Categories
Forex Market Analysis

Daily November 08– Major Trade Setups – Risk on Sentiment Dominates 

The United States and China trade deal optimism supported the risk-on markets and came to a massive increase in the US Treasury yields, sent the greenback higher.

A report came that both countries decided to cancel some existing tariff if the round-1 trade deal happened on a positive outcome. It should be noted that the United States’ ten-year yields increased from 1.80% to 1.97%. This is the highest level since August 1.

Economic Events to Watch Today

Let’s took at these fundamentals.

 

 


EUR/USD – Daily Analysis

The EUR/USD currency pair remains to flash red and dropped for the 4th-consecutive day but didn’t hit below the 50-day average level. Moreover, the bullish trend could be seen in the pair because the Treasury yields are increasing in the wake of mild losses in the US dollar index futures.

As we all well aware, the shared currency faced many selling pressure yesterday, as anticipated, and fell near the 50-day average range at 1.1038. The US Treasury yields increased, sent the US Dollar higher, due to the fresh United States and China trade optimism. 

A report came that both countries decided to cancel some existing tariff if the round-1 trade deal happened on a positive outcome. It should be noted that the United States’ ten-year yields increased from 1.80% to 1.97%. This is the highest level since August 1.

Currently, the futures on the S&P 500 are reporting a 0.18% decline, and the United States ten-year yield is seen at 1.91%, down 6-basis points from Thursday’s high.

On the flip side, the German trade balance and the US Michigan Consumer Sentiment Index are scheduled to release and will likely leave an impact on the EUR/USD pair. As well as, the China trade data fro October release during the Asian trading hours represented declines in the imports.

Daily Support and Resistance

S3 1.1018

S2 1.1047

S1 1.1056

Pivot Point 1.1075

R1 1.1084

R2 1.1103

R3 1.1131

EUR/USD– Trading Tips

The EUR/USD is consolidating with a bearish bias since it broke the bullish trendline support around 1.1125 area. On the 4 hour timeframe, the pair has formed strong bearish channels, which are signaling chances of further selling in the market. 

At the moment, the EUR/USD is focusing on a crucial trading level of 1.1060 level, which is likely to determine the further direction of the pair. Below this level, the EUR/USD may gain support at 1.1040 and 1.1010 level today. 


GBP/USD– Daily Analysis

The GBP/USD currency currently flashing green, but the overall sentiment remains bearish. As of writing the GBP/USD currency pair presently trading at 1.2822, having increased just more than ten pips a few minutes ago because the banks of England’s monetary policy decision has calm down now.

The main reason behind the GBP/USD currency pairs bearish sentiment is that the monetary policy decision by the bank of England. The rates hit the weakest level since September 24 at 1.2793 due to the Bank of England MPC maintained the interest rates, whereas two members of Bank of England voted for a rate cut.

The wary comments from the Bank of England Governor Carney also hurt the GBP. He warned during signaling the risk of a global economic downturn that there would be losses in jobs and business closure in the wake of no-deal Brexit.

On the other hand, the United States and China trade deal optimism supported the risk-on markets and came to a massive increase in the US Treasury yields, sent the greenback higher. So, the GBP/USD currency pair also was seen at the bearish track due to the rise in demand for the US dollar.

Daily Support and Resistance

S3 1.2758

S2 1.2812

S1 1.2832

Pivot Point 1.2865

R1 1.2886

R2 1.2918

R3 1.2971

GBP/USD– Trading Tips

The GBP/USD hasn’t improved enough as it extends to trade sideways ahead of the Bank of England policy decision. The MACD and RSI have crossed below 0 and 50, respectively, suggesting the chances of a bearish trend in the GBP/USD. But the thing is, investors are staying out of the market ahead of BOE rate. On the downside, the GBP/USD may see next support around 1.2786, and the violation of this level can extend sell-off until 1.2690. 


USD/JPY – Daily Analysis

The USD/JPY currency pair is flashing green even after the positive Japanese data and the risk-on sentiment in the equity markets. As of writing, the USD/JPY currency pair is currently trading at 109.35 and consolidates in the narrow range. By the way, the pair hit the high of 109.49 during the overnight trade. Notably, the pair gained its15-pips in the last few minutes.

As of data, Japan’s Household Spending surged 9.5% year-on-year in September, crossed the expected rise of 7.8% by a big margin and up significantly from the preceding month’s 1% rise. Labor Cash Earnings also rose 0.8% in annualized terms, bettering the 0.4% estimate.

However, the Japanese yen is not supportive, mainly due to the fears that the buyers spent more ahead of the October tax hike. Notably, the spending had increased by 7.2% in March 2014, month ahead of the prior sales tax increase, only to fall sharply and stay negative for more than a year.

According to the forecasting view, the USD/JPY currency pair will likely keep its tracking the action in the primary equity markets and US Treasury yields. The ten-year yield increased to 1.97% in the overnight trade since 3-months highs. China’s trade data may also affect the demand for the Japanese yen.

Daily Support and Resistance

S3 108.34

S2 108.66

S1 108.82

Pivot Point 108.98

R1 109.14

R2 109.3

R3 109.62

USD/JPY – Trading Tips

On the technical side, the USD/JPY currency pair had shown the wrong direction to the buyers of the market during the last 48 hours as you know the pair dropped in 48 hours against the buyer’s expectations. The pair closed above the 200-day MA on Tuesday to fall back below the long-term MA in the overnight trade. Consider staying bullish above 

108.700 today.

All the best!

Categories
Forex Market Analysis

Gold’s Bearish Trend Continues – Eyes On Double Bottom Pattern

On Friday, the precious metal gold prices crept lower, exhibiting one of the sharpest weekly drops in two and a half years. The stronger greenback pressured on gold prices while confidence about U.S.-China trade negotiations depressed bullion’s safe-haven bid.

Gold is declining as the buck is performing great, and few traders who purchased gold as a haven are running out. The dollar index was directed for a weekly profit as it profited from the report that China and the United States had admitted to rolling back taxes as part of a possible preliminary agreement to settle their trade war.

Nonetheless, some uncertainties arose as administrators inside and outside the White House rejected the idea of bending up punitive tariffs. The uncertainty limited bullion’s decline.

Meantime, European stock benchmarks departed from the prior session’s speak as contradictory signs from China and the United States on development made in trade discussions collapsed market expectations of a near-term truce.

Gold – XAU/USD – Daily Technical Levels

Support Resistance 

1,484.27    1,495.6

1,477.98    1,500.64

1,466.65    1,511.97

Pivot Point: 1,489.31

On Friday, gold prices may find immediate support around 1,457 level. This level is extended by a double bottom level on the 4-hour chart. The MACD and RSI are exhibiting sharp bearish bias. 

Today, the closing of the 4-hour candle above 1,457 area is likely to offer us a bullish retracement. Until then, we can stay bearish below 1,467 area. All the best! 

Categories
Forex Videos

The Most Powerful Forex Technique – Trading Breakouts

Trading Breakouts

 

In the area of financial trading and in particular within the Forex market, the movement of a currency pair, or price action, does one of three things: it moves up, it moves down, or it moves sideways. Within these types of moves, especially when the price action is moving up and down, we will find trends forming. We also find pullbacks, or price reversals, continuations, slowdowns in volatility, and pauses and hesitations, which are also known as periods of consolidation. Typically at these times you might see very small movements, where price moves sideways in a narrow range. In other words, currency exchange rates in the Forex market do not travel in a continuous straight line. And this is what makes trading so difficult to predict.
Each time you pull the trigger and execute a trade, and especially as a retail trader, you are up against institutional traders, including sovereign wealth funds, hedge funds, governments and their central banks and high net worth individuals, all of whom might well have a different price move expectation than yourself and be trading in the opposite direction, i.e, against you!

This is why it is so important to learn the peculiarities, twists, and turns, the dynamics and unpredictability of the Forex market. And the best way to do this is to study your charts and to study the markets and to practice on a demo account. In other words, learn the ropes, find the best time of day to trade that suits your trading style and methodology, try to determine when the aforementioned big guns are all likely to be singing from the same hymn sheet, in other words when the majority are trading in the same direction.

One of the most popular and rewarding styles of trading the Forex market is identifying breakouts. This type of trading relates to technical analysis only. That Is not to say that we can take our eyes off of the fundamentals, because these events can be triggered by economic data releases. However, after periods of consolidation, where price action becomes narrow and congested, and show a lack of direction, traders look for potential breakouts to test new levels, and these events regularly occur purely on technical analysis, alone.
Because breakouts are so popular, price action can be extremely volatile at these times. It’s almost as if everybody pounces to trade at the same time and either buys or sells a particular currency pair because their charts tell them so. This tends to cause strong moves, as price breaks out of bottlenecks and where quite often those entities who are trading counter to the breakout may be stopped out of their trades. This is often because breakouts regularly happen at, or close to, round numbers. At these levels, traders tend to place their stop losses or limit orders to buy or sell. This can often result in a spoof breakout, where price action breaks out of a period of consolidation only to reverse quickly and start a trend in the opposite direction. And therefore, some breakouts can be short-lived, and which are also known as false breakouts.

Example A

Let’s turn our attention to example ‘A.’ This is a 1-hour chart of the EURUSD pair. Always read your charts from left to right, because it tells you a story of where price action has been, and where it is possibly going to go in the future.


In this example, we can see that we have drawn a horizontal line at position ‘A.’ This has become an area of support; it is effectively a floor. Although we have a high, as marked at the position marked 1, and where price action moves back to our floor, the second move higher at position 2 becomes a lower high than at position 1. This tells us that the market is running out of momentum to the upside, and where indeed price action returns to the floor after this push higher falters. And then, price action forms a new lower high at position 3. This now tells us that bull traders have effectively thrown the towel in, and then, when price again returns to the floor, we see a breakout, as marked by the X, which punches through the floor, or support level. Therefore, this would have been the breakout candlestick that traders were looking for In order to go short on this pair.

Price action continues to move to the downside. However, we now see a new floor at position C, and a new ceiling at position B. And where price action consolidates in a sideways trading fashion.
In the example ‘B,’ we have moved the charts along to the next session. Price action continued to trend sideways between the ceiling marked ‘B’ and the floor marked ‘C’ until it becomes a second breakout occurs and where price action punches through to a new floor marked ‘D’ and where the previous floor, ‘C’ has now become a ceiling.

Again, price action returns to a consolidation or sideways momentum, until, eventually, at candlestick marked X – a series of strong bearish candlesticks form another breakout to the downside. Had we entered a short trade at the first breakout to the downside in example A, we could have realised a profit of over 180 pips.
An important lesson to learn from this section is that breakouts often occur when price action punches through floors and ceilings, and which are also known as levels of support, being the floor, and resistance being the ceiling.
So keep an eye out for possible breakouts and especially at key technical levels when support and resistance levels begin to fail. They will be far stronger in momentum after extended periods of consolidation.

Categories
Forex Basic Strategies

A Twist in the Tale

The Forex market can be very unpredictable. It is a game of probability. With more experience and knowledge, a trader increases the chance to be right in making a trading decision. Having immaculate risk management is another aspect that keeps a trader safe with his investment. In today’s lesson, we are going to talk about the unpredictability of the market.

Let us start with a daily chart of a Forex pair.

The price makes a bullish move and finds its resistance. After four daily candles, the daily chart produces a bullish engulfing daily candle. This is a powerful bullish reversal candle, which forms right at a flipped support. Have a look at the chart below.

The chart above shows that the bullish engulfing candle forms at the flipped support. This means buyers on this chart are to go long on a chart pattern called ‘ABC’ or ‘123’. This is a lucrative and consistent chart pattern, which price action traders love to trade. Let us find out what happens next.

The price stalls and has a rejection at the same level. The buyers would love to get a breakout here to go long and grab some green pips. However, the chart produces a bearish engulfing candle instead. What do you think a trader should do here?

He shall start looking for short opportunities. This is the daily chart. Thus, he shall flip over to the H4 chart to find out a short opportunity.

This is how the H4 chart looks. A very strong bearish candle followed by a little Inside Bar. The trader (the seller) is to wait for consolidation and a bearish reversal candle to go short.

The price consolidates more. It produces a good-looking bullish candle. Let us find out how the next candle comes out. Do not forget that the sellers are waiting to get a bearish reversal candle breaching the lowest low.

This is it. A bearish engulfing candle closes below the level of support. The sellers have been waiting to get a signal candle like this. A short entry may be triggered right after the last candle closes. Let us find out what happens next.

As expected, the price heads towards the South with good bearish momentum. We see the first H4 bullish reversal candle forming at the daily support as well. This may be time to take out the profit.

The Bottom Line

Do you notice how things change within a candle? Before that bearish engulfing daily candle, the pair looks extremely good for the buyers. An upside breakout would make them go long on the pair and push the price towards the North. However, that does not happen, but the price comes down instead. This is what I call “Twist in the tale.” Forex traders often get these twists.

Categories
Forex Price-Action Strategies

A Breakout and the Confirmation

Support and Resistance, also known as Supply and Demand, have long been used in the financial markets. The most characteristic feature of support/resistance is a level of support becomes resistance, and a level of resistance becomes support. The price after making a breakout comes back to the level and makes a move towards the established trend. The price does not always confirm all the breakout levels, though. Traders do not know which broken level is going to produce a trading signal. In reality, they do not even have to know or guess. They have to make decisions according to the price movement or Price Action. Let us have a demonstration of this.

The price is up trending. Traders shall look for long opportunities. To be honest, the last candle on the chart is a buy signal. It was a week ending candle, which must have held the buyers back. Let us wait for a while to get more clues.

The last candle came out as a bearish engulfing candle. Such price action usually makes a pair choppy. The buyers may want to wait for an upside breakout to go long. However, a bearish engulfing candle may not let that happen.

A strong bullish candle closes within the resistance. It seems that the chart may produce a Double Top. Thus, the bear may come and dominate. Let us draw the Neck Line and resistance of the Double Top.

The equation is very simple here. A breakout at the neckline attracts the sellers, which is more likely. On the other hand, an upside breakout attracts buyers. Let us find out which way the price heads to.

The price makes a breakout at the Neckline. However, it does not consolidate around the Neckline after the breakout. Unfortunately, the sellers do not get an opportunity to go short here. It often happens with the traders. Traders’ life is never easy!

Here is a question. Do you see anything interesting? Has the price made another breakout?

It has made a breakout at the red-marked level. It goes back to the level to confirm the breakout, as well. Moreover, it has produced a bearish engulfing candle with a long upper shadow. Things look good for the sellers. A breakout at the lowest low would be the signal to go short.

Here comes the breakout. A bearish Marubozu candle breached the lowest low. The sellers may want to trigger a short entry right after the last candle closes. Let us find out how far down it goes before producing any bullish reversal candle.

Here comes the breakout. A bearish Marubozu candle breached the lowest low. The sellers may want to trigger a short entry right after the last candle closes. Let us find out how far down it goes before producing any bullish reversal candle.

The price heads toward the downside with good bearish momentum. It produces a Doji Candle. It may be time to come out with a profit.

The Bottom Line

The price does not confirm all the breakouts. That does not mean we should start pulling our hair. Concentrate hard and calculate well. The next opportunity is just around the corner.

Categories
Forex Basics

Do not be Biased with Your Anticipation

Financial markets keep going up and down. Traders make money out of those moves. To take an entry, a trader is to do a lot of calculations, such as detecting a trend, waiting for the price to go to the right zone, market psychology, and signal candle, etc.

In trading, we often find ourselves in a situation in which we were waiting for a long entry from a support zone, all of a sudden the price makes a breakout at the support and heads towards the South instead. We feel deprived. However, this should not be like this. In trading, we are to get ready to sell and to buy since the market can go anywhere. We are to stick with the rules to take an entry.

Let us demonstrate an example.

The price heads towards the North with good buying pressure. It seems that the price finds its resistance as well. The buyers are to wait for a bullish reversal candle and a breakout at the resistance to go long again on the pair.

