3308

GBP/USD– Trading Tip

The GBP/USD fell sharply to trade around 1.2360 level and has closed a bullish candle followed by strong selling candles. The Cable has immediate support around 1.2270 level, and above this, the Cable can extend the continuation of a bullish bias until 1.2450 level and 1.2625.  

The MACD is consistently forming bearish histograms below zero, supporting the selling trend in the GBP/USD pair, which is why we should consider selling below 1.2633 today. Recently, the GBP/USD has closed a bullish candle that can drive buying in the GBP/USD, and it may lead its prices higher towards 1.2685 level. 

USD/JPY – Daily Analysis

Today in the Asian session, the USD/JPY currency pair flashing red and trading below the 107.00, representing 1.40% losses on the day after the Bank of Japan avoided delivering the rate cut ahead of the European open on Monday.

During its emergency 1-day monetary policy meeting, the Bank of Japan (BOJ) board members decided to keep rates unchanged at -10bps whereas maintaining a10-yr JGB yield target at 0.00%. Although, the decision on maintaining its interest rate targets was made by a 7-2 vote with board members Goushi Kataoka and Yutaka Harada dissenting.

At the BOJ front, the BoJ Interest Rate Decision is announced by the Bank of Japan. Usually, if the BoJ raises the interest rates, it is positive, or bullish, for the JPY. Likewise, if the BoJ has a dovish view on the Japanese economy and cuts the interest rate, it is considered negative or bearish.

On the other hand, the U.S. Federal Reserve (Fed) announced a surprise rate cut to 0.25% in addition to $700 billion worth of Quantitative Easing. As well as, the Fed policymakers signaled that there would not be any Federal Open Market Committee (FOMC) during this week, which was earlier scheduled for Wednesday.

Whereas, the RBA indicated that it would purchase bonds while holding a special meeting on Thursday, whereas RBNZ finally also joined the role of major central bankers that offered significant rate cuts in order to control the coronavirus (COVID-19). 


Daily Support and Resistance

  • S1 99.26
  • S2 102
  • S3 103.37

Pivot Point 104.74

  • R1 106.11
  • R2 107.47
  • R3 110.21

USD/JPY – Trading Tips

The USD/JPY is trading at 107.800 and has already completed a 61.8% Fibonacci retracement level at 108.065. Below this, the USD/JPY is exhibiting a correction which is likely to lead the USD/JPY prices towards 105.960. Closing of 4-hour candle above this level has confirmed the chances of further buying in the pair until 108. Whereas, below 105.950, we may see further selling until 103.750. On the leading indicator’s front, the USD/JPY is in a bullish mode, and we should consider buying trades over 105. All the best for today!  

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Forex Market Analysis

WTI Crude Oil Recovered Slightly From Yesterday’s Historical Fall – Trade Plan! 

The WTI crude oil prices recovered on the day, representing an 8% gain after yesterday’s historical drop, having hit a multi-year low of $27.40 on Monday. The U.S. Crude Oil WTI Futures gained 6.2% to $33.05. 

The WTI crude oil prices recovered on the day, representing an 8% gain after yesterday’s historical drop, having hit a multi-year low of $27.40 on Monday. The U.S. Crude Oil WTI Futures gained 6.2% to $33.05. 

The WTI crude oil prices recovered on the day, representing an 8% gain after yesterday’s historical drop, having hit a multi-year low of $27.40 on Monday. The U.S. Crude Oil WTI Futures gained 6.2% to $33.05. 

The WTI Crude Oil prices marked a historical 30% fall yesterday because tensions between Saudi Arabia and Russia escalated, whereas intensifying fears about the spread of the new coronavirus continued to affect investor sentiment.

After a failure in talks between OPEC and its allies last week, Saudi Arabia cut its April official selling prices by $6 to $8 to grab market share. It also plans to increase its crude output above 10 million barrels per day in April from 9.7 million BPD in recent months.

On the other hand, Russia also said that it might raise output and said that it could manage with low oil prices for six to ten years. It is worth to mention that possibly 50% of the public exploration and production companies will become bankrupt during the next two years as per the report that came from the Pioneer Natural Resources Co. Chief Executive Scott Sheffield. 

The risk-sentiment was also recovered after Chinese President Xi Jinping visited Wuhan, the epicenter of the coronavirus outbreak, for the first time since the disease started, and because of the spread of the virus in mainland China sharply decreases.

At the demand side, the International Energy Agency said oil demand was set to contract in 2020 for the first time since 2009.

Daily Support and Resistance

  • S1 16.27
  • S2 23.67
  • S3 27.07

Pivot Point 31.07

  • R1 34.47
  • R2 38.47
  • R3 45.87

Technically, crude oil is trading at $34 per barrel, mostly maintaining sideways trading range of 34.40 – 27.33. At the moment, 34.35 resistance is very, very crucial for crude oil as the MACD is extremely oversold, and traders need a reason to long on crude oil. Breakout of 34.35/40 can be that reason which may attract some buying in crude oil and may lead its prices towards 38. Let’s look to stay bearish below 34 and bullish above 34.40 area today. Good luck! 

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Forex Market Analysis

Daily F.X. Analysis, March 09 – Top Trade Setups In Forex – Risk Sentiment Keeps the Market in Action! 

The U.S. Dollar Index plunged 0.9% on the day to 95.95 on Friday, as treasury yields slumped amid sinking investors’ risk appetite. The Eurozone Sentix Investor Confidence Index for March will be released (-11.4 expected). The German Federal Statistical Office will announce January industrial production (+1.6% on month expected) and trade balance (15.3 billion euros surplus expected).

The U.S. Dollar Index plunged 0.9% on the day to 95.95 on Friday, as treasury yields slumped amid sinking investors’ risk appetite. The Eurozone Sentix Investor Confidence Index for March will be released (-11.4 expected). The German Federal Statistical Office will announce January industrial production (+1.6% on month expected) and trade balance (15.3 billion euros surplus expected).

The U.S. Dollar Index plunged 0.9% on the day to 95.95 on Friday, as treasury yields slumped amid sinking investors’ risk appetite. The Eurozone Sentix Investor Confidence Index for March will be released (-11.4 expected). The German Federal Statistical Office will announce January industrial production (+1.6% on month expected) and trade balance (15.3 billion euros surplus expected).

The Bank of France will post February Industry Sentiment Indicator (95 expected).

Economic Events to Watch Today  

 

 

EUR/USD – Daily Analysis

The EUR/USD climbed 0.4% to 1.1286. Official data showed that German factory orders grew 5.5% on month in January (+1.3% expected). The coronavirus breaks in China and South Korea seem to be lagging, as countries outside in the world embrace drastic steps to try and stamp out the virus. 

In Italy, where 16 million people in Lombardy and different sections of the north are presently below quarantine, there were 133 life losses announced on Sunday, drawing the sum to 366. More than 7,000 people in the country have been verified to have the disease. 

In Iran, there were 49 new deaths. Some 194 people have now expired from COVID-19 there. Although the latest numbers from China and South Korea suggest, the virus seems to be diminishing in northeast Asia.

At the data front, the German Industrial Production and the Current Account data are scheduled to release at 07:00 GMT, followed by the Eurozone Sentix Investor Confidence at 09:30 GMT. The German Federal Statistical Office will report January industrial production (+1.6% on month expected) and trade balance (15.3 billion euros surplus expected).

Daily Support and Resistance

  • S1 1.1016
  • S2 1.1152
  • S3 1.1221

Pivot Point 1.1288

  • R1 1.1356
  • R2 1.1424
  • R3 1.1559

EUR/USD– Trading Tips

The EUR/USD is trading with a bullish bias around 1.1445. The EUR/USD seems to extend the bullish trend in the wake of completing the 161.8% and 261.8% Fibonacci extension level, out of which 161.8% has already been achieved until 1.1258. At the moment, the EUR/USD is trading at 1.1458, and bullish breakout of this level can extend buying until 1.1610 level. On the lower side, the EUR/USD may find support around 1.1400 and 1.1296. The RSI and MACD are in the buying zone as the MACD’s histograms are over zero, the bullish zone. Consider taking buy trades above 1.1380.

GBP/USD– Daily Analysis

The GBP/USD climbed 0.6% at 1.2951 to hit its highest mark in a week to the greenback. This came after the forecasts waned for an urgent Bank of England rate cut to follow this week’s emergency movement from the U.S. Federal Reserve to accommodate coronavirus damage. 

The U.S. official data showed that the economy added 273,000 non-farm payrolls in February (+175,000 expected), and the jobless rate dropped to 3.5% (3.6% expected). Average hourly earnings were up 0.3% on the month (as expected). 

January trade deficit was posted at US$45.3 billion (US$46.2 billion expected), and wholesale inventories (final reading) fell 0.4% on the month (-0.2% expected). Despite mixed economic events, the U.S. dollar is getting weaker and driving the GBP/USD pair higher. 

On Monday, the Sterling languished to a five-month low against the Euro, amidst a fresh market panic about the coronavirus outbreak that has prompted significant falls in stocks and oil.

Daily Support and Resistance    

  • S1 1.281
  • S2 1.2913
  • S3 1.2981

Pivot Point 1.3017

  • R1 1.3084
  • R2 1.312
  • R3 1.3224

GBP/USD– Trading Tip

On Monday, the GBP/USD is showing some severe bullish moves in the wake of a weaker dollar and strong Sterling. The GBP/USD soars to trade around 1.3180 and continuation of a bullish trend can extend buying until 1.3200 and even higher. 

During the start of the day, the GBP/USD opened with a dramatic gap, but it soon recovered to fill the gap around 1.3032. Right now, the GBP/USD has formed a solid green candle on the 240 minutes timeframe, which may help drive further buying in the Sterling. The MACD is consistently forming bullish histograms over zero points, supporting the buying trend in the GBP/USD pair. Let’s consider buying over 1.3145. 

USD/JPY – Daily Analysis

The USD/JPY currency pair flashing red and dropped to multi-year lows mainly due to the early-Asian risk-off market sentiment in the wake of coronavirus fears and fall in oil prices. However, the pair is struggled to gain its recovery of over 100 pips from the 3-year lows after downbeat GDP data and trading above mid-102.00s. The USD/JPY currency pair is currently trading at 102.64 and consolidates in the range between the 101.59 – 104.58 on the day.

Moreover, the U.S. yields have recovered slightly from the lows seen after the U.S. Fed’s rate cut. The 2-year yield is currently trading at 0.68%, representing a seven basis point gain on the overnight low of 0.61%, and the 10-year yield has recovered to 0.98% from $0.91%. The currency pair continued to its recent heavy losses and still trading under some heavy selling pressure for the 2nd-consecutive session on Friday.  

On the fundamental side, the headlines growth figure confirms the -1.7% market consensus versus -1.6% initial forecast. The GDP data confirms further challenges to the Asian economy due to coronavirus (COVID-19) fears that have been pushing to the quote downwards.

Daily Support and Resistance

  • R3: 109.46
  • R2: 107.99
  • R1: 107.08

Pivot Point 106.52

  • S1: 105.61
  • S2: 105.06
  • S3: 103.59

USD/JPY – Trading Tips

The USD/JPY is trading at 102.200, breaking below the bearish channel, which supports the Japanese yen at 104.400. The increased demand for safe-haven assets is driving strong bearish trends in the USD/JPY currency pairs. Recently, the USD/JPY has closed two consecutive selling candles, which are followed by the bearish breakout setup and suggesting odds of further bearish bias until 101.650. 

Selling trend continuation can lead the USD/JPY prices towards 101.670 whereas, further selling can lead the USD/JPY to 100.450 area

All the best for today!  

Categories
Forex Market Analysis

WTI Crude Oil Prices Rose – Eyes On OPEC Meeting

The WTI crude oil prices rose because the traders evaluated the latest headlines regarding OPEC’s meeting this week. At the moment, the U.S. Crude Oil WTI Futures gained 1.4% to $47.45.

The WTI crude oil prices rose because the traders evaluated the latest headlines regarding OPEC’s meeting this week. At the moment, the U.S. Crude Oil WTI Futures gained 1.4% to $47.45.

The WTI crude oil prices rose because the traders evaluated the latest headlines regarding OPEC’s meeting this week. At the moment, the U.S. Crude Oil WTI Futures gained 1.4% to $47.45.

According to earlier reports, the OPEC+ alliance will agree to a total production cut of at least 1 million barrels per day from this quarter onward to fight the impact caused by the deadly coronavirus outbreak.

On the other hand, the prices were also supported by a lower-than-expected rise in crude oil inventories in the United States, easing some concerns of oversupply in the world’s biggest oil consumer.

It is deserving to consider that Saudi Arabia wants extra cuts of 1 million to 1.5 million BPD for the next quarter and to retain current reductions of 2.1 million BPD in place until the end of 2020.

The geopolitical tensions in the Middle East also increased prices. The Saudi-led alliance fighting in Yemen said it had stopped an attack on an oil tanker off Yemen’s coast on the Arabian Sea.

The WTI crude oil inventories rose by 785,000 barrels for the week ended Feb. 28, the EIA said. That contrasted with forecasts for a build of 2.64 million barrels.

Daily Support and Resistance

  • S1 44.01
  • S2 45.76
  • S3 46.52

Pivot Point 47.51

  • R1 48.27
  • R2 49.26
  • R3 51.01

On the technical front, the WTI crude oil prices have completed the 38.2% Fibonacci retracement at 48.50 level. Closing of candles below 38.2% Fibo level is driving further bearish bias for the crude oil, and it may lead its prices towards the next support area of 45. Continuation of a selling trend can cause a further drop to 43.85. Alternatively, the bullish breakout of 48.50 can lead oil towards 50 and 50.54 levels. The MACD is crossing into the selling zone, supporting the bearish bias. Consider looking for sell trades below 47 today to target 46.10 and 45.86. Good luck! 

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Forex Market Analysis

Daily F.X. Analysis, March 05 – Top Trade Setups In Forex – Traders Braces for Choppy Sessions! 

On the forex front, the U.S. Dollar Index rebounded 0.2% on the day to 97.37, snapping a four-day decline, supported by better-than-expected U.S. economic data. The Research firm Markit will publish February German Construction PMI.

On the forex front, the U.S. Dollar Index rebounded 0.2% on the day to 97.37, snapping a four-day decline, supported by better-than-expected U.S. economic data. The Research firm Markit will publish February German Construction PMI.

On the forex front, the U.S. Dollar Index rebounded 0.2% on the day to 97.37, snapping a four-day decline, supported by better-than-expected U.S. economic data. The Research firm Markit will publish February German Construction PMI.

The U.S. Commerce Department will post January factory orders (-0.1% on month expected) and final readings of durable goods orders (-0.2% on month expected). The Labor Department will report initial jobless claims in the week ended February 29 (215,000 expected).

Economic Events to Watch Today  

 

 

EUR/USD – Daily Analysis

The EUR/USD retreated 0.3% to 1.1138, halting a four-day rally. The European Commission warned that France and Italy could fall into a technical recession, two-quarters of economic contraction, amid coronavirus impacts. On the other hand, official data showed that the eurozone’s retail sales grew 0.6% on month in January, and German retail sales were up 0.9%, both as expected.

If the risk-on sentiment continues to boost, the selling interest around the EUR could increase. At press time, major Asian indices like Japan’s Nikkei, South Korea’s Kospi, Hong Kong’s Hang, and the Shanghai Composite index are reporting notable gains. The S&P 500 futures, however, are shedding 0.90%.

If the OPEC meeting strengthens an oil price bounce, the risk sentiment will likely increase, pushing the EUR currency and other safe-haven currencies lower. The pair is currently sidelined just below 1.1140.

