LiteForexTeam

XAU/USD: pair remains within range Current trend On Monday, the price of gold declined by 0.7% to $1068 per ounce. US Fed aims at gradual tightening of monetary policy. As long as the US Dollar will be strengthening, the price of gold is likely to remain under pressure. Borrowing costs for purchase and storage of gold tend to increase. From 3:30 to 8:00 pm (GMT+2) attention needs to be paid to US news releases, among which Consumer Confidence data for December. The indicator is expected to be up to 93.8 from 90.4 points that will support the US Dollar. Support and resistance In December, the XAU/USD pair has been trading within the range of 1085.00-1050.00. On the 4-hour chart, OsMA and Stochastic recommend long positions, but a growth in the pair is limited by the resistance levels of 1075.00 (EMA144) and 1080.00 (EMA200 on the 4-hour chart). On the daily chart, the indicators have started giving sell signals. However, due to a lack of drivers, the price is likely to remain within the range. Fundamental factors create prerequisites for a further decline in the price of gold. Support levels: 1071.00, 1067.00, 1060.00, 1050.00. Resistance levels: 1075.00, 1080.00, 1085.00. Trading tips Short positions can be opened from the level of 1068.00 with targets at 1050.00, 1040.00, 1010.00 and stop-loss at 1077.00. Long positions can be opened from the level of 1082.00 with targets at 1085.00, 1088.00 and stop-loss at 1079.00.

XAU/USD: pair remains within range Current trend On Monday, the price of gold declined by 0.7% to $1068 per ounce. US Fed aims at gradual tightening of monetary policy. As long as the US Dollar will be strengthening, the price of gold is likely to remain under pressure. Borrowing costs for purchase and storage of gold tend to increase. From 3:30 to 8:00 pm (GMT+2) attention needs to be paid to US news releases, among which Consumer Confidence data for December. The indicator is expected to be up to 93.8 from 90.4 points that will support the US Dollar. Support and resistance In December, the XAU/USD pair has been trading within the range of 1085.00-1050.00. On the 4-hour chart, OsMA and Stochastic recommend long positions, but a growth in the pair is limited by the resistance levels of 1075.00 (EMA144) and 1080.00 (EMA200 on the 4-hour chart). On the daily chart, the indicators have started giving sell signals. However, due to a lack of drivers, the price is likely to remain within the range. Fundamental factors create prerequisites for a further decline in the price of gold. Support levels: 1071.00, 1067.00, 1060.00, 1050.00. Resistance levels: 1075.00, 1080.00, 1085.00. Trading tips Short positions can be opened from the level of 1068.00 with targets at 1050.00, 1040.00, 1010.00 and stop-loss at 1077.00. Long positions can be opened from the level of 1082.00 with targets at 1085.00, 1088.00 and stop-loss at 1079.00.

XAG/USD: general review Current trend Yesterday the pair fell and lost about 50 points. Market volatility is expected to be low today. Attention needs to be paid to data on the S&P/Case-Shiller Home Price Indices in the US. According to forecasts, the index will fall that might pressure the USD. Also, pay attention to data on Consumer Confidence that is expected to grow by 3.4%. Support and resistance On the 4-hour chart, the pair is trading between the upper and middle MA’s of Bollinger Bands. Moving averages with 50, 100, and 144 periods remain above the price and directed down indicating a negative trend. MACD histogram is in the negative zone and its volumes are growing. ADX is falling and DI lines are directed down indicating a fall in the pair. Support levels: 13.86, 13.67. Resistance levels: 14.03, 14.19, 14.40. Trading tips Long positions can be opened from the level of 14.03 with the target at 14.19. Validity – 1 day. Short positions can be opened after the breakdown of the level of 13.86 with the target at 13.67. Validity – 1 day.

AUD/USD: pair strengthened Current trend Last week the pair strengthened by 100 points amid some weakening in the USD. Tomorrow data on the Producer Price Index for the fourth quarter is due in Australia. Considering strong decline in oil prices during the last quarter that dragged down all commodities’ prices, the index is unlikely to show a growth. Thus, an absence of inflation growth could force the RBA to ease monetary policy further. At the same time, amid gradual policy tightening in the US the pair will remain under pressure in the medium-term. Tomorrow attention also needs to be paid to data from the US on Goods Trade Balance, Rebook Index and Consumer Confidence. Support and resistance The pair broke out its trendline and resistance level at 0.7210 but failed to reach the key resistance level at 0.7330 (ЕМА144 on the daily chart). A breakdown of the levels of 0.7210, 0.7120 (lower border of a correctional upward channel on the daily chart), 0.7100 (December lows) would resume a downward trend towards 0.7030, 0.6980, 0.6910 (year lows). At the same time, a price consolidation above the levels of 0.7450 (ЕМА200 on the daily chart), 0.7510 (23.6% Fibonacci correction) would return the pair in an uptrend. On the daily chart, OsMA and Stochastic recommend purchases, while on the 4-hour chart the indicators turned to sales. Support levels: 0.7210, 0.7120, 0.7100, 0.7030, 0.6980, 0.6910. Resistance levels: 0.7290, 0.7330, 0.7400, 0.7450, 0.7510. Trading tips Pending sell orders can be placed from the level of 0.7250 with targets at 0.7110, 0.7090, 0.7030, 0.6980, 0.6910 and stop-loss at 0.7280. Pending buy orders can be placed from the level of 0.7310 with targets at 0.7330, 0.7410, 0.7450, 0.7490 and stop-loss at 0.7280.