The price keeps being bearish. It seems that the price is going to have a long correction instead of consolidation. The price is at a flipped support. This is where a battle is going to take place between the bull and the bear. Traders are to wait for a downside breakout to sell the pair. On the other hand, a bullish reversal candle is going to attract them to keep an eye for an upside breakout and buy the pair.

The bull wins here. An engulfing bullish candle right at the flipped support means traders shall wait for an upside breakout to buy the pair. The momentum looks good. If the breakout takes place within the next candle, it will be an excellent buy signal. If it takes two candles to make the breakout, that will be a good buy signal as well. Let us proceed to find out what happens next.

The bull has lost the momentum. Traders are to wait for an upside breakout to go long. A good-looking bullish engulfing candle at the support area shall attract the buyers on the minor time frames to push the price towards the upside. That would eventually help the price make an upside breakout on this chart. Let us wait and find what happens next.

What do you see here? A bearish engulfing candle is right at the resistance level. This is a Double Top resistance level as well. If you have been waiting to go long, please change your mind. Get ready to look for short opportunities. This is how the market changes its complexion. You know what you have to do to deal with it. Yes, you must not be biased with your anticipation/calculation — Trade what you see, not what you think.

 

Categories
Forex Elliott Wave

Elliott Wave Principle – Advanced Concepts – Part 3

The Relative Strength Index (RSI) indicator was developed in 1978 by J. Welles Wilder. the RSI is a Momentum indicator that measures the change of the price movement. In this educational article, we will review how to apply the RSI with the Elliott Wave Analysis.

The basics

Possibly, the RSI indicator is the most widespread indicator from professionals to retail traders. The RSI is an oscillator that moves in a range between 0 to 100. Alexander Elder describes it as a “leading or coincident indicator – never laggard.”
 
Some applications of RSI are tops and bottoms identification, divergences, failure swings, support and resistance, and chart formations.
 
In the Elliott wave theory, the RSI application can to aid in the wave identification process. In particular, the identification of divergences is the most used application in the wave analysis.
 
J. W. Wilder describes the divergence between the price action and RSI path as a “powerful indication that the market could reverse soon.
 
A divergence takes place when the price is still increasing, while the RSI began decreasing (bearish divergence). Or when the price falls, and the RSI climbs (bullish divergence.) In the wave analysis terms, divergences appear between the end of waves three and five. Let’s see a couple of examples.

RSI and the Elliott Wave Principle

Johnson & Johnson (NYSE:JNJ), on its weekly chart, illustrates the RSI and the Awesome Oscillator. Both indicators show the divergence created between the end of waves three and five.

On the JNJ chart, we also can observe the RSI levels when price action runs in a wave three. When this occurs, the RSI tends to move between the levels 70 and 80.

In a bull market scenario, usually, the price action tends to find support near to level 40. When the price moves in a bear market, the ascending correction tends to find resistance near to level 60. This concept, with the swings identification, can support the wave analysis.

The following chart corresponds to the Dollar Index (DXY) in its 8-hour timeframe. From the figure, we observe the bullish sequence developed in five internal legs, in which we observe that each leg has three waves.

As a conclusion from the study using the RSI indicator and wave analysis, the price action unveils an ending diagonal pattern. The Elliott wave structure shows us that the Greenback should see new lower lows.

Categories
Forex Market Analysis

Daily FX Brief, November 05– Major Trade Setups – Services PMI Figures In Highlights! 

During the Asian session, the economic event well-occupied as it included October Service sector PMI figures coming out from China and Retail Sales Monitor figures from the United Kingdom. 

On the flip side, the Reserve Bank of Australia also released its November interest rate verdict and rate statement. The RBA decided to keep the policy unchanged today.  

On the geopolitical uncertainty aspect, chatter on trade contributed backing for riskier investments in the first section of the day. The focus today stays on the series of economic events from the U.S. and New Zealand. 

Economic Events to Watch Today

Let’s took at these fundamentals.

   

GBP/USD– Daily Analysis

The GBP/USD currency pair still flashing red for the 3rd consecutive day and dropped to 1.2880 on the day. Apart from trade positive headlines, recent uncertainty is taking place, surrounding the United Kingdom Prime Minister Boris Johnson’s victory in the snap election, which is scheduled to happen in December.

Besides that, not only the trade-positive comments from the United States and Chinese officials but the United States administration plan to remove some tariff on Chinese goods looks to support the existing risk-on sentiment. Everything boosts the chances of an incomplete trade deal between the United States and China.

A Labour-party member as the speaker of House of Commons and questions on the Prime Ministers’ performance in the report of Russia interference in British politics looks to hint additional difficulty for the United Kingdom citizen.

However, the British traders will keep their eyes on October month figures of services Purchasing Managers Index from the United Kingdom, ISM Non-Manufacturing PMI, second-tier jobs data, and trade balance will enhance the economic calendar of United States.


Daily Support and Resistance

S3 1.2769

S2 1.2835

S1 1.2858

Pivot Point 1.29

R1 1.2924

R2 1.2965

R3 1.303

GBP/USD– Trading Tips

The GBP/USD hasn’t changed much so far as it continues to trade bullish due to the weaker U.S. dollar. The Cable has outraged the previous resistance level of 1.2930. Now the pair is likely to face fresh resistance around 1.3050 area. Consider staying bullish above 1.2941 today.  

USD/JPY – Daily Analysis

The USD/JPY currency pair flashing green and representing 0.17% gains on the day mainly due to positive news came regarding trade. Notably, the pair is currently hit the session highs above 108.77. Whereas the recovery in the pair came from Friday’s lows of 107.89 is bright.

Japanese traders enjoy the heightening chances of the Successful trade deal between the United States and China after a holiday. As of writing, the USD/JPY currency pair takes buying to 108.75.

Besides, it’s not only the trade war-related positive comments from the United States and Chinese officials, but the United States administration plan to remove some tariff on Chinese goods looks to support the existing risk-on sentiment.

As a result, the United States’ ten-year Treasury yields continue the previous run-up to 1.8%, whereas Japan’s NIKKEI climbed 1.5% high at the start of Tuesday trading.

There is another reason behind the pair’s bullish trend, and that’s the support of greenback from the market. It came after the Fridays more than expected Nonfarm Payrolls that ward off Mondays’ adverse Factory Orders. Moreover, the U.S. dollar strong buying could be the new comments from the San Francisco Feds Mary C Daly, who declined the scope of the recession.


Daily Support and Resistance

S3 107.62

S2 108.05

S1 108.33

Pivot Point 108.49

R1 108.76

R2 108.92

R3 109.35

USD/JPY – Trading Tips

The USD/JPY continues to trade bearish with the selling bias due to weakness in the U.S. dollar. The USD/JPY pair broke the bullish channel, which was holding the USD/JPY at 108.800 zones.

Three Black Crows candlestick patterns are suggesting chances of additional selling in the USD/JPY until 107.450 today. On the upper side, resistance is likely to stay at 108.350. Consider taking bearish trades under 108.350 today.  

EUR/USD – Daily Analysis

The EUR/USD currency pair found on the bearish outside day candlestick pattern even after the positive news came regarding the United States and China trade progress and seen the risk-on sentiment in the financial markets.

As of writing, the EUR/USD currency pair dropped from 1.1175 to 1.1125 during the Monday and consolidating between the highs and lows. Notably, the bearish outside day candlestick pattern is broadly considered as a sign of a coming bearish reversal.

If the EUR/USD currency pair closes below the level of 1.1125 in today’s trading hour so then the trend reversal would be confirmed. By the way, the currency pair is currently trading at 1.1124, having hit the low of 1.1113 a few minutes ago.

The German economy badly damaged mainly due to the United States and China trade war, sending the Eurozone’s manufacturing powerhouse on the edge of the slowdown. So, the heightened chances of the United States and China makes a trade deal are supportive headlines for Eurozpn and Germany.

The market bought greenback during the Monday and will likely continue to buy more today, possibly due to the decrease of trade tensions that provides the Federal Reserve more opportunity to pause the rate cut series.


Daily Support and Resistance

S3 1.1033

S2 1.1087

S1 1.1105

Pivot Point 1.114

R1 1.1158

R2 1.1194

R3 1.1247

EUR/USD– Trading Tips

The EUR/USD has struck below the double top resistance point of 1.1175 and has lately closed series of neutral candles, which are suggesting chances of a bearish bias until the 1.1175 level gets violated. The pair still stays in the buying zone as the MACD, and RSI value is holding above 0 and 50, respectively. Consider staying bullish above 1.1153 to 1.1180 and 1.1220 today. 

All the best!

Categories
Forex Market Analysis

Gold Retests $1,514 Amid Trade War Concerns – Wait for Breakout! 

On Monday, the precious metal gold prices consolidate below the crucial trading level of 1,514 today. The growing risk appetite amongst traders, encouraged by confidence in U.S.-China trade discussions and diminishing fears of a global economic slowdown. Overall, the precious metal gold dropped 0.1% to $1,511.44 during the Asian session, while gold edged 0.2% higher at $1,513.70.

The U.S. Non-Farm Payroll of US rose above expectations, and the Manufacturing PMI was also increased but came in below expectations. Both these reports were highly awaited by the traders as they were leading indicators of the economy. The increased payrolls in October and modest improvement in the Business activities were notable developments and pointed the calm journey of the US economy in prevailing uncertainties.

Some optimism from US-China Trade talks also appeared in the market after the reports suggested that China & US trade representatives were under a constructive talks session on Friday. The conversation held between Treasury Secretary Mnuchin and Chinese Vice President Liu regarding the next steps in the trade truce phase one deal.

XAU/USD – Daily Technical Levels

Support Resistance 

1506.24 1519.68

1498.06 1524.94

1484.62 1538.38

Pivot Point 1511.5

At the moment, gold is facing substantial resistance at 1,514 level, and this level may decide the fate of precious metal today. Below 1,514 level, we may see gold prices falling towards 1,507, and the violation of 1,507 level can extend sell-off until 1,503. 

All the best! 

Categories
Forex Market Analysis

Gold Triple Top Plays Well – NFP Figures Drive Sell-off! 

On Friday, gold prices slid as influential figures from China faded the risk appetite, while the U.S. labor market figure was robust. U.S. Bureau of Labor Statistics announced total nonfarm payroll (NFP) employment increased by a 128k jobs in October, surpassing forecast of 89k. Besides this, the headline number for the previous month witnessed an upward correction to 180k from 136k. 

Hence, the unemployment rate observed 0.1ppt growth to 3.6%, meeting forecast with the uptick associated with the increase in the labor force participation rate.

Next month, the U.S. & China were supposed to meet at APEC Summit in Chile to discuss a potential Phase-one Trade agreement between both economies. U.S. President Donald Trump and Chinese President Xi Jinping were expected to sign the phase-one deal on that Summit. But due to domestic unrest, the meeting was canceled.

Trump announced that both countries would continue the negotiations and would sign a portion of that deal in the coming weeks.

On Thursday, Chinese Officials showed doubts on the prospects for an agreement and revealed that they were concerned about Trump’s impulsive nature and said that Trump might back out of even a limited deal at the last minute.



Gold – XAU/USD – Daily Technical Levels

Support     Resistance 

1501.56    1519.33

1490.17    1525.71

1472.4      1543.48

Pivot Point 1507.94

Gold is still facing triple top resistance at 1,514, which is keeping gold bearish below this level. On the lower side, gold has already completed 38.2% Fibonacci retracement at 1,50 area. But price reversed right after to close the candle above 23.6% Fibonacci retracement level of 1,507. Therefore, let’s consider staying bearish below 1,513 level today. All the best! 

Categories
Forex Market Analysis

Daily FX Brief, October 31– Major Trade Setups – Fed Cuts Rates, GPD Figures In Highlight! 

The U.S. dollar softened Wednesday, as the Fed expectedly lowered interest rates. The ICE Dollar Index was down 0.2% on the day to 97.45. The euro rose 0.4% to $1.1152. Official data showed that French GDP grew 1.3% on year in the third quarter (as expected and +1.4% in the second quarter). Later today, the eurozone third-quarter GDP will be reported (+1.1% on-year expected).

Economic Events to Watch Today

Let’s took at these fundamentals.

 


GBP/USD– Daily Analysis

The GBP/USD currency pair flashing green and trading near the 1.2930 due to decreeing the uncertainty surrounding the British politics and Federal Reserve rate cut.

One of the main reasons behind the GBP/USD pair revery is Europen Unions 3-month Brexit extension, as well as increasing chances of the December snap election and public support to the United Kingdom Prime Minister Boris Johson looks to support the cable pair recently. 

At the trade front, the uncertainty surrounding the United States and China trade deal, in the wake of no fixed meeting place, joins the U.S. Secretary of State Mike Pompeo’s said that China’s ruling Communist Party (CCP) took benefits from the U.S. goodwill. All traders look to ignore the recent support from the United States side to China.

Whereas, the Chinas Commerce Ministry shares more direction regarding trade discussion, which will happen through the telephone call between the official, and made sure that no change will be coming in the plan for talks.

It should be noted that the risk sentiment has been slow, and also the U.S. ten-year Treasury yields fell to 1.80%, whereas Asian stocks supported by the Feral Reserve rate cut.

Looking forward, the markets will ready for Friday’s employment headlines data from the United States, as well as all focus will keep on trade and Brexit headlines and 2nd-tier statistics on the economic calendar.



Daily Support and Resistance

S3 1.2758

S2 1.2822

S1 1.2862

Pivot Point 1.2885

R1 1.2926

R2 1.2949

R3 1.3013

GBP/USD– Trading Tips

The GBP/USD is trading bullish in the wake of a weaker dollar. The pair faced triple bottom support at 1.2780 level, which triggered a bullish trend in the GBP/USD. On the upperside, the Cable may hit the first target at 1.2960, and the bullish breakout of this level can drive more buying until 1.3000 today.  


USD/JPY – Daily Analysis

The USD/JPY currency pair found on the multi-day low nearby 108.65 despite the Bank of Japan announces that no monetary policy change. The Bank of Japan faced the broad expectations of the market, whereas the holding short-term interest rate target at -0.10% with a 10-year Japanese Government Bond (JGB) yield target around zero. However, the Japanese central bank gave more transparency in its fresh direction through the 3rd-quarter Outlook Report.

As a result, the greenback and Treasury yields surged but then turned back during the Powell press conference. The United States’ two-year Treasury yields surged six-basis points to 1.67% before sliding back to 1.60%, -4 basis points for the day. Finally, the USD/JPY currency pair rose to 109.29 – as being a 3-month bullish before going back to 108.85, unchanged on the day. 

At the data front, the United States Q3 GDP slipped from 2.0% to 1.9% annualized but was above expectations of 1.6%, supported by a stronger consumer. In y/y terms Q3 19 against Q3 18, growth slipped to 2.0% from 2.3%. Personal consumption increased by 2.9%, crossed the estimate of 2.6%, with particularly strong personal durable goods purchases of 5.4%. Core PCE inflation rose to a 2.2% pace from 1.9%, as expected. The ADP private payrolls survey rose 125k in Oct (vs. est. 110k), but the previous reading was revised down from 135k to 93k.

On the other hand, the risk market has been slow overnight due to the uncertainty surrounding the United States and China trade deal. In the wake of no fixed meeting place, joins the U.S. Secretary of State Mike Pompeo’s said that China’s ruling Communist Party (CCP) took benefits from the U.S. goodwill. All traders look to ignore the recent support from the United States side to China. Traders want to decrease the uncertainty regarding Brexit.

Looking forward, the markets will ready for Friday’s employment headlines data from the United States, as well as all focus will keep on the Nonfarm Payrolls, while trade and Brexit headlines and 2nd-tier statistics on the economic calendar will continue under the trader’s eyes.


Daily Support and Resistance

S3 107.82

S2 108.39

S1 108.63

Pivot Point 108.96

R1 109.19

R2 109.53

R3 110.09

 USD/JPY – Trading Tips

The USD/JPY is trading sharply bearish amid weakness in the U.S. dollar over interest rate cut decision. The USD/JPY pair violated the bullish channel, which was supporting the USD/JPY at 108.800 area. 