Besides this, the currency pair will likely take cues from the U.S. weekly unemployment claims, Challenger Job Cuts data for February, and the 4th-quarter Unit Labor Costs figure scheduled for release during the North American trading hours. The European data docket is thin.

Daily Support and Resistance

  • S1 1.0955
  • S2 1.1047
  • S3 1.109

Pivot Point 1.1139

  • R1 1.1182
  • R2 1.1231
  • R3 1.1323

EUR/USD– Trading Tips

On Tuesday, the EUR/USD is trading sideways around 1.1179. The EUR/USD may drop to complete the bearish retracement. On the lower side, the 38.2% Fibonacci retracement is likely to support the EUR/USD at 1.1109, and violation of this level can drive more selling until 1.1085 which marks the 61.8% Fibonacci level. The RSI and MACD are in the buying zone but seems to take a bearish. The MACD’s histograms are becoming smaller on the buying side, which suggests the odds of selling in the EUR/USD. Consider taking buy trades above 1.1119.  

GBP/USD– Daily Analysis

The GBP/USD rose 0.5% at 1.2873. The officials from the European Union and the United Kingdom continue to oppose each other in every phase of post-Brexit trade deal talks. The Fisheries matter is the key factor for the British negotiators, and they have given a warning to the deploy Navy to safeguard the waters from the bloc’s ships if no deal is agreed by June.

It is worth to mention that the Sky News spots former business secretary Andrea Leadsom while saying that the government’s previous willingness for a possible no-deal Brexit. Which

Att he coronavirus front, the deadly virus continues to spread outside China with California recently declaring a state of emergency. However, the global policymakers struggle to control the same, and it seems to have helped the risk-tone sentiment. As in result, the U.S. 10-year Treasury yields remain positive above 1%, whereas stocks in Asia are also positive by the press time.

The BOE Governor Mark Carney is scheduled to speak at University College London and will be key to watch for the U.K. central bank’s actions to control COVID-19 implications. However, the incoming Governor Andrew Bailey has already said that the BOE should wait for more clarity about the economic slowdown from the coronavirus outbreak before making any decision to cut interest rates ahead.

Daily Support and Resistance

  • S1 1.2631
  • S2 1.2734
  • S3 1.28

Pivot Point 1.2837

  • R1 1.2903
  • R2 1.294
  • R3 1.3043

GBP/USD– Trading Tip

The GBP/USD is trading with bullish bias after having violated the horizontal resistance level of 1.2885. As suggested earlier, the GBP/USD overall trading bias remains bullish, and it’s pretty much likely to go after the next resistance level of 1.3019.

The GBP/USD’s immediate support is likely to be found around 1.2870, and below this level, the GBP/USD may aim for the 1.2760 area. The MACD and RSI are in the buying zone, supporting the bullish bias for the GBP/USD. Let’s look for long positions above 1.2837 today.  

USD/JPY – Daily Analysis

The USD/JPY currency pair failed to maintain its overnight bullish trend and reached the fresh lower end of its daily trading range near the 107.30 level because of the greenback weakness. The USD/JPY currency pair 107.34 and consolidates in the interval between 107.0 – 107.73.

As we already mentioned that the pair failed to maintain on the previous day’s recovery move from 5-month lows and faced some fresh supply near the 107.75 regions on Thursday in the wake of subdued U.S. dollar price action.

Moreover, the U.S. yields have recovered slightly from the lows seen after the U.S. Fed’s rate cut. The 2-year yield is currently trading at 0.68%, representing a seven basis point gain on the overnight low of 0.61%, and the 10-year yield has recovered to 0.98% from $0.91%. 

As in result, the safe-haven demand for the yen has weakened in Asia. As we already mentioned that the USD/JPY pair is currently trading at 107.27, representing a 0.17% gain on the day, having hit a high of 107.52 a few minutes before press time. 

Daily Support and Resistance

  • S1 105.75
  • S2 106.93
  • S3 107.63

Pivot Point 108.1

  • R1 108.8
  • R2 109.28
  • R3 110.46

USD/JPY – Trading Tips

The USD/JPY is trading at 107.250, staying mostly outside the tight trading range of 108.400 – 107.400. It’s mostly due to the weakness in the U.S. dollar and a slight safe-haven appeal, which is triggered in the wake of Coronavirus. The pair has recovered a bit to complete retracement until 107.650. 

For now, the USD/JPY has formed a bearish series of Doji pattern over 107.013, which could trigger further selling if the 107.013 level gets violated. We need to pay attention to the USD/JPY as the closing of candlesticks below 107.013 level can provide us selling trade with a take profit of around 106.500 and 105.860.  

All the best for today! 

Categories
Forex Market Analysis

Daily F.X. Analysis, March 03 – Top Trade Setups In Forex – Monetary Policy Report & G7 Meeting Under Spotlight! 

The Asian session was all about the Reserve Bank of Australia, and it’s a policy decision. The Reserve Bank of Australia’s (RBA) interest rate settlement at 0330 GMT was closely followed as it is the critical policy meeting since last week’s exciting change in money market pricing. The RBA has cut the interest rate by the 25-basis-point cut is all but inevitable, devising the Australian dollar exposed to a bearish bias.

The Asian session was all about the Reserve Bank of Australia, and it’s a policy decision. The Reserve Bank of Australia’s (RBA) interest rate settlement at 0330 GMT was closely followed as it is the critical policy meeting since last week’s exciting change in money market pricing. The RBA has cut the interest rate by the 25-basis-point cut is all but inevitable, devising the Australian dollar exposed to a bearish bias.

The Asian session was all about the Reserve Bank of Australia, and it’s a policy decision. The Reserve Bank of Australia’s (RBA) interest rate settlement at 0330 GMT was closely followed as it is the critical policy meeting since last week’s exciting change in money market pricing. The RBA has cut the interest rate by the 25-basis-point cut is all but inevitable, devising the Australian dollar exposed to a bearish bias.

The research firm Markit will publish February U.K. Construction PMI (49.0 expected). The European Commission will report February CPI (+1.2% on-year expected), January PPI (-0.4% on year expected), and jobless rate (steady at 7.4% expected).

Economic Events to Watch Today 

 

 

EUR/USD – Daily Analysis

The EUR/USD jumped 1.1% to 1.1146, the highest level since mid-January. European Central Bank President Christine Lagarde stated that ECB stands ready to “take appropriate and targeted measures,” amid risks to the economic outlook from the coronavirus epidemic.  

Later today, the eurozone’s January jobless rate (steady at 7.4% expected) and February CPI (+1.2% on-year estimated) will be reported.

Overall the risk sentiment remains mixed as the European stocks stabilized, with the Stoxx Europe 600 Index edging up 0.1%. The U.K.’s FTSE 100 rose 1.1%, and France’s CAC was up 0.4%, while Germany’s DAX dropped 0.3%.

Investor’s focus will remain on the research firm Markit which will publish February U.K. Construction PMI (49.0 expected). The European Commission will report February CPI (+1.2% on-year expected), January PPI (-0.4% on year expected), and jobless rate (steady at 7.4% expected).

Daily Support and Resistance

  • R3: 1.1412
  • R2: 1.1265
  • R1: 1.1199

Pivot Point 1.1119

  • S1: 1.1053
  • S2: 1.0972
  • S3: 1.0826

EUR/USD– Trading Tips

The EUR/USD is trading upward near 1.1109, as the pair seems to trade in the overbought zone. Bulls seem to get exhausted, and sooner or later, the EUR/USD may drop to complete the bearish retracement. On the lower side, the 38.2% Fibonacci retracement is likely to support the EUR/USD at 1.1095, and violation of this level can drive more selling until 1.1035 which marks the 61.8% Fibonacci level. 

The RSI and MACD are in the buying zone but seems to take a bearish. The MACD’s histograms are becoming smaller on the buying side, which suggests odds of selling in the EUR/USD. Consider taking sell trades below 1.1150. 

GBP/USD– Daily Analysis

The GBP/USD dropped 0.4% at 1.2804, down for a fourth straight session. Bank of England governor Mark Carney said BOE is working with the government and international authorities to “ensure all necessary steps are taken to protect financial and monetary stability”. The fury of the Coronavirus has led some investors to believe central banks will be expected to go behind dovish monetary policy to underpin the economy against the potential threat of a coronavirus. 

The Sterling continues trading with a bearish bias as the interest rate cut sentiment from 0.75% to 0.50% remains pretty stable. The Sterling also places a four-and-a-half-month low during the previous week versus the greenback as concerns of the economic collapse from the extensive Coronavirus provoked a dramatic selling in with worldwide markets.

The Bank of England announced it was serving with Britain’s finance ministry and international allies to ensure “all necessary measures are exercised” to preserve the banking system and the larger economy.

The GBP/USD also faced a bearish pressure as the global influence of the Coronavirus is beginning to show on a post-election improvement in U.K’s manufacturing, which came out on Monday. 

Daily Support and Resistance

  • R3: 1.3209
  • R2: 1.3015
  • R1: 1.2916

Pivot Point 1.2821

  • S1: 1.2722
  • S2: 1.2627
  • S3: 1.2432

GBP/USD– Trading Tip

The GBP/USD is consolidating in a sideways range, where the overall bias remains mostly bearish. The GBP/USD has already violated the previous narrow trading range of 1.2980 – 1.2880. On the 4-hour chart, the Cable has violated the descending triangle pattern, which is still keeping the pair under 1.2880. 

Below this level, the GBP/USD may aim for the 1.2660 area. The MACD and RSI are in the selling zone, supporting the bearish bias for the GBP/USD. Let’s look for short-trades below 1.2966 and bull trades above the same level today. 

USD/JPY – Daily Analysis

The USD/JPY rebounded 0.2% to 108.29. The safe-haven Japanese yen soared versus the greenback on Tuesday, as the traders curbed expectations for global monetary policy easing with concerns about its balance and effectiveness in fighting the economic collapse from the coronavirus break.

On Tuesday, the G7 finance diplomats and central bank directors carry a conference call later to consider steps to dispense with the outbreak and its widening economic radioactivity.

The call, which French and Italian experts, is scheduled at 1200 GMT, and with this, the traders are already betting on the sentiment that the U.S. Federal Reserve will begin a series of global monetary easing.

The dollar dropped 0.5% to 107.80 yen and trimmed lower on the Swiss franc to 0.9576 francs following a report that the G7 officials are meeting to decide no fresh fiscal or monetary pledges. In the U.S., the coronavirus-related death toll has grown to six. South Korea reported a total of 4,335 cases (28 deaths), Italy 2,036 cases (52 deaths), and Iran 1,501 cases (66 deaths).

Daily Support and Resistance

  • R3: 113.5
  • R2: 112.2
  • R1: 111.46

Pivot Point 110.9

  • S1: 110.16
  • S2: 109.6
  • S3: 108.29

USD/JPY – Trading Tips

The USD/JPY consolidates in a narrow trading range of 108.400 – 107.400 as the weakness in the U.S. dollar and stronger Japanese yen keeps the pair tossed. The USD/JPY pair recovered slightly in the wake of a bullish correction, but more selling pressure seems to come soon. The pair is trading bearish at 107.775, and it has high probability of moving towards the next support level of 107.338.

We can see on the 4-hour chart above, the USD/JPY has formed a bearish engulfing pattern below 108.350, which may trigger further selling until 107.338. We need to keep an eye in the USD/JPY as the closing of candles above 108.338 level can help us secure a buy trade with a take profit of around 109.650.  

All the best for today! 

Categories
Forex Market Analysis

Gold on a Bearish Mode, Coronavirus Continues to Outbreak! 

On Friday, the precious metal gold trades bearish, falling from 1,635 to 1,624 support level. It seems like traders are doing profit-taking ahead of the weekend. The bearish trend in gold continues despite a drop in stock prices. 

On Friday, the precious metal gold trades bearish, falling from 1,635 to 1,624 support level. It seems like traders are doing profit-taking ahead of the weekend. The bearish trend in gold continues despite a drop in stock prices. 

On Friday, the precious metal gold trades bearish, falling from 1,635 to 1,624 support level. It seems like traders are doing profit-taking ahead of the weekend. The bearish trend in gold continues despite a drop in stock prices. 

Global share prices directed for the most critical week since the world financial crunch in 2008 as traders braced for the disease to shift a pandemic and swiftly spread around the globe. Most of the selling triggered after mainland China had 327 new confirmed cases of infections on Thursday, the National Health Commission announced on Friday. 

Besides, Iran reported that its death toll climbed to 26, by far the highest figures outside China, and the total number of infected people held at 245, which also include several senior officials.


Gold – XAU/USD – Daily Technical Levels

Support Resistance 

1633.48 1658.64

1621.83 1672.15

1596.67 1697.32

Pivot Point 1646.99

On the technical side, the precious metal gold is trading at 1,623 level after violating the double bottom support area of 1,633 level. Looking at the leading technical indicators, the XAU/USD’s MACD has crossed below 0, which is suggesting chances of bearish trend continuation. 

Gold may find immediate support around 1,612 for now, and below this, the 61.8% will remain in focus, which may extend support around 1,602 level. Today, we can look for selling trades below 1,626 area. Good luck!   

Categories
Forex Market Analysis

Daily F.X. Analysis, February 27 – Top Trade Setups In Forex – Brace for U.S. Economic Events!

On the forex front, the U.S. dollar stabilized on Wednesday, with the ICE U.S. Dollar Index gaining 0.2% on the day to 99.14. The European Central Bank will report the Eurozone’s M3 money supply in January (+5.3% on-year expected), February Economic Confidence Index (102.8 expected), and final readings of Consumer Confidence Index (-6.6 previously). Let’s take a look at trade ideas…

On the forex front, the U.S. dollar stabilized on Wednesday, with the ICE U.S. Dollar Index gaining 0.2% on the day to 99.14. The European Central Bank will report the Eurozone’s M3 money supply in January (+5.3% on-year expected), February Economic Confidence Index (102.8 expected), and final readings of Consumer Confidence Index (-6.6 previously). Let’s take a look at trade ideas…

On the forex front, the U.S. dollar stabilized on Wednesday, with the ICE U.S. Dollar Index gaining 0.2% on the day to 99.14. The European Central Bank will report the Eurozone’s M3 money supply in January (+5.3% on-year expected), February Economic Confidence Index (102.8 expected), and final readings of Consumer Confidence Index (-6.6 previously). Let’s take a look at trade ideas…

Economic Events to Watch Today 

  

EUR/USD – Daily Analysis

The EUR/USD pair managed to cross the high level of 1.0890 as the U.S. yields continue to flash red in the wake of coronavirus fears. Whereas, the 10-year Treasury note is currently trading at 1.37%, representing a five basis point profit on the record low of 1.32%. 

Overall, the Greenback has traded near a three-month high against the Euro as worries over the outbreak of Coronavirus has driven sharp volatility in the market, mostly driving dollar prices higher. 

The Euro has tried to rally higher during the Asian trading session on Thursday but continues to encounter resistance above. We are in a strong downtrend, and the EUR/USD is exhibiting correction of that downtrend as it could lead the EUR/USD prices towards the next target level of 10925. 

On Thursday, there won’t be any meaningful macroeconomic data releases from the Eurozone. Still, the markets will remain focused on coronavirus headlines and the U.S. economic figures, especially the Prelim GDP q/q and Durable Goods Orders m/m.

Daily Support and Resistance

  • S1 1.0747
  • S2 1.0807
  • S3 1.0844

Pivot Point 1.0867

  • R1 1.0905
  • R2 1.0928
  • R3 1.0988

EUR/USD– Trading Tips

The EUR/USD is consolidating near 1.0916, as the pair seems to go for completing 50% Fibonacci retracement at 1.0930. The pair appears to have initiate correction as it has previously achieved 38.2% Fibonacci retracement at 1.08930. The MACD is crossing above 0 level, which suggests.

