Tag: USDJPY

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Forex Market Analysis

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

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

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

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

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

Economic Events to Watch Today    

 

 

EUR/USD – Daily Analysis

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

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

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

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

    

Daily Support and Resistance

  • S1 1.0654
  • S2 1.0918
  • S3 1.1045

Pivot Point 1.1182

  • R1 1.1309
  • R2 1.1447
  • R3 1.1711

EUR/USD– Trading Tips

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

GBP/USD– Daily Analysis

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

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

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

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

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

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

Daily Support and Resistance

  • S1 1.1957
  • S2 1.2295
  • S3 1.2436

Pivot Point 1.2633

  • R1 1.2774
  • R2 1.297
  • R3 1.3308

GBP/USD– Trading Tip

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

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

USD/JPY – Daily Analysis

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

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

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

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

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


Daily Support and Resistance

  • S1 99.26
  • S2 102
  • S3 103.37

Pivot Point 104.74

  • R1 106.11
  • R2 107.47
  • R3 110.21

USD/JPY – Trading Tips

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

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Forex Market Analysis

Daily F.X. Analysis, March 12 – Top Trade Setups In Forex – Brace for ECB Interest Rate Decision! 

The U.S. dollar strengthened versus its major peers for a second straight session, with the ICE Dollar Index bouncing 0.2% on the day to 96.60. The European Central Bank will announce its key policy rates (deposit facility rate at -0.5% expected). The European Commission will report January industrial production (+1.5% on month expected). During the U.S. session, the U.S. Labor Department will release February PPI (+1.8% on-year expected), and initial jobless claims in the week ended March 7 (220,000 expected).

The U.S. dollar strengthened versus its major peers for a second straight session, with the ICE Dollar Index bouncing 0.2% on the day to 96.60. The European Central Bank will announce its key policy rates (deposit facility rate at -0.5% expected). The European Commission will report January industrial production (+1.5% on month expected). During the U.S. session, the U.S. Labor Department will release February PPI (+1.8% on-year expected), and initial jobless claims in the week ended March 7 (220,000 expected).

The U.S. dollar strengthened versus its major peers for a second straight session, with the ICE Dollar Index bouncing 0.2% on the day to 96.60. The European Central Bank will announce its key policy rates (deposit facility rate at -0.5% expected). The European Commission will report January industrial production (+1.5% on month expected). During the U.S. session, the U.S. Labor Department will release February PPI (+1.8% on-year expected), and initial jobless claims in the week ended March 7 (220,000 expected).

Economic Events to Watch Today   

  

 

 

EUR/USD – Daily Analysis

The EUR/USD fell 0.2% to 1.1263. It is reported that the European Central Bank President Christine Lagarde told European Union leaders that Europe is facing a major economic shock, and that ECB is looking at all of its tools for the monetary policy meeting due later today.

There are so high chances of a slowdown in the Eurozone, especially in Germany, in the wake of dangerous coronavirus. So, possibly the European Central Bank will go with another stimulus measure on Thursday to soften the economic fallout, which may hurt the shared currency very well. 

The European Central Bank will announce its key policy rates (deposit facility rate at -0.5% expected). The European Commission will report January industrial production (+1.5% on month expected).

Considering the slowdown in the economy, the markets are expecting a cut in the deposit rate, which currently stands at -0.5%. Therefore, the EUR could see a sharp rise if the central bank keeps rates unchanged. The traders are keenly awaiting the ECB rate decision to take new directions. The Italian Quarterly Unemployment Rate, Industrial Production m/m, Italian 10-y Bond Auction also will be key to watch.

Daily Support and Resistance

  • S1 1.106
  • S2 1.1176
  • S3 1.1218

Pivot Point 1.1293

  • R1 1.1335
  • R2 1.1409
  • R3 1.1526

EUR/USD– Trading Tips

The EUR/USD is trading with a mixed bias around 1.1305 on Thursday as it seems to extend the bearish trend even after completing the 38.2%% and 50% Fibonacci retracement levels around 1.1350 and 1.1275.  

The EUR/USD is currently trading around 1.1305, and it’s forming lowers low pattern on the 4-hour chart, which mostly drives a continuation of a selling trend. On the lower side, a continuation of a selling bias can extend sell-off until 1.1200 and 1.1095. While the bullish breakout of 1.1350 can drive more buying until 1.1454 area. Consider staying bullish over 1.1275 and bearish below the same level today. 

GBP/USD– Daily Analysis

The GBP/USD dropped 0.7% to 1.2817. The Bank of England slashed its benchmark rate by 50 basis points to 0.25% after a special meeting, citing economic shock from the coronavirus. On the other hand, official data showed that the U.K.’s GDP growth was flat on month in January (+0.2% estimated), and industrial production declined 0.1% in February (+0.3% expected).

Whereas, the U.S. 10-year Treasury yields failed to continue the previous day’s run-up, current down by 8-basis points (bps) to 0.67%.

The U.K. Office for National Statistics will report January monthly GDP (+0.2% on month expected), industrial production (+0.3% on month expected), manufacturing production (+0.2% on month expected) and trade balance (356 million pounds deficit projected). 

At the U.K. front, there are fewer chances that the British PM Johnson will announce any major stimulus after the BOE joined the budgetary push to defeat the virus the previous day. However, Traders should wait for the final announcement because we all know that the Tory leader is famous for providing surprises.

Looking forward, the US PPI and Jobless Claims will likely entertain the momentum traders. The overall PPI was likely lower due to the weakening in energy prices, similar to the pattern in the CPI (TD -0.2%). The core measures were probably moderately weak as well after the above-trend readings in January.

Daily Support and Resistance

  • S1 1.2523
  • S2 1.2695
  • S3 1.2758

Pivot Point 1.2867

  • R1 1.293
  • R2 1.3039
  • R3 1.3211

GBP/USD– Trading Tip

On Thursday, the GBP/USD continues to trade in a bearish mode due to the BOE rate cut decision. The GBP/USD has dropped further after violating the immediate support level of 1.2850, which is now working as a resistance. 

Continuation of a selling trend can lead the GBP/USD prices towards 1.2740 and 1.2720. On the higher side, the GBP/USD is likely to trade bullish until 1.2840 level, and bullish breakout of which may drive further buying until 1.2910 level. The MACD is consistently forming bearish histograms below zero, supporting the selling trend in the GBP/USD pair, which is why we should consider selling below 1.2825 today. 

USD/JPY – Daily Analysis

The USD/JPY currency pair hit the bearish track and dropped below the 104.00, mainly due to a sharp decline in the equity market. U.S. President Donald Trump failed to ease the fears about intensifying coronavirus slowdown in the global economy, which later boosted the safe-haven Japanese yen and sent the USD/JPY pair lower near the 103.30. As of writing, the safe haven pair is trading at 107.30 and consolidates in the range between the 103.09 – 104.81.

Trump said during his speech that the U.S. would ban all flights from Europe to the U.S. for the next 30 days effective Friday at midnight. While also says that travel bans will not apply to the U.K., He said that the U.S. would take emergency action to provide financial relief for workers who are ill, hospitalized, or caring for others due to coronavirus. Whereas also says that we will provide capital and liquidity to the small firms which are affected by the coronavirus, provide low-interest loans as well. Trump promised to provide $200 billion in additional liquidity in the fight against coronavirus. 

As we already mentioned that the investors were expecting a more potent stimulus and sold risk after Trump’s speech. The S&P 500 futures, which traded 0.5% lower ahead of President’s address, are now reporting a 2.4% decline. Meanwhile, the yield on the U.S. 10-year Treasury registering losses by 5-basis points at 0.76%. 

Daily Support and Resistance

  • S1 99.41
  • S2 102.11
  • S3 103.7

Pivot Point 104.81

  • R1 106.4
  • R2 107.51
  • R3 110.21

USD/JPY – Trading Tips

The USD/JPY is trading at 103.800 and has already violated the double bottom support level of 104.100. Closing of 4-hour candle below this level confirms the chances of further selling in the pair. The recent candle on the 4-hour chart is bearish engulfing in nature as it’s covering the full body of the precious candle, and it signifies the chances of further selling in the USD/JPY pair. 

Below 104.250, the selling trend continuation can lead the USD/JPY prices towards 101.670, whereas, further buying over 104.250 can lead the USD/JPY to 106.250 area.

All the best for today!  

Categories
Forex Market Analysis

Daily F.X. Analysis, March 11 – Top Trade Setups In Forex – Who’s Up for U.S. Inflation Rate? 

On the forex front, the ICE U.S. Dollar Index rebounded 1.7% on the day to 96.45, snapping a three-day losing streak, as investors anticipated that fiscal stimulus from the U.S. government would limit the scope for interest rates cut. The U.S. Labor Department will report February CPI (+2.2% expected). The Treasury will post the February monthly budget statement (236.8 billion dollars deficit expected). Here’s an update on the technical side of the market. 

On the forex front, the ICE U.S. Dollar Index rebounded 1.7% on the day to 96.45, snapping a three-day losing streak, as investors anticipated that fiscal stimulus from the U.S. government would limit the scope for interest rates cut. The U.S. Labor Department will report February CPI (+2.2% expected). The Treasury will post the February monthly budget statement (236.8 billion dollars deficit expected). Here’s an update on the technical side of the market. 

On the forex front, the ICE U.S. Dollar Index rebounded 1.7% on the day to 96.45, snapping a three-day losing streak, as investors anticipated that fiscal stimulus from the U.S. government would limit the scope for interest rates cut. The U.S. Labor Department will report February CPI (+2.2% expected). The Treasury will post the February monthly budget statement (236.8 billion dollars deficit expected). Here’s an update on the technical side of the market. 

Economic Events to Watch Today   

 

 

EUR/USD – Daily Analysis

The EUR/USD retreated 1.2% to 1.1312. Most of the movement in the EUR/USD is triggered in the wake of low impact economic events. Regarding the U.S. economic data, the Small Business Optimism Index by the National Federation of Independent Business (NFIB) rose to 104.5 in February (102.8 expected).

Euro also slipped in the wake of the bearish stock market. The European stocks were broadly lower, with the Stoxx Europe 600 Index declining 1.1%. Germany’s DAX slid 1.4%, France’s CAC lost 1.5%, and the U.K.’s U.K.’s FTSE 100 was down 0.1%.

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

There are so high chances of a slowdown in the Eurozone, especially in Germany, in the wake of dangerous coronavirus. So, possibly the European Central Bank will go with another stimulus measure on Thursday in order to soften the economic fallout, which may hurt the shared currency very well. 

Looking forward, the traders will keep their eyes on the incoming virus updates and its impact on the risk sentiment and dollar trades ahead of the US CPI data, which is scheduled to release later today at 1230 GMT.

Daily Support and Resistance

  • S1 1.107
  • S2 1.1197
  • S3 1.1245

Pivot Point 1.1323

  • R1 1.1371
  • R2 1.145
  • R3 1.1576

EUR/USD– Trading Tips

On Wednesday, the EUR/USD is trading with a mixed bias around 1.1315. The EUR/USD seems to extend the bearish trend in the wake of completing the 38.2%% and 50% Fibonacci extension level, out of which 38.2% has already been achieved until 1.1280. 

At the moment, the EUR/USD is trading at 1.1315, and a bullish breakout of 1.1350 resistance level can extend buying until 1.1458 level. On the lower side, the EUR/USD may find support around 1.1280, and bearish breakout of 1.1280 can extend sell-off until 1.1238. The RSI and MACD are in the buying zone as the MACD’s histograms are over zero, the bullish zone. Consider taking buy trades above 1.1280.

GBP/USD– Daily Analysis

The GBP/USD fell 1.7% at 1.2907. Later today, the U.K.’s U.K.’s January GDP data (+0.2% on month expected) and February industrial production (+0.3% on month estimated) will be released. The U.S. official data revealed that the economy added 273,000 non-farm payrolls in February (+175,000 expected), and the jobless rate dropped to 3.5% (3.6% expected). Average hourly earnings were up 0.3% on the month (as expected). 

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

Whereas, the U.S. 10-year Treasury yields failed to continue the previous day’s run-up, current down by 8-basis points (bps) to 0.67%.

The U.K. Office for National Statistics will report January monthly GDP (+0.2% on month expected), industrial production (+0.3% on month expected), manufacturing production (+0.2% on month expected) and trade balance (356 million pounds deficit expected).

Whereas, Chancellor Rishi Sunak is scheduled to announce a significant relief to the U.K. business houses and will try his hands to keep entrepreneurs attached to Britain after the actual Brexit (which may lose the London’s powerhouse status). 

Daily Support and Resistance

  • S1 1.252
  • S2 1.2733
  • S3 1.281

Pivot Point 1.2945

  • R1 1.3023
  • R2 1.3158
  • R3 1.337

GBP/USD– Trading Tip

The GBP/USD has triggered a dramatic sell-off in the wake of stronger dollar and weakness in Sterling as the pair slipped to test 1.2850. Continuation of a selling trend can lead the GBP/USD prices towards 1.2740, but the way Cable has closed a Doji candle above 1.2850, it seems to trigger a bullish reversal. 

On the higher side, the GBP/USD is likely to trade bullish until 1.3020 level, and breakout of which may drive further buying until 1.3100 level. The MACD is consistently forming bearish histograms below zero, supporting the selling trend in the GBP/USD pair. Let’s consider buying over 1.2925. 

USD/JPY – Daily Analysis

The USD/JPY currency pair flashing red and dropped below the 105.00 level, mainly due to equity markets, which turned lower. At the press time, the USD/JPY is trading at 104.90 and consolidates in the range between the 104.11 – 105.67.

The hopes of fiscal stimulus by the Trump administration boosted investors’ appetite for riskier assets on Tuesday, which allowed the U.S. Treasury bond yields to recover sharply from historic lows and helped revive the USD demand. But as of now, the delay in the incentive package offered by U.S. President Donald Trump to diminish the economic influence of the coronavirus epidemic, which he had promised on Tuesday also weighing on the greenback and risk-tone.

The safe-haven flows were further strengthened by a fresh drop in the U.S. equity futures and the U.S. bond yields, which kept the USD bulls on the defensive and turned out to be one of the key factors exerting some pressure on the pair.

Whereas the bearish bias remained cushioned for now, because investors now seemed unwilling to place any aggressive bets, instead preferred to wait on the sidelines ahead of the latest U.S. inflation figures and the U.S. budget for fiscal 2021.

The U.S. Treasury Secretary Steven Mnuchin will testify on the Proposed the Fiscal Year 2021 Budget, which might provide fresh details about the administration’s new policies.

Daily Support and Resistance

  • S1 99.41
  • S2 102.11
  • S3 103.7

Pivot Point 104.81

  • R1 106.4
  • R2 107.51
  • R3 110.21

USD/JPY – Trading Tips

The USD/JPY is trading at 104.800, testing the bearish trendline resistance level at 105.600. The increased reduced demand for safe-haven assets is driving strong bullish correction in the USD/JPY currency pairs. The USD/JPY has closed two consecutive selling candles, which are followed by the bullish engulfing candle on the 4-hour timeframe, and these are suggesting odds of selling in the USD/JPY currency pair. Below 104.250, the selling trend continuation can lead the USD/JPY prices towards 101.670, whereas, further buying over 104.250 can lead the USD/JPY to 106.250 area.

All the best for today!  

Categories
Forex Market Analysis

Daily F.X. Analysis, March 10 – Top Trade Setups In Forex – Choppy Trading In Play! 

The U.S. Dollar Index sank 0.9% on the day to 95.07, down for a third straight session. Investors were speculating a steep cut in U.S. interest rates, though the expectations retreated as President Donald Trump announced that he would announce “very dramatic” actions to support the economy. The Dollar Index rebounded to 95.33. The European Commission will post final readings of 4Q GDP (+0.9% on-year expected).

The U.S. Dollar Index sank 0.9% on the day to 95.07, down for a third straight session. Investors were speculating a steep cut in U.S. interest rates, though the expectations retreated as President Donald Trump announced that he would announce “very dramatic” actions to support the economy. The Dollar Index rebounded to 95.33. The European Commission will post final readings of 4Q GDP (+0.9% on-year expected).

The U.S. Dollar Index sank 0.9% on the day to 95.07, down for a third straight session. Investors were speculating a steep cut in U.S. interest rates, though the expectations retreated as President Donald Trump announced that he would announce “very dramatic” actions to support the economy. The Dollar Index rebounded to 95.33. The European Commission will post final readings of 4Q GDP (+0.9% on-year expected).

France’s INSEE will report January industrial production (+1.8% on month expected) and manufacturing production (+1.7% on month expected).

Economic Events to Watch Today  

 

 

EUR/USD – Daily Analysis

The EUR/USD rose 1.1% to 1.1410. Official data showed that German industrial production grew 3.0% on month in January (+1.7% expected). The coronavirus breaks in China and South Korea seem to be lagging, as countries outside in the world embrace drastic steps to try and stamp out the virus. 

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

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

The ECB is expecting to deliver a rate cut to control the economic fallout from the deadly coronavirus outbreak. Moreover, an unexpectedly bigger decline in the Eurozone Sentix Investor Confidence for March, a lead indicator, also continues to burdening the EUR currency.

Looking forward, the trader’s eyes remain on the Eurozone final GDP while the general market bias and USD dynamics will proceed to play a pivotal role.

Daily Support and Resistance

  • S1 1.1196
  • S2 1.1315
  • S3 1.1384

Pivot Point 1.1434

  • R1 1.1503
  • R2 1.1553
  • R3 1.1672

EUR/USD– Trading Tips

The EUR/USD is trading with a bullish bias around 1.1445. The EUR/USD seems to extend the bullish trend in the wake of completing the 161.8% and 261.8% Fibonacci extension level, out of which 161.8% has already been achieved until 1.1258. 

At the moment, the EUR/USD is trading at 1.1458, and bullish breakout of this level can extend buying until 1.1610 level. On the lower side, the EUR/USD may find support around 1.1400 and 1.1296. The RSI and MACD are in the buying zone as the MACD’s histograms are over zero, the bullish zone. Consider taking buy trades above 1.1380.

GBP/USD– Daily Analysis

The GBP/USD gained 0.3% at 1.3083.to hit its highest mark in a week to the greenback. This came after the forecasts waned for an urgent Bank of England rate cut to follow this week’s emergency movement from the U.S. Federal Reserve to accommodate coronavirus damage. 

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

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

The GBP/USD currency pair buyers are still hopeful because the BBC reports a bumper £5billion boost for British exports by the first post-Brexit budget, which is scheduled to release on Wednesday. Chancellor Rishi Sunak will also announce supportive news for salaried employees in his first budget.

Looking ahead, due to the few economic data/events on the economic calendar, all traders keep their eyes on COVID-19/Brexit headlines for taking fresh directions.

Daily Support and Resistance

  • S1 1.278
  • S2 1.2946
  • S3 1.3023

Pivot Point 1.3111

  • R1 1.3188
  • R2 1.3277
  • R3 1.3443

GBP/USD– Trading Tip

The GBP/USD is showing some severe bullish moves in the wake of a weaker dollar and strong Sterling. The GBP/USD soars to trade around 1.3060 and continuation of a bullish trend can extend buying until 1.3160 and even higher. The GBP/USD has formed a solid green candle on the 4-hour timeframe, which may help drive further buying in the Sterling. 

The MACD is consistently forming bullish histograms over zero points, supporting the buying trend in the GBP/USD pair. Let’s consider buying over 1.3025. 

USD/JPY – Daily Analysis

The USD/JPY currency pair stops its bearish rally and hit the high of 105.00 mainly due to risk sentiment improved in the wake of U.S. stimulus expectations. The hopes of the U.S. stimulus put a bid on the U.S. equity futures, treasury yields. 

At the press time, the USD/JPY currency pair is currently trading at 104.78 and consolidates in the range between the 102.02 – 105.05. The U.S. Vice President Mike Pence took U-turn from his Friday’s comments and signaling a lack of enough testing kits in the labs.

The USD/JPY currency pair recovered from the lowest since late-2016 mainly because U.S. President Donald Trump’s suggested to ‘major’ economic measures in order to control coronavirus (COVID-19) triggered the risk-on.

Looking forward, traders are now keeping their eyes on the U.S. President Trump’s real means to tame the adverse implications of the virus. However, the significant risk recovery could only occur if there is news of any cures.

Daily Support and Resistance

  • S1 98.73
  • S2 100.42
  • S3 101.35

Pivot Point 102.12

  • R1 103.05
  • R2 103.81
  • R3 105.5

USD/JPY – Trading Tips

The USD/JPY is trading at 104.200, testing the bearish channel, which supported the Japanese yen at 104.400. The increased reduced demand for safe-haven assets is driving strong bullish correction in the USD/JPY currency pairs. 

The USD/JPY has closed two consecutive bullish candles, which are followed by the bearish breakout setup and suggesting odds of further bullish bias until 104.650. 

Below 104.550, the selling trend continuation can lead the USD/JPY prices towards 101.670 whereas, further buying over 104.550 can lead the USD/JPY to 106.250 area

All the best for today!  

Categories
Forex Market Analysis

Daily F.X. Analysis, March 06 – Top Trade Setups In Forex – Who’s Up for the U.S. Nonfarm Payroll? 

On the forex front, the U.S. dollars weakened further against its major peers on Thursday, with the ICE Dollar Index dropping 0.8% on the day to a two-month low of 96.60. The German Federal Statistical Office will report January factory orders (+1.3% on month expected). France’s INSEE will post the January trade balance (4.8 billion euros deficit expected).

On the forex front, the U.S. dollars weakened further against its major peers on Thursday, with the ICE Dollar Index dropping 0.8% on the day to a two-month low of 96.60. The German Federal Statistical Office will report January factory orders (+1.3% on month expected). France’s INSEE will post the January trade balance (4.8 billion euros deficit expected).

On the forex front, the U.S. dollars weakened further against its major peers on Thursday, with the ICE Dollar Index dropping 0.8% on the day to a two-month low of 96.60. The German Federal Statistical Office will report January factory orders (+1.3% on month expected). France’s INSEE will post the January trade balance (4.8 billion euros deficit expected).

Economic Events to Watch Today  

 

 

EUR/USD – Daily Analysis

The EUR/USD jumped 0.8% to 1.1227. Later today, German factory orders for January will be released (+1.3% on month expected). The European Commission warned that France and Italy could fall into a technical recession, two-quarters of economic contraction, amid coronavirus impacts. On the other hand, official data showed that the eurozone’s retail sales grew 0.6% on month in January, and German retail sales were up 0.9%, both as expected.

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

Besides this, the currency pair will likely take cues from the German Federal Statistical Office will report January factory orders (+1.3% on month expected). France’s INSEE will post the January trade balance (4.8 billion euros deficit expected). The doors remain open for EUR/USD to extend gains toward the next significant resistance near 1.1282 (July 19, 2019 high). 

Daily Support and Resistance

  • S1 1.0949
  • S2 1.1075
  • S3 1.1156

Pivot Point 1.12

  • R1 1.1281
  • R2 1.1326
  • R3 1.1451

EUR/USD– Trading Tips

On Friday, the EUR/USD is trading with a bullish bias around 1.1245. The EUR/USD may drop to complete the bearish retracement. On the lower side, the 38.2% Fibonacci retracement is likely to support the EUR/USD at 1.1180, and violation of this level can drive more selling until 1.1155 which marks the 61.8% Fibonacci level. On the higher side, the bullish breakout 1.1245 can lead EUR/USD prices further higher towards 1.1300 and 1.1335. The RSI and MACD are in the buying zone as the MACD’s histograms are over zero, the bullish zone. Consider taking buy trades above 1.1230.

GBP/USD– Daily Analysis

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

The GBP/USD currency pair may come under pressure in Europe if the pair do not cross the key hurdle. On the data front, the focus will be on the U.K. Halifax House Prices and the U.S. Nonfarm Payrolls report. 

At the Brexit front, the EU-UK Brexit negotiators complete their first round of trade talks. However, no conclusion has been received so far, while fisheries and the E.U. jurisdiction continue to remain as the key hurdles.

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

Daily Support and Resistance

  • S1 1.2631
  • S2 1.2734
  • S3 1.28

Pivot Point 1.2837

  • R1 1.2903
  • R2 1.294
  • R3 1.3043

GBP/USD– Trading Tip

On Friday, the GBP/USD is trading with bullish bias after having violated the horizontal resistance level of 1.2885, and it’s heading towards the next target level of 1.3000, which is also a psychological resistance level for GBP/USD. 

The GBP/USD’s immediate support is likely to be found around 1.2917, and below this level, the GBP/USD may aim for the 1.2860 area. The MACD and RSI are in the buying zone, supporting the bullish bias for the GBP/USD. Let’s look for long positions above 1.2937 today.  

USD/JPY – Daily Analysis

The USD/JPY currency pair flashing red and trading below the 106.00 level mainly due to the on-going risk-off market sentiment in the wake of Coronavirus intensifying fears. As well as, the currency pair hit the 6-months lows level. For now, the currency pair is currently trading at 105.94 and consolidates in the range between the 105.75 – 106.34.