Bearish engulfing candles are still suggesting chances of further selling in the USD/JPY until 108.450 today. On the upper side, resistance is likely to stay at 108.750. Consider taking selling trades below 108.750 today.  


EUR/USD – Daily Analysis

The EUR/USD Currency Pair hit the bullish track and surged sharply from the 20-day Moving Average at 1.1075, increasing more than 50-basis-points. The pair crossed the level 1.1130 and found on the six-day high at 1.1149. So, the EUR/USD currency pair currently stands on the bullish tone, mainly after the FOCM meeting.

After the Federal Open Market Committee meeting, the U.S. Dollar surged across the boards, sending the EUR/USD currency pair toward the 1.1070and 1.1080 range. As expected, the central bank rate cut the key interest rate but signaled a pause ahead. 

During Powell’s speech, the U.S. Dollar lost the strength and then rose sharply, mainly due to when Chairman mentioned there would not be a rate hike until there is a significant move up in inflation. Whereas, Chairman’s comment pushed higher the equity princes in Wall Street and sent the greenback to fresh lows across the board.

As of now, the EUR/USD Currency Pair remains to increase into 4th-day during the Thursday, in the wake of Greenback weakness, mainly due to the latest United States Federal Reserve rate cut continues to keep the bearish sentiment around the U.S. dollar and Treasury yields.

As we all well aware that the Federal Reserve delivered a rate cut by the 25-basis-points during the last trading hours; however, they indicated a pause in the future easing. Moreover, the traders continue to worry because of the impact of the rate cut on the economy and about Uncetanitny between the United States and China trade progress.



Daily Support and Resistance

S3 1.0981

S2 1.1055

S1 1.1104

Pivot Point 1.1129

R1 1.1178

R2 1.1203

R3 1.1277

EUR/USD– Trading Tips

The EUR/USD has reached under the double top resistance level of 1.1175 and has recently closed the Doji candle, which is suggesting chances of a bearish bias in the pair. The pair is oversold as the MACD, and RSI value stays in the bullish zone. Consider staying bearish below 1.1175 to target 1.1120 today. 

All the best!

Categories
Forex Market Analysis

USD/CAD Trade Plan, While BOC Keeps Rate Unchanged!

The USD/CAD closed at 1.30856 after placing a high of 1.31003 and a low of 1.31420. The overall movement of the pair remained Bullish that day. Central Bank of Canada and Federal Reserve of United States both will hold their Policy Meeting on Wednesday. Ahead policy meeting, both currencies remained under pressure on Tuesday.

Loonie remained under pressure because of falling Crude Oil prices on Tuesday and supported the USD/CAD upward trend. The traders took repositioning ahead policy meetings to gain profit on Wednesday.
The BOC has not cut its rates since 2015, and there are no chances for further rate cuts this month.

However, the Federal Reserve is anticipated to cut its rates by 25 basis points in the meeting of October. But the chances for the third rate cut by fed are also decreased due to the raised optimism of the US-China trade deal & Brexit Extension.

Although there are no chances of rate cuts from Bank of Canada in October, the December cut is not out of the board. Some analysts suggest that the labor markets are stronger, inflation is on target, and the rates are already lower than US rates, but some factors indicate the need for December cut, and they can’t be ruled out.

Despite the weak Consumer Confidence form United States, the pair continued to move in an upward direction. USD/CAD rose sharply on Tuesday and crossed 1.31 level, but it dropped after reaching that point.



USD/CAD – Daily Technical Levels

Support Resistance
0.6846    0.6875
0.683      0.6888
0.68        0.6918
Pivot Point 0.6859

The USD/CAD is staying steady below 1.3100 level, and closing below this level is suggesting strong chances of a bearish trend. Closing above this level can trigger buying until 1.3120 today.
All the best!

Categories
Forex Market Analysis

Daily FX Brief, October 30– Major Trade Setups – Monetary Policy Decisions Ahead! 

The U.S. Dollar Index kept trading within a tight range on Tuesday, closing down 0.1% to 97.69, as investors await the Fed’s interest rates decision.

The euro gained 0.1% to $1.1112, while the British pound was flat at $1.2866. The U.K. Parliament finally supported Prime Minister Boris Johnson’s plan for an early election, which would be held on December 12.

USD/JPY fell 0.1% to 108.88.

Meanwhile, USD/CAD advanced 0.3% to 1.3092 amid weakness in oil prices. On the other hand, the Bank of Canada is expected to keep its benchmark rate at 1.75% unchanged later today.

Economic Events to Watch Today

Let’s took at these fundamentals.


GBP/USD– Daily Analysis

The GBP/USD currency pair consolidates in the narrow range near the 1.2865 despite the United Kingdom parliament approving the extension for the December snap elections. As of writing, the GBP/USD currency pair s currently trading at 1.2863 and has spent a large part of the last 12 hours chipping away at the resistance of the bull flag on the 4-hour chart.

As we all well aware that the market is cautious not only because of key events but the shortage of fresh hints, so in the consequences, the GBP/USD pair is stuck in the tight range during the Asian trading hours.

During the Tuesday, the United Kingdom parliament approved the law for the first December snap eclection since 1932. The bill will likely become law on the weekend.

On the other hand, the breakout could remain difficult or fail mainly if the Federal Reserve delivers the rate cut by the 25 basis-points and give a hint to pause rate cut series, pushing the U.S. Treasury yields and the greenback higher across the board. It should also b noted that the market has already priced in the 25-basis-points easing.

Apart from the Federal Reserve decision, the GBP/USD currency pair could take hints from the U.S. Q3 preliminary GDP and the monthly ADP jobs data.

On the technical side, while 1.3000 and the fresh high near 1.3015 could keep the pair’s near-term upside limited, a bearish break of 1.2800 could take rest on the 21-day Exponential Moving Average (EMA) level of 1.2715 ahead of revisiting September high surrounding 1.2580.



Daily Support and Resistance

S3 1.2661

S2 1.276

S1 1.2813

Pivot Point 1.2859

R1 1.2911

R2 1.2958

R3 1.3056

GBP/USD– Trading Tips

The GBP/USD is still trading the same range, mostly trading bullish above 1.2830 range. On Wednesday, the GBP/USD proceeds to trade bullish above 1.2830 major trading levels. 

On the 4-hour chart, the pair has formed Doji patterns, which is weighing on the bullish trend, but the MACD and RSI are proposing bullish preference. Consider taking buying positions over 1.2859 and bearish under the same level ahead of FOMC and Fed rate decision.

 


USD/JPY – Daily Analysis

The USD/JPY closed at 108.974 after placing a high of 109.037 and a low of 108.657. The overall movement for the pair remained Bullish that day. At 4:50 GMT, the Services Producer Price Index (SPPI) from the Bank of Japan was released and remained the same for the year at 0.5%. 

At 17:30 GMT, the International Goods Trade Balance of the United States for September came in as -70.4B against the expectations of -73.5B and supported the U.S. Dollar on Monday. The negative Prelim Wholesale Inventories from the United States for September also supported the U.S. Dollar. It showed a decline to -0.3% from the previous month’s 0.2%.

The robust macroeconomic data from the U.S. at the starting day of the week gave strength to the U.S. Dollar and increased the prices of USD/JPY in Financial Markets.

On Monday, USD/JPY was rallied to 109 after the Positive comments from Trump about the US-China trade deal and increased U.S. Yields. Trump told the reporters on Monday that he was expecting to sign a significant portion of the Phase-one deal ahead of schedule. Although he did not mention the time for signing the part of the deal, the hint of pre-schedule deal signing itself created a big fluctuation in the market.

The overall optimistic mentality from China & U.S. gave hopes to a possible end of the prevailing Trade-war between them. U.S. & China were expected to sign the phase-one deal at the upcoming APEC Summit in Chile, but Trump announced that a portion of that deal would be signed before the Summit.

This state of affairs raised the appetite for riskier assets in the market, and USD/JPY gained traction in this regard and created a Bullish trend for itself after moving in a consolidated range for almost 2-3 previous days. The incoming positive trade headlines increased the U.S. Yields and hence created more demand for USD/JPY.

  


Daily Support and Resistance

S3 108.13

S2 108.52

S1 108.75

Pivot Point 108.9

R1 109.13

R2 109.28

R3 109.66

 USD/JPY – Trading Tips

The USD/JPY surged to test the resistance area of 109.030, but the bullish momentum wasn’t strong enough to retain a bullish trend for a more extended period. The USD/JPY has dropped below the 109.036 area to retest the bullish trendline support at 108.800. Above this, we can expect USD/JPY to continue trading bullish today. 

So let’s keep an eye on 108.800 today to stay bullish above and bearish below the same level to capture quick 30 pips. The USD/JPY may gain support around 108.550 today. 


EUR/USD – Daily Analysis

The EUR/USD currency pair consolidates in the narrow range near the 1.1109. The pair were fell from the recent highs near the 1.1180 during the previous session; probably, the pair will hit the high level again if the German inflation crosses the forecast figures, and the Federal Reserve delivers a dovish rate cut at the coming meeting.

On the technical side, the currency pair had created a bullish hammer candlestick during yesterday, making a strong follow-through to Mondays bullish inside day candlestick.

The consecutive bullish candles indicate the recovery from 1.1180 has likely ended up creating a bullish higher low near 1.1073. 

Whereas, the preliminary German consumer price index for October is still unchanged at 0% and fell moderately to 1.1% from 1.2% in annualized terms. 

The EUR/USD currency pair will likely get hints from the German job data, which is scheduled to release at 08:55 GMT. On the other hand, the preliminary U.S. Q3 GDP and the monthly ADP employment figures could leave a slight impact on the EUR pairs before the Federal Reserve rate decision.

The Federal Reserve is expected to deliver the 3rd rate cut by the 25 basis-points during 2019 on Wednesday and gives the hint of pause easing further. Moreover, the hawkish rate cut could be capping the upside in EUR/USD currency pair.

According to the forecast, the market has already priced in the rate cut. So, the EUR/USD currency pair could increase mainly if the Federal Reserve keeps the doors open for delivering another rate cut before the year’s end.

    


Daily Support and Resistance

S3 1.1011

S2 1.1056

S1 1.1084

Pivot Point 1.1101

R1 1.1129

R2 1.1147

R3 1.1192

EUR/USD– Trading Tips

The EUR/USD jumped off the support point of 1.1065 yesterday. A bullish trendline extended the support level, which is still keeping the EUR/USD upbeat. The pair rose to the retest 1.1100 area. Today, consider staying bullish above 1.1101 until the FOMC and Fed rate decision comes out.

All the best!

 

Categories
Forex Market Analysis

Gold’s Bullish Trendline Breaks Lower – What’s Next?

Gold prices were closed at $1492.540 after placing a high of $1508.2 and a low of $1489.96. The overall trend for Gold remained Bearish at the starting day of the week.

At 17:30 GMT, the International Goods Trade Balance of the United States for September came in as -70.4B against the expectations of -73.5B and supported the US Dollar on Monday. The negative Prelim Wholesale Inventories from the United States for September also helped the US Dollar. It showed a decline to -0.3% from the previous month’s 0.2%.

The robust macroeconomic data from the US at the starting day of the week gave strength to the US Dollar and weighed on Yellow Metal prices in Financial Markets.

The drop in Gold Prices was boosted on Monday after the positive comments from US President, Donald Trump on Trade Deal talks between US & China. Trump told the reporters on Monday that he was expecting to sign a significant portion of the Phase-one deal ahead of schedule. Although he did not mention the time for signing the part of the agreement, the hint of pre-schedule deal signing itself created a large fluctuation in the market.


XAU/USD – Daily Technical Levels

Support Resistance 

1,485.65    1,503.9

1,478.72    1,515.22

1,460.47    1,533.47

Pivot Point 1,496.97

Gold has recently violated the bullish trendline, which was extending Gold an excellent support around 1490. Below this, the market is likely to stay bearish below 1490. On the lower side, the additional support stays at 1,481 today. Whereas, the resistance remains at 1,495.

All the best

Categories
Forex Videos

Understanding Which Pairs Effect Each Other – Forex Hacks

Correlated Market’s – Understanding Which Pairs Affect Each Other

When we talk about correlation in the financial markets, we are looking for assets across all the financial classes, such as stocks, Forex, bonds futures, commodities precious metals and oil, etc., which trade positively or negatively against each other, either for brief or sustained periods. And so in Forex trading, we seek other currency pairs or other assets from these classes to assist us in our trading decision making, especially when we know that we can rely on correlation due to historical reliance.

As an example, in the stock market, we often find that if a major bank announcers a large loss due to underperformance you might find that there is a knock-on effect in the banking sector, causing bank stocks to fall due to the fact that the market perceives a correlated risk in this sector. This was particularly true in the 2008 market crash. Stock market traders might consider trying to counter this by buying stocks in utilities companies and firms that manufacture consumer staples, which are usually seen as more safe haven stock. In this example, traders look for positive correlation by buying utilities and consumer staples producers, and negative correlation in selling banking stocks in order to balance their portfolios.

There are many ways to measure correlation, and the larger the financial institution, the more complex measurements are used to define values in correlation, such as; Correlation Brownian motions, The Binomial correlation coefficient, Copula correlations, and others.
The basic measurement is called a Correlation Coefficient and is calculated within a range between -1 and +1. A perfect positive correlation has a correlation coefficient of +1, where currency pairs will move in the same direction 100% of the time. A perfect negative correlation is measured at -1 and means that the two currency pairs will move in the opposite direction 100% of the time. And if the correlation is 0, the two currency pairs are said to have no correlation and will act independently of each other.

We often find positive correlation within the precious metals sector, where silver will move either up or down in line with gold. An example of a negative correlation would be between gold and the US dollar. If we think about this logically, gold is valued in US dollars, and therefore for if the price of gold is rising, it stands to reason that the value of the dollar must be falling in value. Therefore some Traders will buy gold when the value of the dollar is falling and vice versa. See example ‘A.’

When looking for correlation on equities we find a positive correlation between the Dow Jones, the NASDAQ 100 and the S&P 500, and this is because these indices are priced in dollars and when the US economy is strong we would expect that these three indices are correlated positively to the upside, and vice versa when their economy is weak. Also, if the US has a strong economy and, therefore, we experience positive correlation between the indices, then we might expect this positive correlation to spill over into global equities. Again the opposite would

apply in a US downturn.
Another area we would expect to see positive correlation would be the bond market and especially when it comes to US and German 10 year treasury bonds, which typically move in sync with each other. Another positive correlation is seen in the oil markets where US, Canadian, and European oil stocks are heavily correlated, being supply-driven, and where the price is affected by the global economy outlook.

Great, so we know that correlation exists in the market and that traders use correlation to adjust their portfolios, but how can it help us in the retail Forex market? First and foremost, the fact that we know it exists already helps us because now we can use it as a tool or leading indicator in order to support our trading view of a particular currency, for example, USDCAD. This pair is heavily influenced by the fluctuations in the oil market. We can see this in action, in the example, ‘B.’

Here we have overlaid the USDCAD pair with US oil on a daily chart. The magenta trend line helps to define areas where USDCAD and especially when the price of oil is moving higher from the 10th to the 12th of June 2019, and the opposite is true between the 18th September to the 4th October 2019.
This is because a major contributor of the Canadian economy GDP is their production and subsequent sale of oil into the global oil market. Therefore when we find the price of oil tumbling, we might see the value of the Canadian dollar to fall in relation to the US dollar due to a negative correlation.

Also during the last few days, we have seen a rapid appreciation of the British pound to US dollar and whereby this rally was followed by the Euro against the US dollar which acted as positive correlation between the two pairs, and which largely came about because of positive sentiments regarding the eurozone and United Kingdom withdrawal agreement. See example ‘C.’

Where we see negative around the beginning of August 2019 and positive correlation during mid-October 2019. Correlation can be seen in the most unexpected places, such as, for example, ‘D,’ between the CHFJPY and EURUSD pairs, so it’s worth looking out for examples by studying your charts regularly.