Chances of further buying in the EUR/USD. The pair may find immediate support around 1.08540, which is mostly extended by the 50 EMA and a bullish trendline. On the higher side, the EUR/USD may find resistance around 1.0930 and 1.0980. Consider taking bullish trades above 1.0900 today. 

GBP/USD– Daily Analysis

On Thursday, the GBP/USD is trading at 1.2935, falling below the 1.2965 resistance to become a support level. The GBP dropped a day before as forecasts of the Bank of England (BOE) rate cut fueled over-optimism that expansionary fiscal policy would support the U.K. economy.

The outbreak of the Coronavirus has directed some traders to think central banks will be required to go after dovish monetary policy to support the economy against the potential threat of a coronavirus. The Sterling is still trading with a bearish bias as the interest rate cut sentiment from 0.75% to 0.50% remains pretty solid. 

The council approved a decision to allow the opening of the Brexit talks for a new partnership with the U.K. The Commission has also formally nominated the Commission as an E.U. negotiator. Besides, the council has also selected negotiating directives, which constitute a mandate to the Commission for the negotiations.

By comparison, when Prime Minister Boris Johnson’s Tories succeeded December’s election, extending his hold on parliament and pushing some Brexit risk, the Sterling was trading near 83 pence per Euro, and it also gained some support against the U.S. dollar.

Daily Support and Resistance

  • S1 1.2802
  • S2 1.2893
  • S3 1.2949

Pivot Point 1.2937

  • R1 1.304
  • R2 1.3074
  • R3 1.3165

GBP/USD– Trading Tip

On Thursday, the GBP/USD continues trading with a mixed bias, following a narrow trading range of 1.2980 – 1.2880. As we can see on the 4-hour chart above, the Cable has formed a descending triangle pattern which is supporting the Sterling around 1.2880. It’s one of the most crucial trading levels as a violation of this can open further room for selling until 1.2795 area. 

On the other hand, the GBP/USD has the potential to go after 1.3070 if it manages to trade above 1.2960 support. The MACD and RSI are holding in the selling zone, supporting bearish bias for the GBP/USD pair. Let’s look for selling trades below 1.2966 and bullish above the same level today. 

USD/JPY – Daily Analysis

The USD/JPY currency pair is flashing red, falling below the 110.350 resistance. The USD/JPY is holding at 110.14 and consolidates in the range between the 110 – 110.58. However, a stable market tends to weaken the Japanese yen’s safe-haven demand.

The Coronavirus is growing in the Middle East, Europe, and another area of the world, as Brazil verified its initial case in Latin America, while other regions of China found to lower their emergency response level as the number of fresh cases recorded there proceeds to reduce.

The Greenback is now trading with a slightly bearish bias amid forecasts that the U.S. Federal Reserve may lower the interest rates this year to control downside influence on the economy produced by China’s coronavirus outbreak.

The dollar initially traded bullish as the virus outbreak further around the globe, with traders eyeing all U.S. assets as safe-haven investments. Nevertheless, money managers now assume the Fed would be more prone to dovish monetary policy and cut rates, considering the ongoing uncertainties of Coronavirus. 

Daily Support and Resistance

  • R3: 113.5
  • R2: 112.2
  • R1: 111.46

Pivot Point 110.9

  • S1: 110.16
  • S2: 109.6
  • S3: 108.29

USD/JPY – Trading Tips

The USD/JPY has traded mostly in line with the previous forecast and stayed below the horizontal resistance level of 110.350. On the 4 hour timeframe, an upward trendline is extending resistance at 110.350, as the USD/JPY pair failed to break above this mark yesterday. 

For now, the USD/JPY has formed a bearish engulfing pattern below 110.350, which may trigger further selling until 109.50. We need to keep an eye in the USD/JPY as the closing of candles below 110.350 level can help us secure a selling trade with a take profit of around 109.650.  

All the best for today! 

Categories
Forex Market Analysis

Daily F.X. Analysis, February 25 – Top Trade Setups In Forex – Coronovirus Dominates Market Sentiment! 

Later today, the Conference Board’s Consumer Confidence Index for February is expected to increase to 132.1. The number of confirmed coronavirus cases in South Korea has jumped to 833 with eight fatalities. Japan has recorded 850 cases (4 deaths), Italy announced there were 229 incidents (7 deaths). Singapore has also addressed 90 instances.

Later today, the Conference Board’s Consumer Confidence Index for February is expected to increase to 132.1. The number of confirmed coronavirus cases in South Korea has jumped to 833 with eight fatalities. Japan has recorded 850 cases (4 deaths), Italy announced there were 229 incidents (7 deaths). Singapore has also addressed 90 instances.

Later today, the Conference Board’s Consumer Confidence Index for February is expected to increase to 132.1. The number of confirmed coronavirus cases in South Korea has jumped to 833 with eight fatalities. Japan has recorded 850 cases (4 deaths), Italy announced there were 229 incidents (7 deaths). Singapore has also addressed 90 instances.

Save-haven assets, like U.S. government bonds and gold, kept receiving bids. The benchmark 10-year Treasury yield slid from 1.470% Friday to 1.377%, the lowest level since July 2016. And the 30-year yield shed 6.8 basis points to 1.849%.

Economic Events to Watch Today 

  

EUR/USD – Daily Analysis

On Tuesday, the EUR/USD remains lightly positive, +0.08%, while taking steps to 1.0860. The dollar slid on Tuesday following a recent bullish momentum amid heightened expectations that the expected hit to economic extension from the spread of the coronavirus will urge the U.S. Federal Reserve to decrease interest rates.

Expectations for the Federal Reserve interest rate cut have grown in the last few days to price in a 50-50 probability. Today is likely to be a quiet day ahead on the economic docket. Key economic figures will include Germany’s 2nd estimate GDP figures for the 4th quarter.

Lack of major deviation from 1st forecast is not likely to have too much of an influence on the EUR. Any drop in the U.S consumer confidence figure and risk sentiment could help capture a movement in the EUR/USD currency pair later during the U.S.s session today. 

Daily Support and Resistance

  • R3: 1.0977
  • R2: 1.091
  • R1: 1.0882

Pivot Point 1.0844

  • S1: 1.0815
  • S2: 1.0777
  • S3: 1.071

EUR/USD– Trading Tips

On Tuesday, the EUR/USD pair soars higher to trade around 1.0865, making a bullish engulfing pattern on the daily chart. This pattern suggests the odds of bullish trend continuation. The 50 periods EMA is also likely to extend support at 1.0815, and we may see a bounce off above this level. The same level also marks the 50% Fibonacci retracement, while 61.8% Fibo support prevails at 1.0815. On the higher side, resistance can be seen around 1.0845.

GBP/USD– Daily Analysis

The GBP/SD currency pair failed to continue its recent gains and dropped to 1.2940, representing 0.20% declines on the day mainly due to uncertainty and worries regarding the Brexit deal. The broad-based greenback strength also keeps the pair under pressure. At this moment, the GBP/USD currency pair is trading at 1.2978 and consolidates in the range between the 1.2934 – 1.3000.

The United Kingdom Prime Minister Boris Johnson will likely push for the U.S. trade deal by March 02, according to the Telegraph. The U.S. gave warning to the Tory government to avoid the greed checks on the good in the Irish Sea to secure the US-UK trade deal.

Besides, the on-going bearish pressure on the Cable is a reason for Greenback’s broad-based strength. The USD is getting gains due to the broad risk-off market sentiment in the wake of deadly coronavirus intensifying fears. As in result, the traders prefer the safe-haven assets like gold and dollar.

Yesterday, the British pound sank along with most currencies as traders blended out of assets considered riskier for the Greenback. Most of the economic analysts see the U.S. economy as nearly well-shielded should the coronavirus damage global economic growth heavily. Eyes will remain on the UK CBI Realized Sales for more trends in the GBP/USD pair.

Daily Support and Resistance

  • S1 1.2749
  • S2 1.2845
  • S3 1.2902

Pivot Point 1.2942

  • R1 1.2998
  • R2 1.3038
  • R3 1.3134

GBP/USD– Trading Tip

The GBP/USD is trading at 1.2975, above the 1.2965 resistance become a support level. Closings of candles above this level may help secure a buy trade around 1.2975 with a target of 1.3070. Whereas, a bearish breakout of 1.2965 can lead the Cable towards 1.2930

. 

On the technical side, a daily closing beyond 100-day SMA level of 1.2955 can recall 1.3000 marks to the charts whereas February 13 top surrounding 1.3070 and 23.6% Fibonacci retracement at 1.3206 can entertain the buyers during further upside. The MACD and RSI are holding in the buying zone, supporting bullish bias for the GBP/USD pair. Let’s look for selling trades below 1.2965 and bullish above the same level today. 

USD/JPY – Daily Analysis

The USD/JPY sank 0.7% to 110.81 on increasing safe-haven demand. The USD/JPY pair failed to maintain its bullish momentum as investors started taking profit in the U.S. dollar, which leads the USD/JPY prices lower. The Japanese yen has now dropped back to the lower end against Greenback, and the pair now continues to trade around the 110.65-60 region.

Investors prefer safe-haven assets, mainly due to a rise in the number of coronavirus cases outside China, especially in South Korea and Italy. As per the latest report, the number of coronavirus cases in Italy’s Lombardy region rose from 54 on Sunday to 89, leaving the country with 150 confirmed infection, the highest in Europe, and around 5-times that of Germany whereas the news came as the total number of virus cases rose past 77,000 in China.

The USD/JPY currency pair may drop to levels below 111.30 if the German IFO data, which is scheduled to release at 09:00 GMT, prints below estimates, increasing recession fears and growing demand for the anti-risk Japanese yen.

Daily Support and Resistance

  • R3: 113.5
  • R2: 112.2
  • R1: 111.46

Pivot Point 110.9

  • S1: 110.16
  • S2: 109.6
  • S3: 108.29

USD/JPY – Trading Tips

The USD/JPY prices are trading with a bearish bias above 61.8% Fibonacci retracement level of 110.450. Closing of the candle above this level can extend buying until 110.850. Earlier, most of the bearish trend came after the USD/JPY violated the 38.2% Fibonacci retracement level on the 4-hour chart. On the lower side, the pair has the potential to go after the next support level of 109.650 in case of a bearish breakout of 110.250 support. Let’s consider staying bullish above 110.2 today to target 110.860. 

All the best for today! 

Categories
Forex Market Analysis

Overbought gold Seems to Head for 38.2% Fib – Quick Trade Plan! 

Gold prices climbed more than 2.5% to over the seven-year top as the extension of coronavirus outside China, and its potential collision on global economic growth pushed safe-haven buying.

Gold prices climbed more than 2.5% to over the seven-year top as the extension of coronavirus outside China, and its potential collision on global economic growth pushed safe-haven buying.

Gold prices climbed more than 2.5% to over the seven-year top as the extension of coronavirus outside China, and its potential collision on global economic growth pushed safe-haven buying.

Japan has recorded 837 coronavirus cases, including 691 cases related to the “Diamond Princess” cruise ship, with a fatality number of four. The number of confirmed cases in South Korea surged to 602 (6 deaths) as the country raised its infectious-disease warning to the highest level. 

Italy said there were over 150 cases across five regions (3 deaths). Meanwhile, in China, official numbers showed nearly 77,000 cases and over 2,400 deaths. The World Health Organization announced it is concerned about the growing number of problems without any apparent connection to China. Consequently, investors are moving funds into gold due to its safe-haven demand.

Gold – XAU/USD – Daily Technical Levels

Support     Resistance 

1,629.58    1,653.22

1,615.82    1,663.11

1,592.18    1,686.76

Pivot Point 1,639.47

On the technical side, the XAU/USD is trading at 1,679 and has entered the overbought zone where the chances of bearish corrections pretty solid. On the lower side, gold may show bearish correction until 1,658, which marks 38.2%. On the higher side, resistance continues to stay around 1,690. A bullish breakout of 1,690 may lead to gold prices to prices 1,710 resistance. Let’s consider taking sell trades to capture the correction below 1,680 until 1,670/1,668. Good luck! 

   

Categories
Forex Market Analysis

Daily F.X. Analysis, February 24 – Top Trade Setups In Forex – Risk-off Sentiment In Play! 

On the forex front, the U.S. dollar retreated from the strongest level in nearly three years, as the ICE Dollar Index lost 0.6% on the day to 99.26. Germany’s IFO Institute reported its indexes for February (business climate at 95.0, current assessment at 98.4 and expectations at 91.6 expected). However, the actual figure surprised the market with a 96.1 gain.

On the forex front, the U.S. dollar retreated from the strongest level in nearly three years, as the ICE Dollar Index lost 0.6% on the day to 99.26. Germany’s IFO Institute reported its indexes for February (business climate at 95.0, current assessment at 98.4 and expectations at 91.6 expected). However, the actual figure surprised the market with a 96.1 gain.

On the forex front, the U.S. dollar retreated from the strongest level in nearly three years, as the ICE Dollar Index lost 0.6% on the day to 99.26. Germany’s IFO Institute reported its indexes for February (business climate at 95.0, current assessment at 98.4 and expectations at 91.6 expected). However, the actual figure surprised the market with a 96.1 gain.

In the U.S., the Federal Reserve Bank of Chicago will post January National Activity Index (-0.16 expected). The Federal Reserve Bank of Dallas will release its Manufacturing Activity Index for February (0 expected).

Economic Events to Watch Today 

  

 

EUR/USD – Daily Analysis

The EUR/USD rose 0.6% to 1.0845. Research firm Markit reported that the eurozone’s manufacturing PMI bounced to 49.1 in February (47.4 estimated) from 47.9 in January and Services PMI climbed to 52.8 (52.3 expected) from 52.5. Later today, the German IFO Business Climate Index will be released (95.0 expected).

The Euro is getting badly hit in the wake of coronavirus. At the virus front, the number of coronavirus cases in Italy’s Lombardy region rose from 54 on Sunday to 89, leaving the country with 150 confirmed infection, the highest in Europe and around 5-times that of Germany whereas the news came as the total number of virus cases rose past 77,000 in China.


Daily Support and Resistance

  • S1 1.0686
  • S2 1.076
  • S3 1.0804

Pivot Point 1.0834

  • R1 1.0878
  • R2 1.0908
  • R3 1.0982

EUR/USD– Trading Tips

The EUR/USD pair soars higher to trade around 1.0865, making a bullish engulfing pattern on the daily chart. This pattern suggests the odds of bullish trend continuation. 

The 50 periods EMA is also likely to extend support at 1.0815, and we may see a bounce off above this level. The same level also marks the 50% Fibonacci retracement, while 61.8% Fibo support prevails at 1.0815. On the higher side, resistance can be seen around 1.0845.

GBP/USD– Daily Analysis

The GBP/SD currency pair failed to continue its recent gains and dropped to 1.2940, representing 0.20% declines on the day mainly due to uncertainty and worries regarding the Brexit deal. The broad-based greenback strength also keeps the pair under pressure. At this moment, the GBP/USD currency pair is trading at 1.2938 and consolidates in the range between the 1.2934 – 1.2955.

The United Kingdom Prime Minister Boris Johnson will likely push for the U.S. trade deal by March 02, according to the Telegraph. The U.S. gave warning to the Tory government to avoid the greed checks on the good in the Irish Sea to secure the US-UK trade deal.

Besides, the on-going bearish pressure on the Cable is a reason for Greenback’s broad-based strength. The USD is getting gains due to the broad risk-off market sentiment in the wake of deadly coronavirus intensifying fears. As in result, the traders prefer the safe-haven assets like gold and dollar.