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

The currency pair continued to its recent heavy losses and still trading under some heavy selling pressure for the 2nd-consecutive session on Friday.  

The reason behind all negative factors could be the market’s fear of coronavirus-led economic pessimism. Whereas, the latest numbers from the U.S., China, and South Korea suggested that the deadly virus continues to spread despite the governments’ struggles.

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

Daily Support and Resistance

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

Pivot Point 106.52

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

USD/JPY – Trading Tips

The USD/JPY is trading at 105.900, breaking below the sideways trading range of 108.500 to 107.100 in the wake of safe-haven appeal. The pair is now in the oversold zone, but the market isn’t moving much as investors seem to wait for the NFP figures, which are coming out during the U.S. session.  

The USD/JPY has formed a Doji pattern near 105.613, and the violation of this could trigger further selling off until 104.300. We need to pay attention to the USD/JPY as the closing of candlesticks above 105.613 level can provide us with buying trade with a take profit of around 107. 

All the best for today! 

Categories
Forex Market Analysis

Daily F.X. Analysis, March 02– Top Trade Setups In Forex – Buckle up for Series of Manufacturing PMI 

Earlier today, during the Asian trading hours, EUR/USD extended its rally to 1.1056, and GBP/USD edged up to 1.2826 as traders seem to do profit-taking in the Greenback.

Earlier today, during the Asian trading hours, EUR/USD extended its rally to 1.1056, and GBP/USD edged up to 1.2826 as traders seem to do profit-taking in the Greenback.

Earlier today, during the Asian trading hours, EUR/USD extended its rally to 1.1056, and GBP/USD edged up to 1.2826 as traders seem to do profit-taking in the Greenback.

The eyes now will remain on the research firm Markit will publish final readings of February Manufacturing PMI for the eurozone (49.1 expected), Germany (47.8 expected), France (49.6 expected), the U.K. (51.9 expected) and the U.S. (50.8 expected). The Bank of England will release the number of mortgage approvals in January (68,000 expected) and the M4 money supply.

Economic Events to Watch Today 

 

 

EUR/USD – Daily Analysis

The EUR/USD rose 0.2% to 1.1026. Official data showed that Germany’s jobless rate was steady at 5.0% in January, and CPI grew 1.7% on year in February, both as expected.

The dollar has traded near a three-month high against the Euro as worries over the outbreak of Coronavirus has driven sharp volatility in the market, mostly driving dollar prices higher. The Euro has tried to rally higher during the Asian trading session on Monday but continues to encounter resistance above. 

The European stocks were also deep in the red, with the Stoxx Europe 600 Index falling a further 3.5%. Germany’s DAX dropped 3.9%, the U.K.’s FTSE 100 lost 3.2%, and France’s CAC was down 3.4%.

The eyes will remain on the final readings of February Manufacturing PMI for the eurozone (49.1 expected), Germany (47.8 expected), France (49.6 expected), the U.K. (51.9 expected), and the U.S. (50.8 expected). The U.S. Commerce Department will report construction spending in January (+0.6% on month expected). The Institute for Supply Management will post its manufacturing index for February (50.5 expected).

Daily Support and Resistance

  • S1 1.092
  • S2 1.0842
  • S3 1.0799

Pivot Point 1.0963

  • R1 1.1041
  • R2 1.1084
  • R3 1.1162

EUR/USD– Trading Tips

The EUR/USD is trading bullish near 1.1116, as the pair seems to go further higher after violating double top resistance at 1.1097. Chances of further buying in the EUR/USD remains pretty high until 1.1140 and 1.1185. The pair may find immediate support around 1.1095, which is mostly extended horizontal support level. The MACD and RSI still stay on the bullish side and are signaling odds of more buying in the pair. The EUR/USD may find resistance around 1.1140 and 1.1185, so let’s look for bullish trends above 1.1085.

GBP/USD– Daily Analysis

The GBP/USD dropped 0.5% at 1.2821, the lowest level since mid-October last year. The U.K. government is expected to publish a negotiating mandate for the future relationship with the European Union. 

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

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

The Bank of England will release the number of mortgage approvals in January (68,000 expected) and the M4 money supply.

Daily Support and Resistance

  • R3: 1.3209
  • R2: 1.3015
  • R1: 1.2916
  • Pivot Point 1.2821
  • S1: 1.2722
  • S2: 1.2627
  • S3: 1.2432

GBP/USD– Trading Tip

The GBP/USD continues trading with a bearish bias, breaking out of a narrow trading range of 1.2980 – 1.2880. On the 4-hour chart, the Cable has formed violated the descending triangle pattern, which was supporting the Sterling around 1.2880. 

It’s was one of the most crucial trading levels, and violation of this has further open room for selling until 1.2755 area. Below this level, the GBP/USD has the potential to go after the 1.2660 area. The MACD and RSI are holding in the selling zone, supporting bearish bias for the GBP/USD pair. Let’s look for selling trades below 1.2966 and bullish above the same level today. 

USD/JPY – Daily Analysis

The USD/JPY rebounded to 109.30. This morning, government data showed that Japan’s fourth-quarter capital spending declined 3.5% on year (-2.6% expected). The USD/JPY extended its decline to 109.30. This morning, government data showed that Japan’s jobless rate rose to 2.4% in January (steady at 2.2% expected), while industrial production grew 0.8% on month in January (+0.2% expected) and retail sales climbed 0.6% (-0.1% expected).

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

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

Daily Support and Resistance

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

Pivot Point 110.9

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

USD/JPY – Trading Tips

The USD/JPY continues with its bearish momentum on Monday in the wake of weakness in the U.S. dollar and stronger Japanese yen. The USD/JPY pair is recovered a bit in the wake of a bullish correction, but more selling seems to come soon. The USD/JPY is trading bearish at 107.775, and it has high odds of going towards the next support level of 107.338.

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

All the best for today! 

Categories
Forex Market Analysis

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

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

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

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

Economic Events to Watch Today 

  

EUR/USD – Daily Analysis

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

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

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

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

Daily Support and Resistance

  • S1 1.0747
  • S2 1.0807
  • S3 1.0844

Pivot Point 1.0867

  • R1 1.0905
  • R2 1.0928
  • R3 1.0988

EUR/USD– Trading Tips

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

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

GBP/USD– Daily Analysis

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

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

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

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

Daily Support and Resistance

  • S1 1.2802
  • S2 1.2893
  • S3 1.2949

Pivot Point 1.2937

  • R1 1.304
  • R2 1.3074
  • R3 1.3165

GBP/USD– Trading Tip

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

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

USD/JPY – Daily Analysis

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

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

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

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

Daily Support and Resistance

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

Pivot Point 110.9

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

USD/JPY – Trading Tips

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

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

All the best for today! 

Categories
Forex Market Analysis

Daily F.X. Analysis, February 26 – Top Trade Setups In Forex – Mixed Sentiment Dominates! 

On the forex front, the U.S. dollar fell against its major peers, with the ICE Dollar Index declining 0.4% on the day to 99.00. France’s INSEE will release the February Consumer Confidence Index (103 expected).

On the forex front, the U.S. dollar fell against its major peers, with the ICE Dollar Index declining 0.4% on the day to 99.00. France’s INSEE will release the February Consumer Confidence Index (103 expected).

On the forex front, the U.S. dollar fell against its major peers, with the ICE Dollar Index declining 0.4% on the day to 99.00. France’s INSEE will release the February Consumer Confidence Index (103 expected).

The U.S. Commerce Department will report January’s new home sales (717,000 units expected). That’s all we have on the economic docket, so let’s take a look at the technical setups for today.

Economic Events to Watch Today 

  

 

EUR/USD – Daily Analysis

The EUR/USD fell back towards $1.08, and the Australian dollar dropped to an 11-year low amid the extension of the coronavirus outside China prompted concerns of a pandemic and led traders to take safe-haven shelter in the Greenback.

What’s more surprising is that the safe-haven Japanese yen and the Swiss franc has also gained bullish momentum, but not by much as the U.S. dollar. It seems like the investors are giving more weightage to Greenback, which is keeping the EUR/USD bearish. 

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

Looking forward, there won’t be any meaningful macroeconomic data releases on Wednesday, and markets will remain focused on coronavirus headlines.


Daily Support and Resistance

  • S1 1.0747
  • S2 1.0807
  • S3 1.0844
  • Pivot Point 1.0867
  • R1 1.0905
  • R2 1.0928
  • R3 1.0988

EUR/USD– Trading Tips

The EUR/USD pair is trading sideways due to the lack of major economic events. The EUR/USD is consolidating near 1.0850, as investors seem to do profit taking due to lack of volatility. The pair appears to have initiate correction as it has previously achieved 23.6% Fibonacci retracement at 1.08530. 

On the 4 hour timeframe, the EUR/USD pair seems to form a bearish flag that has the potential to drive further selling in the EUR/USD pair. The pair may find immediate support around 1.08540, which is mostly extended by the 50 EMA and a bullish trendline. Above this, the direct currency pair can bounce off until 1.0890, while bearish breakout can lead the pair towards the next support area of 1.0820.

GBP/USD– Daily Analysis

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

The stronger dollar has capped the gains for the GBP/USD pair. On Wednesday, the dollar has expanded by 0.2% versus a basket of currencies to 99.62. Even though the U.S. economic figures during the previous week came in under economists’ expectations. Money markets are presently pricing in a Federal Reserve interest rate reduction sentiment as Fed is expected to cut rate by 25 basis points in June. A stronger dollar in the wake of coronavirus can hurt the exports from the United States, and Trump may put more pressure on the Fed Chair Powell to introduce the dovish policy in the future. 

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

On the fundamental side, the Sajid Javid’s abrupt departure as Chancellor of the Exchequer recently helped the GBP currency because markets started to price in the possibilities of a significant fiscal expansion in the U.K., repealing the Bank of England rate cut trade. 

Daily Support and Resistance

  • S1 1.2802
  • S2 1.2893
  • S3 1.2949
  • Pivot Point 1.2984
  • R1 1.304
  • R2 1.3074
  • R3 1.3165

GBP/USD– Trading Tip

Technically, the GBP/USD is trading with a mixed bias, following a narrow trading range of 1.2960 – 1.3010. At the moment, the Cable seems to head south to retest the resistance become support level of 1.2965, and closing of doji or reversal candles above this level may help support the GBP/USD pair. 

The GBP/USD has the potential to go after 1.3070 level only if it manages to trade above 1.2960 support. Bearish violation of this level can extend selling until 1.2900 level. The MACD and RSI are holding in the buying zone, supporting bullish bias for the GBP/USD pair. Let’s look for selling trades below 1.2984 and bullish above the same level today. 

USD/JPY – Daily Analysis

The USD/JPY currency pair flashing green rose above the 110.00 handles, the pair continued its recent recovery rally and reached above the 110.00 level mainly due to market stability. The USD/JPY is holding 110.36 and consolidates in the range between the 110.14 – 110.58. However, a stable market tends to weaken the Japanese yen’s safe-haven demand.

The modest recovery in the global risk sentiment allowed the U.S. Treasury bond yields to stage a goodish bounce from all-time lows. This ultimately continued some support to the U.S. dollar and remained supportive of the early uptick.

The renewed strength could be the cause of the uptick in the S&P 500 futures, which are now reporting a 0.70% gain on the day. The state of confusion between the traders is mainly due to the global outbreak of the deadly coronavirus, which is driving traders towards placing bullish bets on gold and the U.S. dollar instead of Japanese yen. Therefore, it will be a good idea to wait for putting some secure follow-through buying after confirming that the recent sharp corrective slide from multi-month tops has already ended.

Looking forward, there isn’t any major market-moving economic data scheduled to release on Wednesday. So, any fresh developments about the coronavirus will play a key role in producing some meaningful trading opportunities.

Daily Support and Resistance

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

Pivot Point 110.9

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

USD/JPY – Trading Tips

The USD/JPY has dropped from 112.160 level to 110.135 level just in two trading days. Earlier, we expected it to reverse after completing the 61.8% Fibonacci support level of 110.350, but this level has now been violated. 

On the 4 hour timeframe, an upward trendline was also extending support at 110.350, but the pair failed to hold above this mark, perhaps due to profit-taking in the Greenback. For now, the safe-haven pair is showing a slight bullish correction to retest the support become a resistance area of 110.350. Closing of candles below this level can help us secure a selling trade with a take profit of around 109.650.  

All the best for today! 

Categories
Forex Market Analysis

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

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

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

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

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

Economic Events to Watch Today 

  

EUR/USD – Daily Analysis

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

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

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

Daily Support and Resistance

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

Pivot Point 1.0844

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

EUR/USD– Trading Tips

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

GBP/USD– Daily Analysis

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

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

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

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

Daily Support and Resistance

  • S1 1.2749
  • S2 1.2845
  • S3 1.2902

Pivot Point 1.2942

  • R1 1.2998
  • R2 1.3038
  • R3 1.3134

GBP/USD– Trading Tip

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

. 

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

USD/JPY – Daily Analysis

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

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

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

Daily Support and Resistance

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

Pivot Point 110.9

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

USD/JPY – Trading Tips

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

All the best for today! 

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Forex Market Analysis

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

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

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

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

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

Economic Events to Watch Today 

  

 

EUR/USD – Daily Analysis

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

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


Daily Support and Resistance

  • S1 1.0686
  • S2 1.076
  • S3 1.0804

Pivot Point 1.0834

  • R1 1.0878
  • R2 1.0908
  • R3 1.0982

EUR/USD– Trading Tips

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

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

GBP/USD– Daily Analysis

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

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

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

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



Daily Support and Resistance

  • S1 1.2749
  • S2 1.2845
  • S3 1.2902

Pivot Point 1.2942

  • R1 1.2998
  • R2 1.3038
  • R3 1.3134

GBP/USD– Trading Tip

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

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

USD/JPY – Daily Analysis

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

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

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

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



Daily Support and Resistance

  • S1 110.57
  • S2 111.13
  • S3 111.35

Pivot Point 111.69

  • R1 111.91
  • R2 112.25
  • R3 112.81

USD/JPY – Trading Tips

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

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

All the best for today! 

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Forex Videos

Forex – How To Trade The USDJPY Right Now

https://youtu.be/GXWe3aBr1OU

https://youtu.be/GXWe3aBr1OU

What on earth is going on with the USDJPY pair and how to trade it?

The USDJPY pair is one of the most volatile major currency pairs. In the last 12-months, we have seen highs of 112.40 to lows of 105.00 and where current price action has become volatile, difficult to predict and therefore difficult to trade. Or has it?


Let’s look at a naked 15-minute chart of this pair, with only price action on our chart, as in example A. On the face of this, it seems exceptionally volatile, unpredictable, with wild swings and where no particular directional bias is evident. This is a typical time frame for an institutional trader to use when trading this pair..


Let’s drill down a little further and try and analyze what is really going on with this pair. In example B, we have broken down the trading exchange rate from the 5th to the 7th of February 2020, which includes two days of trading in the European and American sessions, which is where you would expect to see the most volume going through.

In section A, we can see the overall price action has been using the 1.10 as an area of resistance, while price action it was confined in a 23 pip sidewards moving consolidation period.
We can then see a drop in the form of a spike lower, in area B, which has a range of 20 pips, before price action is again pushed up into area C, and trades into a narrow range of only 14 pips.

Area B’s spike is attributed to the release of the US non-farm payrolls, which had an upbeat 225,000 jobs added to the US labor force, which caused some initial strength in the US dollar before price action consolidates in area C.
But the real elephant in the room with regard to this pair, and the reason for the spikes higher and lower, can be attributed to news flow, including rumors and speculation around the Coronavirus epidemic. The Japanese Yen is favored as a currency that gets bought in uncertain times due to its safe-haven reputation, and it is therefore very sensitive to any information, real or rumors, which are prevalent in the market at this time. The pair also runs in correlation with us stock indices, and as long as the virus situation continues, we can expect spikes in both directions during news alerts, and potential yen strength should be situation worsen.

Therefore trading this pair should take into account the sentiment around the virus crisis, and bias could form for further downside. And due to the extreme volatility and huge swings in the pair over the last 12- months, it should be treated with the utmost care while using tight stop losses.

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Forex Market Analysis

Daily F.X. Analysis, February 17 – Top Trade Setups In Forex – Presidents Day! 

The current week is anticipated to display a slow start with U.S. banks on holiday and light economic data. U.K. jobs data will be reported on Tuesday, and the Fed will publish minutes from their last conference on Wednesday.

The current week is anticipated to display a slow start with U.S. banks on holiday and light economic data. U.K. jobs data will be reported on Tuesday, and the Fed will publish minutes from their last conference on Wednesday.

The current week is anticipated to display a slow start with U.S. banks on holiday and light economic data. U.K. jobs data will be reported on Tuesday, and the Fed will publish minutes from their last conference on Wednesday.

The market awaits U.S. economic events, which are expected to drive some price action during the U.S. session today. The U.S. Commerce Department will report January retail sales (+0.3% on month expected) and December business inventories (+0.1% expected). 

The Labor Department will post the January import price index (-0.2% expected). The Federal Reserve will release January industrial production (-0.2% expected) and capacity utilization (76.8% expected). The University of Michigan will report its Consumer Sentiment Index for February (99.4 expected).

Economic Events to Watch Today 

 

 

EUR/USD – Daily Analysis

The EUR/USD placed a second consecutive weekly loss and dropped to levels not witnessed since April 2017 during the previous week. The euro was the most vulnerable amongst the majors, and deviation is seen in the dollar index (DXY).

Typically, the greenback and the EUR/USD shares a sharp inverse relationship. Last week, though, the greenback held beneath highs posted in September while the currency pair split to a notable low, which could be indicating a slowing of momentum in the greenback dollar. 

On Monday, the U.S. banks observance a holiday in the wake of President’sPresident’s day, and the economic calendar also remains light, which is why the current week is expected to have a quiet start. Volatility is expected to soar later in the week as the Fed publishes minutes from their latest meeting on Wednesday. On Friday, the PMI figures from Europe will be released and will help drive the movement in the market. 

Coronavirus concerns in the markets have sunk a great deal, and the S&P 500 placed a second back-to-back weekly gain to settle at a fresh record high. The German DAX supported the bullish momentum in the global stock markets and closed at a record high for the first time in 2 years.

Daily Support and Resistance

  • S1 1.0767
  • S2 1.0828
  • S3 1.0851

Pivot Point 1.0888

  • R1 1.0911
  • R2 1.0949
  • R3 1.1009

EUR/USD– Trading Tips

The EUR/USD dropped to trade around 1.0841 support level, and it appears to form a Doji candle today, perhaps due to a lack of trading volume and liquidity. Today’s candle is slightly bullish, and it is pretty much likely to form a bullish engulfing pattern or a tweezers top pattern to drive bullish reversal in the pair.

Today, if the EUR/USD pair manages to drop below 1.0840, we may see EUR/USD prices going towards 1.0760. Let’sLet’s look for buying trade today above 1.0840. 

GBP/USD– Daily Analysis

The GBP/USD traded slightly bullish last week after examining its 100-day moving average. The GBP/USD pair has made a remarkable recovery, although the bearish momentum from earlier in the month reaches to prevent further bullish bias.

The greenback, while posting a second back-to-back weekly rise, has exhibited signs of instability. During the previous week, the dollar weakened against the Sterling, which might be contributing an early sign for a pullback.

The current week is anticipated to display a slow start with U.S. banks on holiday and light economic data. U.K. jobs data will be reported on Tuesday, and the Fed will publish minutes from their last conference on Wednesday. Besides, the inflation figures coming from Britain will be posted on Wednesday. The CPI is anticipated to climb by 1.7% in the year to January versus growth of 1.3% in the previous reading.

The risk-tone stays sluggish with stocks in China contradicting those of India and Japan due to hopes of further monetary/fiscal measures to counter coronavirus risk. Looking forward, the U.S. markets are closed due to the President’sPresident’s Day Holiday, and therefore, fewer moves are expected to take place during the day ahead. However, the traders will keep thor eyes on the coronavirus/Brexit headlines.

Daily Support and Resistance

  • S1 1.2888
  • S2 1.2928
  • S3 1.2944

Pivot Point 1.2968

  • R1 1.2984
  • R2 1.3008
  • R3 1.3047

GBP/USD– Trading Tip

On Monday, the GBP/USD continues to trade sideways, holding below 1.3065 resistance market. The GBP/USD pair holds above 1.3000, which is the most crucial level, and the violation of this level can lead to GBP prices further lower towards 1.2965 and 1.2925. The MACD and RSI are holding in the buying zone, supporting bullish bias for the GBP/USD pair. Let’s look for bullish trades above 1.3000 and bearish below the same level today as the President Day holiday is likely to keep the market less volatile.  

USD/JPY – Daily Analysis

The USD/JPY currency pair flashing red and dropped to 109.75 despite the release of downbeat Japan’ Japan’ preliminary 4th-quarter (Q4) GDP data earlier today. The USD/JPY is currently trading at 109.81 and consolidates in the range between the 109.72 – 109.86. The traders are keeping their focus on qualitative catalysts.

On the forecasted view, Japan’s economic growth decreased and came out well below 0.9% figure to 1.6%, whereas the annual figures also disappoint with -6.3% against -3.7% expected.

The 1st economic recession after the 4th-consecutive quarter of growth pushes the policymakers of the Bank of Japan to take steps and understand how to secure the economy ahead. Whereas, the recent data regarding spending and activity figures were soft, while the traders should not ignore the International Monetary Fund’s (IMF) suggestion for taking fresh directions.

The Bank of Japan struggles to decrease the strength of the Japanese Yen, the safe-haven currency getting benefits from the risk-off market sentiment in the wake of China’s coronavirus, and Brexit fears. These two factors are the biggest reason behind the pair bearish sentiment.

At the coronavirus front, the Chinese officials have struggled too much to improve the risk-sentiment, which is severely disturbed by the fears of the coronavirus. The market showed a slight improvement in the risk-tone. However, the broad sentiment and the numbers have unchanged so far, so, the USD/JPY currency pair still trading on the bearish track.

Daily Support and Resistance  

  • S1 109.42
  • S2 109.6
  • S3 109.69

Pivot Point 109.79

  • R1 109.87
  • R2 109.97
  • R3 110.15

USD/JPY – Trading Tips

The USD/JPY pair is trading 110.025 – 109.500 due to a lack of economic events as the U.S. banks are closed in the observance of Presidents Day. At the moment, the USD/JPY pair is holding below 110 resistance as it failed to violate the horizontal resistance level of 110.025.

In case, the USD/JPY manages to break above 110.025 level; we may see USD/JPY prices going towards 110.350 at first and then towards 110.850. Alternatively, the USD/JPY can drop to 109.300 in case of failure to break above 110.025. 

All the best for today! 

Categories
Forex Market Analysis

Daily F.X. Analysis, February 13 – Top Trade Setups In Forex – U.S. Inflation In Highlights! 

The U.S. government reported a budget deficit of 32.6 billion dollars for January, significantly above the expected deficit of 10.0 billion dollars.

The U.S. government reported a budget deficit of 32.6 billion dollars for January, significantly above the expected deficit of 10.0 billion dollars.

The U.S. government reported a budget deficit of 32.6 billion dollars for January, significantly above the expected deficit of 10.0 billion dollars.

Later today, the Labor Department will post Consumer Price Index for January (+0.2% on month expected), and Initial Jobless Claims for the week ended February 8 (210,000 expected). European stocks were broadly higher, with the Stoxx Europe 600 Index rising 0.6%. Germany’s DAX gained 0.9%, France’s CAC rose 0.8%, and the U.K.’s FTSE 100 was up 0.5%.

The U.S. government bond prices eased for a second session, as the benchmark 10-year Treasury yield settled higher at 1.629%.

Economic Events to Watch Today 

 

 

EUR/USD – Daily Analysis

The EUR/USD slid 0.4% to 1.0874, the lowest level since May 2017. Official data revealed that the Euro zone’s industrial production contracted 2.1% on month in December (-2.0% expected), the most significant decline in nearly four years.

The EUR/USD pair is prolonging the losses, and today, we are on the weakest levels since May 2017. On the news front, that is a blend of dovish ECB and concerns about retardation in the Eurozone, especially in Germany. 

In addition to this, the U.S. Fed Chair Powell kept his stand in testimonies to Congress, verifying that the Fed does not see to cut rates any time shortly. Nonetheless, the money markets proceed to price in another interest rate cut in the second half of the year.

The EUR currency will likely continue to flash red, having found acceptance under the critical support at 1.0879. Whereas, the bearish common currency could find bids if the U.S. Consumer Price Index (CPI) for January, which is listed to deliver at 13:30 GMT, exceeds the expectations by a significant margin. As better than expected CPI data will enable markets to price out probabilities of an additional interest rate cut by the Federal Reserve. 

Daily Support and Resistance

  • R3: 1.1009
  • R2: 1.0949
  • R1: 1.0911

Pivot Point 1.0888

  • S1: 1.0851
  • S2: 1.0828
  • S3: 1.0767

EUR/USD– Trading Tips

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

GBP/USD– Daily Analysis

The GBP/USD marked a day-high of 1.2991 before retreating to close at 1.2955, relatively flat on the day. At the USD front, the greenback getting support as a safe-haven flows from the coronavirus fears. Moreover, the United States economy is performing almost strong, as shown last week’s nonfarm payroll report.