 

The thing to bear in mind when it comes to correlation in the financial markets is that the markets have an ebb and flow to them, and things are constantly changing, and therefore correlation between assets should be seen as a fair-weather friend who comes and goes when they feel like it.

Categories
Forex Basics

Even a Combination of Double Top and Engulfing Fails

Double Top/Double Bottom is one of the most robust patterns that price action traders wait to take entries. When the price is rejected twice at a resistance level, it forms a Double Top. As far as the candlestick pattern is concerned, an engulfing candle is the most reliable reversal candle that traders usually love to take an entry from a value area.

A combination of Double Top and a bearish engulfing candle attracts sellers to go short. Since it is an outstanding price action combination, it does not usually go wrong. However, in today’s lesson, we are going to demonstrate that even a great flourishing price action combination can go wrong, as well.

The price consolidates at the marked resistance and heads towards the downside. It then goes back towards the resistance. The sellers are to get ready to get a bearish reversal candle. The red-marked level is the resistance level, where we don’t consider the upper shadows. Since the price has several rejections at the marked level, and it is a valuable area for the sellers, the price most probably may respect the area and produce the bearish reversal candle.

The price does not respect the red-marked level, but it does not make an upside breakout either. Instead, it closes within the upper shadows. Traders are to adjust here. Let us see how it looks now.

The level where the last candle closes has some significance. One of the bullish candles closes within the marked level. This level may work as a resistance level and ends up producing a bearish reversal candle.

Here it comes. The Double Top’s resistance level produces a bearish engulfing candle. We have found the resistance level at last. So all the equations to go short from here seem to match as far as price action trading is concerned.

  1. The price produces a Double Top.
  2. The price produces a bearish engulfing candle right at the resistance of the Double Top.

The swing low is far enough, which offers good Risk-Reward as well. All seems to be okay to trigger a short entry.

After triggering the entry, the next candle comes out as a bearish Doji candle. Things still look good. The sellers are going to grab some green pips!

No! The next candle comes out as a bullish Marubozu candle, which breaches the resistance of the Double Top. It wipes off the Sellers Stop Loss. The buyers may take control once the breakout is confirmed.

The Lesson

It does not matter how good a trade setup looks: it may fail. Thus, there is no reason to be too optimistic about any entry. We must calculate our Risk-Reward and have immaculate risk management with every single entry that we take in the market.

Categories
Forex Market Analysis

Daily FX Brief, October 28 – Major Trade Setups – Risk-off Sentiment Plays! 

The ICE U.S. Dollar Index climbed 0.2% on the day to 97.83 on Friday. Over the weekend, the trade negotiators of the U.S. and China “agreed to resolve their core concerns properly and confirmed that the technical consultations of some of the text agreement were completed,” as per the given report released by China’s Ministry of Commerce.

The pound lost 0.2% to $1.2823. It is reported that French President Emmanuel Macron blocked the European Union’s attempt to delay Brexit for three months. On Sunday, the media reported that the E.U. hopes to agree on Monday to delay Britain’s departure to January 31 with an option to exit earlier.

The euro fell 0.2% to $1.1080. The German IFO Business Climate Index was flat on the month at 94.6 in October (94.5 expected).

 

Economic Events to Watch Today

Let’s took at these fundamentals.

 


GBP/USD– Daily Analysis

The GBP/USD currency pair got some benefits from the news that the European Union is ready to permit a 3-months Brexit delay to the United Kingdom. As of writing, the GBP/USD currency pair taking buying to 1.2825 in the Asian trading hours.

The Guadian news agency freshly covered a story through saying that the European Union (E.U.) is ready to sign a deal that will offer a three-month Brexit delay, to January 31, 2020, with an option for the United Kingdom (U.K.) to leave earlier if a deal is approved.

 

The news reports reduced the scope of any further negotiations to the agreed deal with an option for the United Kingdom (U.K.) to leave earlier if a deal is approved.

Moreover, it also said that the United Kingdom has the responsibility to choose a candidate for the European Commission. The Prime Minister has said earlier that he will not present the nominee.

With the European Union on its way to reduce the scope of no-deal Brexit, a formal announcement will be expected during Monday’s European Union and British session to trigger drama in the United Kingdom, where signs for snap elections will be sparkled.

 

Notably, the greenback mostly supported by the recent positive sentiment between the United States and China trade talks and has Chicago Fed National Activity Index for September, -0.37 expected against 0.10 previous, up for publishing on the economic calendar.


Daily Support and Resistance

S3 1.2714

S2 1.2773

S1 1.28

Pivot Point 1.2832

R1 1.2859

R2 1.289

R3 1.2949

GBP/USD– Trading Tips

Following a bullish channel breakout, the GBP/USD pair is bearish at 1.2835 area. Overall, the Cable is keeping a choppy series of 1.2950 – 1.2785. On the 4-hour chart, the bearish engulfing pattern is expected to keep the GBP/USD prices towards 1.2785 area today. 

The MACD and RSI indicators are suggesting in the selling zone, maintaining the bearish trend in the GBP/USD. Consider staying bullish above 1.2832 today. 

 


XAU/USD – Daily Analysis

The safe-haven metal prices hit the bullish track despite the tension eased between the United States and China and reduce trade concerns as well. The U.S. Gold Futures gained 0.2% to $1,506.6. 

The yellow-metal prices are high, almost 17% on the year due to the investors runs toward the safe-haven assets in the wake of currency devaluations, slowdown fears, and other tension, including China and Iran.

The bullish trend in the gold prices came today even after the tension easing between the United States and China. As well as U.S. President Donald Trump said that the discussions with China have reached on the progressed track and gave a hint that deal is come to an end, as China wants to get a contract very seriously.

On the other hand, the United States Federal Reserve policy decision is scheduled to deliver on Wednesday, whereas the central bank is broadly expected to deliver its 3rd-rate cut during this year.

 

Instead, traders will be excited to know if the rate cut this week would be the end of the easing cycle, or if more cuts are on the cards.

The Federal Reserve rate cut decision is scheduled to deliver just an hour after the report on the United States’ 3rd-quarter GDP, which is anticipated to show that the economy increased 1.7% during the -months to September, decreasing from 25 during the 2nd quarter.


Daily Support and Resistance

    

S3 1472.9

S2 1490.32

S1 1497.42

Pivot Point 1507.74

R1 1514.84

R2 1525.16

R3 1542.58

XAU/USD – Trading Tips

 

Gold is trading bearish below 1,514 trading level, which is the triple top level. The gold price soared sharply to place a high around 1,517, but the gains were in checked, and gold slid to close nearby 1,505 level. 

On the daily chart, gold’s ascending triangle pattern of gold is yet intact, and it may retain gold bearish under 1,514 and bullish over 1,496 till the breakout occurs.

 


EUR/USD – Daily Analysis

The EUR/USD currency pair found on the 3-week bullish rally since January 2018. Whereas, the pair has closed its trading session at 1.1079 on Friday, confirming a bearish break of the trendline connecting October 11 and October 15 highs. However, the EUR/USD currency pair may take a strong buying in the Europan trading hours due to trade optimism headlines. 

During the Friday, the United States officials said that the discussions with China have reached on the progressed track and gave a hint that the deal has come to an end. Moreover, President Donald Trump asked for congress to pass the USCMA trade pact and said that China wants a trade agreement.

On the other hand, the bullish trend in the EUR/USD currency pair could be limited due to Brexit uncertainty. Additionally, the strong bullish moves couldn’t be seen due to the data calendar has been dull in the European session, and investors may remain cautious ahead of Federal Reserves rate decision, which is scheduled to release on October 30. The market is expecting the 25-basis-points rate cut, but the market focus will be on the hint by the meetings due to there is a divided opinion. It should be noted that the European Central Bank’s outgoing President Draghi is scheduled to speak at 15:00 GMT. The central bank head is likely to reiterate the dovish stance.



Daily Support and Resistance

S3 1.0992

S2 1.1042

S1 1.1061

Pivot Point 1.1092

R1 1.1111

R2 1.1142

R3 1.1192

EUR/USD– Trading Tips

The EUR/USD has broken the 1.1100 support point, and presently it’s trading right over the bullish trendline, which is increasing support at 1.1065 regions. At the same time, the 50 periods EMA is also increasing support at 1.1065 zone, which also marks 38.2% Fibonacci retracement level. The next resistance visits at 1.1092/1.1100. 

All the best!  

Categories
Forex Market Analysis

WTI Crude Oil Exhibits a Weekly Gain – Supply Concern Weights!

On Friday, the WTI crude oil prices continue to hold bullish bias maintaining substantial weekly gains as support from a surprise draws in U.S. inventories and possible action from OPEC and its allies to increase production cuts burdened broader economic interests.

The strong buying in crude oil was mostly underpinned by the surprise plunge in U.S. stockpile data. The U.S. crude oil inventories fell by about 10 million barrels during the previous week.

Whereas, the officials at the Organization of the Petroleum Exporting Countries (OPEC) remarked to extended supply cut is an option to balance the softer demand outlook in 2020, hence extending another reliable support to the WTI crude oil prices.

Technically, the WTI has violated an asymmetric triangle pattern, which keeps the crude oil prices on hold between 54.75 to 53.50. The violation of this range has pushed crude oil higher towards 56.50 area.

WTI Crude Oil – Daily Technical Levels

Support Resistance
55.5 56.59
54.91 57.1
53.82 58.19
Pivot Point 56.01

At the moment, crude oil is facing stiff resistance at 56.50 area. However, the WTI is looking to complete bearish retracement on the 240 mins chart. Crude oil has already completed 23.6% Fibonacci retracement at 55.85 area, and below this, further sell-off is expected until 55.50.

Despite the bearish correction, I would suggest looking for a bullish trades above 55.30 level today. All the best!

Categories
Forex Market Analysis

Daily FX Brief, October 25 – Major Trade Setups – Risk-off Sentiment Plays! 

The U.S. Dollar Index gained 0.2% on the day to 97.68 on Thursday amid mixed U.S. economic data. The euro slid 0.3% to $1.1104. The European Central Bank held its benchmark rates unchanged as expected. ECB President Mario Draghi said risks to the outlook are “on the downside” compared with “tilted to the downside” previously. 

On the other hand, the Markit eurozone manufacturing purchasing managers’ index was flat on the month at 45.7 in October (46.0 expected) while the Services PMI rose to 51.8 (51.9 expected) from 51.6.

The pound dropped 0.6% to $1.2838. U.K. Prime Minister Boris Johnson said he would call for an early general election for December 12. Meanwhile, the European Union is expected to decide the length of Brexit delay later today.

Economic Events to Watch Today

Let’s took at these fundamentals.


GBP/USD– Daily Analysis

The GBP/USD currency pair consolidating in the narrow range below the 200-hour Moving Average at 0.2852, due to the uncertainty intensified regarding the Brexit deal and the United Kingdom eclection. Notably, the pair may remain under pressure mainly due to increased risk.

British Prime Minister Boris Johnson admitted for the first time that he would not fulfill his (do or die) promise to get a departure between the U.K. and E.U. before October 31 and asked for a fresh election on December 12 to break Britain’s Brexit obstacle.

Although the opposition has rejected the election offer and LAbour leader Jermy Corbyn said that he would wait to observe what will the European Union decides regarding the Brexit delay before deciding that how to put the vote on Monday.

Moreover, the European Union is thinking of granting a 3-months delay. However, the decision may not come on Friday. The Brexit is moving in the uncertainty track, and Prime Minister Boris Johnson looks stuck in the middle. Therefore, traders are cautious about buying GBP.

On the technical side, the Technical charts are also indicating a move lower. It should be noted that Thursday’s bearish candlestick has opened the opportunities for a broader reversal, perhaps to the 200-day average at 1.2710.



Daily Support and Resistance

S3 1.2539

S2 1.2701

S1 1.2774

Pivot Point 1.2862

R1 1.2936

R2 1.3024

R3 1.3186

GBP/USD– Trading Tips

After violating the bullish channel, the GBP/USD pair is trading bearish at 1.2835 area. Overall, the Cable is maintaining a sideways range of 1.2950 – 1.2785. The bearish engulfing candle on the 4-hour timeframe is likely to lead the GBP/USD prices towards 1.2785 area today. 

The MACD and RSI indicators are holding in the selling zone, supporting the bearish trend in the GBP/USD. Consider staying bearish below 1.2845 today. 

 


XAU/USD – Daily Analysis

The safe-haven prices rose somewhat due to traders are awaited the next weeks, the United States Federal Reserve policy conference.

The U.S. Federal Reserve’s policymakers will attend next week. Its Oct. 29-30 policy settlement is required to yield in a 3rd-straight quarter-point rate cut.

President Trump tweeted that, “The Federal Reserve is negligent in its duties if it doesn’t deliver the rate cut and even, ideally, stimulate.

Gold prices remain supported in the wake of Japan’s manufacturing activity, which declined at the fastest rate in 3-years. Meanwhile, The U.S. PMI opposed expectations for a drop and rose marginally, but with limited impact on the prices of the safe-haven gold.



Daily Support and Resistance

S3 1466.32

S2 1482.53

S1 1493.22

Pivot Point 1498.74

R1 1509.43

R2 1514.95

R3 1531.16

XAU/USD – Trading Tips

Gold’s bullish trend continues to dominate the market. Closing of 4-hour candles above 1,495 and 1,503 area is indicating chances of further buying in the gold. The precious metal has formed three white soldiers pattern, which typically drives the bullish trend in the market.

On the upper side, the next resistance is likely to be 1,511. Therefore, we should look for buying positions above 1,500 area to target 1508 today. 


USD/JPY – Daily Analysis

The USD/JPY currency pair is sidelined below the 200-day moving average and consolidating in the narrow range of 108.50 and 108.7 overnight, even after the United Sateta data a geopolitical uncertainty. 

As of writing, the USD/JPY currency pair is currently trading at 108.60, having ranged between the level of 108.56and 108.64.

At the Hong Kong front, the condition is dull in Asia right now, but the markets keep their eyes on how the Chinese can react to comments regarding the Honk Kong and China, where he criticized the Chinese over security and human rights.

At the U.S. data front, the United States September Durable Goods Orders were depressed, and the volatile headline dropped -1.1%m/m against an estimate of -0.7%m/m. Though, September New Home Sales found on the positive side, with an increase of 701,000 against 702,000, against the previous revised to 706k from 713k, though average annual prices continued to ease. Markit PMIs also held steady in October, whereby Manufacturing PMI rose to 51.5 and bat the estimates of 50.9 and prior 51.1. Services came in line with expectations with an increase in the composite level to 51.2 from 51.0.

Moreover, the United States’ two-year Treasury yields waited in normal ranges between 1.55% and 1.58%, and the ten-year return moved between 1.74% and 1.77%. Markets are expecting 22-basis points of a rate cut at the October 30 meeting and a terminal rate of 1.21% against 1.88% currently. President Trump tweeted that, “The Federal Reserve is negligent in its duties if it doesn’t deliver the rate cut and even, ideally, stimulate.

At the Brexit front, the British Prime Minister Boris Johnson admitted for the first time that he would not fulfill his (do or die) promise to get departure between the U.K. and E.U. before October 31, and asked for fresh elections on December 12 to break Britain’s Brexit obstacle.

While the European Union was expected to give its answer to the United Kingdom governments request for a delay of European Union membership beyond October. However, due to the conflict between the United Kingdom parliament members, the European Union will decide to prefer to get some transparency first because it is continuously creating uncertainty in U.K. politics and Brexit.



Daily Support and Resistance

S3 108.11

S2 108.37

S1 108.5

Pivot Point 108.63

R1 108.76

R2 108.88

R3 109.14

USD/JPY – Trading Tips

On Friday, the safe have currency pair USD/JPY is facing support at 108.280. This level has become a triple bottom level and pushed the USD/JPY higher for the third time. At the moment, the USD/JPY trend is mixed as it holds right below an immediate resistance level of 108.650. Violation of this level can extend buying until the next resistance level of 108.900. 

Today, let’s keep an eye on 108.650 to stay bearish or bullish above this level to capture quick trade in the USD/JPY. 