Looking forward, the traders will keep their eyes on the Brexit headlines because the British ministers are to approve the initial offer by Tuesday. On the other hand, the 2nd-tier project numbers from the US Dallas Fed and the US Chicago Fed will be the keys to watch.



Daily Support and Resistance

  • S1 1.2749
  • S2 1.2845
  • S3 1.2902

Pivot Point 1.2942

  • R1 1.2998
  • R2 1.3038
  • R3 1.3134

GBP/USD– Trading Tip

The GBP/USD is trading at 1.2898, below the 1.2965 resistance level. Closings of candles below this level may help secure a sell trade around 1.2875, whereas, a bullish breakout of 1.2975 can lead the Cable towards 1.3070. 

On the technical side, a daily closing beyond 100-day SMA level of 1.2955 can recall 1.3000 marks to the charts whereas February 13 top surrounding 1.3070 and 23.6% Fibonacci retracement at 1.3206 can entertain the buyers during further upside. The MACD and RSI are holding in the buying zone, supporting bullish bias for the GBP/USD pair. Let’s look for selling trades below 1.2951 today. 

USD/JPY – Daily Analysis

The USD/JPY currency pair flashing red and dropped from the session high mainly due to the risk-off market in the wake of escalating coronavirus fears. At press time, the USD/JPY pair is trading right now at 111.52 and consolidates in the range between the 111.34 – 111.69. However, the USD/JPY is struggling to keep the recent gans above the 111.50.

Investors prefer safe-haven assets, mainly due to a rise in the number of coronavirus cases outside China, especially in South Korea and Italy. As per the latest report, the number of coronavirus cases in Italy’s Lombardy region rose from 54 on Sunday to 89, leaving the country with 150 confirmed infection, the highest in Europe, and around 5-times that of Germany whereas the news came as the total number of virus cases rose past 77,000 in China.

The USD/JPY currency pair may drop to levels below 111.30 if the German IFO data, which is scheduled to release at 09:00 GMT, prints below estimates, increasing recession fears and growing demand for the anti-risk Japanese yen.

It should be noted that China is declining some limitations in the Wuhan province and may allow non-local citizens to leave the city at the center of the outbreak. Whereas Guangdong province in China, which has the most infected sectors by virus after the Hubei region, decreased its coronavirus emergency response level from its highest this morning.



Daily Support and Resistance

  • S1 110.57
  • S2 111.13
  • S3 111.35

Pivot Point 111.69

  • R1 111.91
  • R2 112.25
  • R3 112.81

USD/JPY – Trading Tips

On Monday, the USD/JPY prices are trading with a bearish bias above 38.2% Fibonacci retracement level of 111.280. Closing of candle below this level can extend selling until 110.850. Earlier, most of the bullish trend came after the USD/JPY violated the upward channel on the daily chart. 

This channel extended resistance around 111.01 level, and now this is going to extend support to the USD/JPY currency pair. On the upper side, the pair has the potential to go after the next resistance level of 112. Let’s consider staying bearish below 111.69 today to target 110.860. 

All the best for today! 

Categories
Forex Market Analysis

Gold Prices Inched Up – Eyes On Fed’s Minutes! 

The safe-have-metal prices rose as traders await the U.S. Federal Reserve minutes of its latest meeting, which is scheduled to release later in the day. The gold gained 0.2% to $1,607.25 by the time of writing this update. 

The safe-have-metal prices rose as traders await the U.S. Federal Reserve minutes of its latest meeting, which is scheduled to release later in the day. The gold gained 0.2% to $1,607.25 by the time of writing this update. 

The safe-have-metal prices rose as traders await the U.S. Federal Reserve minutes of its latest meeting, which is scheduled to release later in the day. The gold gained 0.2% to $1,607.25 by the time of writing this update. 

Gold is higher 5.7% during this year because investors evaluate the impact of the disease on economic growth amid thinking that the Federal Reserve will feel increased pressure to deliver the rate cut. Moreover, fears of the new coronavirus and its impact on global growth pushed the safe-haven metal higher.

Official data showed that new cases in China declined for a second straight day. However, the World Health Organization has cautioned there is not enough data to know if the epidemic was being controlled.

China continues to struggle to achieve the identity of manufacturing in the world’s 2nd-largest economy again after imposing substantial travel restriction and city lockdown to control the virus that has killed more than 2000 peoples so far. However, investors still seem confident that the economic impact may be temporary.

The epidemic is expected to impact business in China and drag down its economic growth. Earlier this month, Moody’s Investors Service has lowered the growth forecast for China from 5.8% to 5.2% for 2020.



Daily Support and Resistance

  • S1 1556.92
  • S2 1577.08
  • S3 1589.29

Pivot Point 1597.25

  • R1 1609.46
  • R2 1617.41
  • R3 1637.58

Technically, the gold prices are likely to face resistance around 1,612. Below this, gold prices are expected to gain support around 1,594 area. A bullish breakout of 1,612 can lead to gold prices towards the next resistance area of 1,622. At the moment, we can either wait for bearish retracement until 1,602 to take a buying trade or enter a buy trade above 1,612 level to target 1,620. Good luck! 

Categories
Forex Market Analysis

Daily F.X. Analysis, February 19 – Top Trade Setups In Forex – UK CPI Surprises! 

The U.S. Empire Manufacturing Index rose to 12.9 in February (5.0 expected). Later today, January reports on housing starts (an annualized rate of 1,425,000 units expected), and producer price index (+0.1% on month expected) will be released.

The U.S. Empire Manufacturing Index rose to 12.9 in February (5.0 expected). Later today, January reports on housing starts (an annualized rate of 1,425,000 units expected), and producer price index (+0.1% on month expected) will be released.

The U.S. Empire Manufacturing Index rose to 12.9 in February (5.0 expected). Later today, January reports on housing starts (an annualized rate of 1,425,000 units expected), and producer price index (+0.1% on month expected) will be released.

European stocks were broadly lower, as the Stoxx Europe 600 Index declined 0.4%. Germany’s DAX fell 0.8%, France’s CAC lost 0.5%, and the U.K.’s FTSE 100 was down 0.7%.

Economic Events to Watch Today 

 

 

EUR/USD – Daily Analysis

The EUR/USD dropped 0.4% to 1.0796, the lowest level since April 2017. The German ZEW Current Situation Index declined to -15.7 in February (-10.0 expected) from -9.5 in January. The research institute said economic development is rather fragile at the moment, and the outlook for export-intensive sectors has deteriorated particularly sharply, citing impacts of the coronavirus outbreak.

The single currency’s vulnerability has prompted by moderate or negative growth in Germany during the last year. Moreover, data from this Monday imply that the market has not yet attained its bottom, as the Bundesbank stated in its monthly statement that there are no indications the currency position is set to improve in the opening quarter of the year, while coronavirus’ risk scores a new course of risk.

The traders eagerly anticipated the German ZEW economic sentiment, which was expected to worsen to 21.5 in February against. 26.7 reported in January. As per the recent release, the ZEW Indicator of Economic Sentiment for Germany decreased sharply in February, dropping 18.0 points to a distinct reading of 8.7 points. 

The fundamental event is thus lightly beneath its December 2019 mark. The evaluation of the economic situation in Germany has also worsened when we compare it with the previous month.

Moreover, EUR/USD currency pair near-term technical outlook also shows a bearish picture, with a test of the psychological support at 1.0800 on the cards. The traders will have their sights on the coronavirus headlines for taking fresh clues.

Daily Support and Resistance

  • S1 1.0702
  • S2 1.0754
  • S3 1.0774

Pivot Point 1.0806

  • R1 1.0826
  • R2 1.0858
  • R3 1.091

EUR/USD– Trading Tips

The pair appears to have formed neutral candles as the investors still didn’t find any solid reason to trigger bearish breakout at 1.0825 level. Today’s candle is also neutral, and it is pretty much likely to drive upward correction. Today, if the EUR/USD pair manages to drop below 1.0840, we may see EUR/USD prices going towards 1.0760. Let’s look for buying trade today above 1.0806. 

GBP/USD– Daily Analysis

The GBP/USD slipped 0.1% to 1.3002. Official data showed that the U.K. jobless rate was steady at 3.8% in the three months to December as expected. Earlier today, the Sterling declined during but concerns about whether the current Chancellor of Exchequer will be ready to pass the budget on time. 

A report from U.K. Prime Minister Johnson’s spokesman confirmed that the U.K. is not asking anything distinct from the E.U. in trade discussions and that they are available to negotiate. 

Besides, the market risk-tone getting worse day-by-day mainly due to the coronavirus fears, which provides support to the greenback as a safe-haven currency. Despite lowering the pace of the death toll and infected peoples in China, the uncertainty and fears still surrounding the market.

On the forecasted views, the Bank of England’s last MPR looks for the unemployment rate to stay unchanged at 3.8% for the next 3-4 months, we look for an increase to 3.9% in December (mkt 3.8%), with the potential for another pop higher in January. 

As we already mentioned that many countries had banned travelers from China, and major airlines have delayed flights, something that China’s representative to the E.U. warned was fuelling panic and threatening attempts to resume business.


Daily Support and Resistance

  • S1 1.285
  • S2 1.2928
  • S3 1.2964

Pivot Point 1.3007

  • R1 1.3043
  • R2 1.3085
  • R3 1.3164

GBP/USD– Trading Tip

The GBP/USD pair slipped lower to test the next support level of 1.2960 and has formed a Doji candle around this corner before taking a sharp bullish reversal. 

The GBP/USD is trading at 1.3036, below the 1.3065 resistance level. Closings of candles below this level may help secure a sell trade around 1.3065, whereas, a bullish breakout of 1.3065 can lead the Cable towards 1.3200. The MACD and RSI are holding in the buying zone, supporting bullish bias for the GBP/USD pair. Let’s look for bullish trades above 1.3018 today. 

USD/JPY – Daily Analysis

The USD/JPY currency pair flashing green and rose to 110.08, mainly due to the uptick in the Asian stocks. As well as the sluggish data from Japan sent the pairs higher. As of writing, the USD/JPY currency pair is currently trading at 110.06 and consolidates in the range between the 109.86 – 110.09. However, the risk-reset based on catalysts from China.

Stocks in China, Hong Kong, Indonesia, and Japan are printing moderate gains ranging between 0.20% and 0.60% after the latest improvement in risk-tone. Also representing the risk reset is the U.S. 10-year treasury yields that rise one basis point to 1.563% by the press time.

The fundamental reason behind the pair’s bullish moves is the release of Japan’s Machinery Order and Merchandise Trade Balance Reports. As well as the positive comments from China’s President Xi Jinping and the World Health Organization (WHO) that we have to stay relaxed. Whereas, the opposing statement from Moody’s Investors Service has been ignored.

Whereas Caixin Media Company Ltd. increased uncertainties regarding the reducing coronavirus infected people on Tuesday, the latest figures from Hubei showed a confused picture. According to the report, there are 1,693 new cases on February 18 against 1,807 of February 17. This report also suggests 132 new deaths compared to 93 recorded the previous day.

Moving ahead, China-related headlines will be the key to watch, the U.S. housing market numbers and the Producer Price Index data will also be essential to watch.

Daily Support and Resistance

  • S1 109.26
  • S2 109.54
  • S3 109.7

Pivot Point 109.83

  • R1 109.99
  • R2 110.11
  • R3 110.4

USD/JPY – Trading Tips

The USD/JPY pair has violated the sideways trading range of 110.025 – 109.500 in the wake of a stronger dollar. The couple is heading north towards the next resistance level of 110.800. On the way, the pair may find 161.8% Fibo extension resistance at 110.450. 

The RSI and MACD are crossing on the higher side, suggesting chances of further bullish bias in the USD/JPY currency pair. Alternatively, the USD/JPY can drop after testing 110.850 resistance. 

All the best for today! 

Categories
Forex Market Analysis

Daily F.X. Analysis, February 18 – Top Trade Setups In Forex – Economic Events Disappoints 

On the forex front, the U.S. Dollar Index was broadly flat at 99.15 amid thin holiday trading. In the U.S., the New York Federal Reserve will publish February’s Empire Manufacturing Index (5.0 expected). The National Association of Home Builders will deliver January Housing Market Index (75 expected). Let’s take a look at trade plans.

On the forex front, the U.S. Dollar Index was broadly flat at 99.15 amid thin holiday trading. In the U.S., the New York Federal Reserve will publish February’s Empire Manufacturing Index (5.0 expected). The National Association of Home Builders will deliver January Housing Market Index (75 expected). Let’s take a look at trade plans.

On the forex front, the U.S. Dollar Index was broadly flat at 99.15 amid thin holiday trading. In the U.S., the New York Federal Reserve will publish February’s Empire Manufacturing Index (5.0 expected). The National Association of Home Builders will deliver January Housing Market Index (75 expected). Let’s take a look at trade plans.

Economic Events to Watch Today 

 

 

EUR/USD – Daily Analysis

The EUR/USD traded mostly around the 1.0830 price zone, a few pips above 1.0826, the multi-year low pasted last Friday. Market participants are struggling to find a catalyst, as the European macroeconomic calendar was empty yesterday due to the U.S. Presidents’ Day holiday. 

The single currency’s vulnerability has prompted by moderate or negative growth in Germany during the last year. Moreover, data from this Monday imply that the market has not yet attained its bottom, as the Bundesbank stated in its monthly statement that there are no indications the currency position is set to improve in the opening quarter of the year, while coronavirus’ risk scores a new course of risk.

The traders eagerly anticipated the German ZEW economic sentiment, which was expected to worsen to 21.5 in February against. 26.7 reported in January. As per the recent release, the ZEW Indicator of Economic Sentiment for Germany decreased sharply in February, dropping 18.0 points to a distinct reading of 8.7 points. 

The fundamental event is thus lightly beneath its December 2019 mark. The evaluation of the economic situation in Germany has also worsened when we compare it with the previous month.

Moreover, EUR/USD currency pair near-term technical outlook also shows a bearish picture, with a test of the psychological support at 1.0800 on the cards. The traders will have their sights on the coronavirus headlines for taking fresh clues.

Daily Support and Resistance

  • S1 1.0795
  • S2 1.0817
  • S3 1.0826

Pivot Point 1.0839

  • R1 1.0848
  • R2 1.0861
  • R3 1.0883

EUR/USD– Trading Tips

On Tuesday, the EUR/USD trades near 1.0825 support level despite weaker than expected German ZEW economic sentiment data. At the moment, the pair appears to have formed neutral candles as the investors still didn’t find any solid reason to trigger bearish breakout at 1.0825 level. Today’s candle is also neutral, and it is pretty much likely to drive upward correction. Today, if the EUR/USD pair manages to drop below 1.0840, we may see EUR/USD prices going towards 1.0760. Let’s look for buying trade today above 1.0840. 

GBP/USD– Daily Analysis

The GBP/USD is trading sideways on Tuesday, but modest losses near the 1.3000 figure. Earlier today, the Sterling declined during but concerns about whether the current Chancellor of Exchequer will be ready to pass the budget on time. A report from U.K. Prime Minister Johnson’s spokesman confirmed that the U.K. is not asking anything distinct from the E.U. in trade discussions and that they are available to negotiate. 

Besides, the market risk-tone getting worse day-by-day mainly due to the coronavirus fears, which provides support to the greenback as a safe-haven currency. Despite lowering the pace of the death toll and infected peoples in China, the uncertainty and fears still surrounding the market.

On the forecasted views, the Bank of England’s last MPR looks for the unemployment rate to stay unchanged at 3.8% for the next 3-4 months, we look for an increase to 3.9% in December (mkt 3.8%), with the potential for another pop higher in January. As wage growth, we look for the recent pattern of deceleration to continue, with headline wage growth slowing to 3.0% y/y (mkt 3.0%), and private sector regular pay to 3.3% y/y (mkt: 3.3%). 