As in result, the U.S. 10-year Treasury yields decreased nearly 3-basis points to 1.60%, whereas most of the Asian shares are also in negative territories.

Looking forward, the Brexit and political updates from the U.K., and the U.S. Consumer Price Index data for January will be the keys to watch whereas; the traders also keep their eyes on the coronavirus headlines.

Daily Support and Resistance

  • R3: 1.3047
  • R2: 1.3008
  • R1: 1.2984
    Pivot Point 1.2968
  • S1: 1.2944
  • S2: 1.2928
  • S3: 1.2888

GBP/USD– Trading Tip

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

USD/JPY – Daily Analysis

The safe-haven-metal prices got support and representing 0.30% gains on the day mainly due to risk-off market sentiment in the wake of coronavirus intensified fears. The yellow metal is currently trading at $1,570 per Oz, representing a 0.30% gain on the day.

The coronavirus is back in action, as the latest report in coronavirus infected and dead people from Hubei registered a sharp rise due to the change in the updated diagnostic standard. The numbers mention 14,840 new coronavirus cases, with the death toll rising by 242 to 1,310 at the end of February 12, 2020.

However, the renewed coronavirus fears could be the reason behind the risk-off sentiment, caused by the big jump seen in the coronavirus cases in China. As in result, the futures on the S&P 500 are currently down 0.30%, and so is the price of WTI oil. Japan’s Nikkei is also representing a 0.10% drop. 

Meanwhile, the Japanese yen is attracting bids against commodity dollars, AUD, NZD, and CAD currencies. The markets might review the historical data with the new methodology. If the trend is found to be slowing, the risk sentiment could improve, and ultimately decreasing the bid tone around the gold. 

Daily Support and Resistance

  • R3: 110.63
  • R2: 110.33
  • R1: 110.21
    Pivot Point 110.02
  • S1: 109.9
  • S2: 109.71
  • S3: 109.4

USD/JPY – Trading Tips

The USD/JPY pair is trading in a narrow range of 110.025 – 109.600 due to a lack of economic events during the Asian session, but we may see movement during the U.S. session on the release of CPI data. At the moment, the USD/JPY pair is looking to cross above the horizontal resistance level of 110.025. 

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

All the best for today! 

Categories
Forex Market Analysis

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

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

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

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

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

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

Economic Events to Watch Today 

 

 

EUR/USD – Daily Analysis

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

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

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

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

Daily Support and Resistance

  • S1 1.0826
  • S2 1.0876
  • S3 1.0893

Pivot Point 1.0925

  • R1 1.0943
  • R2 1.0975
  • R3 1.1025

EUR/USD– Trading Tips

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

GBP/USD– Daily Analysis

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

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

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

Daily Support and Resistance   

  • S1 1.2762
  • S2 1.2837
  • S3 1.2876

Pivot Point 1.2911

  • R1 1.295
  • R2 1.2985
  • R3 1.306

GBP/USD– Trading Tip

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

USD/JPY – Daily Analysis

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

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

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

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

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

    

Daily Support and Resistance

  • S1 109.33
  • S2 109.54
  • S3 109.66

Pivot Point 109.76

  • R1 109.87
  • R2 109.97
  • R3 110.18

USD/JPY – Trading Tips

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

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

All the best for today! 

Categories
Forex Market Analysis

Daily F.X. Analysis, February 6 – Top Trade Setups In Forex -Risk-On Sentiment In Play! 

The U.S. trade deficit grew to 48.9 billion dollars in December (48.2 billion dollars deficit expected).

The U.S. trade deficit grew to 48.9 billion dollars in December (48.2 billion dollars deficit expected).

The U.S. trade deficit grew to 48.9 billion dollars in December (48.2 billion dollars deficit expected).

Later today, the Labor Department will report initial jobless claims for the week ended February 1 (a drop to 215,000 expected).

On China’s coronavirus outbreak, the number of confirmed cases has surged across 27,000, and the related death toll has topped 560. Hong Kong’s government announced plans to impose a mandatory 14-day quarantine on all people entering the city from mainland China

Economic Events to Watch Today 

 

 

EUR/USD – Daily Analysis

The EUR/USD lost 0.4% to 1.0999. Official data revealed that the eurozone’s retail sales declined 1.6% on month in December (-1.1% expected). Later today, German December factory orders will be reported (+0.7% on month expected).

Its worth to mention that the Factory Orders may have recovered in December, as expected by economists. 

Therefore, the pair is currently flashing red and found near the 1.0995 and could hit the lowest level of October 8 at 1.0941 if the German data disappoints upbeat expectations. On the other side, the EUR currency put a strong bid if the German data release better-than-expected by a significant margin.

Looking forward, traders will keep their eyes on the German Factory Orders. Our focus will also point to the European Central Bank President, Lagarde, who is set to deliver her speech at 1:00 pm on the day. The traders will closely listen to Lagarde’s statement for clues about the fresh direction on the ECB policies.

Daily Support and Resistance

  • S1 1.0905
  • S2 1.0959
  • S3 1.0979

Pivot Point 1.1014

  • R1 1.1033
  • R2 1.1068
  • R3 1.1122

EUR/USD– Trading Tips

On Thursday, the EUR/USD continues to trade with a bearish bias bear 1.1000 psychological level. The bearish channel that we spoke about is still there, and it’s keeping the pair in a selling mode. 

At the moment, the EUR/USD pair is likely to face immediate support around 1.1020 level, and violation of this can lead the EUR/USD prices towards 1.0925. The EUR/USD pair as already retrace back 1.1098, and it has the potential to show further selling bias. On the lower side, a breakout of the support level of 1.0990 can lead EUR/USD prices towards the 1.0945 area. 

GBP/USD– Daily Analysis

The GBP/USD pared its gains in the prior session, retreating 0.3% to 1.2997. The currency pair did not get any support from the better-than-expected U.K. services PMI. Likewise, ISM Non-Manufacturing PMI and ADP Employment Change sent the U.S. dollar higher.

On the flip side, the market risk-sentiment is improving gradually despite the coronavirus cases increased time by time, mainly due to the equities of China, which gained support on better than expected economic events. 

Today, the U.K. economic calendar looking empty due to the lack of activities. Therefore, traders will keep their eyes on the Nonfarm Productivity and Average Labor Costs to determine the next movement in the market. 

Besides, the U.S. Jobless Claims and comments from the Federal Reserve Bank of Dallas President Robert Kaplan will be a pivotal event to watch today. The headlines regarding coronavirus and U.K. politics will keep the driver seats.

    


Daily Support and Resistance

  • S1 1.2782
  • S2 1.2896
  • S3 1.2949

Pivot Point 1.301

  • R1 1.3063
  • R2 1.3123
  • R3 1.3237

GBP/USD– Trading Tip

The GBP/USD broke below 1.3050 support is to test the next support level of 1.2965. It’s the most crucial level for the GBP/USD as a violation of this level can lead Sterling prices further down towards 1.2900 and 1.2830 in the coming week.  

At the moment, the GBP/USD has formed three black crows candles above 1.2960 support level, which is suggesting a bearish trend in the GBP/USD. The MACD and RSI are holding in the bearish zone, supporting selling bias for the GBP/USD pair. 

USD/JPY – Daily Analysis

The USD/JPY gained 0.2% to 109.79, posting a three-day rally. The USD/JPY flashing green but still trading below the 110 level because traders await the U.S. Nonfarm Payrolls data at the end of the week for more evidence of a hotter economic performance. 

The USD/JPY is trading at 109.96, representing 0.16% gains on the day and consolidates in the range between the 109.72 – 109.97. The pair rose to 109.80 from the 109.30, mainly due to the report that Chinese researchers have produced a medicine that will use in treating the coronavirus.

It is worth to mention that the pair’s buyers continue to struggle to cross the 110 level. On the other hand, the U.S. bond yields rose during the trading day despite the recovery in the U.S. on Wall street. 

Whereas, the U.S. 10-year yields led global bonds, putting on +6bps to test 1.66% (1.58% to 1.64% after the news came that Chinese researchers had developed a drug that was useful in treating the coronavirus).

    

Daily Support and Resistance

  • S1 108.57
  • S2 109.12
  • S3 109.47

Pivot Point 109.66

  • R1 110.02
  • R2 110.2
  • R3 110.75

USD/JPY – Trading Tips

On Thursday, the USD/JPY pair is trading with a bullish bias in the wake of weakening Japanese yen. The pair has crossed over 109.300 resistance level, and it seems to head towards 109.850. On Wednesday, the USD/JPY is likely to find resistance around 110.300 after violating 109.850. While support remains at 109.250.  

The RSI and MACD have crossed over in the buying zone and are supporting the bullish bias. Let’s look for buying trades above 109.26 today.

All the best for today! 

Categories
Forex Market Analysis

Daily FX. Analysis, December 17 – Top Trade Setups In Forex – Eyes on UK Labor Market Figures! 

On Tuesday, the market trades with a risk-off sentiment as investors are still waiting for clarity about Brexit and Trade deal between the U.S. and China. The U.S. dollar was steady against other major currencies, with the ICE Dollar Index closing flat on the day at 97.15.

On Tuesday, the market trades with a risk-off sentiment as investors are still waiting for clarity about Brexit and Trade deal between the U.S. and China. The U.S. dollar was steady against other major currencies, with the ICE Dollar Index closing flat on the day at 97.15.

On Tuesday, the market trades with a risk-off sentiment as investors are still waiting for clarity about Brexit and Trade deal between the U.S. and China. The U.S. dollar was steady against other major currencies, with the ICE Dollar Index closing flat on the day at 97.15.

China’s official data showed that industrial production rose 6.2% on year in November (+5.0% expected), and retail sales grew 8.0% (+7.6% expected).

Economic Events to Watch Today

Let’s took at these fundamentals.

Economic Calendar by TradingView

 

EUR/USD – Daily Analysis

Today in the early Asian session, the EUR/USD currency pair flashing green and trading on the bullish track but failed to cross the 200-day moving average despite the fresh trade truce between the United States and China. The EUR/USD is presently trading at 1.1147, having faced rejection at the 200-day Moving Average at 1.1152. 

However, the EUR currency has repeatedly failed to close above the 200-day MA. For example, the Euro currency picked up a strong buying on Friday and climbed to a high of 1.12 only to end the day with moderate losses at 1.1118. 

Regarding U.S. economic data, the Empire Manufacturing Index posted 3.5 for December (below the 4.0 expected, up from 2.9 in November). The Markit U.S. Manufacturing Purchasing Managers Index (preliminary reading) declined slightly to 52.5 in December (below 52.6 expected) from 52.6 in November.

The monthly United States Housing Starts and Building Permits are scheduled for release at 13:30 GMT on Tuesday. The Eurozone Trade Balance (Oct), scheduled for release at 10:00 GMT, is unlikely to move markets. 

Daily Support and Resistance

  • S3 1.1079
  • S2 1.1111
  • S1 1.1127

Pivot Point 1.1143

  • R1 1.1159
  • R2 1.1175
  • R3 1.1207

EUR/USD– Trading Tips

Just like the rest of the forex pairs, the EUR/USD hasn’t made much progress on Monday despite a mixture of PMI data. The EUR/USD is trading with a slightly bullish above the bullish trendline, which is supporting the EUR/USD above 1.1125. Extension of a bullish bias above 1.1125 can keep EUR/USD optimistic until 1.1160 and 1.1185. The EUR/USD’s next support prevails around 1.1095 today,

 

GBP/USD– Daily Analysis

The GBP/USD currency pair flashing red and representing more than 60 pips decline to 1.3265, having hit the low of 1.3236 during the Asian trading hours. The bearish bias came mainly due to hard Brexit fears. As of writing, the GBP/USD currency pair is currently trading at 1.3295 and consolidates in the range between the 1.3236 – 1.3339. Looking ahead, the GBP/USD pair could come under pressure due to fresh Brexit concerns.

It should be noted that the victory of conservatives will help the United Kingdom Prime Minister Boris Johnson to pass the Bill to rule out European Union transition beyond 2020. The Departure Agreement Bill (WAB) is widely expected to be put for a 2nd reading in the House of Commons on this Friday.

Whereas, the Conservatives leader Boris Jonhson will not hesitate to repeat his promise regarding leave the region with deal or without a deal before 2020 ends. Despite that, the United Kingdom Prime Minster has repeatedly promoted the idea of the Canda-style free trade agreement, and UK PM will likely push for the same after the Bill gets the Parliaments’ approval.

Comments came from Robert Peterson that the PM Boris Johnson is committed to passing the Tory manifesto commitment to end the transition in just over a year from now. 

Looking forward, investors will seek more hints of the recent declines in the GBP from the political headlines. However, the traders will keep their eyes on the releases of the UK employment figures. A busy week of the UK calendar is worth watching ahead of the Bank of England policy meeting on Thursday. The consensus is for the unemployment rate to tick up to 3.9%, whereas wages growth eases a little to 3.4% YoY,” says Westpac ahead of the data release.

Daily Support and Resistance 

  • R3: 1.3722
  • R2: 1.3548
  • R1: 1.3441

Pivot Point 1.3374

  • S1: 1.3267
  • S2: 1.32
  • S3: 1.3025

GBP/USD– Trading Tip

The GBP/USD is trading bearish below 1.3362 as the pair seems to go for a retracement until 1.3240, which marks a 61.8% Fibonacci level. At the same mark, the 50 periods EMA is likely to support the GBP/USD. 

The RSI and MACD are holding in the buying zone, suggesting odds of a bullish reversal upon completion of 61.8% Fibonacci retracement. Today, consider taking buying trades above 1.3190 and bearish trades below 1.3274. 

USD/JPY – Daily Analysis

The USD/JPY currency pair is struggling to extend its recovery rally because the markets want more clarity about the fresh optimism surrounding the phase-one trade deal and Brexit concerns. As of writing, the USD/JPY currency pair is currently trading at 109.56 and consolidates in the range between 109.50 – 109.63. 

Even after the fresh trade truce of the Sino-US Phase-one deal, the United States and China trade relationships are still being termed as noisy ceasefire by the South China morning post.

On the other hand, ITV’s Robert Peterson thinks the risk of hard Brexit because the United Kingdom’s (UK) Prime Minister (PM) will soon forward the Bill that supports no transition delay beyond 2020.

Moreover, the risk tone gets heavier because the United States’ ten-year treasury yields decline to 1.87%, whereas the S&P 500 Futures losses 0.14% to 3,193 by the press time.

Apart from the trade/Brexit headlines, monetary policy meetings by the Bank of Japan (BOJ) and headline inflation will also entertain momentum traders during this week. Whereas the BOJ is not expected to change the current monetary policy, appreciation of the latest fiscal measures will likely support the Japanese yen (JPY) to strengthen further on Thursday. Moreover, Friday’s inflation data will probably keep exerting downside pressure on the Japanese currency.

The currency pair ignored the sluggish activity data from the United States during the Monday as risk-on sentiment increased due to optimism surrounding the United States and China trade deal. Looking forward, today’s United States Industrial Production, Fed speak, and housing market data can offer immediate direction to the pair movement.

Daily Support and Resistance

  • S3 108.91
  • S2 109.22
  • S1 109.39

Pivot Point 109.53

  • R1 109.7
  • R2 109.84
  • R3 110.15

USD/JPY – Trading Tips

On the technical side, the buyers await a clear break of the monthly high surrounding 109.75 to target 110.00 and May month high near 110.70. Meanwhile, 21-day Exponential Moving Average (EMA) near 109.00 holds the key to fresh declines towards the 108.45/40 support area.

The pair is heading towards the double top resistance level of around 109.700. Below this, the USD/JPY is likely to show a bearish correction of up to 38.2% level, which stays at 109.200. On the higher side, the bullish breakout of USD/JPY can lead the Japanese pair towards 110.300. The MACD and RSI are in support of the bullish trend. 

All the best!

Categories
Forex Market Analysis

Daily FX. Analysis, December 16 – Top Trade Setups In Forex – Eurozone’s PMI Figure Drives! 

The US Dollar Index was broadly flat at 97.17. The euro slipped 0.1% to $1.1121. Later today, research firm Markit will post December eurozone Manufacturing PMI (47.3 expected) and Services PMI (52.0 expected). The USD/JPY edged up 0.1% to 109.38.

The US Dollar Index was broadly flat at 97.17. The euro slipped 0.1% to $1.1121. Later today, research firm Markit will post December eurozone Manufacturing PMI (47.3 expected) and Services PMI (52.0 expected). The USD/JPY edged up 0.1% to 109.38.

The US Dollar Index was broadly flat at 97.17. The euro slipped 0.1% to $1.1121. Later today, research firm Markit will post December eurozone Manufacturing PMI (47.3 expected) and Services PMI (52.0 expected). The USD/JPY edged up 0.1% to 109.38.

Regarding U.S. economic data, retail sales rose 0.2% on month in November (below the +0.5% expected, +0.4% in October). Import prices increased 0.2% on month (as expected, -0.5% in October).

Later today, the Empire Manufacturing Index for December (5.0 expected) and the Markit US Manufacturing Purchasing Managers’ Index (52.6 expected) will be reported.

Economic Events to Watch Today

Let’s took at these fundamentals.

AUD/USD – Daily Analysis

The AUD/USD currency pair seen unchanged and consolidates in the narrow trading range between the 0.6875 – 0.6878. The currency pair remains depressed despite the fresh optimism over the Sino-US trade deal. As of writing, the Aussie currency pair is currently trading at 0.6875.

The AUD/USD currency pair picked up a buying near 0.6775 following the consumer spending data, which represented a rise in retail sales by 8% year-on-year during November, crossing the forecasted growth of 7.6% by a big range.

Industrial production rose 6.2% compared to an expected rise of 5%, marking an improvement from October’s 4.7%. Moreover, the People’s Bank of China has injected 300 billion Yuan into the system via a one-year medium-term lending facility. 

The AUD/USD currency pair did not succeed to gain on its early positive move and saw a dramatic intraday turnaround on Friday. Moreover, the uncertainty regarding the US President Donald Trump’s decision to cancel the December 15 tariff-hike on Chinese imports weighed heavily on the China-proxy Australian dollar, causing a drop in AUD/USD pair around 75 pips from an intraday high level of 0.6938 the highest since July 26.

The bullish sentiment remains weak, possibly due to the reports that Beijing is planning to lower its 2020 gross domestic product target to 6% from the current year’s 6.5%. 

Looking forward, the worries of a deeper recession in China in 2020 will likely continue to overshadow the phase one US-China trade deal and send the AUD lower.

Daily Support and Resistance  

  • S3 0.6759
  • S2 0.6824
  • S1 0.685

Pivot Point 0.6889

  • R1 0.6915
  • R2 0.6954
  • R3 0.7019

AUD/USD– Trading Tips

The AUD/USD pair is hanging around 0.6900, trading mostly bullish despite staying in the overbought zone. The traded higher further above the 0.6865 mark, the 61.8% Fibo retracement level of its November slide. In the 4-hour chart, the 20 SMA has hastened north over the bigger ones, all of them under the current mark. In contrast, the technical indicators lead to the north in overbought territory, without indications of bullish exhaustion. The rally is set to remain on a break over 0.6930, the next resistance.

GBP/USD– Daily Analysis

The GBP/USD currency pair still found on the bullish track and remain supportive mainly due to the United Kingdom Prime Minister Boris Johnson win who promised to leave the European Union (EU) swiftly before January 31, 2020. 

The GBP/USD currency pair traded bullish at 1.3388 and representing sizeable gains of +0.50%, having hit the high of 1.3398. By the way, the pair consolidates in the range between 1.3337 – 1.3398.

Prime Minister Johnson will welcome 109 new Conservative lawmakers to parliament and will repeat his promise to increase funding to the state health service on the day.

Moreover, the GBP/USD currency pair is also supported by the increased expectations of an improvement in the UK’s manufacturing sector activity, as the Markit Preliminary Manufacturing PMI for December is seen arriving at 49.4 against. 48.9 previous. The country’s Services PMI is expected to reach at 49.6 against. 49.3 last.

At the greenback front, markets still unexcited despite the details of the US-China Phase One trade deal. The US dollar index now tests the 97 handles, retreating from Friday’s highs of 97.24.

The GBP currency buyers will keep up the buying because the UK looks to clear the Brexit departure Agreement in the parliament before Christmas. In contrast, the Bank of England (BOE) may signal a willingness to change course on the monetary policy, with the United Kingdom election out of the way.             

Daily Support and Resistance

  • S3 1.3025
  • S2 1.32
  • S1 1.3267

Pivot Point 1.3374

  • R1 1.3441
  • R2 1.3548
  • R3 1.3722

GBP/USD– Trading Tip

The GBP/USD is presently consolidating around at1.3457, placing around 19-month high to 1.3515 during the US session yesterday. The UK election exit polls foretelling a big win for the incumbent Prime Minister Boris Johnson. 

The GBP/USD pair’s 14-day relative strength index (RSI) is now floating around 80.47. I must say it’s the highest mark since January 2018. An above 70-reading shows overbought situations. Consider capturing retracement below 

USD/JPY – Daily Analysis

The USD/JPY currency pair hit the bullish track and representing some moderate gains mainly due to fresh trade optimism between the United States and China. As of writing, the currency pair is currently trading at 109.38 and consolidates in the range of 109.31 – 109.44.

Notably, the currency pair had some good 2-way price moves on Friday and was impressed by the full market risk-on sentiment, which turned out to be one of the major reasons that affected the Japanese yen’s as a perceived safe-haven status. 

However, the USD/JPY pair quickly reversed an early decline to sub-109.00 levels and recovered to multi-month highs in the wake of optimism of UK Parliamentary elections.

However, the bullish momentum failed near the 109.70 regions after the disappointing release of the United States’ monthly retail sales data, which kept the greenback buyers on the defensive.]The uncertainty regarding the United States President Donald Trump’s decision to cancel the December 15 tariff-hike on Chinese imports further helped to the pair’s intraday pullback of around 35-40 pips.

It should be noted that the USD/JPY currency pair finally closed unchanged for the day but succeeded in recovering some positive traction. That might have been due to the United States Trade Representative Robert Lighthizer’s comments on Sunday, saying that the phase-one Sino-US trade deal is done. Under the agreement, China said it would increase agricultural purchases due to the US’ decision not to attempt a new round of tariffs.

Daily Support and Resistance

  • S3 108.42
  • S2 108.92
  • S1 109.13

Pivot Point 109.42

  • R1 109.63
  • R2 109.92
  • R3 110.42

USD/JPY – Trading Tips

The USD/JPY rose 0.8% to 109.40 as investors’ risk appetite grew. The pair is heading towards the double top resistance level of around 109.700. Below this, the USD/JPY is likely to show a bearish correction of up to 38.2% level, which stays at 109.200. 

On the higher side, the bullish breakout of USD/JPY can lead the Japanese pair towards 110.300. The MACD and RSI are in support of the bullish trend. 

All the best!

Categories
Forex Elliott Wave

The USDJPY and its 3-Year Triangle

The triangle is one of the three basic corrective patterns along with the Flat structure, with more variations within Elliott’s Wave Theory. In this educational article, we will review the

The triangle is one of the three basic corrective patterns along with the Flat structure, with more variations within Elliott’s Wave Theory. In this educational article, we will review the

The triangle is one of the three basic corrective patterns along with the Flat structure, with more variations within Elliott’s Wave Theory. In this educational article, we will review the basic concepts of the triangle pattern and then apply it to the USDJPY pair.

The Fundamentals

Triangles are one of the three basic corrective formations described by R.N. Elliott. Five internal segments characterize them. The inner legs overlap and follow an internal sequence as 3-3-3-3-3.

The following figure shows the different types of triangles. By simplification, we omitted the internal structure of each segment that composes the triangle pattern.

We should consider the nature of the triangle, a balance between the buying and selling forces. In this context, and under a conservative approach to trading, it is not desirable to trade within this internal structure. However, the breakout of price action across the wave (D) can provide a reliable entry to the market with reduced risk.

The 3-Year Triangle of USDJPY

The following chart corresponds to the USDJPY pair in its weekly timeframe, using a log scale. We observe the price action on the Japanese currency developing a Contracting Triangle structure that began at the end of 2016.

The next chart shows the USDJPY moving in a 12-hour timeframe. The pair shows the last internal segment corresponding to a wave (E) of Intermediate degree labeled in black.

At the same time, in the last figure, we can distinguish the price action developing an Expanding Triangle formation in a wave C of Minor degree labeled in blue. However, the RSI oscillator reveals in its progress the shape of a contractive triangle pattern.

It should be noted that when the price action develops an Expansive Triangle in a wave C, the pattern should correspond to an Expansive Diagonal formation. Remember that a diagonal pattern has five internal waves overlapped one with another. At the same time, each inner leg holds three segments.

Trading the USDJPY Triangle

The USDJPY pair in its 12-hour chart shows an incomplete expansive diagonal. Consequently, positioning on the long-side could still have endeavored with a short-term objective placed in the upper trendline of the diagonal. A likely target area would be between 109,716 and 110,551.