All the best!  

 

Categories
Forex Price-Action Strategies

When A Breakout Occurs by More than One Candle

Price action traders’ main job is to watch the price action and find out the message out of it. The message comes from candles, various charts, momentum, as well as the attributes of breakouts. In this lesson, we are going to demonstrate an example of a breakout, which occurs with more than one candle. Let us find out whether a breakout with multiple candles gives us any message or not.

The price finds its support at the marked level and heads towards the North with good buying pressure. Price action traders start eyeing on the pair to go long on the pair. The first thing they would want is consolidation. Let us proceed to the next chart.

It seems that the price may have started having a pullback. The price is to come about 38% of the trend’s length to attract the buyers to watch for an upside breakout. Let us see what happens next.

The last candle seems to have covered a good distance. The buyers are going to be keen to get a bullish reversal candle on the chart now. If a reversal candle makes a breakout itself, it attracts traders more. Eventually, it pushes the price towards the trend’s direction at a good pace. Let us find out what happens here.

Here it comes. The bullish reversal candle is here. It is a ‘Track Rail,’ which is the second strongest reversal candle after the Engulfing candle. Traders are to wait for an important event. You know what that is, right?

‘The Breakout’!

The breakout occurs here by a Marubozu candle. Price action trader shall trigger a long entry right after the candle closes. Before triggering the entry, a trader must know where to set his Stop Loss and Take Profit. Stop Loss level is obvious here, which is below the support of the consolidation zone. Where the Take Profit level is to be set? Ideally, a 1:1 risk-reward ratio is the first target in any entry. However, there seems to be enough space for the price to travel. We may go for 1:2 risk-reward here. Does a trader go for a 1:3 risk-reward ratio or even more here? We get the answer later. Meanwhile, let us continue watching the drama.

The plan seems to be working amazingly well. The price heads towards the North with good buying momentum. 1:1 risk and reward ratio is easily achieved within the next candle. 1:2 risk-reward is achieved as well. Some may start splitting the hair for not setting the target with a 1:3 risk-reward ratio. Let us proceed.

The price has produced an Evening Star. This surely is not a good sign for the buyers. Those who set their Take Profit with a 1:3 risk-reward ratio must be in a pensive mood.

The price does not hit the Stop Loss, but there is no profit left for the buyers that are holding the positions. Targeting a 1:3 risk-reward ratio does not bring more pips. It rather makes them lose some pips that they could have earned.

Price Action breakout attributes suggest that if a breakout occurs with multiple candles, the trend often loses its impetus early. Thus, it is best to target 1:1 (in most cases), 1:2 (if there is enough space) risk-reward ratio when a breakout occurs by more than one candle.

Categories
Forex Market Analysis

Daily FX Brief, October 24 – Major Trade Setups – Traders Brace for ECB! 

The European Central bank rate decision is scheduled to release at 11:45 GMT, and Mario Draghi will conduct the press conference at 12:30 GMT. Apart from this, the EUR/USD currency pair may get any fresh hints from the United States Durable Goods order, which is scheduled to release at 12:30 GMT and the German preliminary Manufacturing PMIs and Eurozone due in the European trading hours.

Economic Events to Watch Today

Let’s took at these fundamentals.

 

 


GBP/USD– Daily Analysis

The GBP/USD currency pair consolidating in the narrow range near the 1.29 and could continue to trading in the tight range due to the Brexit Uncertainty.

As the Prime Minister Boris Johson failed to convince parliament to approve the Brexit deal as a law, therefore Prime Minister Boris Johnson is now on the waiting mood that the Europan Union to decide whether to agree to his 3-months delay request.

Moreover, PM Boris Johnson Spokesman has stated that the election will be compulsory if the European Union approved a request for a 3-month delay.

However, there are very fewer chances that the European Union will decide before Friday. So, traders will be cautious until any fresh news does not come.

The GBP/USD currency pair may beat the recent highs around the 1.30 in the American trading hours if the United States Goods order data release below expects figures, by the way, the data is scheduled to release at 12:30 GMT, rising the dovish Federal Reserve expectations.

It should also be remarked that the United States Central Bank is expected to deliver a rate cut by the 25-basis-points at its coming meeting.


Daily Support and Resistance

    

S3 1.2733

S2 1.2813

S1 1.2864

Pivot Point 1.2894

R1 1.2945

R2 1.2974

R3 1.3054

GBP/USD– Trading Tips

The GBP/USD has broken the bullish channel, which was carrying the pair near 1.2945. The formation fo a bearish engulfing candle is suggesting chances of a bearish reversal in the GBP/USD pair. 

On the lower side, the Sterling may find support at 1.2785 level, which also marks a double bottom on the 4-hour chart. Besides, the resistance stays at 1.2945 level. Consider staying bearish below 1.2920 today. 

 

EUR/USD – Daily Analysis

During the early Asian session, the EUR/USD currency pair trying to cross the 100-hour Moving Average level at 1.1140, mainly due to the European Central Bank (ECB) rate decision, which will be the last decision by the Mario Draghi as president.

The central bank rate cut by ten-basis points to -0.5% during September and announced a new step of the asset purchase program.

Europan Central Bank hasn’t many reasons to change its position at today’s meeting because the recent macro data report has been positive. Moreover, the European Central Bank members were divided due to the need to reviving bond purchases.

However, the bearish trend seems limited because the September month stimulus has been priced in. Besides this, it appears that markets are more interested in knowing hints by the incoming President Christine Lagarde in 2019 and 2020.

The European Central bank rate decision is scheduled to release at 11:45 GMT, and Draghi will hold the press conference at 12:30 GMT. Apart from this, the EUR/USD currency pair may get any fresh hints from the United States Durable Goods order, which is scheduled to release at 12:30 GMT and the German preliminary Manufacturing PMIs and Eurozone due in the European trading hours.

An unexpectedly weaker US data will support the dovish Federal Reserve expectations, and probably this greenback will drop across the board. Notably, the markets remain expecting the Federal Reserve will deliver the rate cut by the 25-basis-points on October 30.

Daily Support and Resistance 

S3 1.1058

S2 1.1092

S1 1.1112

Pivot Point 1.1126

R1 1.1147

R2 1.1161

R3 1.1195

EUR/USD – Trading Tips

The EUR/USD consolidates between 1.1116 and 1.1157 after placing a high around 1.1160 at the start of the week. For now, the EUR/USD is likely to continue consolidating in the narrow range of 1.1110 – 1.1150, at least ahead of the ECB rate decision. 

The EUR/USD is bearing double bottom support at 1.1110 regions, and over this, we can anticipate a bullish trend in the EUR/USD until 1.1150 and 1.1180. On the flip side, selling can be expected beneath 1.1110 till the 1.1065 area. 

USD/JPY – Daily Analysis

The USD/JPY currency pair flashing red and declines to 108.60, due to downbeat Brexit news increased the risk-on sentiment. The USD/JPY currency pair recently got support from the upbeat headlines regarding the United States and China trade agreement and Brexit, not to ignore the greenback weakness due to soft data. Although the increases could not long term due to the current threats from the United Kingdom. As of consequence, the recovery in the United States ten-year US treasury yields could not take much longer, whereas Wall street also ended with minor increases.

Brexit headlines and SIno-US trade headline keeps the markets cautious, as fears of hard Brexit and a potential trade deal between the United States and China.

Europan Central Bank hasn’t many reasons to change its position at today’s meeting because the recent macro data report has been positive. Moreover, today’s last meeting of President Draghi’s should be directed on the Governing Council’s views on the economic and geopolitical outlook, especially should talk about Germany’s slowdown as well as on the loud criticism by some Europan Central Bank member of restarting asset purchases. 

The ECB’s policy meeting will be under the eyes overnight, but the market doesn’t anticipate much action after last month’s rate cut package.

On the other hand, the US Durable Orders, Purchasing Managers Index, and New Home Sales will also keep under focus.

Daily Support and Resistance

 S3 107.69

S2 108.12

S1 108.39

Pivot Point 108.55

R1 108.81

R2 108.97

R3 109.4

USD/JPY – Trading Tips

The USD/JPY gained support above 108.280, the triple bottom level, which triggered a bullish reversal in the USD/JPY. At the moment, the bullish trend seems pretty strong, but the USD/JPY may find an immediate resistance at 108.900 area first. 

The MACD and Stochastics have diverted their direction to the bullish side, signaling chances of further buying in the pair. Today, the violation fo 108.270 can help us capture a quick sell position until 107.950. Whereas, buying can be seen until 108.900 level.

All the best!  

 

Categories
Forex Videos

Mastering Price Action – The Forex Traders Bible

Mastering Price Action

Price action is a discipline of identifying price action trends (up and down movement) reversals, support, and resistance via technical analysis on a trading chart during a specified period of time. Price action analysis is used in conjunction with global news events and economic data releases, which act together in order to influence exchange rates.

Most technical traders profit by devising a strategy which actually combines both price action, fundamental analysis, and their overall understanding of technical analysis. All these factors work hand-in-hand with each other.
Different tools can be applied to a chart to make trends in price action more obvious for traders. And where technical analysis formations and chart patterns are derived solely from price action.

Example ‘A’

Example ‘A’ is a 2-hour line graph of the British pound against the American dollar, also known as Cable. Let’s disregard the comments on the graph and simply focus on the actual line graph itself, which denotes the up and down movements – or price action – of the exchange rate of this currency pair. If we only used this line graph to trade this particular pair, we would find it extremely difficult to know when to open a trade in any particular direction. It simply looks chaotic and random!
However, looking a little more closely we can see a peak on the left hand side of the chart which occurs at the 1.2567 exchange rate level, before price action descends to the 1.22 level, which is a key level, and where we might expect to find some potential support, (a floor in this example) and where indeed the price flattens out here and which marks the end of trend ‘A’.
Price then moves higher throughout trend B and where we see a couple of spikes, some pullbacks, and then a continuation to the peak of 1.2850; another key level (in this case, a potential ceiling).

Example B


In example B, we have changed the line graph to Japanese candlesticks, a style of technical analysis which is more widely used in the trading community and which is much easier to read in terms of potential fading of price action and therefore possible opportunities to enter the market more easily.
Here we can see for example that our initial peak on the left-hand side of the screen showed a high, as denoted by the green (bullish) candlesticks, which was replaced by a red (bearish) candlestick – which was larger than the preceding two candlesticks – and was a warning to traders of a potential pullback, or a reversal of price action.

Indeed price begins to fall before almost returning to trendline ‘A’ and then continues the momentum to the downside. Eventually, the price action returns to our trend line before continuing the move lower by way of a series of falls and pullbacks and where trendline ‘A’ has become a simple moving average.
After the price action flattens out at the 1.22 level, we are able to identify a move higher and where the larger candlesticks (a sign of a strong trend) move above the trend line or simple moving average, and this starts a price action reversal. When price crosses the extended trend line ‘A,’ this becomes a signal of a new trend, and indeed trendline ‘B’ becomes a simple moving average to the peak of 1.2850.

Example C

Now let’s look at candlesticks a little more closely. In example ‘C’ we have magnified a section of price action in order that we can analyze the candlesticks in more detail. Note that price action, as denoted by the green candlesticks, is in an upward trend. The last green candlestick in this sequence is called an upside-down hammer. This has a smaller ‘wick’ at the bottom, a small ‘body,’ and then a longer wick at the top: Hence the term upside down hammer. At its height, the price has moved to the highest point and then pulled back before the next candlestick opens. The subsequent candlestick is a descending candlestick with a long body, and one small wick at the top, and where the candlestick is longer than the preceding two bull candlesticks. This type of Candlestick is an engulfing candlestick (it engulfs the previous ones), and often sets the precedent for any subsequent move; in this case lower.

Example D

In example ‘D’ we can see that the bulls have been in control of the price action and moved the exchange rate up to trendline ‘A.’ However the subsequence candlestick is a bearish candlestick, which engulfs the body of the previous candlestick, and where price action begins to trend lower. In the middle of the sequence, we see another hammer shape candlestick, but this time it has a longer wick at the bottom, and traders have taken advantage of this and move the price higher. Many of the candlesticks in the remainder of this sequence are very small, and this usually denotes that there is a lack of volume at the present moment in time.

Example E

Now we turn our attention to example ‘E,’ where we have magnified the price action around the key 1.22 area. Many of the candlesticks we see have small bodies, and where some of the candlesticks have small wicks; these types of candlesticks are called ‘spinning tops’ and usually denote a lack of direction and a lack of volume in the market. Towards the end of this sequence, we can see that the last two bullish green candlesticks open above the preceding ones, and both of these have long bodies with small wicks, which ingulf the previous candlesticks from the beginning of the move in this highlighted sequence. They form our new bullish move, which we have called trend ‘B.’

Therefore, the candlesticks become a much better tool to read price action. Suddenly the chaos and randomness ebb away! Remember, the larger the candlestick, the stronger the trend. Candlesticks are the best available tool for mastering price action. They are a leading indicator, and when combined with other technical analysis tools will help you get an edge in your trading! We will identify more Japanese candlesticks later in our course.

Categories
Forex Price-Action Strategies

Breakout by a Single Candle Generate More Impetus

Breakout is one of the most important factors in trading. Attributes of a breakout give clues with what traders can manage their opened position to make more profit. Price action traders, in particular, love to compute the attributes of a breakout to determine their take profit level.

In this section, we are going to demonstrate an example of a single candle breakout and its impact afterwards. Have a look at the chart below.

The price finds support at the red market level and heads towards the North. The price action suggests that the buyers are going to control the pair. A downward correction/consolidation followed by a bullish reversal candle at a value zone is what they need to wait for. Let us find out what happens next.

The price seems to have started having a pullback. The first corrective candle comes out as an Inside Bar, which is a good sign for the buyers. The buyers wait for the price to come back at a level of support with a reasonable distance from the resistance. Let us see how far it comes up to.

The price has crossed a good distance from resistance. The buyers are to wait for a bullish reversal candle. Ideally, a bullish engulfing candle is the first choice for the buyers. Other candles such as Inside bar, Spinning Top do the job as well, but an engulfing candle’s signal attracts more traders, and it brings more liquidity. Let us see what happens next.

Price action traders dream of such a reversal candle. This is not only a bullish engulfing candle but also an engulfing candle, which breaches the highest high of the last wave. Let us draw the consolidation zone on the chart.

The reversal candle makes the breakout with good momentum. A trader shall trigger a buy entry shall right after the candle closes. When a reversal candle itself makes a breakout, it makes the fore coming move go towards the trend’s direction with good momentum. Look at the chart below.

Look at the pace of the bullish move after the breakout. Here is another very important factor that traders must remember. A single candle breakout usually offers a 1:2 risk-reward ratio. This means traders shall add some extra pips with their profit target when they get such price action. The drama remains. Have a look at the chart below.

The price makes a correction and seems to have found support again. It suggests that the buyers are still in control. Smart buyers take their Partial profit and let the rest of the trade run to earn more pips.

As mentioned, breakout attributes give clues about the trend’s strength. Eventually, this helps traders manage their trade nicely and make more money out of trading.

Categories
Forex Elliott Wave

Elliott Wave Principle – Advanced Concepts – Part 1

Intermarket Analysis studies the correlation or relationship between different markets or assets. In this educational article, we will review how to apply the correlation analysis within the Elliott Wave Principle.

The basics

In financial markets, we use the correlation to measure the relationship between two or more assets. These assets can be from the same or different markets.

For example, we can analyze the relationship between a commodity and a currency pair. In the first figure, we observe the relationship between Crude Oil (NYMEX:CL) and the FX pair US Dollar – Canadian Dollar (USDCAD).

From the figure, we observe that Crude Oil holds an inverse relationship with USDCAD. It means that, if CL soars, the USDCAD should decrease, and vice-versa. This type of correlation is known as negative or inverse correlation.

In the contrarian case, when an asset moves in the same direction that the second one is known as positive or direct correlation.

The second key concept in the Intermarket analysis is convergence and divergence. In the same way that we use and identify divergences, or deviations, on technical indicators, we use it with correlations. Divergences allow us to foresee the exhaustion of a sequence.