As the latter measure, the short-term trend growth rate has more than halved from a peak of 5.0% on a 3m/3m annualized basis in July to 2.2% as of November.

Daily Support and Resistance

  • S1 1.2912
  • S2 1.2965
  • S3 1.2985

Pivot Point 1.3018

  • R1 1.3038
  • R2 1.3072
  • R3 1.3125

GBP/USD– Trading Tip

The GBP/USD pair slipped lower to test the next support level of 1.2960 and has formed a Doji candle around this corner before taking a sharp bullish reversal. The bullish reversal is mostly caused by robust unemployment claims data, which is in support of the Sterling. 

The GBP/USD is trading at 1.3036, below the 1.3065 resistance level. Closings of candles below this level may help secure a sell trade around 1.3065, whereas, a bullish breakout of 1.3065 can lead the Cable towards 

The MACD and RSI are holding in the buying zone, supporting bullish bias for the GBP/USD pair. Let’s look for bullish trades above 1.3018 today. 

USD/JPY – Daily Analysis

The USD/JPY currency pair flashing red dropped to 109.70 from the 109.90, mainly due to safe-haven Japanese Yen strength in the wake of intensifying coronavirus fears. The USD/JPY is currently trading at 109.75 and consolidates in the range between the 109.66 – 109.90. However, the equity market again turned in red and sending Japanese yen higher.

The futures on the S&P 500 are currently reporting a 30% drop on the day. Meanwhile, stocks in South Korea and Hong Kong are presently dropping more than 1%. Major indices like Japan’s Nikkei and China’s Shanghai Composite are reporting a 1.2% and 0.30% drop, respectively. 

Whereas, the yield on the U.S. ten-year Treasury dropped nearly 3-basis points at 1.559%. The equity market flashing red and the uptick in the anti-risk Japanese yen could be the reason for on-going concerns on the economic impact of the coronavirus outbreak in China. 

The number of new virus cases in region China dropped below 2,000 on Tuesday for the first time since January; experts say it is too quick to say the outbreak has risen. 

On the other hand, China’s growth rate is expected to drop sharply in the 1st-quarter, while the officials seem not in favor of significant monetary stimulus. According to the MNI News, the officials have asked for a careful monetary policy action that will target only affected areas and avoid changing the current overall neutral stance. 

Looking forward, the risk-tone of the equity market may get worse, as tech giant Apple said on Monday that it would not reach its target income for the first quarter, largely because of to weaker iPhone production and softer market in China in the wake of coronavirus.


Daily Support and Resistance  

  • S1 109.6
  • S2 109.74
  • S3 109.81

Pivot Point 109.89

  • R1 109.96
  • R2 110.03
  • R3 110.18

USD/JPY – Trading Tips

The USD/JPY pair is trading 110.025 – 109.500 as the demand for safe-haven assets remains in check. At the moment, the USD/JPY pair is holding below 110 resistance as it failed to violate the horizontal resistance level of 110.025. In case, the USD/JPY manages to break above 110.025 level; we may see USD/JPY prices going towards 110.350 at first and then towards 110.850. Alternatively, the USD/JPY can drop to 109.300 in case of failure to break above 110.025. 

All the best for today! 

Categories
Forex Market Analysis

Daily F.X. Analysis, February 12 – Top Trade Setups In Forex – Fed Chair Powell Testimony Ahead! 

The U.S. National Federation of Independent Business’s Small Business Optimism Index posted at 104.3 for January, better than 103.5 expected.

The U.S. National Federation of Independent Business’s Small Business Optimism Index posted at 104.3 for January, better than 103.5 expected.

The U.S. National Federation of Independent Business’s Small Business Optimism Index posted at 104.3 for January, better than 103.5 expected.

Later today, the U.S. government is expected to post a monthly budget deficit of 10.0 billion dollars for January. The European stocks ended in positive territory, with the Stoxx Europe 600 Index rising 0.9%. Germany’s DAX advanced 1%, and both France’s CAC and the U.K.’s FTSE 100 were up 0.7%.

The Safe-haven assets were broadly lower in price. U.S. government bond prices eased, lifting the benchmark 10-year Treasury yield to 1.589% from 1.574% Monday.

Economic Events to Watch Today 

 

 

EUR/USD – Daily Analysis

The EUR/USD rebounded 0.1% to 1.0919, halting a six-day decline. European Central Bank President Christine Lagarde hinted that ECB might not ease monetary policy further, saying: “Monetary policy cannot, and should not, be the only game in town.” Later today, the Eurozone’s December industrial production will be reported (-2.0% on month expected).

The support to Euro came after the dovish remarks by the ECB President Lagarde, iterating that the slowing growth momentum in the Eurozone also decreased pressure on prices, which further helped the pair’s slide beneath the 1.0900 level for the first time after early October.

Looking forward, the shared currency will likely stay on the bullish track, mainly if the equities market continues to flash green in the wake of coronavirus development. Moreover, the riskier currencies like the NZD and the Aussie are also flashing green an picked up a strong bid at the press time.

In case the Eurozone industrial production disappoints expectations, the single currency may drop and revisit support at 1.0879 (October 1 low). Besides, the traders will keep their eyes on the German 10-y Bond Auction for taking fresh clues.

Daily Support and Resistance

  • S1 1.0826
  • S2 1.0876
  • S3 1.0893

Pivot Point 1.0925

  • R1 1.0943
  • R2 1.0975
  • R3 1.1025

EUR/USD– Trading Tips

The EUR/USD is consolidating in a bearish zone around 1.0912 in the wake of a stronger dollar and weaker Euro. Presently, the pair is very near to the strong support mark of 1.0879, and the EUR/USD has also concluded a daily candle over this level. The pair has also formed a Doji candle accompanied by a robust bearish trend, which implies the odds of a downward reversal unto 1.0945 and 1.0980. Alternatively, the violation of 1.0925 can push buying in Euro; elsewhere, it may extend trading bearish unto 1.0880.

GBP/USD– Daily Analysis

The GBP/USD rose 0.3% to 1.2954. Official data showed that the U.K. fourth-quarter GDP grew 1.1% on year (+0.8% expected, +1.1% in the third quarter).

The GBP/USD rate is growing higher this week as the moving average extends support alongside the weakness in the U.S. dollar. The GBP/USD was last seen around the 1.3000 resistance after placing a low around 1.2870 in the early week.

The GDP figures from the United Kingdom published on Tuesday had little influence on the GBP/USD price as economic growth was not surprising in the fourth quarter, which was widely anticipated. A recovery yesterday was held lower by a major technical mark at 1.2960, although the pair is seen climbing over it in early trading today.

Daily Support and Resistance   

  • S1 1.2762
  • S2 1.2837
  • S3 1.2876

Pivot Point 1.2911

  • R1 1.295
  • R2 1.2985
  • R3 1.306

GBP/USD– Trading Tip

The GBP/USD broke above 1.2950 resistance level, which is now looking to test the next resistance around 1.3045. The following support level is likely to be found around 1.2950 for now. On the 4 hour timeframe, 1.3000 is the most crucial level for the GBP/USD as a violation of this level can lead Sterling prices further higher towards 1.3045 and 1.3065 in the coming week. The MACD and RSI are holding in the buying zone, supporting bullish bias for the GBP/USD pair. Let’s look for bullish trades above 1.3000 today. 

USD/JPY – Daily Analysis

The USD/JPY currency pair is flashing green and struggling to cross the 1.10 level, mainly due to the Japanese yen weakness in the wake of risk-on market sentiment. Currently, the USD/JPY is currently trading at 109.89 and consolidates in the narrow trading range between the 109.77 – 109.90. 

In the market, traders are found on the waiting mode for economic data and a carefully optimistic Federal Reserve chair Jerome Powell who resumes his semi-annual congressional testimony, performing before the Senate Banking Committee later today in New York.

At the coronavirus front, the latest numbers China’s Health Commission gave showed 1,638 new cases of coronavirus contaminated people from Hubei. Compared to the prior day’s 2,097 incidents, the disease appears to decrease gradually. Moreover, the World Health Organization (WHO) has already said that the vaccine could be ready in 18 months, giving a boost to the risk-on.

As a result, it increased from 1.40% to 1.42%, ten-year yields from 1.57% to 1.59%, boosting the U.S. dollar and sending the yen and risk asset classes like gold lower. The S&P 500 and Nasdaq Composite each posting a record finish, and the Dow Jones Industrial Average was virtually unchanged.

So, this news has also improved risk sentiment and sentiment in global financial and commodity markets (copper +0.97%, CRB index +0.44% time of writing) as it is showing that the Chinese are making progress in fighting and controlling the virus. The Federal Reserve’s Chair, Jerome Powell, sounded dovish but had a cautious tone in his semi-annual testimony to Congress.

    

Daily Support and Resistance

  • S1 109.33
  • S2 109.54
  • S3 109.66

Pivot Point 109.76

  • R1 109.87
  • R2 109.97
  • R3 110.18

USD/JPY – Trading Tips

On Wednesday, the USD/JPY pair is trading in a narrow range of 110.025 – 109.600 due to a lack of economic events. At the moment, the USD/JPY pair is looking to cross above the horizontal resistance level of 110.025. 

In case, the USDJPY manages to break above 110.025 level; we may see USD/JPY prices going towards 110.350 at first and then towards 110.850. Alternatively, the USD/JPY can drop to 109.600 in case of failure to break above 110.025. 

All the best for today! 

Categories
Forex Market Analysis

Daily F.X. Analysis, February 11 – Top Trade Setups In Forex – Central Bank Speeches Ahead! 

On Tuesday, the U.S. Labor Department will post JOLTS job openings for December (6.85M expected). The National Federation of Independent Business (NFIB) will release January Small Business Optimism Index (103.3 expected).

On Tuesday, the U.S. Labor Department will post JOLTS job openings for December (6.85M expected). The National Federation of Independent Business (NFIB) will release January Small Business Optimism Index (103.3 expected).

On Tuesday, the U.S. Labor Department will post JOLTS job openings for December (6.85M expected). The National Federation of Independent Business (NFIB) will release January Small Business Optimism Index (103.3 expected).

The U.S. government bond prices were steady as the benchmark 10-year Treasury yield edged down to 1.574% from 1.578% last Friday.

Economic Events to Watch Today 

 

 

EUR/USD – Daily Analysis

The EUR/USD lost 0.4% to 1.0911. The eurozone’s Sentix Investor Confidence Index fell to 5.7 in February (5.9 expected) from 7.6 in January.

If Federal Reserve Chairman Jerome Powell ignores the impact of coronavirus, then the greenback may put strong bids mainly due to fewer chances of the rate cut. As in result, the EUR/USD currency pair drop further below the 1.079. 

The U.S. dollar continued its fresh rally versus the European counterpart and moved the EUR/USD pair to new 2020 lows on the first day of a new trading week. Despite a positive sentiment encompassing equity markets, concerns about the spread of the fatal coronavirus continued helping the greenback’s perceived safe-haven status and continued exerting pressure on the major.

Besides this, the currency pair will likely take clues from the Europan Central Bank head Christine Lagarde’s presentation at the European Parliament in Strasbourg at 2 pm. 

    

Daily Support and Resistance

  • S1 1.0874
  • S2 1.0916
  • S3 1.0931

Pivot Point 1.0957

  • R1 1.0972
  • R2 1.0998
  • R3 1.104

EUR/USD– Trading Tips

The EUR/USD collapsed beneath the horizontal support level of 1.0995, which is now working as a support level for the EUR/USD pair. Closing of candles below this 1.099 is confirming a breakout and demonstrates that this level is currently working as a resistance. It may keep the Euro bearish until 1.09374. 

On the 4 hour timeframe, the pair’s MACD is closing histograms under 0, demonstrating chances of further selling in the pair while the bearish channel is also likely to get violated until and unless Nonfarm payroll comes out better than expected. 

GBP/USD– Daily Analysis

The GBP/USD rebounded 0.2% to 1.2915, snapping a three-day losing streak. Later today, U.K. fourth-quarter GDP growth will be released (+0.8% on-year expected).

The U.K.’s data dump for December, including Trade Balance, Industrial Production and Manufacturing Production, will be the key to watch respecting the latest upbeat British data pushing BOE off from its bearish bias. However, the key will be the preliminary prints of the 4th-quarter (Q4) Gross Domestic Product (GDP). 

The growth measure is expected to decrease to 0.8% YoY from 1.1% earlier, while the QoQ GDP will shrink to 0.0% from 0.4% earlier. Moreover, the BOE’s Governor Mark Carney will also speak at the U.K. parliament and might reiterate his dislike for the Brexit. At Powell’s speech front, the Federal Reserve (Fed) chief Jay Powell will testify before Congress on Tuesday (15:00 GMT) and Wednesday. 

Whereas, the market’s traders are expecting dovish tone from the Powell mainly due to global economic slowdown in the wake of coronavirus outbreak. On the other hand, if Federal Reserve Chairman Jerome Powell ignores the impact of coronavirus, then the greenback may put strong bids mainly due to fewer chances of the rate cut.

Daily Support and Resistance

  • S1 1.2753
  • S2 1.2831
  • S3 1.2858

Pivot Point 1.2909

  • R1 1.2936
  • R2 1.2987
  • R3 1.3065

GBP/USD– Trading Tip

The GBP/USD broke below 1.2950 support is to test the next support level of 1.2925. It’s the most crucial level for the GBP/USD as a violation of this level can lead Sterling prices further down towards 1.2870 and 1.2830 in the coming week.  

At the moment, the GBP/USD has neutral candles below 1.2920 support level, which is suggesting a bearish trend in the GBP/USD. The MACD and RSI are holding in the bearish zone, supporting selling bias for the GBP/USD pair. 

USD/JPY – Daily Analysis

The USD/JPY currency pair is flashing green but still below the 110 handles; the currency pair is still struggling to hit the 110 level ahead of major events. The USD/JPY currency pair is currently trading at 109.90 and consolidates in the range between 109.74 – 109.95. 

The currency pair is getting support from the improving risk-tone after China’s liquidity support and the positive report of coronavirus vaccination. Besides, the fresh developments of the virus, the focus also shifts on the U.S. yields and the Federal Reserve this week. The U.S. 2-year treasury yields fell from 1.41% to 1.38%, while the 10-year yields moved from 1.59% to 1.55%. 

The markets have been pricing in a 10% chance of a rate cut at the next Fed decision on March 18, and a terminal rate of 1.12% (vs. Fed’s mid-rate at 1.63% currently). While stock markets remain solid, with the U.S. benchmarks rising to new highs, there is an underbelly of dissatisfaction in the bond markets, which may be a warning that investors are still complacent.

Although, the risk-tone recovers mainly due to China’s liquidity support and the report came that the experts in Shanghai recently have isolated strains of the novel coronavirus, which will raise the development of vaccine and medicine against the virus. 

Daily Support and Resistance

  • S1 108.57
  • S2 109.11
  • S3 109.47

Pivot Point 109.66

  • R1 110.01
  • R2 110.2
  • R3 110.75

USD/JPY – Trading Tips

On Tuesday, the USD/JPY pair is consolidating with a bullish bias in the wake of weakening Japanese yen. The pair has crossed over 109.300 resistance level, and it seems to head towards 109.850. On Wednesday, the USD/JPY is likely to find resistance around 110.300 after violating 109.850. While support remains at 109.250. The RSI and MACD have crossed over in the buying zone and are supporting the bullish bias. Let’s look for buying trades above 109.26 today.

All the best for today! 

Categories
Forex Market Analysis

Daily F.X. Analysis, February 10 – Top Trade Setups In Forex – Post NFP Trade Plan! 