Considering that the invalidation level of the bullish segment is the bottom of the wave ((iv)) in green at 108,242, the breakdown and close of the price below this level could give us the first bearish scenario with a target at the end of the wave B labeled in blue located at 106,625.

Now, if the USDJPY price continues extending its falls below the end of wave C in blue and (D) in black located at 104,446, a major-degree bearish scenario would be activated. Under this context, the pair could see the psychological support of 100 yen per dollar.

Conclusions

Depending on the trader’s style and its risk aversion, the internal structure of the triangle pattern could be traded one timeframe shorter than the time frame in which the triangle has been identified.

We must remember that the internal structure of the triangle follows a sequence 3-3-3-3-3. Under this context, a three-wave corrective structure can be a Flat pattern (which has a subdivision 3-3-5); or it can also be a zigzag pattern (5-3-5). Therefore, an internal wave C could give a trading opportunity. However, knowing the nature of the triangle pattern, and considering it is formed by the struggle between buyers and sellers, the targets of the movements anticipated should be limited by the triangle formation.

Categories
Forex Market Analysis

Daily F.X. Analysis, November 27 – Top Trade Setups In Forex – U.S. GDP In Play! 

The U.S. Dollar Index was little changed on Tuesday, closing relatively flat on the day at 98.25. The euro gained 0.1% to $1.1022. The German GfK Consumer Confidence Index edged

The U.S. Dollar Index was little changed on Tuesday, closing relatively flat on the day at 98.25. The euro gained 0.1% to $1.1022. The German GfK Consumer Confidence Index edged

The U.S. Dollar Index was little changed on Tuesday, closing relatively flat on the day at 98.25. The euro gained 0.1% to $1.1022. The German GfK Consumer Confidence Index edged up to 9.7 in December (9.6 expected and in November).

On the fundamental’s front, the Conference Board Consumer Confidence Index plunged to 125.5 in November (127.0 expected) from 126.1 in October. Wholesale inventories rose 0.2% on month in October (as expected), while new home sales fell to an annualized rate of 733,000 units (705,000 units estimated) from 738,000 units in September. Let’s took at today’s trade setups. 

Economic Events to Watch Today

Let’s took at these fundamentals.

EUR/USD – Daily Analysis

The EUR/USD currency pair flashing red and hit the record lows to trade below the seven months lows. At the moment, the currency pair is currently trading at 1.1015.

The reason behind decreased uncertainty could be the recent progress in the United States and China trade deal, which is likely to resolve issues. 

For now, the focus is likely to be on the U.S. data Q3 GDP, Personal Spending (Oct), Durable Goods Orders (Oct), Weekly Jobless Claims. The 3rd-quarter annualized GDP is forecasted to be unchanged at 1.9%. The economy increased by 2% and 3.1% in the 2nd and the 1st quarter as well.

With that being said, a prolonged period of low volatility often paves the way for a big move on either side. The level of uncertainty will drop if both nations reach a trade agreement. This ultimately can drive a significant drop in the common currency against the U.S. dollar. 

Daily Support and Resistance

  • S3 1.0959
  • S2 1.0988
  • S1 1.1001
  • Pivot Point 1.1017
  • R1 1.103
  • R2 1.1045
  • R3 1.1074

EUR/USD– Trading Tips

On the technical side, indicating the route of least resistance is to the bearish. The 14-day relative strength index is suggesting selling conditions with as the RSI value holds below 50, and the daily MACD histogram is again printing deeper bars below the zero line, a sign of strengthening bearish momentum. The double bottom pattern on the 4-hour chart is extending support to the direct currency pair. Let’s look for staying bullish above or bearish below 1.1000 level today to target 1.1055 on the upper side and 1.0985 on the lower side. 

GBP/USD– Daily Analysis

The GBP/USD currency pair found on the bearish track and still on the backfoot while dropping 1.2850, mainly due to showing depreciation in the ruling Conservative Party lead. The greenback strength leaves a negative impact on the GBP/USD currency pair.

The Tory announcement is already under criticism for its lack of defense, failure to mention promises on the National Healthcare System (NHS), and Brexit’s deadline is keeping the political depression for the ruling party. The Independent says that former senior judge blames the United Kingdom’s (U.K.) ‘s current Prime Minister for his reckless private life.

On the other hand, the United States President Donald Trump continues its hopes of a phase-one deal with China even after the media releases from Beijing that blamed the U.S. for unfair behavior. The greenback stays on the bullish track across the board because investors still trust the U.S. dollar during the risk-on sentiment.

For now, there is no significant data and event is scheduled to release from the United Kingdom, the United States economic calendar is full of critical figures ranging from the 2nd-version on 3rd-quarter (Q3) Gross Domestic Product (GDP) to October month Durable Goods Orders. The markets will keep their eyes on the U.S. Personnel Income and Spending, coupled with the Core Personal Consumption Expenditure Index.

Ahead of the data, T.D. Securities anticipates the Core PCE to stay around 0.7% YoY whereas also expecting Durable Goods Orders to recover to -1.0%.

Daily Support and Resistance

  • S3 1.2748
  • S2 1.2818
  • S1 1.2859
  • Pivot Point 1.2887
  • R1 1.2928
  • R2 1.2956
  • R3 1.3025

GBP/USD– Trading Tips

On Wednesday, the GBP/USD is now heading lower to test the triple bottom support area of 1.2820. The cable seems to close a tweezers bottom pattern on the 2-hour chart, which is famous for driving a bullish trend in the market. So here we can expect GBP/USD to trade bullish above 1.2820 to target 1.2880 later today. 

 

USD/JPY – Daily Analysis

The USD/JPY currency pair found on the bullish track, extending its recent recovery rally. As of writing, the currency pair currently trading at 109.15. The USD/JPY pair hit the two-weeks high during the Asian session mainly due to the positive headlines which came out from the United States and China regarding trade deal.

The pair closed beyond 200-day Simple Moving Average (SMA) for the first time since early November because the market’s risk sentiment further improved. Traders, the primary reason behind such a drop in uncertainty is increasing expectations that the United States (U.S.) and China will soon sign an initial, or phase-one, trade deal.

Elsewhere, the new trade headlines came from the United States President Donald Trump that we are very close to making a deal with China. The South China Morning Post’s (SCMP) story highlights the Commerce Secretary’s order to protect telecommunication networks and their supply chains from national security warnings. Though, the same fails to get much of the attention.

At the Fed front, the positive comments from the Federal Reserve (Fed) Chairman Jerome Powell and Governor Lael Brainard also supported the USD/JPY currency pair. Notably, the Federal Reserve (Fed) Chairman Jerome Powell praised the current economic status and the present monetary policy, whereas Governor Brainard said that the economic risk outlook still weak, but the sentiment seems to be improving. 

Traders did not give much focus on the comment from the President of the Federal Reserve bank of Dallas, Robert Kaplan, that the United States economy has a good opportunity to grow by 25 in the coming year. Still, unfortunately, the growth in the 4th-quarter is going to be weak.

The 2nd version of the 3rd-quarter US Gross Domestic Product (GDP) and October month Durable Goods Orders will be closely observed in the U.S. economic calendar as well as the comments from the Bank of Joana board member Makoto Sakurai, and trade headlines can be kept for intermediate direction.

Daily Support and Resistance

  • R3: 109.38
  • R2: 109
  • R1: 108.77
  • Pivot Point 108.61
  • S1: 108.39
  • S2: 108.23
  • S3: 107.84

USD/JPY – Trading Tips

The USD/JPY is trading at 109.100, and it has just violated the horizontal resistance area of 109. The closings of bullish candles above 109 mark are suggesting further buying until 109.300 and 109.450. Besides, the MACD and RSI are still holding in the bullish zone. Consider taking buying trades over 109 to target 109.35 today. 

All the best!

Categories
Forex Market Analysis

Daily FX Brief, November 26 – Major Trade Setups – Stronger Dollar Rules the Market

The U.S. Dollar Index rose 0.3% on the day to 98.27, lifted by stronger-than-expected U.S. economic data. The euro slid 0.3% to $1.1024. The Markit eurozone Manufacturing PMI posted 46.6

The U.S. Dollar Index rose 0.3% on the day to 98.27, lifted by stronger-than-expected U.S. economic data. The euro slid 0.3% to $1.1024. The Markit eurozone Manufacturing PMI posted 46.6

The U.S. Dollar Index rose 0.3% on the day to 98.27, lifted by stronger-than-expected U.S. economic data. The euro slid 0.3% to $1.1024. The Markit eurozone Manufacturing PMI posted 46.6 in November (46.4 expected, 45.9 in October), while Services PMI declined to 51.5 (52.4 expected) from 52.2.

The sentiment was lifted after Chinese President Xi Jinping called for Beijing and Washington to strengthen communications.

Regarding U.S. economic data, the Markit U.S. Manufacturing Purchasing Managers’ Index (preliminary reading) posted 52.2 in November (51.4 expected, 51.3 in October). The University of Michigan Consumer Sentiment Index (final reading) came in at 96.8 (95.7 expected).

Economic Events to Watch Today

Let’s took at these fundamentals.

EUR/USD – Daily Analysis

The EUR/USD currency pair looking flat and consolidates in the narrow range of 1.1012 / 1.1016. Looking forward, this pair will likely hit the 4-day winning rally mainly due to the hints came regarding a rate cut from the Federal Reserve President Jerome Powell on Monday that interest rates are unlikely to increase anytime soon.

Notably, Powell’s comments indicate the Federal Reserve is likely to hold rates steady for some time until the inflation spikes well above 2 percent.

Therefore, the markets will likely offer the greenback and supporting the EUR/USD currency pairs to hit the bullish level for the first time after November 19. As we know, the currency pair found oo the bearish track yesterday to confirm the 4th-consecutive daily decline.

While Powell’s comments may weigh over the U.S. dollar, the upside in the common currency looks limited, courtesy of weaker Eurozone and German PMIs released last Friday.

Whereas on the other hand, the Federal Reserve President Jerome Powell’s comments could leave the pressure on the greenback, the bullish move in the EUR currency looks limited in the wake of weaker Eurozone and the German PMIs released last Friday.

At the Sino-US front, the report came that the United States and China have reached on the solving trade deal and reduced the risk appetite sentiment in the market. That is visible from the flat action in the Chinese Yuan and the Australian dollar currency. Whereas, the futures on the S&P 500 are also trading in a sideways manner. 

    

Daily Support and Resistance

S3 1.1036

S2 1.1056

S1 1.1067

Pivot Point 1.1076

R1 1.1087

R2 1.1095

R3 1.1115

EUR/USD– Trading Tips

The EUR/USD traded as we forecast to drop to 1.1010 level after forming a bearish hammer candle during the previous week. For the moment, the EUR/USD is trading at 1.1020 level and has developed a bullish engulfing pattern on the 2-hour chart. It’s suggesting strong chances of a bullish reversal until 1.1040 and 1.1060 the 38.2% and 61.8% Fibonacci resistance areas. Let’s consider staying bullish above 1.1015 level today to target 1.1060. 

GBP/USD– Daily Analysis

The GBP/USD currency pair sidelined and consolidates in the narrow range near the 1.2900 mainly due to traders takes clues from the trade news and Federal Reserve Chairman Jerome Powell diverting markets attention off from the United Kingdoms matters.

At the Sino-US front, the report came that the official from the United States and China discussed the multiple ways to resolve the trade deal matter over the phone call raised the chances of the phase-1 deal between the world’s biggest nations. Traders are ignoring the rising uncertainty regarding the 2nd-phase deal.

Moreover, the United States Federal Reserve Chairman Jerome Powell crossed wires while delivering the speech at the Providence Chamber of Commerce Annual Meeting in Rhode Island. The Fed avoided giving any fresh hints regarding future monetary policy. By the way, his positive preference for household spending ruled out the negative comments regarding global trade and jobs increase.

As well as, the greenback increases its recent rally, whereas the risk sentiment stays almost positive due to the United States’ 10-year treasury yields and major stock indices.

In the United Kingdom (U.K.), the ruling Conservatives and the opposition parties are at each other after the Tory leader, Boris Johnson, released the party’s announcement during the weekend. Whereas the Labour Party is struggling to detect mistakes in the Tory promises, ordering from National Healthcare System (NHS) to Defence, the Liberal Democrats (LibDems) doubts the Prime Minister (PM) Boris Johnson led to party’s ability to offer smooth Brexit before the Christmas.

There is no significant data and event for decorating the economic calendar, so the traders will keep their eyes on the U.S. catalysts to plan near-term trading bias. Moreover, the 2nd-tier housing and manufacturing data will join Consumer Confidence and speech from the Fed Governor Lael Brainard.

Daily Support and Resistance

S3 1.2651

S2 1.2756

S1 1.2794

Pivot Point 1.2862

R1 1.29

R2 1.2967

R3 1.3073

GBP/USD– Trading Tips

On Tuesday, the GBP/USD has opened higher to 1.2865 following a massive fall to 1.2822 on Friday, which would yield consolidation ahead of another bearish wave from 1.2985 extends to 1.2775. Lets us reckon Nov’s low of 1.2769 as it supports the GBP/USD around the same level if 1.2825 level gets violated. Consider staying bearish below 1.2875 level today to target 1.2825 

 

USD/JPY – Daily Analysis

The USD/JPY closed at 108.917 after placing a high of 108.975 and a low of 108.596. Overall the movement for USD/JPY remained Bullish that day.

China said on Sunday that it would seek to improve protections for intellectual property rights, including raising the upper limits for compensation for rights violations. 

China rolled out plans to strengthen its rules on copyrights, patents, and trademarks. This subject has been one core sticking point in more than a year of trade negotiations with the United States.

It was reported that by 2022, China would be making progress in issues that have affected intellectual property rights enforcement, such as low compensation, high costs, and the difficulty of proof. And that a better system of protection should be placed by 2025.

The rules around Intellectual property rights have been a major complaint against China and have been boosting the dispute between the most significant economies from the year. It was reported by US International trade Administration in 2018 that the estimated Intellectual Property theft has cost American businesses up to $600 billion a year.

The unauthorized access to a wide range of commercially valuable business information, technical data, trade secrets, and proprietary internal communications by the Chinese Government has been a burden on US commerce. In response to this, the need to address intellectual property rules came out against China by Trump administration, which led to increased tariffs on thousands of products and cast uncertainty on business activity across the globe.


Daily Support and Resistance

R3: 109.38

R2: 109

R1: 108.77

Pivot Point 108.61

S1: 108.39

S2: 108.23

S3: 107.84

USD/JPY – Trading Tips

The USD/JPY is trading at 108.700, and it has just violated the triple top resistance area of 108.600. The closings of bullish candles above 108.600 level are extending support to the safe-haven currency USD/JPY. With this, the market opens further room for buying until 109.090 for the USD/JPY pair. Besides, the MACD and RSI are still holding in the bullish zone. Consider taking buying trades over 108.650 to target 109 today. 

All the best!

Categories
Forex Market Analysis

Daily FX Brief, November 25 – Major Trade Setups – Stronger Dollar In Play! 

The U.S. Dollar Index rose 0.3% on the day to 98.27, lifted by stronger-than-expected U.S. economic data. The euro slid 0.3% to $1.1024. The Markit eurozone Manufacturing PMI posted 46.6

The U.S. Dollar Index rose 0.3% on the day to 98.27, lifted by stronger-than-expected U.S. economic data. The euro slid 0.3% to $1.1024. The Markit eurozone Manufacturing PMI posted 46.6

The U.S. Dollar Index rose 0.3% on the day to 98.27, lifted by stronger-than-expected U.S. economic data. The euro slid 0.3% to $1.1024. The Markit eurozone Manufacturing PMI posted 46.6 in November (46.4 expected, 45.9 in October), while Services PMI declined to 51.5 (52.4 expected) from 52.2.

The sentiment was lifted after Chinese President Xi Jinping called for Beijing and Washington to strengthen communications.

Regarding U.S. economic data, the Markit U.S. Manufacturing Purchasing Managers’ Index (preliminary reading) posted 52.2 in November (51.4 expected, 51.3 in October). The University of Michigan Consumer Sentiment Index (final reading) came in at 96.8 (95.7 expected).

  

Economic Events to Watch Today

Let’s took at these fundamentals.

 

EUR/USD – Daily Analysis

The EUR/USD currency pair flashing red and will likely hit the bearish level below 1.10 on the day if the German IFO data ignore expectations. 

As of writing, the EUR/USD currency pair dropped from 1.1058 to 1.1014. At the end of the week, the EUR/USD was seen trading as a bearish at 1.1097, in the wake of mixed German PMIs and the dismal Eurozone PMIs. It should be noted that European Central Banks President Christianne Lagarde said the global economic uncertainty is high and asked for a fiscal boost, as required.

The recent bearish high setup will likely retest of 1.10. The pairs bearish sentiment is likely to be stronger due to the fading United States and China’s optimism. Whereas the United States and China phase-one trade deal seems not to happen soon, by the way, both nations struggling to reach on a positive outcome. Notably, the German economy has paid a heavy price for the year-long trade tensions.

The greenback found on the bullish track in the wake of unexpectedly better U.S. Markit PMIs and a bullish revision to the University of Michigan consumer sentiment.

According to the situation, there are very low reasons for the shared currency traders to take a buying under the single currency on the day, and the support at 1.10 will be likely to be failed if the German IFOs miss expectations, which is scheduled to release 09:00 GMT.

That German economy is suffering recession risk is generally accepted by now. So, the forward-looking IFO – Expectations (Nov) index will take priority over the Business Climate and the Current Assessment number. The Expectation index is seen reading at 92.5 against 91.5 in October.

Daily Support and Resistance

S3 1.0894

S2 1.0967

S1 1.0993

Pivot Point 1.104

R1 1.1066

R2 1.1113

R3 1.1187

EUR/USD– Trading Tips

The EUR/USD traded as we forecast to drop to 1.1010 level after forming a bearish hammer candle during the previous week. For the moment, the EUR/USD is trading at 1.1020 level and has developed a bullish engulfing pattern on the 2-hour chart. It’s suggesting strong chances of a bullish reversal until 1.1040 and 1.1060 the 38.2% and 61.8% Fibonacci resistance areas. Let’s consider staying bullish above 1.1015 level today to target 1.1050. 

GBP/USD– Daily Analysis

The GBP/USD currency pair found on the bearish track and currently trading at 1.2850. The Cable pair got the support from the polls showing a hike in Tory support for the December snap election before losing ground due to doubts arising from the ruling party’s latest announcement.

During the weekend, the United Kingdom Prime Minister Boris Johnson released the ruling Conservative Party’s announcement that offers many austerity measures apart from smooth Brexit. Notably, the party’s commitments regarding a National Healthcare System (NHS) budget by £33.9 billion by 2023-24, an offer of 50,000 nurses and not to increase rates of income tax, national insurance or VAT till the next five years took significant attention.

However, the latest series of polls keep the Conservatives at the front seat with more than 10% points of a lead over other parties.

The GBP/USD currency pair was found on the strong bearish track on Friday, mainly due to preliminary figures of activity number keep portraying the markets Brexit fears. On the other side,

the same conflicts with the United States statistic that kept the U.S. dollar.

At the greenback front, the strong buying in the greenback came mainly due to optimism surrounding the United States and China trade deal after the United States President Donald Trump said that the trade deal with China is very close. Although the confidence remains under check with the Donald Trump administration’s willingness to take a good look at the Hong Kong bill, which in turn could resume the conflict between the U.S. and China, whereas also negatively affecting the trade negotiations.

The United Kingdom CBI Distributive Trade Survey and the United States Chicago Federal Reserve National Activity Index, as well as the US Dallas Fed Manufacturing Index, will keep under the spotlight. Moreover, the market will keep their eyes on the trade and political headlines for fresh impulse.

Daily Support and Resistance

S3 1.2651

S2 1.2756

S1 1.2794

Pivot Point 1.2862

R1 1.29

R2 1.2967

R3 1.3073

GBP/USD– Trading Tips

On Monday, the GBP/USD has opened higher to 1.2865 following a massive fall to 1.2822 on Friday, which would yield consolidation ahead of another bearish wave from 1.2985 extends to 1.2775. 

Lets us reckon Nov’s low of 1.2769 as it supports the GBP/USD around the same level if 1.2825 level gets violated. Consider staying bearish below 1.2895 level today. 

 

USD/JPY – Daily Analysis

The USD/JPY currency pair is flashing green and found on the bullish track despite few headlines during the weekend regarding geopolitical themes that have kept markets on alert. At of writing, the USD/JPY currency pair is currently trading at 108.66 and consolidates in the narrow range of 108.63 and 108.69.

The market’s focus, as described in this week’s Asia open. Recap of latest progress as risk-on tones appear with trade wars and Brexit. The fresh news is slightly more favorable for risk appetite, possibly reducing the Japanese yen’s progress for the time being with USD/JPY moving between 108.48 and 108.76 on Friday.

Meanwhile, the U.S. dollar is bid on its right after dome promising data from Friday. U.S. November flash Markit PMIs contrasted with the European and U.K.’s releases, beating expectations manufacturing climbed to 51.6 (vs. est. 51.0, prior 50.6), and services rose to 52.5 (est. 51.4, prior 51.3).

For the U.S. calendar, we have the Producer Price Index and Consumer Price Index data, which analysts at T.D. Securities said suggest core PCE inflation could remain steady at 1.7% YoY in October, even after a notable MoM increase in healthcare prices. On the other hand, headline PCE likely rose a tenth to 1.4% YoY. Separately, we expect personal spending to advance 0.2% MoM for a 3rd-consecutive month in October, with a firm increase in services spending leading the upside.

Daily Support and Resistance

S3 108.11

S2 108.37

S1 108.51

Pivot Point 108.62

R1 108.77

R2 108.88

R3 109.13

USD/JPY – Trading Tips

The USD/JPY is trading at 108.700, and it has just violated the triple top resistance area of 108.600. The closings of bullish candles above 108.600 level are extending support to the safe-haven currency USD/JPY. With this, the market opens further room for buying until 109.090 for the USD/JPY pair. Besides, the MACD and RSI are still holding in the bullish zone. 

Consider taking buying trades over 108.650 to target 109 today. 

All the best!

Categories
Forex Market Analysis

Daily FX Brief, November 18 – Major Trade Setups – Risk-on Sentiment In Play

On Monday, the market trades with a risk-on sentiment over the faded safe-haven appeal. Significant forex pairs indicated time on Monday as traders observed to whether Washington and Beijing can

On Monday, the market trades with a risk-on sentiment over the faded safe-haven appeal. Significant forex pairs indicated time on Monday as traders observed to whether Washington and Beijing can

On Monday, the market trades with a risk-on sentiment over the faded safe-haven appeal. Significant forex pairs indicated time on Monday as traders observed to whether Washington and Beijing can promptly approve an agreement to end a trade war that has been a drag on word’s economic growth.

  EUR/USD – Daily Analysis

The EUR/USD currency pair hit the bullish track and currently trading at 1.1061, As of writing, the pair consolidates between the range of 1.1048 – 1.1065 on the day and hit the weekly highs at 1.1065 mainly due to greenback weakness against the bucket of currencies. The buyers join the latest bullish trend, awaiting fresh trading clues and keep their eyes on ECB-speak.

On the EUR-side of the equation, the Eurozone October inflation came in as expected, up by 0.7% YoY and core CPI up by 1.1%, which supported the continuing bullish drive in the common currency.

Looking forward, the buyers target the 100-DMA now located at 1.1093 should the recovery momentum continue. On the other side, the 50-DMA at 1.1042 could defend the downside if the ECB speakers support dovish expectations. However, the United States and China’s trade progress will keep under the spotlight for getting the fresh impulse.

    


Daily Support and Resistance

S3 1.0957

S2 1.0999

S1 1.1026

Pivot Point 1.1042

R1 1.1069

R2 1.1084

R3 1.1126

EUR/USD– Trading Tips

The EUR/USD proceeds to trade higher, violating the resistance level of 1.1000, which now is working as a support. On the 4 hour timeframe, the EUR/USD has three white soldiers candlestick pattern, which is signaling chances of further buying in the EUR/USD. At the moment, the EUR/USD is holding at the resistance level of 1.1065 as above this; the pair can continue to soar until 1.1080. So consider staying bullish above 1.1065 and bearish below the same level today.

GBP/USD– Daily Analysis

The GBP/USD currency pair consolidates in the range of 12909 – 1.2933, representing 0.20% gains on the day. As of writing, the pair is currently trading at 1.2925 and faced a month old falling trend line resistance due to the increasing expectations of Tory leadership after the December elections. As well as the hardship for the United Kingdom Prime Minister Boris Johnson, limit the further pair’s upside.

The market’s trade sentiment still slows with the United States’ ten-year treasury yields taking rounds to 1.82%, whereas most Asian shares are flashing mixed signals.

Looking forward, traders will now keep their eyes on British prime minister Boris Johnson’s speech at Confederation of British Industry’s annual conference for getting a new direction to move ahead. At the economic calendar front, the US NAHB Housing Market Index figures for November, expected to remain at 71, will keep the thin line of statistics. However, trade and political headlines will keep under the spotlight.