From the figure one, we identified the divergence with the red arrow. In the example, we observe at the end of a wave, when Crude Oil soars, the Loonie decreases. In general, we find divergences when the fifth wave is in progress.

Putting all together

The next chart corresponds to the NASDAQ Biotechnology ETF (IBB) and the stock price chart of MERCK & Co. (MRK), in the weekly timeframe and log scale.

In this case, both assets belong to the same sector. Thus, we expect a positive correlation with each other. From the chart, we observe that IBB and MRK started a rally in the third quarter of 2009.

MRK looks like it’s near to end the bull trend; however, IBB unveils an incomplete bullish five-waves sequence.

Finally, please, note how the divergence appears at the end of the third wave on IBB, while MRK started the wave four.

Categories
Forex Market Analysis

Daily FX Brief, October 23 – Major Trade Setups – Stronger Dollar Plays

On Wednesday, the dollar rose versus its peer currencies as a risk spread ahead of the British parliament’s vote on the Withdrawal Agreement Bill, which will reflect light on when and how Britain will exit the Eurozone.

The British Pound currency was found on the selling track, although Prime Minister Boris Johnsons Brexit bill gained the parliamentary support, the government timeline of just three-days discussion on the bill was rejected.

The European Union Consumer Confidence is scheduled to release at 14:00 GMT. Hence, the European Central Bank, Andrea Enria, is expected to deliver the speech at an event in Madrid at 08:45GMT.

Economic Events to Watch Today

Let’s took at these fundamentals.


GBP/USD– Daily Analysis

The GBP/USD currency pair came under pressure, and the pair is currently trading below the 1.2850. As well as, the pair failed to hit the critical support range on Tuesday, mainly due to Brexit uncertainty and delay. The 50-hour and 100-hour Moving Averages are found at 1.2940 and 1.2905, respectively.

The British Pound currency was found on the selling track, although Prime Minister Boris Johnsons Brexit bill gained the parliamentary support, the government timeline of just three-days discussion on the bill was rejected.

The chances of Britain departing the European Union before the deadline date of October 31 has dropped sharply, mainly due to parliamentary failure.

On the other hand, the headline came from the Prime Minster Boris Johnson office said that if the European Union agree to a delay until January, then the only way to shift from Britain’s Brexit crisis is a new election.

Forecast view, the ongoing uncertainty regarding Brexit could continue to push the GBP lower. Moreover, the pair is trading well below the 100-hour Moving Average for the 1st time since October 11.

It should be noted that the greenback may gain some haven buying due to the risk-off sentiment in the equity markets and trade uncertainty.



Daily Support and Resistance

S3 1.264

S2 1.278

S1 1.2839

Pivot Point 1.292

R1 1.2979

R2 1.306

R3 1.32

GBP/USD– Trading Tips

The GBP/USD has violated the bullish channel, which was supporting the pair around 1.2945. The formation fo a bearish engulfing candle is suggesting chances of a bearish reversal in the GBP/USD pair. 

On the lower side, the Sterling may find support at 1.2785 level, which also marks a double bottom on the 4-hour chart. Besides, the resistance stays at 1.2945 level. Consider staying bearish below 1.2920 today. 

 

EUR/USD – Daily Analysis

During the early Asian session, the EUR/USD currency pair hit the bearish track, having gained acceptance below the 100-day M.A. yesterday. The EUR currency came under selling pressure, mainly due to the decline in the GBP currency as the Brexit obstacle.

If talking about the past movement of EUR, Brexit certainty has sent the shared currency above the 100-day Moving Average on October 18. 

On the technical side, the EUR/USD currency pair found on the inverted hammer on Monday and ended well below the inverted hammers low of 1.1139 on Tuesday.

So, the EUR currency could drop further, notably if the German ten-year bond yields extend Tuesdays 4-basis-points decline to -0.38%. 

Moreover, the greenback may gain some haven buying, adding to the bearish pressures near the EUR/USD currency due to the risk-off sentiment in the equity markets.

On the other hand, the European Union Consumer Confidence is scheduled to release at 14:00 GMT. Hence, the European Central Bank, Andrea Enria, is expected to deliver the speech at an event in Madrid at 08:45GMT.


Daily Support and Resistance

    

S3 1.1056

S2 1.1096

S1 1.1113

Pivot Point 1.1135

R1 1.1153

R2 1.1175

R3 1.1214

EUR/USD – Trading Tips

The EUR/USD currency was trading 1.1116 and 1.1157 yesterday, hit the lowest range. As for today, the EUR will likely to continue consolidating in the narrow range of 1.1110 – 1.1150.

The EUR/USD is also facing double bottom support at 1.1110 area, and above this, we can expect to buy a trend in the EUR/USD until 1.1150 and 1.1180. On the other hand, selling can be expected below 1.1110 until the 1.1065 area. 

USD/JPY – Daily Analysis

The USD/JPY currency pair is flashing red and representing 0.16% declines on the day. As of writing, the USD/JPY currency pair currently trading at 108.30, as the time of writing, the pair traveled from a high range of 108.51 to a low range of 108.25.

The USD/JPY currency pair may end with a much higher daily loss, as the four-hour chart is showing a head-and-shoulders breakdown. 

Such as Prime Minister Boris Johnsons Brexit bill gained the parliamentary support, but the government timeline of just three-days discussion on the bill was rejected.

Notably, Prime Minister Boris Johnson made a plan to meet with European Union leaders once again to discuss the timeline, and the chances of an early election are increasingly, but Brexit delayed beyond the elections. 

At the data front, the Oct Richmond Fed manufacturing survey rose firmly to +8 (est. -7, prior -9). Increases were comprehensive, with noted raises in employment and new orders with expectations edging higher in addition to stronger current conditions. United Step Sep existing home sales slid -2.2%m/m (est. -0.7%m/m). However, at 5.38mn (est. 5.45mn), the annualized level continues close to post record highs, and NAR’s chief economist continues to cite a shortage of stock and supply.

The United States’ two-year Treasury yields were moving between 1.59% and 1.63, whereas the ten-year yield traveled between 1.76% and 1.80%. Markets are expecting 22-basis points of a rate cut at the October 30 meeting and a terminal rate of 1.24% against % currently.


Daily Support and Resistance

S3 108.09

S2 108.31

S1 108.41

Pivot Point 108.53

R1 108.63

R2 108.75

R3 108.97

USD/JPY – Trading Tips

Recalling our previous update, the USD/JPY was trading in the bullish channel, which was extending support at 108.350. This bullish channel is now violated. As anticipated, the violation of 108.350 is extending bearish rally until the 108 level. 

The MACD and Stochastics are consistently pointing into the selling zone, signaling odds of a bearish bias.

The USD/JPY may attain a critical resistance at 108.57, along with support at 108.300. Today, the violation fo 108.270 can help us capture a quick sell position until 107.950. 

All the best!  

 

Categories
Crypto Market Analysis

Daily Crypto Review, Oct 23 – Stablecoins may be considered securities, crypto markets in the red today

The cryptocurrency market is in the red for the past 24 hours. Most of the day has passed by without any downside resistance whatsoever. There has not been any new money coming into the markets as volume seems to be a bit lower than average. However, the downward-facing moves were not weak, but rather steady and stable. The market is now trying to find a price level to consolidate. As for the top3 cryptocurrencies, Bitcoin went down 3.03%, while Ethereum lost 4.3% of its value and. XRP was down 3.01% in the past 24 hours. Out of the top50 cryptocurrencies, BAT performed the best with its gains reaching over 7.5%.

 


Bitcoin’s dominance increased a fraction of a percent when compared to yesterday’s value. It now sits at 66.5%, which represents a 0.01% increase from the previous day.

 

Most cryptocurrencies ended up being in the red in the past 24 hours. This, of course, slightly increased the value of the cryptocurrency market as a whole. The industry now has a market capitalization of $217.4 billion, which represents a $5 billion decrease from the previous day.

What happened in the past 24 hours

Cryptocurrencies have had both positive and negative news in the past 24 hours.

As reported by CoinDesk, Morgan Creek Digital managed to raise $60.9 million for its second blockchain venture capital fund. It seems that two pension funds invested $50 million into the project. This is more than double what they initially started with ($21 in the first blockchain fund).

The US Congress may consider a bill which would classify stablecoins as securities. This bill draft was published on Tuesday by Rep. Sylvia Garcia. The bill wants to regulate stablecoins under the Securities Act of 1933, seeking to provide clarity in an area the bill suggests lacks regulatory guidance.

Technical analysis

Bitcoin



Bitcoin has managed to break a bull flag downwards, making quite a bearish announcement to the market. If we take a look at the charts, the downtrend that started on Sep 30 ended up with a bull flag that broke upwards and increased in price right to the 161.8% of the downwards-facing move. After that, another similar downtrend started and we’ve come to the point when a bull flag was starting to rise. Everyone was expecting it to break upwards and Bitcoin to attempt to reach new highs (a 161.8% increase would mean a price of $9,440).

However, Bitcoin managed to fail the pattern and broke it downwards. Its price stabilized at just below $8,000.

Ethereum

Ethereum has lost over 4% of its value in the past 24 hours. It seems to be forming a falling wedge pattern on the daily chart. One more descending move is to be expected before Ethereum could attempt a price increase. However, if that does not happen, even a price of $110 is not excluded.


At the moment, Ethereum is sitting at $167, with a big support line being at $157. Its volume is at extremely low levels and RSI is approaching oversold territory.

XRP

XRP broke its ascending trend range and fell to $0.288. After creating a range that it moved in all the way from Sep 19 until now, XRP managed to break it downwards. It is now trying to recover and get back into the range, but the attempt has been unsuccessful so far.


XRP’s volume is average while its RSI is neither oversold nor overbought. It would take a significant increase in bull power in order for XRP to get back in its lane. If that does not happen, however, XRP has strong support sitting at $0.266.

Categories
Crypto Market Analysis

Daily Crypto Update 06.07.2018 – Market Can’t Keep Bullish Momentum

Recently, the market has seen a moderate downward trend in most of the cryptocurrencies and the last hours are showing a small correction in the pairs we are going to see today in this update. Only 3 of the top ten cryptos report positive numbers right now (BTC-ETH-XLM).


General Overview


Market Cap: $271.699.753.396

24h Vol: $15.382.782.187

BTC Dominance: 42.1%

Cryptos Report:


News


Why India And China Won’t Lift Their Crypto Bans
The highest court in India this week upheld the Reserve Bank’s decree prohibiting the country’s banks and other regulated lenders from dealing with or supporting any cryptocurrency-related services, including allowing customers to buy crypto with credit cards.
Source: barchart.com

Coinbase UK CEO Interview: Huge Interest From Institutional Investors Toward Crypto
Coinbase UK CEO Zeeshan Feroz is working to achieve a crypto revolution amidst hesitant bankers in a city torn over Brexit. Last week, he made a speech on blockchain’s potential to connect the unbanked and rebuild the entire financial system. Today, in an interview with NewsBTC, he said that Coinbase is looking to roll out GBP wires in the next few weeks, where London could be the next blockchain hub and that Brexit may even speed up clarification over regulatory uncertainties.
Source: barchart.com

Digital Collectible On Ethereum Network Sold For $1 Million On Valentine’s Day 
A group of ten collectors split the million dollar price tag for a digital photo of a red rose digital collectable on valentines day launched on the Ethereum network. The piece is thought to have fetched the highest price yet paid for a piece of virtual art. Forever Rose, produced by Kevin Abosch and GIFTO, exists on the blockchain just as Bitcoin and other virtual currencies do.
Source: newsbtc.com


Analysis


XRP/USD

The price of XRP had a considerable drop today from $0.5063 and broke the $0.50 support area, the drop was only stopped by the Pivot S1 at $0.4624. Now the price is moving around the 0.50% Fib Retracement while the bears keep showing strength.



There is a crucial support broken at $0.475 and if a break below the Pivot S1 happens, we could see declines towards the $0.4547 and the Pivot S2 at $0.4477.


Market sentiment

4-H chart technicals signal a sell sentiment.

Oscillators are showing buy signals and pointing up.


Pivot points

R3 0.5299
R2 0.5163
R1 0.4966
PP 0.4830
S1 0.4634
S2 0.4498
S3 0.4301

ADA/USD

The price of ADA has been recovering from the last drop from $0.1614, bouncing on the Pivot S1 at $ 0.1408. The bears have lost momentum and now the price has been recovering with three consecutive green candles. It seems the price reacted to news from the Cardano Foundation that stated the company is releasing a new roadmap.



Although the EMA-100 appears at this moment as the resistance to break, added to that, the Central Pivot Point is very close to it. We should also consider that a new bearish pressure could send the price to look for the 0.50% Fib Retracement close to $0.1369.


Market sentiment

4-H chart technicals signal a Bullish sentiment.

Oscillators are showing buy signals.


Pivot points

R3 0.1693
R2 0.1627
R1 0.1550
PP 0.1483
S1 0.1408
S2 0.1382
S3 0.1265

EOS/USD

EOS tries to recover the losses of the beginning of today’s session and bounced the price in the Pivot S2 at $8.36 that converges with the lower trend line of this ascending channel in the 4-H graph. At this moment it is trying to beat the Pivot S1 at $8.60. If the price can cross down the channel we could see pronounced sales in the short term.




Market sentiment

4-H chart technicals signal a Bullish sentiment.

Oscillators are showing buy signals.


Pivot points

R3 9.68
R2 9.45
R1 9.13
PP 8.89
S1 8.59
S2 8.36
S3 8.06

Conclusion


Cryptos Report: The expected trend change has not yet shown and that’s why sellers are still taking intraday profits in the market rebounds.

Categories
Forex Market Analysis

June 22 – Quick Update on Gold and SPX – Risk-Off Sentiment Plays

The global stock markets are facing an immense amount of selling pressure as risk-off sentiment continues to dominate the market. The European Union is anticipated to impose tariffs on approx $3.4 billion of U.S. imports on a weekday. The expected tariffs have added to tensions as investors worry about an outright world trade war between the U.S., the EU, and China.

Tensions between the U.S. and China have additionally continued because these 2 largest economies within the world, faced a tit-for-tat over trade tariffs. Earlier on, U.S. President Donald Trump decided to impose tariffs on another $200 billion of Chinese merchandise.

 

Gold – XAUUSD – Daily Outlook

Gold prices alleviated from fresh lows for the year because the greenback turned negative on weaker U.S. economic figures. Gold futures for August delivery on the Comex division of the New York Mercantile Exchange fell by $3.10 or 0.24%, to $1,271.10 an ounce, spiralling to a new 2018 low of $1,263.20.

A sharp retreat within the greenback – from its highest level since last summer – supported a recovery in gold, however, sentiment remained negative amid expectations of an aggressive Fed rate-hike cycle would still spur demand for the dollar.



 

Gold was down by 0.31%, and it has completed 61.8% retracement near 1270.67 and below this. We can expect a selling opportunity, whereas, the support prevails near 1264 and 1261.

Support    Resistance
1268.04    1272.02
1266.82    1273.24
1264.83    1275.23
Key Trading Level: 1270.03

 

S&P500 – SPX – Dialy Outlook

The S&P500 is trading bearish at 2,748.50, down 22.50 points and -0.78% for the day. That’s mostly because of risk-off sentiment. Investors are feeling uncertain regarding the U.S.- China trade war issues and thereby moving their investments towards safer assets such as Japanese yen, Swiss franc, and Gold.



 

Technically, SPX has already completed a 50% retracement at $2,745 on the 2-hour chart. The U.S. is likely to gain support on this level, whereas, the bearish breakout can lead it towards $2,735.

Support   Resistance
2764.52    2772.88
2761.93    2775.47
2757.75    2779.65
Key Trading Level: 2768.7

Categories
Crypto Market Analysis

DASH/BTC Imminent Breakout


Dash (DASH)


Market Cap: $2.17B

Circulating Supply: 8.13M DASH

Max Supply: 18.9M DASH

Volume (24H) $114.09

DASH/USD = $268.17


DASH Technical Analysis


DASH/BTC is trading right below some very, very important resistance levels. It seems somehow motivated to pass above them, but it remains to be seen if the buyers will have enough energy to push the rate higher. The rate moves in a range in the short term after the failure to move towards the downside line of the down channel and after the false breakdowns below the lower median line (LML) of the major descending pitchfork and below the outside sliding line (sl)of the ascending pitchfork.