The U.S. Labor Department reported that the economy added 225,000 nonfarm payrolls in January, higher than the addition of 162,000 expected. Meanwhile, the jobless rate climbed to 3.6% (3.5% expected). Average hourly earnings grew 0.2% on month (+0.3% expected) and were up 3.1% on year (+3.0% expected).

The U.S. Labor Department reported that the economy added 225,000 nonfarm payrolls in January, higher than the addition of 162,000 expected. Meanwhile, the jobless rate climbed to 3.6% (3.5% expected). Average hourly earnings grew 0.2% on month (+0.3% expected) and were up 3.1% on year (+3.0% expected).

The U.S. Labor Department reported that the economy added 225,000 nonfarm payrolls in January, higher than the addition of 162,000 expected. Meanwhile, the jobless rate climbed to 3.6% (3.5% expected). Average hourly earnings grew 0.2% on month (+0.3% expected) and were up 3.1% on year (+3.0% expected).

Official data showed that wholesale inventories (final reading) fell 0.2% on month in December (-0.1% expected).

Economic Events to Watch Today 

 

 

EUR/USD – Daily Analysis

The EUR/USD dropped 0.3% to 1.0945, the lowest level since October. Official data showed that German industrial production contracted 3.5% on month in December (+0.6% expected), the largest decline in a decade.

The EUR/USD currency pair bullish moves could be limited mainly due to the risk-off market sentiment as coronavirus fears still on the peak and at the front of the latest news, recorded more than 37,000 known cases across the globe and 813 deaths so far.

The investors may ignore the China data in Asia due to coronavirus fears, which showed producer price index, a gauge of factory gate prices, edged up 0.1% on year in January, compared with a 0.5% decline in December. 

At the data front, Eurozone’s Sentix Investor Confidence (Feb) will be released at 09:00 GMT. On the other hand, the focus will be on the Federal Reserve President’s speech and short-term bill auctions.

 

Daily Support and Resistance

  • S1 1.0874
  • S2 1.0916
  • S3 1.0931

Pivot Point 1.0957

  • R1 1.0972
  • R2 1.0998
  • R3 1.104

EUR/USD– Trading Tips

On Friday, the EUR/USD broke below the horizontal support level of 1.0995, which is now working as a support level for the EUR/USD pair. Closing of candles below this 1.099 is confirming a breakout and demonstrates that this level is currently working as a resistance. It may keep the Euro bearish until 1.09374. 

On the 4 hour timeframe, the pair’s MACD is closing histograms under 0, demonstrating chances of further selling in the pair while the bearish channel is also likely to get violated until and unless Nonfarm payroll comes out better than expected. 

GBP/USD– Daily Analysis

The GBP/USD slid 0.3% to a six-week low of 1.2893, the weakest level since November. The currency pair bearish trend also could be the reason for coronavirus fears because investors were sacred and poured money into the safe-haven treasuries. As in result, the greenback succeeded in gaining support from it.

At the front of the latest news, I have recorded more than 37,000 known cases across the globe and 813 deaths so far. As a result, the U.S. ten-year treasury yields continue to positive around 1.58%, whereas Asian stocks register mild losses by the press time.

Looking forward, due to the lack of data in the economic calendar, the traders will find clues from China and the U.K. headlines for taking fresh directions. Whereas, the positive headlines will likely support the pair. 

The GBP/USD is gaining momentum over the weaker dollar as the U.S. Labor Department reported that the economy added 225,000 nonfarm payrolls in January, higher than the addition of 162,000 expected. Meanwhile, the jobless rate climbed to 3.6% (3.5% expected). Average hourly earnings grew 0.2% on month (+0.3% expected) and were up 3.1% on year (+3.0% expected).


Daily Support and Resistance

  • S1 1.2753
  • S2 1.2831
  • S3 1.2858

Pivot Point 1.2909

  • R1 1.2936
  • R2 1.2987
  • R3 1.3065

GBP/USD– Trading Tip

A day before, the GBP/USD broke below 1.2950 support is to test the next support level of 1.2925. It’s the most crucial level for the GBP/USD as a violation of this level can lead Sterling prices further down towards 1.2870 and 1.2830 in the coming week.  

At the moment, the GBP/USD has neutral candles below 1.2920 support level, which is suggesting a bearish trend in the GBP/USD. The MACD and RSI are holding in the bearish zone, supporting selling bias for the GBP/USD pair. 

USD/JPY – Daily Analysis

The USD/JPY currency pair flashing red and dropped below the 110 level, mainly due to greenback losing its bullish momentum ahead of the pre-NFP data. The USD/JPY currency pair s currently trading at 109.97 and consolidates in the range between the 109.81 – 110.03. The currency pair registered a fresh high at 110.03 during early Asia but failed to maintain and dropped again.

We have seen a strong run in U.S. equities despite the renewed threat of the coronavirus while the Japanese yen felt the stampede nonetheless. 

At the coronavirus front, China declared the latest update that there were an additional 73 deaths losses and 3,143 new cases of the coronavirus in China as of the end of February 6, the National Health Commission said in its daily update on Friday. This brings the total number of deaths in China to 636 and the total number of confirmed cases to 31,161.

Meanwhile, U.S. 2-year Treasury yields consolidate in the narrow range between 1.43% and 1.47%, and 10-year yields moved between 1.63% and 1.68%. Moreover, the markets are pricing a 10% chance of a rate cut at the next Fed decision on March 18, and a terminal rate of 1.18% (vs. Fed’s mid-rate at 1.63% currently).

Looking forward, the trader’s focus will be on January nonfarm payroll and hourly earning for taking fresh direction.

Daily Support and Resistance

  • S1 108.57
  • S2 109.11
  • S3 109.47

Pivot Point 109.66

  • R1 110.01
  • R2 110.2
  • R3 110.75

USD/JPY – Trading Tips

The USD/JPY pair is trading with a bullish bias in the wake of weakening Japanese yen. The pair has crossed over 109.300 resistance level, and it seems to head towards 109.850. On Wednesday, the USD/JPY is likely to find resistance around 110.300 after violating 109.850. While support remains at 109.250. The RSI and MACD have crossed over in the buying zone and are supporting the bullish bias. Let’s look for buying trades above 109.26 today.

All the best for today! 

Categories
Forex Market Analysis

Daily F.X. Analysis, February 6 – Top Trade Setups In Forex -Risk-On Sentiment In Play! 

The U.S. trade deficit grew to 48.9 billion dollars in December (48.2 billion dollars deficit expected).

The U.S. trade deficit grew to 48.9 billion dollars in December (48.2 billion dollars deficit expected).

The U.S. trade deficit grew to 48.9 billion dollars in December (48.2 billion dollars deficit expected).

Later today, the Labor Department will report initial jobless claims for the week ended February 1 (a drop to 215,000 expected).

On China’s coronavirus outbreak, the number of confirmed cases has surged across 27,000, and the related death toll has topped 560. Hong Kong’s government announced plans to impose a mandatory 14-day quarantine on all people entering the city from mainland China

Economic Events to Watch Today 

 

 

EUR/USD – Daily Analysis

The EUR/USD lost 0.4% to 1.0999. Official data revealed that the eurozone’s retail sales declined 1.6% on month in December (-1.1% expected). Later today, German December factory orders will be reported (+0.7% on month expected).

Its worth to mention that the Factory Orders may have recovered in December, as expected by economists. 

Therefore, the pair is currently flashing red and found near the 1.0995 and could hit the lowest level of October 8 at 1.0941 if the German data disappoints upbeat expectations. On the other side, the EUR currency put a strong bid if the German data release better-than-expected by a significant margin.

Looking forward, traders will keep their eyes on the German Factory Orders. Our focus will also point to the European Central Bank President, Lagarde, who is set to deliver her speech at 1:00 pm on the day. The traders will closely listen to Lagarde’s statement for clues about the fresh direction on the ECB policies.

Daily Support and Resistance

  • S1 1.0905
  • S2 1.0959
  • S3 1.0979

Pivot Point 1.1014

  • R1 1.1033
  • R2 1.1068
  • R3 1.1122

EUR/USD– Trading Tips

On Thursday, the EUR/USD continues to trade with a bearish bias bear 1.1000 psychological level. The bearish channel that we spoke about is still there, and it’s keeping the pair in a selling mode. 

At the moment, the EUR/USD pair is likely to face immediate support around 1.1020 level, and violation of this can lead the EUR/USD prices towards 1.0925. The EUR/USD pair as already retrace back 1.1098, and it has the potential to show further selling bias. On the lower side, a breakout of the support level of 1.0990 can lead EUR/USD prices towards the 1.0945 area. 

GBP/USD– Daily Analysis

The GBP/USD pared its gains in the prior session, retreating 0.3% to 1.2997. The currency pair did not get any support from the better-than-expected U.K. services PMI. Likewise, ISM Non-Manufacturing PMI and ADP Employment Change sent the U.S. dollar higher.

On the flip side, the market risk-sentiment is improving gradually despite the coronavirus cases increased time by time, mainly due to the equities of China, which gained support on better than expected economic events. 

Today, the U.K. economic calendar looking empty due to the lack of activities. Therefore, traders will keep their eyes on the Nonfarm Productivity and Average Labor Costs to determine the next movement in the market. 

Besides, the U.S. Jobless Claims and comments from the Federal Reserve Bank of Dallas President Robert Kaplan will be a pivotal event to watch today. The headlines regarding coronavirus and U.K. politics will keep the driver seats.

    


Daily Support and Resistance

  • S1 1.2782
  • S2 1.2896
  • S3 1.2949

Pivot Point 1.301

  • R1 1.3063
  • R2 1.3123
  • R3 1.3237

GBP/USD– Trading Tip

The GBP/USD broke below 1.3050 support is to test the next support level of 1.2965. It’s the most crucial level for the GBP/USD as a violation of this level can lead Sterling prices further down towards 1.2900 and 1.2830 in the coming week.  

At the moment, the GBP/USD has formed three black crows candles above 1.2960 support level, which is suggesting a bearish trend in the GBP/USD. The MACD and RSI are holding in the bearish zone, supporting selling bias for the GBP/USD pair. 

USD/JPY – Daily Analysis

The USD/JPY gained 0.2% to 109.79, posting a three-day rally. The USD/JPY flashing green but still trading below the 110 level because traders await the U.S. Nonfarm Payrolls data at the end of the week for more evidence of a hotter economic performance. 

The USD/JPY is trading at 109.96, representing 0.16% gains on the day and consolidates in the range between the 109.72 – 109.97. The pair rose to 109.80 from the 109.30, mainly due to the report that Chinese researchers have produced a medicine that will use in treating the coronavirus.

It is worth to mention that the pair’s buyers continue to struggle to cross the 110 level. On the other hand, the U.S. bond yields rose during the trading day despite the recovery in the U.S. on Wall street. 

Whereas, the U.S. 10-year yields led global bonds, putting on +6bps to test 1.66% (1.58% to 1.64% after the news came that Chinese researchers had developed a drug that was useful in treating the coronavirus).

    

Daily Support and Resistance

  • S1 108.57
  • S2 109.12
  • S3 109.47

Pivot Point 109.66

  • R1 110.02
  • R2 110.2
  • R3 110.75

USD/JPY – Trading Tips

On Thursday, the USD/JPY pair is trading with a bullish bias in the wake of weakening Japanese yen. The pair has crossed over 109.300 resistance level, and it seems to head towards 109.850. On Wednesday, the USD/JPY is likely to find resistance around 110.300 after violating 109.850. While support remains at 109.250.  

The RSI and MACD have crossed over in the buying zone and are supporting the bullish bias. Let’s look for buying trades above 109.26 today.

All the best for today! 

Categories
Forex Market Analysis

Daily F.X. Analysis, February 04 – Top Trade Setups In Forex -U.S. Factory Orders! 

Hong Kong, the government has closed more border checkpoints connected to China, while the city’s medical workers continued a strike demanding the closing of all such checkpoints.

Hong Kong, the government has closed more border checkpoints connected to China, while the city’s medical workers continued a strike demanding the closing of all such checkpoints.

Hong Kong, the government has closed more border checkpoints connected to China, while the city’s medical workers continued a strike demanding the closing of all such checkpoints.

Regarding U.S. economic data, the Markit U.S. Manufacturing Purchasing Managers Index (final reading) rose to 51.9 in January, above 51.7 expected. The Institute for Supply Management’s Manufacturing PMI increased to 50.9 in January, beating 48.5 expected. Monthly construction spending fell 0.2% on month in December, missing expectations of +0.5%.

Later today, the U.S. Commerce Department will report December factory orders (+1.2% on month expected), and durable goods orders (final reading, +2.4% expected).

Economic Events to Watch Today

 

EUR/USD – Daily Analysis

The EUR/USD climbed higher late last week but has grappled with continuing the skyward trend in the early week. The revival in the EUR/USD that took place lately may have been the effect of trades squaring before the month-end.

The single currency euro is sensitive to changes in risk sentiment as it is usually employed as a funding currency. Nevertheless, it is less sensitive when we compare it with the Japanese yen and Swiss franc, which are generally known as safe-haven currencies.

Considering the idea of risk appetite, both the RBA (Reserve bank of Australia) and the BOJ (Bank of Japan) kept the rates steady today. Some traders may have assumed a little more of a dovish stance from policymakers after the increase in the Coronavirus break during the previous week.

Regarding U.S. economic data, the Markit U.S. Manufacturing Purchasing Managers Index (final reading) rose to 51.9 in January, above 51.7 expected. The Institute for Supply Management’s Manufacturing PMI increased to 50.9 in January, beating 48.5 expected. Monthly construction spending fell 0.2% on month in December, missing expectations of +0.5%.

Daily Support and Resistance

  • S3 1.091
  • S2 1.099
  • S1 1.1043

Pivot Point 1.107

  • R1 1.1123
  • R2 1.115
  • R3 1.123

EUR/USD– Trading Tips

The EUR/USD is trading in a narrow trading range of 1.1100 – 1.1040 area, as it continues to maintain the downward channel. Right now, the pair is likely to face immediate support around 1.1040 level, and violation of this can lead the EUR/USD prices towards 1.0925. 

The EUR/USD pair as already retrace back 1.1098, and it has the potential to show further selling bias. On the lower side, a breakout of the support level of 1.0990 can lead EUR/USD prices towards the 1.0945 area. 

GBP/USD– Daily Analysis

The GBP/USD plunged from 1.5% to 1.2997. U.K. Prime Minister Boris Johnson rejected Europe Union chief negotiator Michel Barnier’s demand to respecting the bloc’s regulations under a trade deal. On the other hand, the Markit Construction PMI for January will be released later today (47.1 expected).

The latest risk recovery came possibly due to the Chinese officials’ that struggle to satisfy the traders and halt short-selling in the stock market. While Asian equities and the U.S. 10-year treasury yield recovers from Monday’s fall. Nevertheless, the increasing losses of coronavirus contagion keep the risk on the cards.

The total death losses have increased to 425, and the number of confirmed cases has risen to more than 20,000 due to coronavirus.

Looking forward, the final figures of the U.K. Construction PMI, which is expected to be 46.6 against 44.4, will be the key economic figure to watch on Tuesday. While markets are expecting no significant surprises in data, risk catalysts may lead to near-term GBP/USD pair movements.

Daily Support and Resistance

  • S3 1.2679
  • S2 1.2864
  • S1 1.293

Pivot Point 1.3049

  • R1 1.3114
  • R2 1.3234
  • R3 1.3418

GBP/USD– Trading Tip

The GBP/USD is consolidating in a narrow trading range of 1.3220 to 1.2980. Earlier today, the GBP/USD pair tried to break below 1.2985 support level, but it failed to continue its bearish momentum. 