Daily Support and Resistance

S3 1.2793

S2 1.2845

S1 1.2874

Pivot Point 1.2897

R1 1.2926

R2 1.2949

R3 1.3001

GBP/USD– Trading Tips

The GBP/USD continues to trend upward to test our previously suggested upper corner of a wide trading range of 1.2970 – 1.2780. 

The MACD and RSI are lingering in overbought territory as their values linger at 0 and 50, respectively. Besides this, the chances of bullish correction are becoming very strong. 

At the time, the GBP/USD trades at 1.2940 level, and it may find support immediate support around 1.2920. I will consider taking buying positions above 1.2920 and bearish positions if this level breaks on the lower side. 

USD/JPY – Daily Analysis

The USD/JPY currency pair consolidates in the narrow range between the 108.75 and 109.00, mainly due to intensifying tensions in Hong Kong and lack of trade war hopes.

So, the risk-off sentiment raises so far, with S&P 500 futures down -0.15%, Treasury yields falling almost 0.50%, whereas the Asian equity markets trade with moderate losses. The Japanese Yen currency still on the supported track and keeping a break above the 109 range.

If talking about the greenback, the U.S. Dollar still on the bearish track due to the losses in the Treasury yields. As in result, this situation sending lower the USD/JPY currency pair. Moreover, the investors are on the waiting mood and await some transparency regarding the United States and China trade deal and FOMC minutes for fresh trading direction, because the United States economic calendar seem light during this week.

As of writing, the U.S. Dollar Index traded 0.1% lower to 97.810. The Federal Reserve will announce the minutes of it’s October meeting on Wednesday, and several Federal Reserve policymakers are scheduled to speak before the upcoming Thanksgiving holiday.


Daily Support and Resistance

S3 107.96

S2 108.33

S1 108.55

Pivot Point 108.7

R1 108.93

R2 109.08

R3 109.45

USD/JPY – Trading Tips

The USD/JPY is trading at 108.90, crossing over 61.8% Fibonacci retracement level. This level also marks a double bottom resistance level, but that has now been violated and may keep the USD/JPY pair supported today.

The violation of the 108.90 level can extend buying until 109.200. The MACD and RSI are also supporting the bullish trend in the USD/JPY pair. 

All the best!

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

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

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

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

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

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
Forex Market Analysis

Daily FX Brief, October 22 – Major Trade Setups – Brexit Parliamentary Votes Ahead! 

The Canadian dollar continued to trade bullish around three-month high on Tuesday as the market seems to celebrate the re-election of the Liberal government, 

“You did it, my friends. Congratulations

The Canadian dollar continued to trade bullish around three-month high on Tuesday as the market seems to celebrate the re-election of the Liberal government, 

“You did it, my friends. Congratulations

The Canadian dollar continued to trade bullish around three-month high on Tuesday as the market seems to celebrate the re-election of the Liberal government, 

“You did it, my friends. Congratulations,” Trudeau told supporters in Montreal early on Tuesday.

Despite this win, few of the traders are worried that the Liberals need to depend upon an opposition party to govern the government. 

Economic Events to Watch Today

Let’s took at these fundamentals.

Economic Calendar by TradingView

 

XAU/USD– Daily Analysis

On Tuesday, the yellow metal gold is trading mostly muted, pressed down by floating Asian shares that helped growth in trade discussions between the United States and China, but gained relief from a lack of certainty in the trade talk details.

The lack of clarity over Brexit has kept the gold prices inside a rang for almost two weeks. But on Saturday, some of the uncertainty cleared up from the market after the vote of U.K. parliament against PM Johnson’s Brexit Deal. Gold prices reacted to that news on Monday and showed a slight Bearish trend at the starting day of the week.

The precious metal gold continues to maintain a sideways range of $1,500 to $1,480. At the moment, the gold prices are taking a bullish turn as sellers seem to make profit-taking ahead of the Brexit Parliament vote today. 

Besides, the Peoples Bank of China (PBOC) reduced the mortgage rate from 4.25% to 4.20%. The LPR is estimated based on the range over the medium-term Loan Facility each month. 

Gold may face a bearish trend if the yield drops alliance with a bullish breakout over 1.80%. Nevertheless, the yellow metal is displaying flexibility by neglecting losses. The gold mostly falls due to the Central Bank’s hawkish policy.


Daily Support and Resistance   

S3 1472.23

S2 1480.87

S1 1485.48

Pivot Point 1489.51

R1 1494.12

R2 1498.15

R3 1506.79

XAU/USD– Trading Tips

Gold prices drifted lower on Monday and but the Tuesday sessions are bringing bulls. Gold is poised to test resistance around 1,491, which is extended by the bullish trendline resistance. 

Gold may find support bear near the triple bottom support level of 1,480. The MACD histogram is marking in the red with a smooth trajectory that leads to consolidation. Today, consider staying bearish below 1,492 and bullish above 1,480. 

 

EUR/USD – Daily Analysis

The Euro was little changed at $1.1152, while USD/JPY gained 0.2% to 108.61. The Euro traded mostly unchanged during the day on Monday, as traders didn’ find any reason to determine it’s direction. The market is presently a bit overstretched, so I would not be amazed at all to detect a bit of a pullback occurring.

The Euro has been comparatively low throughout the day on Monday, as we proceed to see much choppiness at the peak of a significant move. 

Studying the 4-hour chart, the 200-day EMA is also rising beyond the 61.8% Fibonacci retracement mark, a range that should bring much attention as well. With that being said, I am not a tremendous fan of attempting to jump in and begin selling instantly. We need to wait for a few checks; especially, the Brexit Parliament Vote is something than can trigger sharp volatility in the market. 


Daily Support and Resistance

R3: 1.1238

R2: 1.1197

R1: 1.1174

Pivot Point 1.1156

S1: 1.1133

S2: 1.1116

S3: 1.1075

EUR/USD – Trading Tips

The bullish engulfing candle over 1.1100 level pushes the currency pair towards the 1.116 level. The RSI and MACD are yet dispensing a buying bais, though the EUR/USD pair may exhibit retracement till 1.1130 ere dispensing a new bullish trend. 

Consider staying bearish below 1.1156 level today to target 1.1135 on the lower side.

USD/JPY – Daily Analysis

The USD/JPY was closed at 108.598 after placing a high of 108.662 and a low of 108.290. The overall trend remained Bullish that day.

At 4:50 GMT, the Trade Balance for September from Japan showed a figure of -0.10T against the expectations of -0.17T and supported the Japanese Yen. The All industrial activities of Japan for September came in as 0.0% against the expectations of 0.1% at 9:30 GMT.

USD/JPY showed an upward trend in the beginning day of the week, the hopes that U.K. Parliament would approve the re-voting for the Brexit deal caused high-risk factors in the market, and traders started buying USD/JPY under that influence. But when the U.K. parliament denied taking another vote on the same issue, the pair’s upward trend suffered.

Additionally, on Monday, the 10-year U.S. Treasury Bond Yield showed a growth of more than 1.5% and added in the upward trend of USD/JPY.

Furthermore, the White House economic advisor on Monday stated that US-China talks were going very well. If the written agreement would get signed in November, then the December tariff hikes could be avoided. This caused an increased demand for U.S. dollars in the market, and hence, USD/JPY surged.



Daily Support and Resistance

R3: 108.99

R2: 108.78

R1: 108.68

Pivot Point 108.57

S1: 108.47

S2: 108.36

S3: 108.15

USD/JPY – Trading Tips

The USD/JPY continues to trade a bullish channel, which is extending support at 108.350. On the lower side, the violation of 108.350 can extend bearish rally until the 108 level. Overall, the MACD and Stochastics are holding in the selling zone, signaling chances of a bearish bias.

The USD/JPY may find an immediate resistance at 108.57, and that’s I think is a perfect level to open sell positions. On the upper side, violation of 108.57 can extend buying until 108.950

All the best!  

 

Categories
Forex Market Analysis

Daily FX Brief, October 11 – Major Trade Setups – Canadian Job Report On Radar!

The Dollar Index dropped 0.4% on the day to 98.68 on Thursday, as Brexit deal hopes boosted the Euro and the British pound. Meantime, U.S. President Donald Trump said journalists

The Dollar Index dropped 0.4% on the day to 98.68 on Thursday, as Brexit deal hopes boosted the Euro and the British pound. Meantime, U.S. President Donald Trump said journalists

The Dollar Index dropped 0.4% on the day to 98.68 on Thursday, as Brexit deal hopes boosted the Euro and the British pound. Meantime, U.S. President Donald Trump said journalists on Thursday: “We just completed an agreement with China, we are doing very fine, we are having another one tomorrow. I am reaching with the vice-premier over at the White House, and I think it is going well.”

Official data revealed that U.S. consumer prices were even on month in September (+0.1% anticipated and in August). The U.S. Labor Department announced that initial jobless claims amounted to 210K. Following today, U.S. import is predicted to be stable for September versus -0.5% in August. The University of Michigan Sentiment is supposed to get in at 92 for the October preliminary reading versus 93.2 in September.

Economic Events to Watch Today

Let’s took at these fundamentals.

 

EUR/USD – Daily Analysis

The EUR/USD currency pair hit the bullish track and struggling to catch break above the crucial level of around 1.1000 due to trade optimism. Moreover, the EUR/USD currency pair could extend its gains if the European Central Bank meeting declares the statement unexpectedly less dovish. 

As of writing, the EUR/USD currency pair took 0.16% gains in the Asian hours as traders sold greenback on trade optimism and announce that the United States is planning to start the currency deal with China. On the other hand, the report came that President Donald Trump may issue a license that will permit a few companies of the United States to supply products to Chinas Huawei.

At the ECB front, the European Central Bank meeting regarding monetary policy is scheduled to happen at 11:30 GMT.

The Central Bank reduced its deposit rate by the 10-basis-points to -0.50% during September and also announced a new bond-buying plan that is scheduled to start from November.

Distinctly, the EUR currency may take a buying trend if the ECB meeting underscores the growing dissent within the Governing Council. Moreover, the EUR may come under pressure and hit the bearish bias if the meeting reports increased odds for more rate cut.


Daily Support and Resistance

S3 1.0904

S2 1.0938

S1 1.0956

Pivot Point 1.0973

R1 1.099

R2 1.1008

R3 1.1042

EUR/USD – Trading Tips

The pair is currently trading at 1.0987, 21-day moving average. The technical line has been closing bullish move since October 3, and this level is considered as a support for the buyers. 

A close above the key Moving Average would open the doors for a stronger corrective bullish move, possibly to 1.1110 (September 13 high).

Today consider staying bullish 1.1025 as the EUR/USD may stay bearish below and bullish above this level. 

 

USD/JPY – Daily Analysis

The USD/JPY currency pair hit the session high of 108.13 and increased more than 20 pips and presently trading at 108.04, due to President Donald Trump’s positive comments related to trade talks.

President Donald Trump’s comment that the trade talks with China are going well and that a deal could be reached on a positive outcome.

On the other hand, the demand or the anti-risk Japanese Yen declined due to the United States President Donald Trump’s positive comment related to trade talks.

The futures on the S&P 500 are presently showing 0.15% increases. The index increased by 0.64% on Thursday, due to trade talks continued, denying reports released in the Asian trading hours, which said Chinese officials could cut short their visit. 

Asian equities are flashing green at press time. Japan’s Nikkei is currently risen by 0.87%, and Hong Kong’s Hang Seng is increased by 1.26%. 

We should also take note that the USD/JPY currency pair could continue its bullish trend if the trade talks finish on the positive outcome. President Trump will meet with Chinese Vice Premier Liu later today. 

    



Daily Support and Resistance    

S3 105.83

S2 106.47

S1 106.77

Pivot Point 107.11

R1 107.41

R2 107.75

R3 108.39

USD/JPY – Trading Tips

The USD/JPY may mark a critical resistance at 108, which is extended by the 78.2% Fibonacci retracement levels. On the lower side, the USD/JPY may get supported at 107.720. The bullish violation of 108 can drive USD/JPY towards 108.54. Consider taking sell positions below 108 and buying positions on the breach of 108 to target 108.450. 

GBP/USD – Daily Analysis

The GBP/USD currency pair now found on the bullish track and was seen while consolidating in the narrow range, just below mid-1.2400s in the Asian session. Moreover, the eyes will keep on the resumption of the European Union and the United Kingdom Brexit talks.

The GBP/USD currency pair took some aggressive buyings and printed its highest % gains since March amid repeated Brexit certainty. Moreover, the GBP is considered as the best performing major currency after the Irish PRimme Minister Leo Varadkar said that a Brexit agreement possibly would be closed by the end of October.

After a 3-hour meeting with United Kingdom Prime Minster Boris Johnson Regarding Brexit, Varadkar said that they have identified a possible way forward on the Irish border issue and how to avoid a hard border. 

Despite the positive trade headlines and an aggressive uptick in the United States Treasury bond yields, the U.S. Dollar failed to gain any rest. The currency is still depressed due to increasing chances of another rate cut by the Federal Reserve at its coming meeting, which is scheduled for 29-30 October.



Daily Support and Resistance

S3 1.2025

S2 1.2133

S1 1.2177

Pivot Point 1.224

R1 1.2285

R2 1.2348

R3 1.2455

GBP/USD – Trading Tips

The GBP/USD pair recovered almost 250 pips, taking along with some trading stops being located near the 1.2300 levels and the 1.2345 and 1.2350 supply zone, and got further support from the prevalent greenback selling bias. The GBP/USD trade at 1.2480 right below the strong double top resistance. The overall trend appears bullish as the GBP/USD can proceed to trade higher. 

Consider keeping an eye on 1.2490 level to take a sell position below this and buy position above the same standard to capturing 30/40 pips. 

All the best! 

 

Categories
Forex Market Analysis

Daily FX Brief, October 10 – Major Trade Setups – Turkey Triggers Safe Haven Demand!

Earlier today, the financial markets experience extreme volatility after Turkey attacked Syrian rebels. The Syrian Democratic Forces (SDF), which is lead by Kurds, said that civilian areas were targeted by

Earlier today, the financial markets experience extreme volatility after Turkey attacked Syrian rebels. The Syrian Democratic Forces (SDF), which is lead by Kurds, said that civilian areas were targeted by

Earlier today, the financial markets experience extreme volatility after Turkey attacked Syrian rebels. The Syrian Democratic Forces (SDF), which is lead by Kurds, said that civilian areas were targeted by Turkish warplanes and caused a massive panic in the region.

Turkish President Recep Tayyip Erdogan said that the operation named “Peace Spring” has launched with the collaboration of the Syrian National Army against the Kurdish Workers’ Party (PKK) & Daesh Terrorists. He added that the operation was launched to create a “safe zone” to house Syrian refugees after clearing the area from Kurdish militias.

 

Overall, the focus stays on the GDP and CPI figures from the United Kingdom and the United States.  

Economic Events to Watch Today

Let’s took at these fundamentals.

 

EUR/USD – Daily Analysis

The EUR/USD currency pair hit the bullish track and struggling to catch break above the crucial level of around 1.1000 due to trade optimism. Moreover, the EUR/USD currency pair could extend its gains if the European Central Bank meeting declares the statement unexpectedly less dovish. 

As of writing, the EUR/USD currency pair took 0.16% gains in the Asian hours as traders sold greenback on trade optimism and announce that the United States is planning to start the currency deal with China. On the other hand, the report came that President Donald Trump may issue a license that will permit a few companies of the United States to supply products to Chinas Huawei.

The pair is currently trading at 1.0987, 21-day moving average. The technical line has been closing bullish move since October 3, and this level is considered as a support for the buyers. A close above the key Moving Average would open the doors for a stronger corrective bullish move, possibly to 1.1110 (September 13 high).

At the ECB front, as we know, the European Central Bank meeting regarding monetary policy is scheduled to happen at 11:30 GMT.

The Central Bank reduced its deposit rate by the 10-basis-points to -0.50% during September and also announced a fresh bond-buying plan that is scheduled to start from November.

Distinctly, the EUR currency may take a buying trend if the ECB meeting underscores the growing dissent within the Governing Council. Moreover, the EUR may come under pressure and hit the bearish bias if the meeting reports increased odds for more rate cut.

The Federal Reserve September meeting released on Wednesday and showed the rising attention between policymakers that markets continue to expecting more rate cuts than the U.S. Central Bank will deliver this year.

Daily Support and Resistance

S3 1.0904

S2 1.0938

S1 1.0956

Pivot Point 1.0973

R1 1.099

R2 1.1008

R3 1.1042

EUR/USD – Trading Tips

The single currency Euro is taking a sharp bullish turn in the wake of a weaker dollar. The pair is facing support at 1.0975, along with resistance at 1.1025. The MACD and Stochastics are also supporting the bullish bias, especially after the EUR/USD has a bullish crossover of the 50-period EMA today. The bullish breakout of 1.1025 can extend buying until 1.1075 today.

 

USD/JPY – Daily Analysis

During the early Asian session, the USD/JPY currency pair hit the high level following a drop to the 107.00 level. Later, the USD/JPY prices recovered to the 1-weeks high in the last hour.

The USD/JPY currency pair is found on a weekly bullish track after placing a low of 106.560 during the last week. Most of the buying came on sentiments that China is still ready to make a deal with the United States despite the recent development.

The USD/JPY currency pair was marked on the bearish level earlier this Thursday in the nervousness due to the high-level United States and China trade negotiations. The sharp uptick in the pair came as the United States is planning to enter into a currency deal with China as a part of the partial trade deal, although the depressed greenback prices action kept a lid on any strong follow-through.

Despite the positive trade news and the less dovish Federal Reserve meeting minutes, the U.S. Dollar struggled to increase any traction and still on the sideways due to the weaker tone surrounding the United States Treasury bond yields.

Daily Support and Resistance

S3 106.36

S2 106.88

S1 107.17

Pivot Point 107.4

R1 107.69

R2 107.92

R3 108.44

USD/JPY – Trading Tips

Consider the safe-haven appeal triggered by Turkish news, the USD/JPY is holding below the healthy resistance level of 107.700. There has been a sideways movement in the market, as traders are confused about whether to buy JPY on safe-haven or to sell it on U.S. – China trade deal sentiments. 

The USD/JPY may notice a critical resistance at 107.7500, which is extended by the 61.8% Fibonacci retracement levels. On the lower side, the USD/JPY may find support at 106.920. The bullish violation of 107.750 can drive USD/JPY towards 108.04 and 108.50. 

GBP/USD – Daily Analysis

The GBP/USD currency pair found on the recovery track after the bearish session, the pair currently fluctuating between the 1.2225 and 1.2230 area. Cable recovered to the 1.2300 in the wake of a report that the Europan Union is ready to allow a time-limit on the Irish backstop. 

Moreover, the Northen Irish Democratic Unionist party refused the European Union concession on Brexit, and the Europan Union official denied the report and in the consequences, sent the cable pair into the negative area.

On the other hand, the buyers still showing some resilience below the 1.2200 round-figure marks, and some repeated greenback weakness supported limit any further declines. Besides this, the Wednesday FOMC meeting doing little to depress the hopes for yet additional interest rate cut during October. The continued decline in the U.S. Treasury bond yields weakened demand for the U.S. Dollar and turned out to be one of the key factors giving insignificant support to the major.

Moreover, the United Kingdom economic docket could further influence the more extensive market sentiment surrounding the GBP and give some brief trading impetus

Daily Support and Resistance

S3 1.2046

S2 1.2139

S1 1.2175

Pivot Point 1.2233

R1 1.2269

R2 1.2327

R3 1.2421

GBP/USD – Trading Tips

On Thursday, the GBP/USD trade at 1.2233 right above the strong double bottom support level of 1.2220. The overall trend appears sideways as the GBP/USD can proceed to trade within 1.2280 – 1.2108 area. Nevertheless, the bearish breach may prolong the GBP/USD selling until 1.2170 following slight retracements.

All the best! 

 

Categories
Forex Market Analysis

Daily FX Brief, October 09 – Major Trade Setups – Fed Meeting Minutes on the Radar

The U.S. dollar traded slightly bearish ahead of the FOMC meeting minutes report today. The downward trend was escalated when Inflation data from American session came on board. 

The U.S.

The U.S. dollar traded slightly bearish ahead of the FOMC meeting minutes report today. The downward trend was escalated when Inflation data from American session came on board. 

The U.S.

The U.S. dollar traded slightly bearish ahead of the FOMC meeting minutes report today. The downward trend was escalated when Inflation data from American session came on board. 

The U.S. inflation data showed a drop in September to -0.3% at 17:30 GMT. This release made the fears of the U.S. recession to re-emerge in the market along with increased chances of further rate cuts by Federal Reserve in the next meeting. 

On Tuesday, Chinese foreign ministry spokesman, Geng Shuang, denied that the government abused human rights in that region and said that the United States should withdraw the relevant decision and stop interference in ‘sChina’s internal affairs. He also stressed that China would take forceful measures against actions that affect the security, national sovereignty, and development interests of the country.

The report about a possible ban on Visa of Chinese ‘communists’ officials linked to the abuses in Xinjiang from the United States gave a boost to the tensions caused by the blacklist report.

Economic Events to Watch Today

Let’sLet’s took at these fundamentals.

 

EUR/USD – Daily Analysis

EUR/USD currency pair hit the bullish level on the day and ahead of Federal Reserve minutes. As of writing, the EUR/USD currency pair is presently trading at 1.0963.

Moreover, the buying tone around the Greenback declined, sent the EUR/USD pair from the 200-hour M.A. support at 1.00947, mainly due to comments by the Federal Reserves Chairman Powell that central Bank balance sheet, which was shrinking until August, but soon will grow again. The Federal Reserve chairman Powell also gave the surety for another rate cut during this month.

Today, the Federal Reserve meeting minutes from its September rate decision is scheduled to happen at 18:00 GMT. Recalling, the U.S. Central Bank cut the rate by 25-basis-points in September. Markets considered this rate cut as a hawkish policy because policymakers were expecting a further rate cut from the FED, and having just 0.25% rate cut was a bit disappointing. 

The Greenback may find a buying track due to a recent drop in the EUR/USD pair, which pushed the pair below recent lows near 1.0879. On the forecast side, the possibility of a rate cut by 25 basis points on October 30 marks above 80%. Moreover, nearly 87 basis points of rate cuts are expected by January 2021 according to forecast.

Daily Support and Resistance    

S3 1.0854

S2 1.0909

S1 1.0932

Pivot Point 1.0964

R1 1.0988

R2 1.102

R3 1.1075

EUR/USD – Trading Tips

The EUR/USD currency pair may hit the resistance of the 21-day moving average at 1.0988 if the Federal Reserve meeting shows the consensus between the policymakers in the wake of the further rate cut. The EUR/USD has violated 1.0970 support, and the pair may head further lower towards 1.09200 and 1.0882 later today. Consider staying bearish below 1.0964 area today.

USD/JPY – Daily Analysis

The USD/JPY currency pair is presently trading around 107.00, hit the bearish track, and faced rejection at 107.30 in overnight trading. By the way, the USD/JPY currency pair consolidate in the narrow range due to intensifying trade tension and risk aversion in the equity markets.

The U.S. stocks fell on Tuesday as tensions between the U.S. and China escalated ahead of the critical trade talk scheduled to happen at the end of the week. The U.S. threatened to blacklist the Chinese companies over human rights violations in Uighur province.

The United States stocks dropped on Tuesday due to tension between the United States, and China intensified in the wake of high-level trade talk scheduled to happen later this week. President Donald Trump’s decision to levy a visa restriction on Chinese officials, including the blacklisting of Chinese firms in the wake of china’s treatment with Muslim minorities. With this, the threats increased into coming talks between the United States and China.

China asked Washington to withdraw its decision and gave warning to retaliation. The United States said that the plan to blacklist the Chinese companies were unrelated to trade talks. As a consequence, the S&P 500 index dropped by 1.56%, pushing the traditional safe-haven assets higher.

At this moment, the futures on the S&P 500 are showing 0.21% gains, which could reduce some bullish pressures around the Japanese Yen and may push the USD/JPY pair higher.

Moreover, the yield on the United States ten-year treasury note is showing signs of life. At press time, the return is trading at 1.54%, indicating a 4-basis point increase on the low of 1.50%. Hence, the Greenback may find some support.



Daily Support and Resistance

S3 105.83

S2 106.47

S1 106.77

Pivot Point 107.11

R1 107.41

R2 107.75

R3 108.39

USD/JPY – Trading Tips

The USD/JPY is trading slightly bullish ahead of the FOMC meeting minutes. The USD/JPY may find an immediate resistance at 107.500, along with support around 106.920. The bullish breakout of 107.450 can lead the USD/JPY prices towards 107.800. On the lower side, the support stays around 106.90. The MACD is hovering in the buying territory. Considering this, we should look for buying trades over 107.11. 

GBP/USD – Daily Analysis

The GBP/USD hit the bearish track, and the pair is found trading in the tight range just above 1-month lows of 1.2203 set in the previous session.