 

Right now you should stay away and wait for a valid breakout from the down channel, above the lower median line (lml) and above the 0.041780 static resistance (support turned into resistance). It is very important for the price to make a valid breakout from this minor accumulation because if it stays too much within it, it could turn into a distribution and the rate could drop further.

DASH/BTC has shown an oversold sign when it has failed to approach the down channel’s downside line, but we still need a confirmation that we may have another leg higher.


 Conclusion 


DASH Technical Analysis: A valid breakout above the mentioned near-term resistance levels will give us a great chance to go long on this crypto pair. It could find temporary resistance at the 50% lines, but the major target remains around the median line (ML) of the major descending pitchfork and at the median line (ml) of the ascending pitchfork.

 

Categories
Crypto Market Analysis

SAN/BTC Is The Retreat Completed?


Santiment Network Token (SAN)


Market Cap: $53.67M

Circulating Supply: 62.66M SAN

Max Supply: 0 SAN

Volume (24h) $777.54K

SAN/USD = $0.85343


SAN/BTC Technical Analysis


SAN/BTC has found a very strong support and now is fighting very hard to recover after the impressive sell-off. It remains to be seen what will happen because the rate has already found a temporary resistance. You should know that the rate remains under selling pressure as long as it is located right below some very important resistance levels.


 

It is trading at 0.000131380 level, much below the 0.000142000 today’s high signalling that we could have a retest of the near-term support levels soon. SAN/BTC has found a strong support right below the down sloping line and right below a major support zone. Actually, it has made a false breakdown below the mentioned levels and that’s why we could think of another leg higher at least in the short term.

SAN/BTC could increase only if it will stay above the 0.000127226 static support, above the down sloping line and below the lower median line (lml) of the ascending pitchfork. However, a valid breakdown below the lower median line (lml) will confirm a further drop in the short term.

Price is trapped below the downtrend line and below the 50% Fibonacci line of the ascending pitchfork. So, only a valid breakout above these dynamic resistance lines will confirm a broader rebound.


Conclusion


We’ll have a great buying opportunity only after a valid breakout above the downtrend line and above the 50% line. The major upside target it will be at the upper median line (uml) of the ascending pitchfork.

Categories
Crypto Market Analysis

XRP/BTC Up Channel, Can We Buy It?


Ripple (XRP)


Market Cap: $21.69B

Circulating Supply; 39.24B XRP

Max Supply: 100B XRP

Volume (24h) $412.65M

XRP/USD = $0.55050


Technical Analysis


 

The rate dropped on the daily chart, but it has found a bottom at the 0.000069000 level and now tries to climb higher again. XRP/BTC failed to reach and retest the mentioned low, signalling that we may have a rebound. The price increased a little but failed to stay above the 0.000100000 psychological level.

The crypto pair has failed to reach the previous lows so the behaviour could change in the short term. However, we still need a confirmation that the rate will increase again.


 

You can see on the Daily chart that the rate has failed to stay below the median line (ML) of the descending pitchfork and is now trading above it. It has retested it and closed much higher signalling that the buyers could step in again in the short term.

XRP/BTC remains under some pressure as long as it is trading below the sliding parallel line (SL) of the descending pitchfork. Price is trapped within an up channel, so it is somehow expected to climb towards the upside line as long as it stays above the downside line.

You can notice that it has failed to reach and retest the downside line and the lower median line (lml) of the ascending pitchfork. Right now, it is trying to take out the 50% Fibonacci line of the ascending pitchfork to be able to climb at least to the previous high.


Conclusion 


Personally, I believe that we may have a significant upside movement if the rate will really manage to make a valid breakout above the inside sliding line (SL) of the descending pitchfork and above the 50% Fibonacci line of the descending pitchfork.  The major target will be at the upside line of the up channel and at the upper median line (uml) of the ascending pitchfork.

Categories
Crypto Market Analysis

Metaverse ETP – Is This A Temporary Drop?


Metaverse ETP (ETP)


Market Cap: $26.12M

Circulating Supply: 35.84M ETP

Max Supply: 100M ETP

Volume (24h) $4.50M


Technical Analysis


ETP/USD continues to move sideways somehow in the short term but it remains to be seen what will really happen after the rate will reach the major and critical support. The price drops in the short term as all the major cryptocurrencies have crashed in the short term. The rate continues to stay above some very important support levels, so we may still have a rebound on the short term.

 


 

Unfortunately, the rate failed to make a valid breakout above the outside sliding parallel line (sl) of the minor descending pitchfork and now it has slipped below the upper median line (uml) again. It is pressuring the upper median line (UML) of the major descending pitchfork, so a rejection from here and from the 0.6000 psychological level will signal a rebound and a potential breakout above the outside sliding line (sl).

Right now it is very important for the rate to stay above the UML of the major descending pitchfork and above the 0.6000 psychological level because a breakdown will send the rate at least till the upside 50% Fibonacci line of the descending pitchfork.


Conclusion


We may have a great buying opportunity only if the rate will make a valid breakout above the outside sliding line (sl). This scenario will be invalidated if the rate will resume the downside movement and if will close and stabilise below the 0.5701 static support.

Categories
Crypto Market Analysis

XMR/BTC Head and Shoulders Confirmed


Monero (XMR)


Market Cap: $2.16B

Circulating Supply: 16.12M XMR

 Max Supply: 0 XMR

Volume (24h) $36.49M

XMR/USD = $132.77


Technical Analysis


XMR/BTC dropped sharply today but failed to reach the 0.01950010 yesterday’s low. It is expected to drop further as the Head and Shoulders pattern is confirmed now. The price has increased a little in the short term, but it was only a temporary rebound. The crypto is on a declining path in the short term and maybe you can still go short on it.

The rate is pressuring a dynamic support, so a valid breakdown will confirm a further drop towards the next downside targets.


 

XMR/BTC dropped again below the upside 50% Fibonacci line (descending dotted line) of the descending pitchfork but it remains to be seen if this will really be a valid breakdown or if we’ll have another false breakdown.

You can see that the 50% Fibonacci line acts like a very strong dynamic support and has rejected the rate in the last weeks. A valid breakdown will confirm a further drop towards the median line (ML) of the descending pitchfork and towards the major uptrend line.

The failure to reach and retest the upper median line (UML) of the descending pitchfork has signalled a high selling pressure. It has broken below the lower median line (lml) of the black descending pitchfork.


Conclusion


Right now we don’t have a great selling opportunity but only because the sell-off has already started, but you could still go short if the rate will close above or if it will stabilise below the 50% Fibonacci line. The next major target will be at the uptrend line.

 

Categories
Forex Market Analysis

June 11 – U.S. Indices Soars As Risk-on Sentiment Heads Up

On the first trading day of the fresh week, most of the markets opened with huge gaps on the back of the uncertainty driven by the G7 meeting. However, the markets soon recovered despite unease after U.S. President Donald Trump inflated the threat of higher import tariffs at a rough G7 meeting. Did you miss an opportunity? No worries the game has just begun…

S&P 500 – Daily Outlook

The U.S. stock market index is trading bullish at 2,791.25, up +8.75 points and +0.31%. The S&P500 has come out of the asymmetric triangle pattern at $2,712, indicating the bull bias of investors. At the moment, the SPX is likely to face resistance near the $2,795 level.



Support    Resistance

2767.96    2780.04
2764.24    2783.76
2758.2      2789.8
Key Trading Level: 2774

 

Nikkei – Daily Outlook

Japan’s Nikkei soared more than 375 points to trade at 22,975 on Monday. Most of the bullish trend began in response to the rise in risk appetite. The risk on sentiment kicked in as the investors are very optimistic about the U.S.- North Korea meeting tomorrow.

Technically, the bearish trendline is extending a solid resistance to Nikkei at $22850. At the same time, the RSI has entered the oversold zone which is signifying the chances of a bearish reversal.



 

Support    Resistance
22184.88   22303.38
22148.28   22339.98
22089.03  22399.23
Key Trading Level: 22244.13

That’s pretty much it for now. I hope you are ready for some action tomorrow. We’ve got to deal with the U.S.-North Korea updates and the markets can remain volatile throughout the session.

Categories
Crypto Market Analysis

Dogecoin Could We Have A Breakout?


Dogecoin (DOGE)


Market Cap: $433.90M

Circulating Supply: 114.75B DOGE

Max Supply: 0 DOGE

Volume (24h) $14.08M


Technical Analysis


Dogecoin (DOGE) continues to move higher on the short term after the failure to reach the near-term support levels. The cryptocurrency increased as the crypto market has managed to recover a little after the last corrective phase.  You should know that the perspective remains bearish on the short term because the rate is still trapped below a downtrend line which represents a very strong dynamic resistance.

The rate moves sideways on the short term, so maybe will be better to stay away until we’ll have a valid breakout from this extended range.


 

DOGE/USD has developed a major triangle on the Daily chart and now the rate has failed to approach and reach the downside line signaling a potential reversal. The rate has turned to the upside on the short term, but it remains to see how long this will be because it has increased slowly. The current rebound could be only temporary and it could still drop towards the 0.00288000 – 0.00248254 support area.

Price dropped along the upper median line (uml) of the descending pitchfork,, but failed to reach the first warning line (WL1). It could still reach the WL1 as it is trading very close to it. Dogecoin (DOGE) has managed to breakout above the 150% line and could fight hard to reach the first warning line (wl1) in the upcoming period.


Conclusion


A really great buying opportunity could appear only after a valid breakout above the downtrend line, above the warning line (wl1) and above the 0.00487198 static resistance. The Stop Loss could be placed below a former low.

 

Categories
Crypto Market Analysis

RDD/BTC Lost The Bearish Momentum


ReddCoin (RDD)


Market Cap: $195.44M

Circulating Supply: 28.81B RDD

Max Supply: 0 RDD

Volume (24h) $3.62M

RDD/USD = 0.006804


Technical Analysis


RDD/BTC rallies right now and resumed yesterday’s bullish candle. The rate approaches a very strong dynamic resistance, so it remains to see how it will react. A valid breakout will confirm a further increase in the short term. The rate has shown some oversold signs after the failure to make new lows. It seems that the behaviour has changed, but we still need a confirmation that the rate will increase further.


 

As you already know, it is very important for the major crypto to increase, and maybe we’ll have an important increase with this pair as well. The last drop was expected and it was natural after another failure to reach and retest the median line (ML) of the sideways pitchfork.

RDD/BTC has found strong support right above the 0.00000076 level and above the 61.8% retracement level. The failure to drop towards the 76.4% level and towards the LML of the sideways pitchfork has attracted the buyers again.

It has also failed to reach the median line (ml) of the minor descending pitchfork signalling a breakout from the descending pitchfork’s body. A valid breakout above the upper median line (uml) should send the rate towards the median line (ML) again.


Conclusion


We can go long after a valid breakout above the upper median line (uml). The first target it will be at the warning line (wl1) and at the ML of the sideways pitchfork. The Stop Loss can be placed below the 0.00000076 level.

Categories
Crypto Market Analysis

XRP/BTC Looks To Trade Higher


Ripple (XRP)


Market Cap: $26.18B

Circulating Supply 39.24B XRP

Max Supply: 100B XRP

Volume (24h) $397.67M


XRP/BTC Technical Analysis


XRP/BTC increased and maintains a bullish perspective in the short term. It remains to see what will really happen in the upcoming period because the crypto market is still weak. The rate dropped in yesterday’s trading session as the crypto market dropped further.

The price rebounded in the short term after the failure to reach the previous lows. The rate has managed to break out above some very important resistance levels and now is struggling to reach new highs.


 

The rate has made a false breakdown below the 150% line of the descending pitchfork signalling that we may have an oversold situation. It has moved sideways on the short term but now has started an upside movement after the breakout above the WL1 of the descending pitchfork.

The perspective will remain bullish in the short term as long as the rate stays above the 150% Fibonacci line of the minor ascending pitchfork. The next upside obstacle is at the 61.8% Fibonacci level, so we need a breakout above this level so we can think of a further increase.

It looks bullish in the short term, you can see that the price failed to retest the minor red uptrend line, signalling that the buyers are strong.


Conclusion


We can go long on this crypto pair if it will close above the 0.000091050 yesterday’s high and we can place a stop loss below the 0.000073170 low. A valid breakout above the 61.8% level will send the rate towards the 50% line and maybe towards the median line (ml) of the ascending pitchfork.

Categories
Crypto Market Analysis

BTG/BTC Long After A Valid Breakout


Bitcoin Gold (BTG)


Market Cap: $741.47M

Circulating Supply: 17.05M BTG

Max Supply: 21M BTG

Volume (24h) $16.06M

BTG/USD = $43.309


Technical Analysis


BTG/BTC is on a declining path on the daily chart. The rate dropped significantly in the last months as the crypto market has crashed. Right now, it is very important to see what will really happen in the short term because the rate hovers right above a crucial support level. A valid breakdown will confirm a further drop in the upcoming period. The rate dropped today as the all major cryptocurrencies have dropped significantly today.


 

The price dropped and has found strong support at the 0.005564 level on April 12, 2018. It has increased a little and has made a valid breakout above the median line (ML) of the descending pitchfork. Unfortunately, the rate didn’t resume the rebound and has started another minor corrective phase in the short term.

BTG/BTC has found a temporary support again and has increased a little in the last days, that’s why I’ve drawn an ascending pitchfork. Unfortunately, the rate dropped significantly and could invalidate a further increase in the short term. The next few days will be crucial because a valid breakdown below the 0.005564 will signal a further drop.

We may have a buying opportunity only after a valid breakout above the downtrend line and if the rate will stay within the minor ascending pitchfork’s body.


Conclusion


You could go long after a valid breakout above the downtrend line. We’ll have an important upside target at the median line (ml) of the minor ascending pitchfork and another one at the UML.

Categories
Crypto Market Analysis

PARTICL Can Buyers Take Control Again?


 Particl (PART)


Market Cap: $87.60M

Circulating Supply: 8.98M PART

Max Supply: 0 PART

Volume (24h) $1.26M


Technical Analysis


Particl price resumes the downside movement and could reach lows soon as the pressure is very high. PART/USD approaches a very strong support area, so you can keep an eye on this to see how it will react in the upcoming days.

The current drop is natural as the crypto market has turned to the downside again and because the rate has failed to stay above a very strong dynamic support.


 

It was expected to drop further after the breakdown below the lower median line (lml) of the ascending pitchfork. The breakdown below the 150% line has attracted more sellers.

Technically, it is expected to drop towards the first warning line (wl1) of the ascending pitchfork and towards the downside line of the Falling Wedge pattern after the failure to approach and retest the downtrend line.

The rate has signalled that it is losing the bearish momentum in the last days when it has failed to reach and retest the upside 50% Fibonacci line of the descending pitchfork.  However, the bearish bias remains intact as long as the rate continues to stay below the sliding parallel line (SL) of the descending pitchfork.


Conclusion


We may have a buying opportunity if the rate will be rejected by the 8.21276496 static support, if it will stay above the warning line (wl1) and if it will make a valid breakout above the SL of the descending pitchfork. A drop below the mentioned levels will invalidate the bullish scenario.

Categories
Crypto Market Analysis

EOS/USD Is The Corrective Phase Completed?


EOS (EOS)


Market Cap: $11.33B

Circulating Supply: 872.87M EOS

Max Supply: 1B EOS

Volume (24h)  $927.61M


Technical Analysis


EOS/USD dropped sharply in the last weeks after making new highs. Price increased as much as 23.0290 on April 29, 2018, but the buyers weren’t strong enough to keep the rate near this historic high. The rate is trading in the red today and resumed the yesterday’s bearish candle. It remains under high selling pressure on the Daily chart, that’s why it is premature to talk about another leg higher.