Right now, 1.3220 is supporting the pair, and it’s very much likely to drive the bullish trend in the GBP/USD until the breakout occurs. Whereas, the bearish breakout of this level can extend selling until 1.2945 today. 

Let’s look for sell trades only below 1.2980 level and buying above the same today. 

USD/JPY – Daily Analysis

The USD/JPY currency pair found on the bullish track and rose to 108.78, mainly due to an uptick in the Asian stocks, but the pair is still trading below the 100-day Moving Average. The USD/JPY currency pair is currently consolidating at 108.75 and consolidates in the range between the 108.55 – 108.78. Notably, the pair has hit a low level of 108.55 an hour ago.

The reason behind the bullish sentiment in the pair could be the uptick in the S&P 500 futures and the Asian equity markets. China’s Shanghai Composite Index is scoring 0.65% at press time. 

On the front of the latest reports, the total death losses have increased to 425, and the number of confirmed cases has risen to more than 20,000 due to coronavirus.

It is worth to mention that Moody’s Investors Service responded on the increasing risks to chinas credit rating in the wake of the coronavirus outbreak. Whereas, the global rating giant announced expected drops in the consumption and its credit implications as the main catalysts.

Daily Support and Resistance

  • S3 107.87
  • S2 108.25
  • S1 108.47

Pivot Point 108.64

  • R1 108.85
  • R2 109.02
  • R3 109.4

USD/JPY – Trading Tips

On Tuesday, the USD/JPY pair is trading with slightly bullish bias after testing the support level around 108.500. The USD/JPY is maintaining the upward channel, which is keeping the safe-haven currency bullish. 

On Tuesday, the USD/JPY is likely to find resistance around 109.250, which is the same level that provided support to the USD/JPY earlier. We can see selling below this level until 108.520. 

Furthermore, the RSI and MACD have crossed over in the buying zone and are supporting the bullish bias. Let’s look for buying trades above 108.950 today.

All the best for today! 

Categories
Forex Market Analysis

Daily F.X. Analysis, January 31 – Top Trade Setups In Forex – Eyes on Canadian GDP!

The U.S. stocks erased early losses to close higher. The Dow Jones Industrial Average ended 124 points higher (+0.4%) at 28859, the S&P 500 added 10 points (+0.3%) to 3283 and the Nasdaq Composite was up 23 points (+0.3%) to 9298.

The U.S. stocks erased early losses to close higher. The Dow Jones Industrial Average ended 124 points higher (+0.4%) at 28859, the S&P 500 added 10 points (+0.3%) to 3283 and the Nasdaq Composite was up 23 points (+0.3%) to 9298.

The U.S. stocks erased early losses to close higher. The Dow Jones Industrial Average ended 124 points higher (+0.4%) at 28859, the S&P 500 added 10 points (+0.3%) to 3283 and the Nasdaq Composite was up 23 points (+0.3%) to 9298.

The benchmark U.S. 10-year Treasury yield remained subdued as it drifted lower to 1.545% from 1.593% Wednesday. Let’s take a look at trade ideas for today.

 

Economic Events to Watch Today

 

 

EUR/USD – Daily Analysis

The EUR/USD gained 0.2% to 1.1028. Official data showed that the German jobless rate was steady at 5.0% in January (as 5.0% expected). On the other hand, the eurozone’s fourth-quarter GDP growth will be released (+1.2% on-year estimated).

On the flip side, if the Retail Sales Data release disappoints expectations, then bears could try to cross the convincing break below 1.10. The U.S. Commerce Department reported that fourth-quarter GDP grew at an annualized rate of 2.1% on quarter, in line with expectations. Initial jobless claims declined to 216,000 in the week ended January 25, slightly higher than expected.

Looking forward, the trader’s eyes will be on the Eurozone Gross Domestic Product (GDP) for the 4th-quarter and the U.S. Personal Spending and Personal Income numbers as well. Whereas, the German Retail Sales is key to watch.

    

Daily Support and Resistance

  • S3 1.0961
  • S2 1.0993
  • S1 1.1013
  • Pivot Point 1.1026
  • R1 1.1045
  • R2 1.1059
  • R3 1.1091

EUR/USD– Trading Tips

On Friday, the EUR/USD hasn’t changed much than before as it continues to trade at 1.1020 area, testing the downward channel around 1.0990. It also marks a triple bottom level of around 1.0990. 

The EUR/USD pair may retrace back a bit until 1.1045 and 1.1065 before showing further selling bias. The EUR/USD can show bullish correction until 1.1060 and 1.1075 if it manages to stay above 1.0990. On the lower side, a breakout of the support level of 1.0990 can lead EUR/USD prices towards the 1.0945 area. 

GBP/USD– Daily Analysis

The GBP/USD rebounded 0.5% to 1.3086, snapping a five-day decline. The Bank of England held its benchmark rate at 0.75% unchanged as expected, while the number of officials who supported a rate-cut remained at two. 

It should be noted that the United Kingdom Prime Minster wants a deal with the European Union like Canada-style, but nothing has confirmed yet. The risk has seen again in the market in the wake of mixed headlines regarding China’s coronavirus. The World Health Organization finally had released a notification for a global emergency but later gave some hope that coronavirus will likely be controlled soon.

Looking forward, there will be many celebrations and sad farewell gatherings during the day ahead; the Tory leader’s speech, which is scheduled to happen during the day, will gain significant attention because all traders considerably wait for this. If the U.K. Prime Minister Boris Johnson says anything about future trade relations with the European Union, a surprise hint will be taken seriously. 

On the other hand, the U.S. economic calendar has many data, including Chicago PMI and Michigan Consumer Sentiment, which will entertain the traders during the day.

Daily Support and Resistance

  • S3 1.2795
  • S2 1.2928
  • S1 1.3011

Pivot Point 1.306

  • R1 1.3143
  • R2 1.3193
  • R3 1.3326

GBP/USD– Trading Tip

The GBP/USD is peaking out of the symmetric triangle pattern, which was keeping the pair supported above 1.2961 along with resistance at 1.3050. For now, the pair may find resistance around the double top pattern around the 1.3155 area. The pair is very likely to trade with in the same range due to a lack of related economic events. However, a bullish breakout of 1.3150 level can cause a bullish trend in the GBP/USD prices until 1.3256. 

On the lower side, the support prevails at 1.2961 and 1.2900. Taking a look at the MACD and RSI, both are holding in the selling zone, and are supporting the concept of selling. Keeping this in mind, we can go for selling trade below 1.306 today. 

USD/JPY – Daily Analysis

The USD/JPY currency pair flashing green and crossed the 109.00 level mainly due to the slight risk recovery in the wake of upbeat Chinese services sector data. As of writing, the USD/JPY currency pair is currently trading at 109.11 and consolidates in the range between the 108.88 – 109.14 day’s range.

However, the data was an improvement and a pleasant surprise. Whereas, the Chinese State Bureau said this was taken before some of the recent heightened coronaviruses headlines. The PMI survey was taken before January 20; it means that the result of the coronavirus is not fully shown.

Meanwhile, U.S. stocks closed in the green territory but were still down for the week so far. Positive earnings were a factor. However, USD/JPY will likely continue to flash green in the wake of risk-on sentiment, and U.S. yields continue to print lower lows. U.S. 2-year Treasury yields dropped from 1.41% to 1.37% but then back to 1.40% whereas UST ten-year yields dropped from 1.58% to 1.53% (a fresh four-month low), but then bounced to 1.57%.

Markets are expecting a slight chance of a rate cut at the next Fed decision on March 18, but a terminal rate of 1.10% (vs. Fed’s mid-rate at 1.63% currently). This comes after a slightly dovish tilt from, Jerome Powell, FED’s governor, who is stating his concerns over the persistently low inflation below the target of 2%. 

Daily Support and Resistance

  • S3 107.99
  • S2 108.42
  • S1 108.69

Pivot Point 108.85

  • R1 109.12
  • R2 109.28
  • R3 109.71

USD/JPY – Trading Tips

On Friday, the USD/JPY pair continues to maintain the sideways trading range of 109.250 – 108.850. The pair is still holding within the upward channel, which is keeping the trading sentiment bullish. The USD/JPY may find resistance around 109.250, which is the same level that provided support to the USD/JPY earlier. We can see selling below this level until 108.520. Moreover, the RSI and MACD have crossed over in the selling zone and are supporting the selling bias. Let’s look for selling trades below 109.150 today.

All the best for today! 

Categories
Forex Market Analysis

Daily F.X. Analysis, January 29 – Top Trade Setups In Forex – Eyes on Federal Reserve Rate Decision! 

The forex traders are keeping their eyes on the Fed Fund Rate and Monetary Policy decisions, which are likely to drive some major price action in the market.  

The forex traders are keeping their eyes on the Fed Fund Rate and Monetary Policy decisions, which are likely to drive some major price action in the market.  

The forex traders are keeping their eyes on the Fed Fund Rate and Monetary Policy decisions, which are likely to drive some major price action in the market.  

The U.S. Commerce Department reported that durable goods orders (preliminary reading) increased 2.4% on month in December, much better than +0.4% expected. The C.B. Consumer Confidence Index surged to 131.6 in January (128.0 expected) from 128.2 in December.

Economic Events to Watch Today

  

 

EUR/USD – Daily Analysis

The EUR/USD was flat at 1.1018. Later today, the GfK Consumer Confidence Index for February will be released (9.6 expected). Although, the currency pair could hit the below level of 1.10 in the European session if the forward-looking German Gfk Consumer Confidence Survey (Feb) release below the estimate of 9.6. 

By the way, the data is scheduled for release at 07:00 GMT. As well as, the German Import Price Index will also hit the wires at 7:00 GMT. In Germany, the GfK Consumer Confidence Index for February will be released (9.6 expected). France’s INSEE will release January Consumer Confidence Index (102 expected).

As we all well aware that the EUR currency was poorly beaten last week, possibly due to the European Centra Bank’s President Christine Lagarde spoke unexpectedly dovish.

Daily Support and Resistance

  • S3 1.0963
  • S2 1.0989
  • S1 1.1006

Pivot Point 1.1015

  • R1 1.1031
  • R2 1.104
  • R3 1.1066

EUR/USD– Trading Tips

The EUR/USD is trading at 1.1001 area, having formed a bearish engulfing candle around 1.0991 support level, particularly on the 4-hour timeframe. The bearish engulfing pattern is suggesting the probabilities of a bearish trend in the EUR/USD. The Fed rate decision will be helping us determine further trends in the EUR/USD. 

The EUR/USD can show bullish correction until 1.1060 and 1.1075 if it manages to stay above 1.0990. On the lower side, a breakout of the support level of 1.0990 can lead EUR/USD prices towards the 1.0945 area. 

GBP/USD– Daily Analysis

The GBP/USD lost 0.2% to 1.3035, sliding for a fourth straight session.

At the Brexit side, the United Kingdom Prime Minister Boris Johnson’s immigration efforts are continuing to getting mixed responses with the ‘Australian-style’ immigration vision getting hit by the independent Migration Advisory Committee (MAC).

The U.S. Commerce Department will report December goods trade balance (65 billion dollars deficit expected) and wholesale inventories (+0.1% on month expected). The National Association of Realtors will issue pending home sales in December (+0.5% on month expected).

Looking forward, chances of the Bank of England’s (BOE) next move are standing on the confusing track due to recently mixed data and Brexit concerns, as well as Governor Carney’s dovish tone. 

Daily Support and Resistance

  • R3: 1.3189
  • R2: 1.3105
  • R1: 1.3066

Pivot Point 1.3021

  • S1: 1.2982
  • S2: 1.2937
  • S3: 1.2853

GBP/USD– Trading Tip

The GBP/USD is stuck in a symmetric triangle pattern, which is keeping the pair supported above 1.2961 along with resistance at 1.3050. Since all eyes remain in the Fed rate decision, it will be nice to wait for the outcome to have a better idea about the trend. 

The bearish breakout of 1.2961 support can lead the GBP/USD prices towards 1.2900. Taking a look at the MACD and RSI, both are holding in the selling zone, and are supporting the concept of selling. Keeping this in mind, we can go for selling trade below 1.3021 today. 

USD/JPY – Daily Analysis

The USD/JPY found on the bullish track mainly due to the mixed headlines from China. By the way, the par having hit the high of 109.30 and currently dropped to 109.12. As of writing, the USD/JPY currency pair is currently trading at 109.13 and consolidates in the range between the 109.00 – 109.30. Although traders are also preparing for today’s Federal Open Market Committee.

At the BOJ front, the Bank of Japan said that it should maintain low rate policy bias because it must be careful to risk Japan’s economy may lose momentum for hitting inflation. The statement also said to coordinate with govt’s fiscal policy, structural measures.

Whereas China’s promised to kill the coronavirus soon triggered the recent risk recovery, increasing the rate of death cases and newly infected cases keep risk-off sentiment in the market. 

As in result, the U.S. ten-year treasury yields remain mostly directionless around 1.65%, after bouncing off the early October lows on Tuesday, whereas S&P 500 Futures lose 0.1% to 3,275 by the press time.

Daily Support and Resistance    

  • S3 108.14
  • S2 108.59
  • S1 108.87

Pivot Point 109.04

  • R1 109.31
  • R2 109.48
  • R3 109.93

USD/JPY – Trading Tips

A couple of days ago, the safe-haven pair USD/JPY violated long-held horizontal support level has already been violated at 109.250 level, and now, the USD/JPY is holding below this level. At the same level, the USD/JPY is also getting supported by the bullish channel, which can be seen in the chart above. 

The USD/JPY may find resistance around 109.250, which is the same level that provided support to the USD/JPY earlier. We can see selling below this level until 108.520. Moreover, the RSI and MACD have crossed over in the selling zone and are supporting the selling bias. 

All the best for today! 

Categories
Forex Market Analysis

Gold Flashing Green – China’s Coronavirus Outbreak Threats! 

The safe-haven-metal prices continued to flash green and rose to $1,588.70, mainly due to the risk-off market sentiment in the wake of China coronavirus outbreak threats. It is worth to mention that the gold prices recently got love from the fears of China’s coronavirus outbreak, as well as the headlines from the Middle East and the global trade news also add in the risk tone in the market.

The safe-haven-metal prices continued to flash green and rose to $1,588.70, mainly due to the risk-off market sentiment in the wake of China coronavirus outbreak threats. It is worth to mention that the gold prices recently got love from the fears of China’s coronavirus outbreak, as well as the headlines from the Middle East and the global trade news also add in the risk tone in the market.

The safe-haven-metal prices continued to flash green and rose to $1,588.70, mainly due to the risk-off market sentiment in the wake of China coronavirus outbreak threats. It is worth to mention that the gold prices recently got love from the fears of China’s coronavirus outbreak, as well as the headlines from the Middle East and the global trade news also add in the risk tone in the market.

According to the recent statement, the death toll in China due to coronavirus has risen to more than 80 from the 57. Meanwhile, Chinese authorities have recently updated the number of people affected by coronavirus as 30,400. Besides, more cases are also found in the United States, Japan, and Sydney. Whereas, the World Health Organization is likely to change its statement of delaying to call the coronavirus as International emergency amid the worldwide spread of the virus.

On the other hand, the renewed fears of the United States and Iran war also threatened the market risk-tone after repeated attacks on the US troops in Iraq on Sunday. The Sanctions on Iran from US Trump’s Administration has also added in the risk-off sentiment of the market.

Meanwhile, the US ten-year treasury yields hit the lowest from October 09 to 1.63%, whereas the S&P 500 decline more than 1.0% to 3,258 by the press time.

Looking forward, the traders will keep their eyes only on the trade and geopolitical news for fresh clues due to the lack of major data and events on the economic calendar in the wake of Australia and China’s holiday.