The recent downside pressure surrounding the GBP raised the activity on Tuesday. Most of the trading activity and sharp slum in GBP came after the report that Brexit talks between the UK and the E U were very close to separation.

While the German Chancellor Angela Merker told the British Prime Minister Boris Johnson through the phone call that the U.K. should keep the Northen Ireland in the Europan Union customs union. With this, the odds of the no-Brexit deal raises. 

The cable pair declined to 1.2200 levels; this is the lowest level since September 04. President Donald Trump’s decision to levy a visa restriction on Chinese officials, including blacklisting of Chinese firms in the wake of china treatment with Muslim minorities, threats increased incoming talks between the United States and China.

Eventually, the progress sparked a fresh flow of global risk-aversion trade, which supported the Greenback’s relative safe-haven status against its British counterpart.

Meanwhile, the greenback buyers were not successful in gaining on the positive move overnight amid moderately weaker tone around the United States Treasury bond yields.



Daily Support and Resistance

S3 1.2025

S2 1.2133

S1 1.2177

Pivot Point 1.224

R1 1.2285

R2 1.2348

R3 1.2455

GBP/USD – Trading Tips

The GBP/USD traded sharply bearish, falling from1.2281 to 1,2200 area amid odds of hard Brexit. The GBP/USD has broken the double bottom level at 1.2225 and has settled a range of candles beneath this level, which is validating the bearish breakout.

Today, traders should consider opening a sell position only below 1.224 and bullish positions above the same level to target 1.2276 on the upper side while bearish target stays at 1.2140. 

All the best! 

 

Categories
Forex Market Analysis

Daily FX Brief, October 08 – Major Trade Setups – U.S. China Trade Talks In Focus! 

On Tuesday, the U.S. dollar trades to trade choppy to slightly bullish on the back of no significant economic figures. The range of light United States numbers during the past

On Tuesday, the U.S. dollar trades to trade choppy to slightly bullish on the back of no significant economic figures. The range of light United States numbers during the past

On Tuesday, the U.S. dollar trades to trade choppy to slightly bullish on the back of no significant economic figures. The range of light United States numbers during the past week increased uncertainties on the assumption that the United States economy will be further elastic as compared to the other economies and pushed investors to start pricing in another rate cut by the Federal Reserve.

Powell Stressed that an Independent Central Bank could make decisions in the long-term best interests of the economy without regard to the political pressure. He also quoted that “the management of Central Bank must be free from the dangers of control by politics and by private interests, singly or combined.”

In previous days, President Trump has criticized the Federal Reserve for not Lowering its Interest Rates enough. In reply to that criticism, Jerome Powell’s statement about central bank independency has raised the possibility that the Fed might not cut its rate further in the next policy meeting.

Economic Events to Watch Today

Let’s took at these fundamentals.

 

EUR/USD – Daily Analysis

The EUR/USD currency pair consolidating in a narrow range near 1.0975, as we know, the pair were representing 0.06% losses on Monday. It should be noted that the EUR/USD currency pair hit the rejection at the 21-day moving average for the 3rd straight day yesterday. Therefore the figures are presently found at 1.0992. 

On the economic data front, all eyes stay on the German industrial production data, which is scheduled to release at 06:00 GMT, and expectations are high that the German Industrial Production data dropped 0.3% month on month during August, having fallen 0.6% in the previous month. The final number is anticipated to release at -2.7% versus -4.2% in July.

German Factory Orders declined by 0.6% month-on-month in August – the 2nd-straight monthly decline, due to weaker demand from domestic consumers, the official data showed on Monday. 

Additionally, the headline IHS Markit and BME Germany Manufacturing PMI for February, a single-figure picture of the performance of the manufacturing economy, had marked well below 50, indicating contraction.

The statement came that the German recession is generally accepted at this time and price. Therefore, the EUR/USD currency pair will likely remain resilient if the Geman Industrial Production fell according to expectations. The pair may take hints from the United States Producer Price index and comments by the Feral Reserves President Powell.

Daily Support and Resistance

S3 1.0901

S2 1.0939

S1 1.0956

Pivot Point 1.0978

R1 1.0994

R2 1.1017

R3 1.1056

EUR/USD – Trading Tips

On the technical aspect, the EUR/USD may gain support at the critical trading point of 1.0960 level. The MACD and RSI are staying in the bullish territory, implying probabilities of a bullish reversal. 

A bearish breach of the 1.0967 level can spread selling until 1.0885. While buying can be seen above 1.0960 till 1.1035 levels. 

USD/JPY – Daily Analysis

The USD/JPY currency pair found on the recovery track and traded well in the striking distance of the overnight swing high.

After a bearish break opening at the begin of a new trading week, the USD/JPY currency pair has managed to recover positive traction and returned near 80-pips from an intraday low level of 106.65. Positive figures in the United States treasury bond yields propped the greenback demand and turned out to be one of the critical factors that started the initial support of the uptick.

The momentum gained another boost from some positive comments by the White House economic adviser Larry Kudlow, who said that the U.S. was available for China plans and proposals, but the Chinese companies were not there. Meanwhile, Kudlow noted further that the United States trade officials could make progress between the Sino-US trade war.

The USD/JPY currency pair is trading steady ahead of Fed Chair Speech and PPI figures today as investors seem hesitant to enter the market ahead of the news release. Besides, the highly-expected United States and China trade negotiations in Washington are also keeping the USD/JPY in check ahead of Top-level negotiations scheduled on Thursday.

Meanwhile, Tuesday’s U.S. economic docket, highlighting the release of Producer Price Index (PPI), is under focus, and all eyes will keep on it for fresh impetus. Moreover, the market risk-sentiment and the greenback prices progress could further produce some meaningful trading opportunities together.

Daily Support and Resistance    

S3 105.78

S2 106.47

S1 106.85

Pivot Point 107.16

R1 107.54

R2 107.85

R3 108.54

USD/JPY – Trading Tips

On Monday, the USD/JPY opened with a bearish gap, which is already covered by the end of the day. The USD/JPY pair soared to complete a 50% Fibonacci retracement level at 107.450.  

The USD/JPY is now trading above 50 periods EMA, which is placing a bullish pressure on the USD/JPY at 106.900. The MACD is looming in the buying zone. However, the live histogram is smaller than the previous one, which shows the odds of a bearish reversal. Consider trading bearish below 107.450 to target 106.900. 

GBP/USD – Daily Analysis

The GBP/USD currency pair flashing red and still consolidating in the narrow range just below the 1,2300 handles due to renewed Brexit pessimism. 

The cable found exhibited some intraday bounce during the start of a week. In contrast, a shortage of any substantial progress leads the pair to quickly hit the fresh low level near the 1.2335 level, which is also marked as an important level by 200-period EMA on the 4-hourly chart. 

Considering that the bloc’s leaders observe the United Kingdom Prime Minister Boris Johosn’s new Brexit plan is not enough, uncertainties related to Briaitan exits from the Europan Union, leaving some pressure on the GBP.

The modest pickup in the greenback demand, benefited by the positive rebound in the United States Treasury bond yields and positive trade-related headlines, further helped to the pairs downtick. While, the White House economic adviser Larry Kudlow, who said that the U.S. was available for China plans and proposals, but the Chinese companies were not there, drove some haven appeal in the market.


Daily Support and Resistance    

S3 1.2205

S2 1.2253

S1 1.2271

Pivot Point 1.2302

R1 1.2319

R2 1.2351

R3 1.24

GBP/USD – Trading Tips

On Tuesday, the trading in GBP/USD has changed much as the cable continues to trade bearish. On the upper side, 1.2340 level is extending it a substantial resistance now. The 50 EMA is expected to maintain support at 1.2275, but the new bearish movement in the GBP/USD is likely to challenge the support zone. Consider opening a sell position only below 1.2275 level today. 

All the best! 

 

Categories
Forex Market Analysis

Daily FX Brief, October 07 – Major Trade Setups – Fed Chair Powell Speak! 

On Monday, the U.S. dollar continues to trade sideways in the wake of mixed economic figures. The series of soft United States data last week increased uncertainties on the assumption

On Monday, the U.S. dollar continues to trade sideways in the wake of mixed economic figures. The series of soft United States data last week increased uncertainties on the assumption

On Monday, the U.S. dollar continues to trade sideways in the wake of mixed economic figures. The series of soft United States data last week increased uncertainties on the assumption that the United States economy will be more flexible as compared to the other economies and pushed investors to start pricing in another rate cut by the Federal Reserve.

At the Fed front, the dollar may trade slightly bearish over the strong market expectation that the Federal Reserve will deliver the rate cut again at its upcoming policy meeting on 29-30 October to support the economy.

Economic Events to Watch Today

Let’s took at these fundamentals.


EUR/USD – Daily Analysis

The EUR/USD currency pair is flashing green and representing 10% gains on the day while the currency pair is currently trading around 1.0980, and the twenty-one-day moving average is found at 1.0996. The EUR/USD currency pair can hit the bullish level above the critical M.A. hurdle. Hence, there are some chances that the pair will continue its recovery trend if the German Factory Orders blow past expectations.

On the other hand, if the German Factory Orders decline more than expected, the EUR/USD currency pair could hit the bearish level and will come under the selling pressure below 1.0950.

The German factory orders data is scheduled to release at 06:00 GMT, and expectations are high that the German factory data will show the pace of decline in August.

Factory Orders are anticipated to decline by 1.5% month-on-month in August, after July’s 2.7% decline. The annualized number is expected to print at -4.6%.

The headline IHS Markit and BME Germany Manufacturing PMI, a single-figure snapshot of the performance of the manufacturing economy, increased slightly to 43.5 during August, but remains well below 50, indicating contraction for an 8-month in a row.

It should also be noted that the possibilities of a twenty-basis-points rate cut by the Federal Reserve during October 30 have turned back higher to 83%. Therefore, the EUR/USD bearish trend could be limited.


Daily Support and Resistance

S3 1.0895

S2 1.0937

S1 1.0958

Pivot Point 1.0978

R1 1.1

R2 1.102

R3 1.1062

EUR/USD – Trading Tips

On the technical front, the EUR/USD may find support at the crucial trading level of 1.0960 level. The MACD and RSI are holding in the bullish zone, suggesting odds of a bullish reversal. 

A bearish breakout of the 1.0967 level can extend selling until 1.0885. While buying can be seen over 1.0960 until 1.1035 levels. 

USD/JPY – Daily Analysis

USD/JPY currency pair still consolidating in the narrow range, although the pair has managed to hold its neck comfortably above around1-month lows.

After Friday’s price fluctuations, the USD/JPY currency pair started with a bearish break on Monday as the Chinese officials are hesitant to agree to a comprehensive trade deal extended by the United States President Donald Trump. The Japanese Yen’s relative safe-haven status is applying some bearish pressure on the major.

At the Fed front, the strong market expectation that the Federal Reserve will deliver the rate cut again at its upcoming policy meeting on 29-30 October in the wake to support the economy.

The series of soft United States data last week increased uncertainties on the assumption that the United States economy will be more flexible as compared to the other economies and pushed investors to start pricing in another rate cut by the Federal Reserve.

The weaker trend in the United States treasury bond yields was found pushing greenback lower, and at the same time, helped driving a slight bearish movement in the USD/JPY pair today. 


Daily Support and Resistance

S3 105.78

S2 106.33

S1 106.62

Pivot Point 106.88

R1 107.17

R2 107.43

R3 107.98

USD/JPY – Trading Tips

The USD/JPY pair covered the bearish gap that we can see on the 4-hour timeframe. The USD/JPY pair is trading below 50 periods EMA, which is placing a bearish pressure on the EUR/USD at 106.850. 

The MACD was massively bearish, but know it’s trying to exhibit a bullish crossover. Histograms above 0 are signalings chances of a bullish reversal in the USD/JPY. The pair has immediate support at 106.400, along with resistance at 107.450. 

GBP/USD – Daily Analysis

GBP/USD currency pair still consolidating in the narrow range and traded well on the bullish track held over the previous 1-week or so.

All factors failed to give any significant reason for the significant and led trading at the beginning of the recent week. The GBP currency is still flat due to Friday’s report that the European parliament president has denied the United Kingdom Prime Minister Boris Johnson’s new Brexit proposal.

However, the bearish range remained warm so far, due to slightly weaker trend surrounding the greenback, pressurized by the strong market expectations that the Federal Reserve will deliver the rate cut again at its upcoming meeting regarding monetary policy, the conference is scheduled to happen on 29-30 October.

On the flip side, the U.K. Prime Minister Boris Johnson still stands to take Britain out of the European Union on October 31, with deal or without, and caught investors from placing any aggressive bullish risk.

Due to serious of soft United States data, last week increased uncertainties on the assumption that the United States economy will be more flexible as compared to the other economies and pushed investors to start pricing in another rate cut by the Federal Reserve.



Daily Support and Resistance

S3 1.2169

S2 1.2245

S1 1.2291

Pivot Point 1.2322

R1 1.2367

R2 1.2398

R3 1.2474

GBP/USD – Trading Tips

The GBP/USD is trading with a bearish bias, as the 1.2340 level is extending it a substantial resistance today. The 50 EMA is likely to continue support at 1.2275, but the recent bearish engulfing candle may keep the GBP/USD under heavy selling pressure. 

The trading bias remains mostly bearish, and you should consider staying bearish below 1.2275 level today. 

All the best! 

 

Categories
Forex Market Analysis

Daily FX Brief, October 03 – Major Trade Setups – Services PMI’s In Highlights

The U.S. dollar retreated for a second straight session, with the ICE Dollar Index slipping 0.1% to 99.02 on Wednesday. The euro climbed 0.3% to $1.0961. The top five economic

The U.S. dollar retreated for a second straight session, with the ICE Dollar Index slipping 0.1% to 99.02 on Wednesday. The euro climbed 0.3% to $1.0961. The top five economic

The U.S. dollar retreated for a second straight session, with the ICE Dollar Index slipping 0.1% to 99.02 on Wednesday. The euro climbed 0.3% to $1.0961. The top five economic think-tanks in Germany lowered their 2020 German GDP forecast to 1.1% from 1.8% previously, citing shrinking manufacturing production. And they said the economy could fall into a technical recession in the third quarter this year.

Economic Events to Watch Today

Let’s took at these fundamentals

 

EUR/USD – Daily Analysis

The EUR/USD currency pair flashing red at the level of1.0955, also the pair got a rejection near the 1.0967 (38.2% Fib Retracement of 1.1110/1.0943).

The EUR/USD currency pair took a buying at lows below 1.09 on Monday after the negative United States Manufacturing data propped the U.S. economic slowdown fears. As we know, the EUR/USD pair reached the recovery range above 1.0950 on Tuesday, ahead of unexpectedly lowest US ADP Employment data.

The United States’ ten-year treasury yield dropped by 3-basis-points and 4-basis-points on Tuesday and Wednesday, individually, and hit a bearish level of 1.578% in the Asian session. By the way, it’s one of the lowest levels since September 09.

However, the currency pair failed to hit the level of 1.0967, due to the decision by the United States President Donald Trump that to impose tariffs on $7.5 billion in European imports starting October 18. 

At the data front, the U.S. non-manufacturing data scheduled to release at 14:00 GMT is anticipated to compensate for worse than expected manufacturing PMI activity during September. The PMI is expected to issue figures at 55.1 against 56.4 during August.

Massive slip in the U.S. economic data will prop the United States slowdown concerns, eventually supporting the EUR/USD pair to hit higher to 1.10. Moreover, the chances of a 25-basis-points rate cut by the Federal Reserve during this month have already increased from 40% to 84% this week. Whereas, if the data beats the expectations, then the EUR/USD pair could decline back below the 1.09 level.

Daily Support and Resistance    

S3 1.0823

S2 1.0883

S1 1.0921

Pivot Point 1.0943

R1 1.0981

R2 1.1002

R3 1.1062

EUR/USD – Trading Tips

A day before Non-farm payrolls, the EUR/USD is trading a bit muted, as traders are staying out of the market due to a National holiday in China and Germany. Despite that, the EUR/USD may trade bearish below 1.0964 to target 1.0915 area. On the other side, the bullish breakout of 1.0960 can lead EUR/USD 1.1020. 

USD/JPY – Daily Analysis

The USD/JPY currency pair consolidates in the narrow range of 107 handle, due to the greenback falls out of favor with investors. Moreover, the USD/JPY currency pair struggles to hit the high-level of107 handles while the Asian equities and Treasury yields trade lowest.

As we know, the greenback continues to drop since the start of the week. The dollar has the weakest start of a 4th-quarter since 2008 after following a slump in the 3rd-quarter range.

The United States stocks continued their decline due to more dismal data. The downward risk sentiment is increasing, and the global economy is slowing down, which was again evident in the U.S. data that pushed the U.S. benchmarks lower. The Dow Jones Industrial Average, DJIA, dropped around 344 points, or 1.3% during the previous session.

Moreover, the S&P 500 index fell by 52.64 points, and the Nasdaq dropped by 123.44 points. The ADP data showed just 135,000 new jobs against forecasted figures of 140,000. With this, the traders are pricing in weaker Nonfarm Payrolls which is due on Friday.

The greenback and Treasury yields need support at this position. The United States’ two-year treasury yields dropped from 1.55% to 1.48%, and the ten-year dropped from 1.66% to 1.59%. 

Daily Support and Resistance

    

S3 105.7

S2 106.53

S1 106.86

Pivot Point 107.37

R1 107.69

R2 108.2

R3 109.04

USD/JPY – Trading Tips

The USD/JPY has formed tweezers bottom on the 4-hour timeframe which is suggesting odds of a bullish reversal. The USD/JPY pair may find support at 106.90, and below this, it can go after 106.400. On the upper side, resistance stays at 107.450. 

WTI Crude Oil – Daily Analysis

The WTI crude oil prices found on the recovery track, due to concerns of the worsening global economic outlook. The economic outlook hit crude oil prices very hard during the previous trading session as traders are pricing in the probability for development in solving the on-going trade war between the United States and China. The U.S. West Texas Intermediate (WTI) crude oil futures were up 23 cents, or 0.4%, to $52.87 a barrel, after sinking by 1.8% on Wednesday.

On the other hand, the global equity benchmarks found on the lowest level in a month on Wednesday. That came due to a sign of a recession in the United States economic growth. Secondly, the weaker economic data in Europe also distributed fears the global economy could fall into the slowdown.

There was a hurting sentiment in the previous trading session from the Energy Information Administration, which reported a surge of 3.1 million barrels in crude oil inventories in the last week. 

It should also be noted that top oil exporter Saudi Arabia is planning to lift the cost for crude oil it sells to Asia during November. The sentiments came following the drone attack on Sauida Kingdoms, and its oil production has also started to spike in the Middle East.  

Daily Support and Resistance

S3 48.53

S2 50.77

S1 51.65

Pivot Point 53

R1 53.89

R2 55.24

R3 57.48

WTI Crude Oil – Trading Tips

The WTI crude oil is finishing the Asian session in a bearish mode, falling from 53 to 52.70. Crude oil is facing significant resistance at 53 levels today. The MACD and RSI are bearish as both of them are holding under their crossover levels of 0 and 50 respectively. 

Consider staying bearish on crude oil below 53 to target 52.65 and 51.80 levels. All the best! 

 

Categories
Forex Market Analysis

Daily FX Brief, October 02 – Major Trade Setups – Weaker Dollar Sentiment Prevails!

The Greenback retreated 0.2% from a two-year high to 99.15 on Tuesday, as data suggested that U.S. manufacturing activity contracted at the quickest pace in a decade. The euro gained

The Greenback retreated 0.2% from a two-year high to 99.15 on Tuesday, as data suggested that U.S. manufacturing activity contracted at the quickest pace in a decade. The euro gained

The Greenback retreated 0.2% from a two-year high to 99.15 on Tuesday, as data suggested that U.S. manufacturing activity contracted at the quickest pace in a decade. The euro gained 0.3% to $1.0934, while USD/JPY slid 0.3% to 107.75.

The British pound tested a day-low of $1.2207 before bouncing back to close flat on the day at $1.2292. Media reported that European Union leaders have considered offering the U.K. a concession on Brexit that could set an expiration date on the contentious Irish backstop. The Markit U.K. Manufacturing PMI rose to 48.3 in September (vs. 47.0 expected) from 47.4 in August. Whereas, the U.S. ISM manufacturing PMI figures fell dramatically, triggering a sharp sell-off in the U.S. dollar.

Economic Events to Watch Today

Let’s took at these fundamentals

 

EUR/USD – Daily Analysis

The EUR/USD currency pair consolidates in the narrow range and maintains 0.32% increases. Prominently, the pair may take bids on them today due to the increasing possibilities of the rate cut by the Feral Reserve and the intensified United States slowdown fears.

The United States Insitute of Supply Managements was closely-observed yesterday. The manufacturing index dropped to 47.8 during the month of September. Its the weakest range since the month of June 2009. Besides this, the gauge contracted for the 2nd-consecutive month, confirming the fact that the continuing trade war with the dragon nation is damaging the United States economy lower.

Yesterday’s economic data has propped the U.S. economic slowdown fears, forcing markets to price in the possibility of further rate cuts by Federal Reserve in October. 

Today, the Greenback may trade further lower if the United States ADP employment change which is due to release at 12:15 GMT, release against the estimated number. Consequently, the EUR/USD may hit a high level of 1.10, as suggested by the flag breakout on technical charts. 



Daily Support and Resistance

S3 1.079

S2 1.0854

S1 1.0893

Pivot Point 1.0918

R1 1.0957

R2 1.0982

R3 1.1046

EUR/USD – Trading Tips

On Wednesday, consider staying bearish below 1.0918 level as the EUR/USD has formed a tweezers top pattern on the 4-hour timeframe. 

On the lower side, one should look for a target of 1.0880 and 1.0820. 

USD/JPY – Daily Analysis

USD/JPY was opened on Tuesday at 108.070 and had shown a bearish trend. The U.S. Dollar on Tuesday fell because of drop-in ISM Manufacturing PMI to a 10-year low point.

The highlight release on Tuesday, ISM Manufacturing PMI came in lower than expected increased the fear of the U.S. falling into recession because of Prevailing US-China Trade war’s impact on the domestic economy.

After the weak economic results from the United States on Tuesday, Donald Trump blamed the Federal Reserve for a strong Dollar in his tweet that the Fed has no clue that they are their enemy.

The weak PMI indicated that economic activity in the U.S. manufacturing sector was reserved in September. The data showed that PMI dropped to a 10-Year low of 47.8 from the previous month’s 49.1.

From Japan Side, at 4:30 GMT, the Unemployment Rate came as 2.2% against 2.3% in favor of Japanese Yen. At 4:50 GMT, Tankan 

Manufacturing Index and Tankan Non-Manufacturing Index came as 5 and 21 against expected 1 and 20 respectively. They were also in favor of the Japanese Yen.

However, the Final Manufacturing PMI from Japan at 5:30 GMT came as 48.9 against 49.3 expectations. Like the U.S. and other countries, Japanese PMI also showed a drop in economic activities in September.

The USD/JPY showed a downward movement of 0.2% on Tuesday and placed a low of 107.625; it is currently moving at 107.761.

Daily Support and Resistance

S3 107.13

S2 107.56

S1 107.82

Pivot Point 108

R1 108.26

R2 108.44

R3 108.87

USD/JPY – Trading Tips

The USD/JPY is likely to trade mostly lower as the pair has violated the bullish channel at 108.200. On the lower side, the support stays at 107.300, which is why I will be looking to take sell positions below 108 level to target 107.400.  

 

GBP/USD – Daily Analysis

 The GBP/USD currency pair hit the bearish track and dropped by 0.2% to 1.2280, ahead of U.K. Prime Minister Boris Johnson who is ready to announce his last and final Brexit deal/offer to the European Union during this day. Meanwhile, he clearly said that Britain would not talk anymore if the agreement is not engaged and will leave on October 31.

It should be noted that the greenback overall weakness couldn’t send the GBP/USD sellers far away due to new headlines from the U.K. left bearish pressure on the cable pair. By the way, the currency pair is presently trading around 1.2290.

The United Kingdom PM Boris Johnson has a strong attitude about the Brexit final date October 31. Still, at the same time, the PM is hoping for additional effort to extend the British Parliament. 

Apart from this, the intensified fears and anxiety of the economic recession are likely to keep investor’s focus on the Federal Reserve Bank of New York President John Williams’ speech for further clues about the Fed policy ahead. Whereas the September’s ADP Employment Change is expected 140,000 against 195,000 prior and it’s also one of the highlights today.



Daily Support and Resistance    

S3 1.2008

S2 1.2143

S1 1.2217

Pivot Point 1.2279

R1 1.2352

R2 1.2414

R3 1.2549

GBP/USD – Trading Tips

The GBP/USD pair is finishing the Asian session in a bearish mode, falling over from 1.2330 to 1.2250. The sideways trading range market is keeping the cable in between 1.2335 to 1.2235 zone. 

The MACD and RSI are mixed due to a series of mixed fundamentals. On one side, the GBP/USD is turning bullish over a weaker dollar, and on the other hand, bears are shorting GBP to avoid uncertainties coming from Brexit. 