EOS was one of the best performers in April as it has increased from 5.1000 to 23.0290, but now it is trading at only 12.8080. It remains to see if the crypto will recapture enough directional energy to be able to approach the 23.0290 high. Personally, I want to show you a bullish scenario, if the rate will make a valid breakout in the upcoming period.



 

EOS/USD has found temporary support at the upside 50% Fibonacci line (ascending dotted line) of the ascending pitchfork. It has come higher to retest the upper median line (uml) and now drops again. It seems like it has only made a false breakout above the 50% level, which could announce a further drop towards the 61.8% retracement level and toward the median line (ml).

Right now you should stay away from this crypto because we don’t have a reversal sign. Personally, I want to see a consolidation or another signal that the corrective phase has ended before I’ll go long again.


Conclusion


It remains to be seen where it will find a strong support area. Personally, I believe that only a valid breakout above the 250% Fibonacci line will bring us the chance to go long again on this amazing crypto. The first major upside target will be at the 23.0290 highest high.

Categories
Crypto Market Analysis

INCNT Further Increase Needs Validation


Incent (INCNT)


Market Cap: $17.36M

Circulating Supply: 46.02M INCNT

Max Supply: 0 INCNT

Volume (24h)


Technical Analysis


INCNT/USD continues to stay above some very important dynamic support levels and maintains a bullish perspective in the short term. The price could increase significantly in the upcoming period if it will make a valid breakout above some very important upside targets.

The rate is trapped below some very important resistance levels, that’s why we have to stay away until a further increase will be confirmed by the price action.



 

You can see that the rate was into a corrective phase, but it has found a bottom and a strong support right below the lower median line (lml) of the ascending pitchfork. I’ve drawn an outside sliding parallel line to show you where the crucial support line is. A further increase will be invalidated by a valid breakdown below this line.

You can see that the rate has failed to reach and retest the sliding line (sl) of the ascending pitchfork signalling that the bulls are still present in the game. However, only a valid breakout will be above the 150% Fibonacci line and above the 0.4226


Conclusion


You can go long on INCNT if the rate will jump and will stabilise above the 150% line and above the 0.42260400. The next upside targets will be at the WL1 and at the 50% line. You can place your Stop Loss somewhere below the outside sliding parallel line (SL). A drop below this line will really signal a further drop in the short term.

Categories
Crypto Market Analysis

Can MUE/BTC Start An Important Upside Movement?


MonetaryUnit (MUE) 


Market Cap: $15.52M

Circulating Supply: 131.36M MUE

Max Supply: 4B MUE

Volume (24h) $118.29K


Technical Analysis


MUE/BTC posted humble gains in the last days, signalling that the buyers are still weak.  The price hovers above a major support area, that’s why we can think of another upside movement. The rate is narrowing right now, but I really hope that we’ll have a major move after the breakout from this minor chart pattern.

The rate tested and retested a dynamic support and it has now increased, but it is premature to talk about a larger upside movement at this moment.



 

I’ve drawn an ascending pitchfork hoping that I’ll catch an important upside movement. The rate has come back down to test and retest the lower median line (LML) and now approaches the minor downtrend line. A valid breakout will signal a further increase towards the 50% Fibonacci line and towards the major downtrend line.

However, it remains to see if this sideways movement will be an accumulation or a distribution. Anything could happen right now. The rate could drop significantly if it fails to pass above the minor dynamic resistance.

Personally, I believe that we could have an important upside movement towards the downtrend line as long as the rate stays above the LML. A larger rebound will be confirmed only after a valid breakout above the major downtrend line.


Conclusion


You could go long on MUE/BTC if the rate jumps and it closes above the minor dynamic resistance. You can place a Stop Loss somewhere below the support area.

Categories
Crypto Market Analysis

PAY/USD Inverse Head and Shoulders?

TenX (PAY)

Market Cap: $153.75M

Circulating Supply: 109M PAY

Max Supply: 0 PAY

Volume (24h) $53.58M

 

PAY/USD rallied aggressively today and has reached new highs, but unfortunately, the buyers weren’t strong enough to hold the rate near 1.97956344 today’s high. Price is trading at 1.41913765 right now but is trapped below a crucial dynamic resistance.

The crypto moves somehow sideways on the short term, so we’ll have a significant move after a breakout from this minor range.



 

It is premature to talk about a larger upside movement as long as the rate is trapped below the minor downtrend line. You can see that the rate has found support at the lower median line (LML). The previous retreat was natural after the failure to reach and retest the median line (ML) of the ascending pitchfork.

It remains to see what will happen in the upcoming period because the current rebound could be only temporary after the today’s failure to stay higher. A  further increase could be validated after a valid breakout above the downtrend line, but a major upside movement will be confirmed only after a valid breakout above the median line (ML).

Technically, we could say that the rate has developed an Inverse Head and Shoulders pattern, this could be confirmed only after a valid breakout above the downtrend line which could be considered to be the neckline.

Conclusion

We could go long on PAY/USD if it will make a valid breakout above the downtrend line and if the LML will remain intact. A breakdown below the LML will invalidate a potentially significant increase.

Categories
Crypto Market Analysis

Bitcoin Keeps Bleeding, The Next Days Are Crucial

Crypto Price Predictions: Bitcoin is trading in the red and resumes yesterday’s bearish candle. If you’ll read my editorials you’ll see that I’ve talked about a retreat after the temporary rebound. The crypto has failed to make a valid breakout above the near-term resistance levels, that’s why the bears have taken the lead and are driving the price down.

Everyone wants to know what will happen with Bitcoin because a major drop will drag the other cryptocurrencies down. Bitcoin approaches two crucial support levels, a valid breakdown will signal a further drop towards fresh new lows.

As I’ve mentioned in the previous weeks, we may have another drop before the rate will really start a broader upside movement. Bitcoin needs to recapture more directional energy to be able to increase again and to give birth to a major leg higher.



 

Bitcoin drops after the failure to breakout above the red downtrend line and above the third warning line (wl3) of the former descending pitchfork. Actually, we had a strong confluence formed by the wl3 with the downtrend line and with the SL2.

The price failed to stay above the 50% Fibonacci line, so the current retreat is natural. It remains to see how long it will be because it has tried to take out the dynamic resistance from the third warning line (wl3).

The next hours will tell us if today’s drop will represent only a retest of the broken warning line (wl3). It approaches the lower median line (LML), where it could find temporary support. The major downside target remains at the outside sliding parallel line (SL). I’ve said that it could come back down to test and retest the mentioned support levels before it will climb higher again.

However, a valid breakdown below the SL will confirm a further drop towards the 5000 psychological level.

You can notice that Bitcoin is trapped within a triangle, so only a breakout from this pattern will give us a great trading opportunity. Personally, I would like to see a false breakdown below the LML or below the SL and a failure to reach the downside line of the chart pattern, then we could think about a broader upside movement.

A major upward movement will be confirmed by a valid breakout above the downtrend line. Another leg higher will bring us great returns if we’ll go long on Bitcoin after a valid breakout above the red downtrend line. This scenario will take shape only if the sliding parallel line (SL) will hold.

Crypto Price Predictions Conclusion

You should stay away for now because anything could happen in the short term. Personally, I believe that we may have a great trading opportunity soon. Right now we have to let the market to play its role and to step in only after a confirmation.

Categories
Crypto Market Analysis

INCNT/BTC – Can We Buy It?

 Incent (INCNT)

Market Cap: $15.13M

Circulating Supply: 46.02M INCNT

Max Supply: 0 INCNT

Volume (24h) $45.70K

 

Price is trading in the red right now and is about to reach a very strong dynamic support again. INCNT/BTC erased yesterday’s impressive gains signalling that it continues to remain under massive selling pressure.

The outlook remains bullish on the Daily chart despite the current drop. INCNT/BTC could still increase if the rate will be rejected by the near term dynamic support. The uptrend is still unharmed, that’s why I’ve said that it could increase.



 

The next few days will be crucial because a breakdown will attract more sellers. A false breakdown or a rejecting from the uptrend line will send the rate towards the inside sliding line (SL) of the descending pitchfork. It could take this out if it will close on it.

Only a valid breakout above the sliding line (SL) will announce an important upside movement. Personally, I believe that a breakout above the sliding line (SL) will send the rate much above the UML. So, the bias will remain bullish as long as the rate stays above the uptrend line.

INCNT/BTC failed to retest the 50% Fibonacci line (descending dotted line) signalling that this could be only a temporary drop.

Incent Price Chart (INCNT/BTC)Conclusion

It will increase further if it will stay above the uptrend line. A valid breakout from the descending pitchfork will bring us a great chance to go long on it with an upside target at the WL1.

Categories
Crypto Market Analysis

XMR/BTC Hovers Above Critical Support

XMR/BTC has developed a Head and Shoulders pattern, but we still need the confirmation. What are the perspectives now? Can we sell this crypto pair?

Monero (XMR)

Market Cap: $3.70B

Circulating Supply: 16.02M XMR

Max Supply: 0 XMR

Volume (24h) $32.97M

XMR/USD = $231.03

 

The XMR/BTC is trading into a strong support area. The price increased today and is trying to reach the 0.02505000 yesterday’s high. It remains to see what will really happen in the upcoming period because it looks like the rate has developed a Head and Shoulders chart pattern.

The rate moves sideways on the short term, so we’ll have a clear direction only after a valid breakout from this pattern.



 

XMR/BTC has found a temporary support on the 50% Fibonacci line and on the 0.023 static support. It could increase a little and could try to retest the upper median line (UML) of the descending pitchfork. A valid breakdown below the 0.023 area could validate the Head and Shoulders pattern.

The crypto pair will drop towards the 0.016 if this scenario will take shape. Price could drop as long as it stays below the 150% Fibonacci line.

Personally, I believe that the rate will take out the resistance from the 150% Fibonacci line if it will touch it. We could think of another trading opportunity if the Head and Shoulder pattern will be invalidated and if the rate will make a valid breakout above the 150% Fibonacci line. The price should rally from above the 150% Fibonacci line targeting the 0.03234574 static resistance.

Conclusion

We’ll have a great selling opportunity if the Head and Shoulders is confirmed and as long as it stays far away from the 150% Fibonacci line. However, a valid breakout above the 150% Fibonacci line will send the rate at least up to its former highs.

Categories
Crypto Market Analysis

WAVES into a Corrective Phase

Waves (WAVES)

Market Cap: $647.89M

Circulating Supply: 100M WAVES

Max Supply: 0 WAVES

Volume (24h) $29.10M

 

The WAVES drops like a rock on the short term after another false breakout above a very strong dynamic resistance. Price approaches a strong support right now. It remains to see how it will react when it touches and retests the near-term support levels.

It is premature to talk about a larger drop in the short term as long as the rate is located above some crucial support levels. I said in last weeks report that the crypto marker rebound could be only temporary and it could come back down trying to capture more bullish energy.

We have important corrective movements on all major cryptocurrencies. This retreat is natural and it was expected after the impressive rally. I’ve told you in one of my editorials (Is the crypto market sell-off natural?) that the cryptocurrencies have reached important upside targets and could turn to the downside on the short term.

WAVES/USD dropped sharply in the last days

The WAVES/USD dropped sharply in the last days and now is pressuring the 6.28330036 static support. It should reach and retest the lower median line (LML) as well. A further increase on the Daily chart will be invalidated by a valid breakdown below the outside sliding line (SL) of the ascending pitchfork.

 

Conclusion

We could go long on this after a false breakdown below the mentioned support levels and after a retest. The first upside target will be at the 50% Fibonacci line. Only a valid breakout above the 50% line will signal a further increase towards the median line (ML).

©Forex.Academy

Categories
Crypto Market Analysis

SYS/BTC is this a temporary drop?

Syscoin (SYS)

Market Cap: $265.04M

Circulating Supply: 533.32M SYS

Max Supply: 888M SYS

Volume (24h) $3.45M

 

The SYS/BTC dropped aggressively in the last days and has reached an important support level. The bearish momentum was paused for the moment and is premature to talk about a significant rebound at this moment. Right now will be better to stay away because we don’t have a clear direction, but I really hope that we’ll have a great trading opportunity very soon.

Syscoin Price Prediction

The SYS/BTC has made two false breakouts above the upper median line (UML) of the descending pitchfork. The current drop is natural but remains to see how long this could be. We may have a perfect buying opportunity from above the upper median line (UML) of the descending pitchfork.

So, a rebound from here and a valid breakout from the descending pitchfork’s body will signal a further increase in the upcoming period. You can see that the 150% Fibonacci line represents a very strong dynamic support and could stop the retreat.

A drop below the 150% Fibonacci line will signal a further drop, and it could slip much below the 50% Fibonacci line as well, and it could be attracted by the median line (ML) again.

Price moves in range on the daily chart, that’s why only a valid breakout from the descending pitchfork’s body will signal a further increase and a breakout from the extended sideways movement.

Conclusion

The Syscoin dropped significantly after the false breakouts above the UML. Technically, it was somehow expected to climb much higher after the several failures to reach and retest the median line (ML) of the descending pitchfork. We’ll have an important upside target at the lower median line (lml) of the ascending pitchfork.

©Forex.Academy

Categories
Crypto Market Analysis

FUN/BTC – buy a valid breakout

FunFair (FUN)

Market Cap: $270.95M

Circulating Supply 4.86B FUN

Max Supply 0 FUN

Volume (24h) $43.88M

 

The crypto pair increased significantly today and has jumped above a crucial dynamic resistance. It remains to see what will happen because the price failed to stay above this obstacle. You should stay away, for now, to see if this will be a valid breakout.

We may have a great buying opportunity if the FUN/BTC will make a valid breakout above the near term dynamic resistance.

FUN/BTC chart

The FUN/BTC has finally managed to make a breakout above the median line (ML) of the major descending pitchfork, but it remains to see if this will be a valid one. Price has tested and retested the uptrend line and now is fighting hard to close and stabilize in the buyer’s territory.

A valid breakout above the median line (ML) will bring us a great buying opportunity with a Stop Loss below the uptrend line.

You should know that a failure to make a valid breakout will signal an overbought and exhaustion in the short term. This situation will send the rate towards the downside 50% Fibonacci line very quickly. The perspective will remain bullish as long as the rate stays above the uptrend line.

Conclusion

You can go long on this crypto pair after a valid breakout and after a minor increase. The Stop Loss should be placed below the uptrend line, while the first upside target will be at the upside 50% Fibonacci. The major upside target will be at the upper median line (UML) of the descending Pitchfork.

©Forex.Academy

Categories
Crypto Market Analysis

Ardor – Has The Rebound Completed?

Ardor (ARDR)

Market Cap. $430.46M

Circulating Supply: 999M ARDR

Max Supply: 999M ARDR

Volume (24h) $5.40M

 

The ARDR/USD dropped today and could invalidate a further increase. It remains to be seen what will really happen in the upcoming days because the perspective is still bullish in the short term as long as the rate is trading above some very important support levels.

We may have a great buying opportunity if the rate will decrease a little to retest the near-term support levels.

Ardor ARDR/USD chart

You can see on the Daily chart that the rate has made another false breakout above the 50% Fibonacci line (ascending dotted line) of the ascending pitchfork signalling that we may have a minor drop. It could come back down to test and retest the lower median line (lml) and the 0.33818380 static support.

We could take a long position from the mentioned levels if the rate stays above them after a retest. However, we could also buy this crypto after a valid breakout above the 50% Fibonacci line. A valid breakout will signal a potential increase above the median line (ml).

The perspective remains bullish as long as the rate stays above the 0.3381 level and the lower median line.

Personally, I was expecting to see an important upside movement after the retest of the lower median line (lml) of the ascending Pitchfork, but the 50% Fibonacci line represents a very strong dynamic resistance.

Conclusion

You can buy the ARDR/USD from above the 50% Fibonacci line after a valid breakout or after a retest of the lower median line (lml) of the ascending pitchfork. We have an important upside target at the 23.6% retracement level and higher at the upper median line (uml).

©Forex.Academy