Daily Support and Resistance

  • S3 1529.51
  • S2 1548.81
  • S1 1560.32

Pivot Point 1568.11

  • R1 1579.62
  • R2 1587.41
  • R3 1606.71

On Monday, the boosted safe-haven demand has prompted a huge surge in the gold prices as it has opened with a gap from 1,572 to 1,581. Even now, gold prices are staying over 1,577 support zone, and bearish breakout of such level can prolong bearish trend unto 1,572 level. The general trend is bullish presently, but this gap should be swelled here we see further buying in gold. Good luck! 

Categories
Forex Market Analysis

WTI Crude Oil Prices Rose Amid Fresh Fear of China Coronavirus! 

The WTI crude oil prices flashed green and rose to $55.84 after dropping to 9-week lows, mainly due to the fears regarding China coronavirus. The U.S. West Texas Intermediate futures (CLc1) were 24 cents up, or 0.4%, higher at $55.83 a barrel. The contract fell 2% on Thursday and is 5% lower for the week.

The WTI crude oil prices flashed green and rose to $55.84 after dropping to 9-week lows, mainly due to the fears regarding China coronavirus. The U.S. West Texas Intermediate futures (CLc1) were 24 cents up, or 0.4%, higher at $55.83 a barrel. The contract fell 2% on Thursday and is 5% lower for the week.

The WTI crude oil prices flashed green and rose to $55.84 after dropping to 9-week lows, mainly due to the fears regarding China coronavirus. The U.S. West Texas Intermediate futures (CLc1) were 24 cents up, or 0.4%, higher at $55.83 a barrel. The contract fell 2% on Thursday and is 5% lower for the week.

On the front of the main headlines, the market’s risk tone has already badly shaken by the headlines from China regarding the increased number of affected people and deaths because of coronavirus. China has reportedly blocked millions of people in two cities to prevent the virus spread.

Whereas the World Health Organization (WHO) still needs some time to understand the cause behind the coronavirus as an international threat. The SARS fighting team of China returned to find the reason and battle the coronavirus.

On the flip side, oil inventories dropped by 405,000, the EIA reported in its weekly report. Traders were looking for a drop of about 1 million barrels for oil inventories.

After the massive build in fuels during the previous two weeks, you can say that this is slightly positive news for the crude oil future buyers, as well as it did not prove to be much help because the market’s worries are all on China’s demand now, under the coronavirus problem.

While we had a near 1-million barrel decline in Cushing stockpiles, U.S. crude exports fell about 70,000 bpd on the week, and production remained at an unreasonable high of 13 million bpd.


Daily Support and Resistance       

S3 52.98

S2 54.25

S1 54.97

Pivot Point 55.51

R1 56.24

R2 56.78

R3 58.04

Technically, crude oil has violated the horizontal intraday support level of 55.90, which is now working as resistance for oil. It’s trading at 54.50, having formed strong bearish candles, which are known as “Three Black Crows.” These patterns are likely to drive more sales until 53.95, the next support level for crude oil. The MACD also supporting the strong bearish trend in the crude oil, although there’s a need for a bullish correction. Let’s consider to take sell tradings below 55 today to target 53.95. Good luck! 

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Forex Market Analysis

Gold Rose Slightly As Fear of Virus Continue To Raise – Trade Idea!

The safe-haven-metal prices slightly rose, mainly due to the spread of China’s coronavirus. There were reports that the virus has almost killed 17 people in China, and officials have completely closed the Wuhan city to prevent the infection from further spread. However, China is looking up to other nations as well for finding the cause behind this virus. It has been found so far that the virus is contagious and can be transmitted from person to person, and this has resulted in an increase of risk-tone in the financial market.

The safe-haven-metal prices slightly rose, mainly due to the spread of China’s coronavirus. There were reports that the virus has almost killed 17 people in China, and officials have completely closed the Wuhan city to prevent the infection from further spread. However, China is looking up to other nations as well for finding the cause behind this virus. It has been found so far that the virus is contagious and can be transmitted from person to person, and this has resulted in an increase of risk-tone in the financial market.

The safe-haven-metal prices slightly rose, mainly due to the spread of China’s coronavirus. There were reports that the virus has almost killed 17 people in China, and officials have completely closed the Wuhan city to prevent the infection from further spread. However, China is looking up to other nations as well for finding the cause behind this virus. It has been found so far that the virus is contagious and can be transmitted from person to person, and this has resulted in an increase of risk-tone in the financial market.

The latest coronavirus has refreshed the memories of the SARS virus, which was also started in China in 2002-2003 and resulted in dented economic growth and a slump of the travel business. The market’s risk sentiment has increased due to the possible effects of the virus on the world’s second-largest economy.

At the Sino-US trade font, the uncertainty regarding trade tensions eased around the globe when the US reported that it has decided to roll back some tariffs on Chinese products on Valentine’s Day.

On the other hand, US President Donald Trump gave the warning to impose 25% tariffs on the EU cars if it fails to deliver any trade deal. The EU Chief Von Der Leyen may visit Washington in early February to discuss the possibility of the trade deal.

Whereas, the Lower export figures from Japan in December also supported the safe-haven metal today. As well as the country’s exports fell 6.3% in December from a year earlier, the Ministry of Finance data showed on Thursday. Meanwhile, Imports decreased by 4.9% in the year to December, against the median estimate for a 3.4% decrease. They fell 15.7% in the previous month.



Daily Support and Resistance
S3 1538.86
S2 1547.56
S1 1553.22
Pivot Point 1556.26
R1 1561.92
R2 1564.96
R3 1573.66

Gold is trading with a neutral bias, keeping the trading rangebound within 1,566 – 1,549. On the 4 hour chart, it has produced a series of Doji and Spinning top candles, which indicates uncertainty among investors.

At the moment, gold may find immediate support nearby 1,555 levels, which is expected to keep it in a buying mode until the subsequent resistance level of 1.561.

A bullish violation of this level can encourage more buying to 1,565. On the lower side, the breach of 1,555 support level can spread selling unto 1,551 level today.

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Forex Market Analysis

Daily F.X. Analysis, January 23 – Top Trade Setups In Forex – ECB Interest Rate In Highlights! 

The European Central Bank will deliver its interest rates decision (deposit facility rate expected to be unchanged at -0.50%). The European Commission will release the eurozone’s December Consumer Confidence Index (-7.0 expected).

The European Central Bank will deliver its interest rates decision (deposit facility rate expected to be unchanged at -0.50%). The European Commission will release the eurozone’s December Consumer Confidence Index (-7.0 expected).

The European Central Bank will deliver its interest rates decision (deposit facility rate expected to be unchanged at -0.50%). The European Commission will release the eurozone’s December Consumer Confidence Index (-7.0 expected).

The U.S. Labor Department will post initial jobless claims in the week ended January 18 (215,000 expected). The Conference Board will release its December Leading Index (-0.2% on month expected).

Economic Events to Watch Today

 

EUR/USD – Daily Analysis

The EUR/USD currency pair is moving flat and consolidating in the narrow range between the 1.1070 – 1.1120 ahead of the European Central Bank’s decision regarding rates. As of writing, the EUR/USD currency pair is currently trading at 1.1085. The pair have not attempted any move out of the range 1.1070 – 1.1120 since January 17.  

The European Central Bank is likely to keep interest rates and other essential policy tools unchanged. As we know, the ECB had delivered rate cut by ten basis points to -0.5% in September 2019. Moreover, the Bank also restarted bond purchases in October.

It is worth to mention that the purpose of Thursday’s meeting would be to announce the official strategy review, which would redefine its mission and tools. The Bank would also set the scope and parameters for the review, which could gain the attention of traders.

Moving ahead, the EUR currency will likely put strong bids if the speech of ECB President Lagarde decreases the chances of the possible change in the sense of the price stability and methods to achieve it.

On the other hand, the German economy is flashing green in the wake of optimism surrounding the United States and China trade deal. As we already mentioned that the EUR currency might pick up bid if Lagarde focuses on recent positive data, and confirm the need for more effort toward the economy.

On the negative side, the EUR currency could be subject to selling pressure if the Lagarde ignores the recent German/Eurozone economic recovery and focus more on the downside risks. Furthermore, any sign regarding Bank planning to adopt a higher inflation target in the future will likely push the EUR currency lower.


Daily Support and Resistance           

  • S3 1.1031
  • S2 1.1059
  • S1 1.1076
  • Pivot Point 1.1087
  • R1 1.1105
  • R2 1.1116
  • R3 1.1144

EUR/USD– Trading Tips

On Thursday, the EUR/USD is trading at 1.1086 area, having formed a series of Doji candles pattern above 1.1070 support level, particularly on the 4-hour timeframe. The bullish Doji pattern is proposing the odds of a bullish and bearish trend both in the EUR/USD as it depends upon the ECB rate decision. 

The EUR/USD can show bullish correction until 1.1106. On the lower side, a breakout of the support level of 1.1077 can lead EUR/USD prices towards the 1.1045 area. 

GBP/USD– Daily Analysis

The GBP/USD currency pair was flashing red, and it failed to continue its three-day bullish rally despite the United Kingdom’s Prime Minister Boris Johnson’s Brexit deal victory regarding Withdrawal Agreement Bill (WAB). As of writing, the GBP/USD currency pair is currently trading at 1.3015 and is consolidating in the range between the 1.3119 – 1.3152.

On the front of the leading news, despite seeing 5-amendments from the House of Lords, the Tory leader/UK PM Boris Johnson has passed his WAB Bill through the Parliament (without modification) in the wake of majority support. As of now, the bill will get the royal approval within 9-days to become law.

Whereas, the hard Brexit fears continue to surround the market. That is due to the European Union chief Von der Leyen saying that the United Kingdoms’ position would be weakened in the single market if it does not continue to sign up the European Union rules and regulations after Brexit withdrawal. The E.U. chief also said that the trade talks would start from February, after considering that there could be a further delay until March.

Moreover, the pair could weaken further in the wake of the U.S. threat to impose the sanctions if the United Kingdom moves forward in its punitive measures to impose digital service tax on search engines like Google and Facebook. Whereas France backed out after the warning from Washington and agreed with the U.S. to develop an international framework for digital taxation at the OECD level, but both disagree on ways to shape it.

At the China front, fears of a Chinese virus explosion and noises surrounding the US-China trade deal, as well as the U.S. President Donald Trump’s impeachment hearings, all are keeping the market under pressure.

As a result, the U.S. ten-year treasury yields remained under pressure around 1.75%, while the Asian stocks also gave mixed trade sentiment.

Daily Support and Resistance

  • S3 1.2879
  • S2 1.2994
  • S1 1.3067
  • Pivot Point 1.311
  • R1 1.3182
  • R2 1.3225
  • R3 1.3341

GBP/USD– Trading Tip

On the 4 hour timeframe, the GBP/USD is testing the resistance level, which is extended by the bearish channel at 1.3060. At the moment, the GBP/USD pair is trading at 1.3060, and it seems to extend its bullish bias until 1.3090.

The GBP/USD pair may find support around the 1.3044 area today. Whereas, the RSI and MACD support the bullish bias. Let’s look for selling trades below 1.3080 and bullish trades above 1.3010. 

USD/JPY – Daily Analysis

The USD/JPY currency pair failed to cross the 110.00 range and is still trading on the bearish track below the 110.00 level, mainly due to the risk-off market sentiment in the wake of global coronavirus spread. As of writing, the USD/JPY currency pair is currently trading at 109.55 and is consolidating in the range between the 109.50 – 109.86.

As we already mentioned, the USD/JPY currency pair failed to break the 110 handles because of the lack of events to distract the market attention from the virus fears as well as Trump’s impeachment trial. Whereas the U.S. stock markets had mixed sentiment and without the full commitment from U.S. dollar traders, the prices finally dropped.

The virus has killed 17 people so far in China, and leaders have almost closed Wuhan and also keeping the focus on the other nation to understand the cause behind the virus. By the way, the virus is known to be humanly transmitted. As a result, market risk-tone has severely disturbed.

At the Sino-US trade font, the U.S. has decided to reduce some part of its tariffs on Chinese products on this Valentines’ Day, as agreed in the phase-one deal, which resulted in ease in the uncertainty about the impact of the US-China deal on global financial markets.

Although the trade and geopolitical fears have been pushing the markets off lately, the rising trade optimism has given a cool tone to the market. Despite that, the U.S. ten-year treasury yields remained weak, around 1.77%, whereas global equities have also shown mixed results.

Looking forward, the Investors will keep their eyes on Japan’s trade figures, All Industry Activity Index, and Leading Economic Index, as well as the news headlines, to further invest in the market. On the negative side, a possible recovery in Japanese Yen will likely keep the pair under pressure. And on the positive side, the BOJ Governor’s overall dovish outlook in the latest meeting, as well as the broad greenback strength, could keep the pair bullish.

Daily Support and Resistance

  • S3 109.4
  • S2 109.65
  • S1 109.74
  • Pivot Point 109.9
  • R1 109.99
  • R2 110.15
  • R3 110.41

USD/JPY – Trading Tips

The USD/JPY pair has finally violated the double bottom level of 109.850, which is now leading the currency pair towards the next support level of 109.185. Technically, the USD/JPY may find resistance around 109.850, which is the same level that provided support to the USD/JPY earlier. We can see selling below this level until 109.250. Moreover, the RSI and MACD have crossed over in the selling zone. Today, I will be looking for selling trades below 109.850 and selling above 109.250 level. 

All the best for today! 

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Forex Market Analysis

The Safe-Haven-Metal Prices Rose on IMF Report & China Virus Headlines!

On Tuesday, gold prices inched up mainly due to the International Monetary Fund (IMF) report, which indicated a gloomy outlook for 2020. Gold traded 0.4% to $1,566.65 before falling to 1,555 during the European session.

On Tuesday, gold prices inched up mainly due to the International Monetary Fund (IMF) report, which indicated a gloomy outlook for 2020. Gold traded 0.4% to $1,566.65 before falling to 1,555 during the European session.

On Tuesday, gold prices inched up mainly due to the International Monetary Fund (IMF) report, which indicated a gloomy outlook for 2020. Gold traded 0.4% to $1,566.65 before falling to 1,555 during the European session.

The IMF decreased its forecast for global growth this year to 3.3% from 3.4% in October. The estimates for the U.S. and Eurozone were both lowered by the same amount. This report sent the prices of the safe-haven metal higher point, whereas the equities to the lower positions.

On the other hand, the safe-haven metal also got some support due to the risk-off market sentiment in the wake of the corona-virus outbreak in China.

Gold prices earlier boosted mainly due to the headlines regarding the China virus, which gained market attention. Because of the virus, four people were reported as dead in China, and an Australian man has also been recently tested for this human transmitted disease. As a precautionary measure, Wuhan has created a Wuhan Pneumonia control center to stop further spread of the disease. Meanwhile, he has also strongly suggested that markets and public transportation stations should be supervised strictly to prevent this virus from spreading further.

At the geopolitical front, unrest in Iraq during the weekend was also in focus, while it did not give any meaningful support to gold prices. At the USD front, the reason behind the greenback strength could be the rising expectations because of upbeat economic events that the economy of the United States will continue to expand.

Daily Support and Resistance

S3 1551.67
S2 1556.16
S1 1558.45
Pivot Point 1560.65
R1 1562.94
R2 1565.14
R3 1569.63

On the 4 hour chart, gold has violated the bullish channel, which was supporting it around 1,553. Violation of this level can extend selling until 1,549. Besides that, gold has formed a bearish engulfing pattern is also suggesting chances of a bearish trend in the gold. The violation of 1,549 can open bearish bias until 1,544 today. Good luck!