Consider staying bearish below 1.2330 to target 1.2250. In the case of a bearish breakout, the GBP/USD pair can drop further towards 1.2185.

All the best! 

 

Categories
Forex Market Analysis

Daily FX Brief, September 30 – Major Trade Setups – Traders Set to Trade Monday! 

Happy Monday, Folks! 

A stellar week for the U.S. dollar index had price halt just shy of YTD highs at 99.37. Up 0.67% and recording its second week in positive

Happy Monday, Folks! 

A stellar week for the U.S. dollar index had price halt just shy of YTD highs at 99.37. Up 0.67% and recording its second week in positive

Happy Monday, Folks! 

A stellar week for the U.S. dollar index had price halt just shy of YTD highs at 99.37. Up 0.67% and recording its second week in positive territory, the next port of call, aside from 99.37, sits at 99.62, a robust weekly resistance level that draws history as far back as March 2015.

The main highlight of the week was U.S. House Speaker Pelosi opening a formal Trump impeachment inquiry over a controversial phone call between himself and his Ukrainian counterpart. Data was largely ignored. 

Consumer confidence declined in September, following a small slump in August. The Index presently holds at 125.1, falling from 134.2. Headline U.S. durable goods orders rose +0.2% m/m in August, topping the consensus view at -1.1%, according to the U.S. Census Bureau on Friday. U.S. personal consumption expenditures, according to the Bureau of Economic Analysis, fell 0.1% m/m, unable to meet consensus at 0.3%.

Economic Events to Watch Today

Let’s took at these fundamentals

 

EUR/USD – Daily Analysis

Europe’s shared currency ended the week down 0.70% vs. the U.S. dollar. The week booted off undergoing heavy losses, beaten by dark flash PMI numbers and later pulled by resurgent dollar demand. 

Technically, weekly price trades very south of support at 1.0873, while daily run meets with the buying pressure at 1.0851-1.0950. The 4 hourly flow re-entered a descending channel creation (1.1109/1.0993) and is poised to make way for the essential figure 1.10 this week possibly.

Concerning macroeconomic figures, headline U.S. durable goods orders grew +0.2% m/m in August, beating the forecast of -1.1%, according to the U.S. Census Bureau on Friday. U.S. personal consumption expenditures, as per the U.s.s Bureau of Economic Analysis, fell 0.1% m/m, unable to meet consensus at 0.3%.

Technically, the H4 candles left 1.09 unchallenged Friday, sporting several lower candlestick shadows before rotating back within the descending channel formation (1.1109/1.0993). Aided on the back of daily demand highlighted above at 1.0851-1.0950, the pair certainly has scope to shake hands with September’s opening level at 1.0989, closely followed by the key figure 1.10 and channel resistance, this week.

 


Daily Support and Resistance 

S3 1.0814

S2 1.0872

S1 1.0895

Pivot Point 1.0931

R1 1.0954

R2 1.099

R3 1.1049

 

EUR/USD – Trading Tips

Consider staying bearish below 1.0936 and bullish above the same to capture quick take profits of 50 pips on either side. The market may trade sideways over neutral German CPI. However, the sharp variation in number can bring changes in the market. 

USD/JPY – Daily Analysis

Last week, the USD/JPY was closed at 107.929 after placing a high of 108.178. Overall the movement of this pair showed a Bullish trend Last week.

Geopolitical issues were also cooled down a bit due to Saudi ‘Arabia’s decision about a ceasefire in Yemen. Moreover, the impeachment inquiry of Trump was also a headline last week for political anxiety in Washington but had a lesser effect on the U.S. Dollar Index. U.S. Yields rose after a decrease in Global Political & Economic tensions and gave strength to U.S. Dollar against Japanese Yen last week.

On Friday, few reports showed that U.S. President Donald ‘ Trump’s administration was considering the option to delist Chinese companies from US Stock Exchange, and it was also planning to limit the U.S. investors’investors’ portfolio flows in Chinese companies. These reports cause a slowdown in the upward trend of USD/JPY.

On the other hand, the speech of BOJ governor, Kuroda last week, expressed the concerns of Bank of Japan over the escalating risks to the economy. 


Daily Support and Resistance 

R3: 108.98

R2: 108.45

R1: 108.19

Pivot Point 107.92

S1: 107.66

S2: 107.4

S3: 106.87

USD/JPY – Trading Tips

The USD/JPY violated the bullish channel on the hourly chart, which was extending its support around 107.950 area. On the 4 hour timeframe, the 20 and 50 moving averages are reflecting the bearish trend in the USD/JPY. The Japanese yen may find support at 107.750 against the U.S. dollar along with resistance at 107.885. Consider staying bearish below 107.900 today as the pair is likely to stay bearish in the short term. 

AUD/USD – Daily Analysis

The Australian dollar wrapped up the week unmoved against the buck last week, unable to overthrow channel support taken from the low 0.7003. To the upside, resistance resides close by at 0.6828, with a break of the channel mentioned above possibly exposing 0.6677, the YTD low. As is painfully evident on the weekly chart, the long-term downtrend remains in full swing and has done since early 2018. 

Support at 0.6733 endures a significant fixture on the daily timeframe, as does resistance outlined at 0.6833. Likewise, the interest is the 200/50-day SMAs both fronting south. A breach of the said support can help target the market around 0.6687, followed by support at 0.6301 

Daily Support and Resistance

S3 0.6688

S2 0.6723

S1 0.6736

Pivot Point 0.6759

R1 0.6772

R2 0.6794

R3 0.6829

AUD/USD – Trading Tips

The Australian central bank is expected to deliver a 0.25% rate cut on October 01. However, the United States Durable goods Orders, Michigan Consumer Sentiment, and Personal Consumption data might consider short-term investors during the following part of the day.

The AUD/USD is trading at 0.6750 area, maintaining a short trading range of 0.6800 – 0.6750 range on Monday. The 50 periods exponential moving average is neutral but mostly suggesting a bearish bias on the 4-hour timeframe. 

Whereas, the MACD is consolidating in a green and red zone, indicating a neutral bias among traders. Hence, let’s keep an eye on 0.6759 to stay bullish and bearish below this level. 

All the best for trading. 

 

Categories
Forex Market Analysis

Daily: New Episode of Trade War, Brexit Negotiations, U.S & South Korean Summit

 

NEWS COMMENTARY

 

 

U.S. President Donald Trump and South Korean leader Moon Jae-in will meet in New York on Monday to discuss how to move forward on a formal declaration of the end of the Korean War. Moon met with North Korean leader Kim Jong Un last week. “Chairman Kim expressed his wish to finish complete denuclearization at an early date and focus on economic development,” Moon said of his meeting with the North Korean leader in Pyongyang.

The Organization of the Petroleum Exporting Countries and Russia pushed back against a call last week by U.S. President Donald Trump to lower prices. “I do not influence prices,” Saudi Energy Minister Khalid al-Falih told reporters as OPEC and non-OPEC energy ministers gathered in Algiers. The group of oil producers is in discussion about rising output to counter falling Iranian supplies due to U.S. sanctions but made no formal recommendation for any additional supply boost at its Sunday meeting.

British Prime Minister Theresa May is under attack from several fronts over her Brexit plan. Members of her own party launched an alternative plan for leaving the European Union which would involve ditching her Chequers deal for a cleaner break with the bloc. The main opposition Labour Party are holding their annual conference where members will decide on whether to back a second referendum on the issue. There were also reports over the weekend of a possible snap election in November. Relations with the EU side, meanwhile, continue to be strained.

 

CHART ANALYSIS

 

OIL

Last week price continued its ranging move between support at 66.2-64.15 and resistance at 74.45-72.45. After having breached the ascending trend, price turned back to the support zone with a bounce from an ascending trend as shown on the daily chart below. As we expected, price is now “pin bar” reaching the main resistance zone with touching 72.45, we expect bullish momentum to build up towards the 74.45 level. and then wait for a bounce or a break to determine the next move



 

S&P 500

On the daily chart, the price has broken the key resistance level at 2875.58 and stayed above it to reinforce the bullish bias.

However, we should highlight significant reversal signs, including:

1. Elliot’s Wave 5 has formed;
2. AB=CD harmonic pattern in play.
3. A Wedge reversal pattern remains active.
4. RSI Divergence.

Thus, if price breaks through support at 2875.58 we should witness a correction towards 2797.82.



 

AUD/USD

On the daily chart, the Aussie is clearly reflecting a bearish bias as it descends down a channel that started forming since the beginning of this year; reaching support at 0.71 where some clear sign of reversal showed up.

We expect reversal/consolidation to develop further as:

1. Price has bounced from the support zone between 0.71-0.716.
2. An AB=CD harmonic pattern is rather suggestive.
3. A Wedge reversal pattern.
4. RSI divergence.

the price manages to stay above 0.7225,then it has the potential of reaching 0.733 and 0.745



 

USD/CAD

On the daily chart, we observe the Loonie to follow a descending channel since June this year, with a false 2 weeks reversal before continuing its way down.

As we expected before that the price fell further to 1.289 and meet the ascending trend line from March’s Low, coupled with the 200 Exponential Moving Average (EMA)

Now the price located at the key support of 1.289 besides the ascending trend line from the low of 2017. so, any bounce here would expose the price back to 1.312. and any break beneath these levels would continue the bearish bias to 1.272



 

USD/JPY

On the daily chart, as expected, price is moving upwards to the 113 target, leaving 112 as near-term support. We expect an extension towards the 113 area before resumption of the downside towards at least 109,75.



 

Categories
Forex Market Analysis

Sep 24 – 28: EUR/USD, USD/JPY & Gold – Week Ahead

 

EUR/USD – ECB Mario Draghi Speech Remains In Focus

The US declared new taxes on China on $200 billion value of products, as exacted. Markets appeared to take it with a pace. Nevertheless, the greenback had the rise in 10-year yields. ECB President Mario Draghi did not rock the boat. August’s inflation numbers were confirmed at 2% on the headline and 1% on the core, just before September’s preliminary numbers.

Fundamentally, the Eurozone banks agreed to repay 3.6 billion euros ($4.2 billion) of ultra-cheap funding to the European Central Bank, returning only a fraction of their borrowings two years ahead of schedule.

 

EUR/USD – Technical Analysis 

Euro/dollar climbed up but was slightly stuck when testing the 1.1720 level. It then rose to 1.1800, the steepest since July before settling a bit lower.

  • 1.1915 was the lowest level in January and remains relevant. 1.1850 was the peak on June 14th, before Draghi sent the euro down. 1.1800 capped the pair in mid-September.
  • 1.1750 held the pair no less than four times in July and remains a powerful level.
  • 1.1720 is a veteran line that worked in both directions and it capped the pair in mid-September. 1.1650 was a swing low in late August and is very closely followed by 1.1630 which held the price down in mid-August.
  • 1.1580 worked as support in late August. 1.1530 supported the pair twice in August, making it an important line. 1.1435 held the EUR/USD down when it was trading around the yearly lows.
  • 1.1300 is a round number that held the pair in mid-August and also held the pair down in June 2017.

USD/JPY – Bank of Japan Leaves The Rate Unchanged

USD/JPY advanced nicely as trade wars took a step back, US yields climbed and the Fed remained hawkish. But not everything is going in favor of the pair.

The deadline came and went and the US did not impose new tariffs on China. On one hand, Trump threatened to add additional ones. On the other hand, Treasury Secretary Steven Mnuchin initiated talks with China. Does he have the backing of Trump? Probably not, but Trump is busy with Florence, the hurricane pounding the Eastern seaboard.

 

USD/JPY Technical Analysis

  • 113.15 is the high point seen in July. 112.45 was a stepping stone for the pair when it traded on such high ground. 112.15 was a swing high early in the month.
  • 111.80 was a peak in the dying days of August and serves as resistance. Close by, 111.50 capped the pair beforehand and is another barrier.
  • 110.60 was a swing low in late July and then again in late August. 109.70 was a swing low in late August and provides extra support below the round 110 level.
  • Close by, 109.35 was a cushion in mid-July. 108.70 was a cushion early in the summer and 108.10 a swing low in late May.
  • Lower, we find 107.50 capped the pair in early April and is a strong line.

Gold – Breakouts Out of Ascending Triangle Pattern Ahead of FOMC

On Friday, Gold prices sank more than 1 percent as the dollar firmed upon the British Pound and the Euro after British Prime Minister Theresa May said the European Union must supply an alternative Brexit proposal.

China’s progress to expand domestic consumption also helped support the dollar rally prompted by investor risks that the latest U.S.-China trade war was unlikely to dent global growth.

The dollar’s status as the chief reserve currency makes it the prime beneficiary of U.S.-China trade conflict, with the United States seen as having less to lose.

Gold – Technical Analysis

The gold bear trend is on hold for the fifth week in a row as the market is grinding higher. The 50, 100 and 200-period simple moving averages are coiled together while Gold is in consolidation mode. The RSI, MACD, and Stochastics indicators are bullish as buyers consider the consolidation phase as a bull flag while the market holds above 1,189.49 (September 4 low). Nothing indicates that the bullish momentum should abate anytime soon. Bulls target might be located near 1,225.90 (July 17 low). A break below 1,189.49 (September 4 low) should invalidate the bullish bias.

Categories
Forex Market Analysis

Weekly: Trade Tensions Continue; Italy “Crisis”; No Brexit Deal; FED to Raise Rates

 

NEWS COMMENTARY

US

Bets on Fed fund futures suggest that traders have already priced in the near-certainty of the next rate hike to occur this coming week. Yet the dollar reversed course, after last week posting the second trough in a descending peak-trough succession.

Also in the U.S., traders will get the opportunity to react to the latest data on consumer confidence, durable goods and gross domestic product.

OIL

A steady rise in U.S. oil output will gather pace in the next five years, OPEC said on Sunday, predicting that demand for the producer group’s crude will decline despite a growing appetite for energy fed by global economic expansion.

“Declining demand for OPEC crude is a result of strong non-OPEC supply in the 2017–2023 period, most notably from U.S. tight oil,” the Organization of the Petroleum Exporting Countries said in its long-term world oil outlook.

“The U.S. remains by far the most important source of medium-term supply growth, contributing … two-thirds of new supply, driven by surging tight oil output,” it said

 

EUR & GBP

The near term drag for the  single currency continues to be around the Italian debt. Recently, on August 31 to be more precise, the 2-year yield gilt on Italian bonds was as high as 1.465%, before plummeting to 0.63% after the presentation of the Italian budget prospect. It’s of no coincidence that the Euro rally in September coincided with a reduction of perceived short-term sovereign credit risk around Italy. If concerns around Italy are going to impact the Euro, it will be via another rise in short-term yields. We believe that there is no such a thing as a “crisis” surrounding Italian Credit’s situation; however, “news” do have the potential to print short-lived volatility to the markets.

The return of ‘hard Brexit’ fears resulting from the “surprisingly” fractious Salzburg summit obviously hit the British Pound hard at the end of the week. After Teresa May suggested that there would be a no deal Brexit, which of course causes a lot of fear. She stated that there are still a couple of points in the negotiation that divide the UK and the EU, but the spillover impact to the Euro was apparent as well. If odds of a disruptive exit from the EU increase, the uncertainty surrounding the impact to trade could be enough of a reason for the European Central Bank to eventually delay its monetary policy timeline for late next year.

 

AUD & NZD

While an easing of trade tensions between the United States and China may have been the catalysts behind last week’s rally in the Aussie and Kiwi, the possibility of renewed concerns could take the currencies lower early this week. This is because late Friday, China announced it was cancelling its meeting with the U.S., and wouldn’t resume negotiations until after the November U.S. mid-term elections.

The Australian Dollar, a proxy of China-related trades as well as gauge of risk sentiment, climbed to a three-week high last week. It also produced its biggest weekly advance in 14 months. Additionally, S&P Global Ratings revised its outlook on triple-A rated Australia to stable from negative on Friday, providing the Aussie with a further lift.

In its monetary policy minutes, the Reserve Bank of Australia (RBA) warned on risks to its outlook from U.S.-China trade tensions and weak wages, while reaffirming its next interest rate move would likely be a hike.

The RBA also said “Significant tensions” around trade policy are a “material risk” to the global outlook. Unemployment is expected to decline gradually toward 5 percent and wage growth is expected to increase gradually as spare capacity in the labor market is absorbed.

Although the Fed is widely expected to raise its benchmark interest rate on its next meeting, Australian and New Zealand Dollar traders will be primarily focused on the direction the Fed will chart ahead. Traders essentially want to know how aggressive the Fed will be in increasing rates in the future.

The 25-basis point increase to the federal funds rate is already priced into the market. The hike will push the funds target to 2 percent to 2.25 percent, where it last was more than 10 years ago.

Since the rate hike has already been factored into the dollar and the currencies, traders will be paying more attention to any information that shows how much more monetary tightening will be necessary to keep the economy (and inflation) healthy.

In New Zealand, the focus will be on business confidence and the interest rate and monetary policy decisions by the Reserve Bank of New Zealand (RBNZ). The Reserve Bank is widely expected to leave its benchmark interest rate at 1.75%.

 

 

CHART ANALYSIS

 

 

OIL

Last week price continued its ranging move between support at 66.2-64.15 and resistance at 74.45-72.45. After having breached the ascending trend, price turned back to the support zone with a bounce from an ascending trend as shown on the daily chart below. Price is now “pin bar” retesting this zone, as we expect bullish momentum to build up towards the 72.45-74.45 level.



 

S&P 500

On the daily chart, the price has broken the key resistance level at 2875.58 and stayed above it to reinforce the bullish bias.

However, we should highlight significant reversal signs, including:

1. Elliot’s Wave 5 has formed;
2. AB=CD harmonic pattern in play.
3. A Wedge reversal pattern remains active.
4. RSI Divergence.

Thus, if price breaks through support at 2875.58 we should witness a correction towards 2797.82.



 

AUD/USD

On the daily chart, the Aussie is clearly reflecting a bearish bias as it descends down a channel that started forming since the beginning of this year; reaching support at 0.71 where some clear sign of reversal showed up.

We expect reversal/consolidation to develop further as:

1. Price has bounced from the support zone between 0.71-0.716.
2. An AB=CD harmonic pattern is rather suggestive.
3. A Wedge reversal pattern.
4. RSI divergence.

the price manages to stay above 0.7225,then it has the potential of reaching 0.733 and 0.745



 

USD/CAD

On the daily chart, we observe the Loonie to follow a descending channel since June this year, with a false 2 weeks reversal before continuing its way down.

As we expected before that the price fell further to 1.289 and meet the ascending trend line from March’s Low, coupled with the 200 Exponential Moving Average (EMA)

Now the price located at the key support of 1.289 besides the ascending trend line from the low of 2017. so, any bounce here would expose the price back to 1.312. and any break beneath these levels would continue the bearish bias to 1.272



 

USD/JPY

On the daily chart, as expected, price is moving upwards to the 113 target, leaving 112 as near-term support. We expect an extension towards the 113 area before resumption of the downside towards at least 109,75.



Categories
Forex Market Analysis

Daily: Trade War Fears Fading; Strong Kiwi on NZ GDP Increase; U.K Retail Sales Printing Upward Momentum on the Pound

 

NEWS COMMENTARY

 

 

Markets extended their rally on Thursday as U.S.-China trade war fears were set aside and investors focused on bullish macroeconomic and corporate news.

Global markets appear to be shrugging off concerns over an escalating trade war between the U.S. and China

The British Pound got a strong boost following the surprisingly positive UK monthly retail sales figures, coming in to show 0.3% m/m growth in August as against a contraction of 0.2% anticipated. This coupled with some optimistic Brexit comments by the European Commission President Juncker and Irish Foreign Minister Simon Coveney remained supportive of the strong bid surrounding the cross.

In Europe, attention will be focused on an informal summit of European Union leaders in Austria on Thursday. Brexit and immigration are set to be the main points of discussion. U.K. Prime Minister Theresa May, under pressure at home and abroad to achieve a workable Brexit deal, has called for “goodwill” and flexibility from her EU counterparts. The future of the Irish/Northern Irish border remains a stumbling block in talks.

The New Zealand dollar jumped to three-week highs after strong domestic GDP data showed the country’s economy grew at the fastest pace in two years in the second quarter.

The Swiss National Bank (SNB) is maintaining its expansionary monetary policy, thereby stabilising price developments and supporting economic activity. Interest on sight deposits at the SNB remains at –0.75% and the target range for the three-month Libor is unchanged at between –1.25% and –0.25%. The SNB will remain active in the foreign exchange market as necessary, while taking the overall currency situation into consideration. Since the monetary policy assessment of June 2018, the Swiss franc has appreciated noticeably, against the major currencies as well as against emerging market currencies. The Swiss franc is highly valued, and the situation on the foreign exchange market is still fragile. The negative interest rate and the SNB’s willingness to intervene in the foreign exchange market as necessary remain essential in order to keep the attractiveness of Swiss franc investments low and thus ease pressure on the currency.

 

CHART ANALYSIS

 

OIL

Last week price continued its ranging move between support at 66.2-64.15 and resistance at 74.45-72.45. After having breached the ascending trend, price turned back to the support zone with a bounce from an ascending trend as shown on the daily chart below. Price is now “pin bar” retesting this zone, as we expect bullish momentum to build up towards the 72.45-74.45 level.



S&P 500

On the daily chart, the price has broken the key resistance level at 2875.58 and stayed above it to reinforce the bullish bias.

However, we should highlight significant reversal signs, including:

1. Elliot’s Wave 5 has formed;
2. AB=CD harmonic pattern in play.
3. A Wedge reversal pattern remains active.
4. RSI Divergence.

Thus, if price breaks through support at 2875.58 we should witness a correction towards 2797.82.



AUD/USD

On the daily chart, the Aussie is clearly reflecting a bearish bias as it descends down a channel that started forming since the beginning of this year; reaching support at 0.71 where some clear sign of reversal showed up.

We expect reversal/consolidation to develop further as:

1. Price has bounced from the support zone between 0.71-0.716.
2. An AB=CD harmonic pattern is rather suggestive.
3. A Wedge reversal pattern.
4. RSI divergence.

the price manages to stay above 0.7225,then it has the potential of reaching 0.733 and 0.745



USD/CAD

On the daily chart, we observe the Loonie to follow a descending channel since June this year, with a false 2 weeks reversal before continuing its way down.

We expect price to fall further to 1.289 and meet the ascending trend line from March’s Low, coupled with the 200 Exponential Moving Average (EMA)



USD/CHF

On the 4H chart, price is moving in a broadening wedge while breaking through the continuous Rectangle pattern at 0.9652. A correction has been already made to this level at the descending trend of the wedge. so, any reverse will take the price back to 0.956



USD/JPY

On the daily chart, price is moving upwards to the 113 target, leaving 112 as near-term support. We expect an extension towards the 113 area before resumption of the downside towards at least 109,75.



 

Categories
Forex Market Analysis

Sept 20 – Daily Briefing- Forex & Commodities In Focus

EUR/USD – Ascending Triangle Pattern In Play

The U.S. dollar trimmed lower against the euro and declined to the lowest in almost three weeks. As for the European Affairs Minister, Italy proposed the public debt within the Eurozone nations to be taken below 60% of the gross domestic product, via a long-term restructuring approved by the European Central Bank. The thoughts of reduction in debt extended support to the EUR/USD.

EUR/USD – Technical Levels
R3: 1.1828
R2: 1.1748
R1: 1.1717
Key Trading Level: 1.1667
S1: 1.1636
S2: 1.1587
S3: 1.1506

Trend continuation of EUR/USD is likely to be resolved by how investors react to the 1.1666 level which coincides with an ascending trendline. Therefore, a buying momentum above is needed if we want to see this pair reaching the 1.1900 final target. It is worth noticing that 1.1725 represents a heavy hurdle. On the contrary, the failure of the 1.1666 area would bring bears (i.e., sellers) back into the play field. Near-term downside targets are 1.1602, 1.15 and 1.10.

GBP/USD – UK Inflation Figures Underpins Sterling

After yesterday upbeating inflation figures, today´s docket brought us Retail Consumer data. Overall, retail sales numbers were worse than in the previous term but a bit better than expected, i.e., the (YoY) in August came at 3.3% v. 2.3% expected and 3.8% previous. By the time of writing this report, the Pound is reached yesterday´s High at 1.3200, the highest since July.

We still believe that everything for the Sterling is about Brexit and its negotiation ongoings. We could well witness a similar price action as yesterday, as we observe that sentiment is shifting to the downside. How long this will take is still uncertain.

GBP/USD – Technical Levels
R3: 1.3319
R2: 1.3225
R1: 1.3191
Key Trading Level: 1.3132
S1: 1.3098
S2: 1.3039
S3: 1.2945

The GBP/USD remains bullish at this point as long as it holds the 1.3135 support level. Rebound from 1.3135 could extend the Cable higher to 1.3190. However, the bearish breakout of 1.3135 can cause a drop up to 1.3100.

 

USD/JPY – Ascending Triangle Pattern

The USD/JPY remain mostly unchanged as the Bank of Japan interest rates were left unchanged at -0.1%, which was in line with traders forecasts. The Central Bank is also keeping its promise to keep 10-year government bond yields at 0% over the mid-term.

While leaving policy stable, inflation remains the biggest fear of both the government and BoJ. However, confidence towards the economy was pondered in the monetary policy statement regardless of growing tensions around global trade war. The Japanese Yen advanced from ¥112.324 to ¥112.349 against the Dollar, upon an announcement of the statement.

USD/JPY – Technical Levels
R3: 112.61
R2: 112.26
R1: 112.06
Key Trading Level: 111.91
S1: 111.7
S2: 111.56
S3: 111.21

For the moment, the immediate support level is likely to be 112.150. In the 4 hours chart, the pair extends moving away from it’s 100 and 200 SMA, with the smallest gaining upward traction, currently at about 111.45.

In the cited chart, the Relative Strength Index is crossing above 50, signifying the bullish bias of traders. As a result, the pair is heading north towards the potential target levels of 113.100, 114.150 and 115.300.

Gold – Ascending Triangle Pattern In Focus

The precious metal gold bounced as the dollar declined, symbolizing investors are starting to bother about the impact of the U.S.-China trade war on the U.S. economy, attracting some buyers back into gold investments. Gold prices have decreased by nearly 12% since April, damaged by the intensifying conflict and on growing U.S. interest rates with investors buying the dollar in the hope the United States has limited to lose from the conflict.

Gold – Technical Levels
R3: 1214.88
R2: 1207.08
R1: 1202.72
Key Trading Level: 1199.27
S1: 1194.92
S2: 1191.47
S3: 1183.66

For the moment, gold has formed an ascending triangle pattern which is signaling the bullish bias of traders. The precious metal is trading at 1203 with an immediate support near 1197 and a resistance at 1209.

 

 

Categories
Forex Market Analysis

Daily -UK CPI Gives Sterling (short-lived?) Upward Momentum; NAFTA Talks Continues; European Summit Ahead

 

NEWS COMMENTARY

Trade war

Investors continue expectant on new developments over the U.S.-China trade war after the Trump administration said on Monday it will implement new tariffs of 10% on $200 billion of Chinese products on Sept. 24, with the tariffs to go up to 25% in January. China retaliated by threatening to implement duties on about $60 billion worth U.S. goods, as previously announced; which is lower than expected. Unless new information hits the wires, markets seem to have fully priced in the current status on the Trade War theme.

Housing Data Ahead

The focus on Wednesday’s economic calendar will be on home construction coming 12:30 GMT.

Housing starts are expected to  risen by 5.8% to an annual rate of 1.235 million in August.

OIL

Oil traded slightly lower on Wednesday as stockpile data from the American Petroleum Institute showed a 1.25 million barrels increase in weekly crude inventories.

Traders are waiting for the weekly government data from the Energy Information Administration with expectations for a draw of 2.741 million barrels.

UK CPI

Meanwhile sterling increased after the consumer price index came in 2.7% higher than expected 2.4%, with core CPI 2.1% v. 1.8% forecasted,  which is regarded by market participants as yet another reason for the BoE and its MPC peers to to expand their monetary policy normalization plan further with a new rate increase anytime soon.

Later on, according to Times, UK Prime Minister Theresa May is set to reject the improved offer by Chief EU Negotiator Michel Barnier for a solution on the Irish border.  Maintaining an open border between the Republic of Ireland and Northern Ireland (part of the UK) has been one of the thorniest issues in the Brexit negotiations. This could make the recent Sterling rally fade.

The report from the times comes a short time before European leaders including May convene for an unofficial summit in Salzburg, Austria, with Brexit being high on the agenda.

NAFTA

U.S. Trade Representative Robert Lighthizer and Canadian Foreign Minister Chrystia Freeland will meet later today in Washington as the two countries remain at odds over some key details on a deal. President Donald Trump has warned he would impose tariffs on Canada in the event of no deal being reached, while Congress remains unwilling to approve a Mexico-only pact.

 

 

CHART ANALYSIS

OIL

Last week price continued its ranging move between support at 66.2-64.15 and resistance at 74.45-72.45. After having breached the ascending trend, price turned back to the support zone with a bounce from an ascending trend as shown on the daily chart below. Price is now “pin bar” retesting this zone, as we expect bullish momentum to build up towards the 72.45-74.45 level.



S&P 500

On the daily chart, the price has broken the key resistance level at 2875.58 and stayed above it to reinforce the bullish bias.

However, we should highlight significant reversal signs, including:

1. Elliot’s Wave 5 has formed;
2. AB=CD harmonic pattern in play.
3. A Wedge reversal pattern remains active.
4. RSI Divergence.

Thus, if price breaks through support at 2875.58 we should witness a correction towards 2797.82.



AUD/USD

On the daily chart, the Aussie is clearly reflecting a bearish bias as it descends down a channel that started forming since the beginning of this year; reaching support at 0.71 where some clear sign of reversal showed up.

We expect reversal/consolidation to develop further as:

1. Price has bounced from the support zone between 0.71-0.716.
2. An AB=CD harmonic pattern is rather suggestive.
3. A Wedge reversal pattern.
4. RSI divergence.

the price manages to stay above 0.7225,then it has the potential of reaching 0.733 and 0.745



USD/CAD

On the daily chart, we observe the Loonie to follow a descending channel since June this year, with a false 2 weeks reversal before continuing its way down.

We expect price to fall further to 1.289 and meet the ascending trend line from March’s Low, coupled with the 200 Exponential Moving Average (EMA)


USD/CHF

On the 4H chart, price is moving in a broadening wedge while breaking through the continuous Rectangle pattern at 0.9652. A correction has been already made to this level at the descending trend of the wedge. so, any reverse will take the price back to 0.956



USD/JPY

On the daily chart, price is moving upwards to the 113 target, leaving 112 as near-term support. We expect an extension towards the 113 area before resumption of the downside towards at least 109,75.



 

Categories
Forex Market Analysis

Daily: Trade was Escalates; RBA Gives the Australian Dollar Upwards Momentum

NEWS COMMENTARY

 

 

U.S. President Donald Trump announced on Monday that the U.S. will put 10% tariffs on $200 billion in Chinese goods, which will go up to 25% at the end of the year.

Trump added that “if China takes retaliatory action against our farmers or other industries, we will immediately pursue phase three, which is tariffs on approximately $267 billion of additional imports.” “We have been very clear about the type of changes that need to be made, and we have given China every opportunity to treat us more fairly,” he said in the statement. “But, so far, China has been unwilling to change its practices.”

 

China said on Tuesday that it had no choice but to retaliate against new U.S. trade tariffs, raising the risk that U.S. President Donald Trump could soon impose duties on virtually all of the Chinese goods that America buys. The Chinese commerce ministry’s statement came hours after Trump said he was imposing 10 percent tariffs on about $200 billion worth of imports from China, and threatened duties on about $267 billion more if China retaliated against the U.S. action.

The brief statement gave no details on China’s plans, but Foreign Ministry spokesman Geng Shuang told a news briefing later that the U.S. steps have brought “new uncertainty” to talks between the two countries. “China has always emphasized that the only correct way to resolve the China-U.S. trade issue is via talks and consultations held on an equal, sincere and mutually respectful basis. But at this time, everything the United States does not give the impression of sincerity or goodwill,” he added. Geng said he would not comment on “hypotheticals” such as what measures Beijing might consider apart from tariffs on U.S. products, saying only that details would be released at the appropriate time.

The Aussie rise in today’s session was caused by the upbeat approach used by the RBA in the Minutes published earlier today, i.e., while there was no strong case for near-term adjustment in policy, the next move in the lending rate is more likely to be an increase. Furthermore, despite of persistent risks related to abroad uncertainty and the slow recovery in labor wages, the bank explicitly vowed for a stronger AUD as supportive of domestic growth. However, upward momentum is likely to be temporary due to another key economic indicator, the CPI, which print was also released at -0.6% v.-0.7% and 2.0% prior; which lessens pressure on the RBA to push for a faster monetary policy normalization.

CHART ANALYSIS

 

OIL

Last week, price continued its ranging move between support at 66.2-64.15 and resistance at 74.45-72.45. After having breached the ascending trend, price turned back to the support zone with a bounce from an ascending trend as shown on the daily chart below. Price is now “pin bar” retesting this zone, as we expect bullish momentum to build up towards the 72.45-74.45 level.



 

S&P 500

On the daily chart, the price has broken the key resistance level at 2875.58 and stayed above it to reinforce the bullish bias.

However, we should highlight significant reversal signs, including:

1. Elliot’s Wave 5 has formed;
2. AB=CD harmonic pattern in play.
3. A Wedge reversal pattern remains active.
4. RSI Divergence.

Thus, if price breaks through support at 2875.58 we should witness a correction towards 2797.82.



 

AUD/USD

On the daily chart, the Aussie is clearly reflecting a bearish bias as it descends down a channel that started forming since the beginning of this year; reaching support at 0.71 where some clear sign of reversal showed up.

We expect reversal/consolidation to develop further as:

1. Price has bounced from the support zone between 0.71-0.716.
2. An AB=CD harmonic pattern is rather suggestive.
3. A Wedge reversal pattern.
4. RSI divergence.

Consequently, if the price manages to stay above 0.7225, it has the potential of reaching 0.733 and 0.745.



 

USD/CAD

On the daily chart, we observe the Loonie to follow a descending channel since June this year, with a false 2 weeks reversal before continuing its way down.

We expect price to fall further to 1.289 and meet the ascending trend line from March’s Low, coupled with the 200 Exponential Moving Average (EMA)



 

USD/CHF

On the 4H chart, price is moving in a broadening wedge while breaking through the continuous Rectangle pattern at 0.9652. A correction may occur at this level again before digging down to the next support 0.956



 

USD/JPY

On the daily chart, price is moving upwards to the 113 target, leaving 112 as near-term support. We expect an extension towards the 113 area before resumption of the downside towards at least 109,75.



 

Categories
Forex Market Analysis

Daily Briefing- Forex & Commodities In Focus

EUR/USD – Bounces Off After Inflation Report

The demand for the European currency continues firm at the inception of the week, raising EUR/USD to new daily highs in the 1.1690 zone. The index proceeds to gain from Friday’s pullback, climbing up after reaching solid contention in the 1.1620 areas.

 

Fundamentally, the downside risk from concerns regarding Italian fiscal sustainability now appears much more near term. However, the investors still believe the relative-rate support for the USD versus the EUR concurrently with the lingering trade war can cause a bearish pressure on the EUR/USD currency pair.

 

EUR/USD – Technical Levels
R3: 1.1858
R2: 1.1756
R1: 1.169
Key Trading Level: 1.1655
S1: 1.1588
S2: 1.1554
S3: 1.1452

GBP/USD – Goes For a Bullish Ride

Fundamentally, the European Union and Britain yet have a task to do to resolve a range of matters in Brexit negotiations including bypassing a “hard” border in Ireland, the EU stated before its negotiator Michel Barnier briefs ministers from member states.

The GBP/USD remains bullish at this point as long as it holds the 1.3135 support level. Rebound from 1.3135 could extend the Cable higher to 1.3190. However, the bearish breakout of 1.3135 can cause a drop up to 1.3100.

GBP/USD – Technical Levels
R3: 1.3266
R2: 1.3178
R1: 1.3124
Key Trading Level: 1.309
S1: 1.3036
S2: 1.3002
S3: 1.2915

 

USD/JPY – Ascending Triangle Pattern

The USD/JPY is pointing little change in the Monday session. At the moment, the pair is trading at 111.97, depressed 0.08% on the day. In economic headlines, it’s a modest inception to the week. The U.S Empire State Manufacturing Index sank piercingly from 25.6 to 19.0 points. This missed the forecast of 23.2 and was the weakest figure in five months.

For now, the monthly Bank of Japan rate meeting is awaited which is coming out on Tuesday. But it’s not expected to cause any major move in the market. As policymakers are foreseen to keep the short-term interest rate target at -0.1% and a promise to guide long-term rates near 0%.

 

USD/JPY – Technical Levels
R3: 112.83
R2: 112.41
R1: 112.24
Key Trading Level: 112
S1: 111.82
S2: 111.58
S3: 111.16

Gold Jumps above $1200 – Weaker Dollar In Play

Gold has begun the week with heavy gains. In Monday’s North American business, the spot rate for one ounce of gold is $1202.93, up 0.74% on the day. In the U.S, a key manufacturing report failed to surprise the market. The Empire State Manufacturing Index fell sharply, dropping from 25.6 to 19.0 points, causing a weakness in the dollar and bringing bulls for the gold.

Is the US-China trade war about to open a new stage? The world’s two biggest economies have now exchanged tariffs, and President Trump has frightened to piercingly up the ante and force tariffs of some $200 billion on China which is also causing a sort of haven appeal in the market. The greenback remains under pressure in the absence of economic catalysts. That’s why we are seeing a bullish trend in gold.

 

For the moment, the precious metal is heading north towards the major resistance level of 1208. On the 2 – hour chart, you can see it’s a triple top pattern and historically pattern is known for the bearish reversals.

 

Gold  – Technical Levels
R3: 1230.09
R2: 1214.21
R1: 1203.9
Key Trading Level: 1198.33
S1: 1188.02
S2: 1182.45
S3: 1166.57

Categories
Forex Market Analysis

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

NZD/USD

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



DAX

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



GBP/USD

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



USD/JPY

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



EUR/USD

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



Categories
Forex Market Analysis

FOMC statement, Canadian growth, New Zealand data

 

news commentary

 

 

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

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

 

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

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

 

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

 

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

 

 

chart analysis

 

 

US INDEX

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

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

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


 

 

AUD/USD

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

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


 

 

NZD/USD

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

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

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


 

 

USD/CAD

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

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

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


 

 

USD/JPY

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

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


Categories
Forex Market Analysis

Central Banks meetings, China conditions to negotiate

 

news commentary

 

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

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

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

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

 

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

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

 

 

chart analysis

 

 

US INDEX

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

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

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



 

 

AUD/USD

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

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



 

 

NZD/USD

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

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

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



 

 

USD/CAD

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

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

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



 

USD/JPY

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

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



 

Categories
Forex Market Analysis

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

 

 News Commentary

 

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

 

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

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

 

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

 

 

 Chart Analysis

 

 

US INDEX

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

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

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

 


 

USD/JPY

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

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

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

 


 

AUD/USD

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

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

 


 

NZD/USD

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

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

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

 


 

AUD/JPY

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

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

 


 

CHF/JPY

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

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


 

Categories
Forex Market Analysis

Weekly Technical Overview

US Dollar Index

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US Dollar Index is resuming its bullish trend. Nevertheless, even though

US Dollar Index

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US Dollar Index is resuming its bullish trend. Nevertheless, even though

US Dollar Index



 

US Dollar Index is resuming its bullish trend. Nevertheless, even though it has left behind many resistances now it is facing a horizontal resistance that will decide whether it creates a double top or breaks it and continues its run. For now, we wait to see its reaction the following week.

 

EURUSD



 

EURUSD has been moving sideways recently, mostly due to the uncertainty of the trade war between China and USA. However, in the upcoming days it should resume its bearish trend without any support ahead in the near term.

 

DAX



 

After weeks of moving sideways and without a clear direction, both fundamentals and technicals give positive reasons to be bullish at the indexes. Not only that the macroeconomic figures are forecasted to be strong but so are the quarterly results from both European and American corporations. Hence, we reopen a bullish position looking to profit the upcoming bull market.

 

GBPUSD 



 

GBPUSD is beginning the bearish trend we were waiting for. However, there is still a long way to go until it reaches the profit target. It can either resume the bearish trend or start moving sideways due to uncertainty. The next few weeks will be key to watch what happens both fundamentally and technically. For now, we remain bearish.

 

USDJPY



 

After weeks of waiting for the breakout, it is finally confirmed. Open positions have been opened waiting for the continuation of the bullish trend. It can either continue or do a retest which will eventually lead to a stronger confirmation of the breakout and the beginning of a bull run.

 

US Oil



 

Between resistances and supports there is not a clear path for oil prices apart from the many fundamental variables surrounding it. For now remain neutral awaiting a clear signal.

 

 

Categories
Forex Market Analysis

Daily Market Update: NFP Report, Brexit View

 

News Commentary

 

 

The dollar was heading up three-week lows against a currency basket after the latest U.S. jobs report on Friday showed wages grew less than expectation

 

News Commentary

 

 

The dollar was heading up three-week lows against a currency basket after the latest U.S. jobs report on Friday showed wages grew less than expectation

 

News Commentary

 

 

The dollar was heading up three-week lows against a currency basket after the latest U.S. jobs report on Friday showed wages grew less than expectation in June with 0.2% (forecast was 0.3%), even as the economy created more jobs than expected with 213K (forecast was 195K).

The average hourly earnings pointed to sustain inflation pressures that hold expectations back for a fourth rate hike by the Federal Reserve this year.

 

Brexit secretary David Davis resigned unexpectedly last night, to send a blow to Prime Minister Theresa May, as she struggles to end conflicts among her ministers who felt her plan to press for the closest possible trading ties with the European Union had betrayed their desire for a clean break with the bloc.

The pound had fallen responding to the following the reports, before having another turnaround amid indications that May would not face major trouble against her Brexit policy and hopes that a softer Brexit may be on the cards moving forward.

 

The Euro was boosted after data showing that German exports rose by more than imports in May, indicating that the euro area’s largest economy remains solid despite global trade tensions.

 

 

Chart Analysis

 

 

USD INDEX

As we expected on the daily chart, the price had bounced from the key resistance at 95.5, powered by divergence on RSI and a break beneath an ascending trend line.

The price also had shaped a reversal double top pattern.

So, the index is supposed to get back down to the support zone again of 93.2-92.6.



 

USD/JPY

On the daily chart, the pair retested the key resistance of 111.1 again and the descending trend from the high of 2017 to shape a double top reversal pattern.
So, the price is expected to assure the next bearish move that leads the price to the support zone of 108.65-108.15.



 

AUD/USD

On the daily chart, as we expected, the price has reversed from the support zone of 0.7325-0.7365.

The pair is supposed to go on in its bullish momentum powered by divergence on RSI to reach the key resistance of 0.758, where the descending trend from the high of February is located.



 

AUD/JPY

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

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



 

CAD/JPY

On the 4 hour chart, we can see a break above the descending wedge along with shaping a head & shoulders pattern.

A GARTLEY harmonic pattern has enhanced the bullish bias before 84.35.

Watch the neckline of the H&S which is located at the mentioned resistance (84.35) with moving average 200 too.

A break above these levels would take the price up to the key resistance 87.



Categories
Forex Market Analysis

Daily Market Update: Trade Tariffs Begin, FOMC Meeting, NFP Data

 

News Commentary

 

The trade conflict between the US and China has just been put into action today when U.S. tariffs on $34 billion worth of Chinese goods went

 

News Commentary

 

The trade conflict between the US and China has just been put into action today when U.S. tariffs on $34 billion worth of Chinese goods went

 

News Commentary

 

The trade conflict between the US and China has just been put into action today when U.S. tariffs on $34 billion worth of Chinese goods went into effect at 04:00 GMT. An additional tariffs on another $16 billion is expected to take place in the upcoming two weeks. Meanwhile U.S. President Donald Trump has given instructions to identify a further $300 billion on possible Chinese goods.

China has also vowed to reply with tariffs on $34 billion of American goods. Beijing had previously said it would impose tariffs on U.S. agricultural products, crude imports, and vehicle products.

 

Yesterday, Federal Reserve policymakers enhanced the view of further increases in interest rates as the U.S. economic growth continued “above trend”.

“Participants generally expected that further gradual increases in the target range for the federal funds rate would be consistent with the solid expansion of economic activity, strong labour market conditions, and inflation near the Committee’s symmetric 2 per cent objective over the medium term,” the Fed said in the minutes.

The Fed’s statement to continue tightening monetary policy was boosted by a continued rally in inflation and a solid labour market, despite concerns about the impact of rising trade tensions on spending and business sentiment.

 

Today’s big data will be at 12:30 GMT with NFP. The expectation goes for 195K, less than the previous reading 223K

Also keep an eye on average hourly earnings, which is expected to remain the same as the last reading with 0.3%

 

 

 Chart Analysis

 

 

USD INDEX

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

The price also had shaped a reversal double top pattern.

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



 

USD/JPY

On the daily chart, the pair retested the key resistance of 111.1 again and the descending trend from the high of 2017 to shape a double top reversal pattern.
So, the price is expected to assure the next bearish move that leads the price to the support zone of 108.65-108.15.



 

AUD/USD

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

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



 

AUD/JPY

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

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



 

CAD/JPY

On the 4 hour chart, we can see a break above the descending wedge along with shaping head & shoulders pattern.

A GARTLEY harmonic pattern has enhanced the bullish bias before 84.35.

Watch the neckline of the H&S which is located at the mentioned resistance (84.35) with moving average 200 too.

A break above these levels would take the price up to the key resistance 87.



 

Categories
Forex Market Analysis

Daily Market Update: FOMC Meeting, Friday Deadline Of Tariffs, German Industrial Bounces

 

News Commentary

 

 

US President Trump has restated his call for OPEC to bring down the price of gasoline. He recently asked Saudi Arabia to increase production after

 

News Commentary

 

 

US President Trump has restated his call for OPEC to bring down the price of gasoline. He recently asked Saudi Arabia to increase production after

 

News Commentary

 

 

US President Trump has restated his call for OPEC to bring down the price of gasoline. He recently asked Saudi Arabia to increase production after he imposed Iran with sanctions reducing Iran’s production by up to 1.1M barrels per day. An Iranian Republican Guard Commander has said that Iran would block the Strait of Hormuz if the US stops Iranian oil sales.

Investors are still cautious ahead of Friday’s deadline for the U.S. to impose a 25% tariff on $34 billion worth of Chinese imports, which Beijing has pledged to match with a levy on U.S. products.

 

The Fed will release minutes of its June meeting today, with investors looking for clues on whether it is still on track to raise interest rates twice more this year

Most economists expect that the FED will persist in raising the rates at its own pace.

“Every FED official but one projects the central bank will get rates above 3% by 2020”, said Michael Hanson, head of global macro strategy at TD Securities.

Seth Carpenter, chief U.S. economist at UBS, agreed. He said it would take “a major surprise” to keep the FED from pushing interest rates up at a steady pace.

 

On other hand, some ECB members seemed to be troubled about the slow pace of rates hikes, saying that a Sept/Oct 2019 hike is too late. In response, the probability of a September rate hike has risen from 69% to 80%.

German industrial orders bounced back in May with higher than expected results after four consecutive monthly drops, as demand from domestic customers and the rest of the Eurozone picked up.

 

 

 Chart Analysis

 

USD INDEX

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

The price also had shaped a reversal double top pattern.

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



 

USD/JPY

On the daily chart, the pair retested the key resistance of 111.1 again and the descending trend from the high of 2017 to shape a double top reversal pattern.
So, the price is expected to assure the next bearish move that leads it to the support zone of 108.65-108.15.



 

AUD/USD

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

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



 

AUD/JPY

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

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



Categories
Forex Market Analysis

Daily Market Update: PBOC To Hold Rates, Positive Data For AUD & GBP

 

News Commentary

 

The Dollar fell against the rest of the currency basket on Wednesday as trade slowed ahead of the U.S. Independence Day holiday, as concerns over trade

 

News Commentary

 

The Dollar fell against the rest of the currency basket on Wednesday as trade slowed ahead of the U.S. Independence Day holiday, as concerns over trade

 

News Commentary

 

The Dollar fell against the rest of the currency basket on Wednesday as trade slowed ahead of the U.S. Independence Day holiday, as concerns over trade tensions remain the top issue.

Investors remained worried ahead of Friday’s deadline for the U.S. to impose a 25% tariff on Chinese imports, which Beijing has declared to match with a another response on U.S. products.

U.S. President Donald Trump is insisting on plans to harm major trading partners, including the European Union, Mexico and Canada as part of his ‘America First’ policy that many investors fear will hit global growth.

 

On the other hand, China’s central bank has warranted to keep the exchange rate “basically stable,” in an attempt to calm markets which have been on fire by fears over the escalating trade hassle between Washington and Beijing.

 

The Australian dollar was boosted overnight after data showing that retail sales rose by a higher than expected 0.4% in May, beating forecasts for the second straight month.

 

Great Britain services PMI grew to 55.1 to exceed expectations and the last reading which was at 54.0.

Services PMI is considered a substantial factor to Sterling as it represents 80% of the total Gross Domestic Product (GDP), which has risen to 0.2% with a hike in manufacturing & construction, 54.4 & 53.1 respectively.

This data enhances the hawkish outlook for the BoE to raise the rate in August.

 

 

 Chart Analysis

 

 

USD INDEX

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

The price had also shaped a reversal double top pattern.

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



 

USD/JPY

On the daily chart, the pair retested the key resistance of 111.1 again and the descending trend from the high of 2017 to shape a double top reversal pattern.
So, the price is expected to assure the next bearish move that leads the price to the support zone of 108.65-108.15.



 

AUD/USD

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

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



 

AUD/JPY

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

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