XAG/USD: pair corrected Current trend Last week the pair slightly strengthened amid closing of short positions by traders prior to Christmas holidays. In addition, gold and silver prices were supported by growing oil prices that managed to strengthen after the publication of oil reserves data in the US. The data showed that reserves fell by 5.88 million barrels, while experts predicted a 1.5 million barrels growth. At the same time, the market attention shifts to fresh macroeconomic statistics that are coming out in the US and which could help to determine future changes in monetary policy. Support and resistance Bollinger Bands on the daily chart is moving horizontally while the price range remains unchanged. MACD is growing and giving a weak buy signal. Stochastic is in the overbought zone and trying to turn down. The indicators recommend waiting for clearer trading signals. Support levels: 14.30 (local low), 14.20, 14.00, 13.90, 13.82, 13.63 (14 December low). Resistance levels: 14.48 (local high), 14.63 (7 December high), 14.77, 15.00 (beginning of November high), 15.15, 15.25. Trading tips Long positions can be opened after the price rebound from the level of 14.20 (with the appropriate indicators signals) with targets at 14.63, 15.00 and stop-loss at 14.00. Validity – 2-4 days. Short positions can be opened after the breakdown of the level of 14.20 with targets at 14.00, 13.80, 13.60 and stop-loss at 14.50. Validity – 3-4 days.

USD/JPY: general analysis Current trend The Japanese Yen continues strengthening against the US Dollar amid the publication of BoJ economic report. Initial Jobless Claims statistics are due today in the US. Analysts expect the indicator to be down by 1K to 270K. Such dynamics suggests strong labor market conditions and might support the US Dollar. Tomorrow, attention needs to be paid to Japan’s Unemployment Rate which is expected to increase by 0.1% to 3.2%. Weakness in the labor market affects the country’s economy and the JPY exchange rate. Support and resistance On the daily chart, the pair is trading near the lower MA of Bollinger Bands. The price remains below the MA50, MA100 and MA144, directed parallel and horizontally. MACD histogram is in the negative zone, its volumes are growing; thus, negative dynamics in the pair is likely to develop. Support levels: 120.12 (lower MA of Bollinger Bands), 118.80, 118.06, 117.20, 116.19. Resistance levels: 121.73, 122.00, 122.50, 123.60, 124.25, 125.27. Trading tips Long positions can be opened from the level of 120.12 with the target at 121.15 and stop-loss at 119.85. Short positions can be opened from the level of 119.85 with the target at 119.00 and stop-loss at 120.12. Validity – 2 days.

AUD/USD: growth in oil prices supported AUD Current trend Yesterday, after the Energy Information Administration reported a fall in US crude inventories, the price of oil grew by 3.8%. Since opening of the trading day, the AUD/USD pair has been strengthening amid a growth in commodity prices. The Australian Dollar gained support as Australia is a large exporter of commodities. However, in the medium term, the pair tends to continue declining due to different approaches to monetary policy of the Fed and RBA. Today, attention needs to be paid to Initial Jobless Claims data, due in the US. If the indicator comes in below the forecast, the pair might get another impulse for growth. Support and resistance On the 4-hour and daily charts, OsMA and Stochastic recommend long positions. The nearest resistance level is 0.7290. If this level is broken out, a growth to 0.7325 (EMA144 on the daily chart) will be possible. If the price declines below the level of 0.7210, it might move further down to 0.7100 (lower border of an ascending correctional channel on the daily chart). Support levels: 0.7210, 0.7100, 0.7030, 0.6980, 0.6910. Resistance levels: 0.7290, 0.7325, 0.7400, 0.7450, 0.7510. Trading tips Short positions can be opened from the level of 0.7220 with targets at 0.7110, 0.7090, 0.7030, 0.6980, 0.6910 and stop-loss at 0.7250. Long positions can be opened from the level of 0.7310 with targets at 0.7325, 0.7410, 0.7450, 0.7490 and stop-loss at 0.7280.

USD/JPY: pair declined Current trend Last week, the Japanese Yen gained support when the Bank of Japan decided to keep monetary policy unchanged. BoJ Governor gave a generally favorable outlook of the country’s economy. At present, the USD/ JPY pair still tends to continue declining. However, Japan is undergoing a period of a weak growth in Industrial Production, Services PMI and a decline in exports. Moreover, inflation will remain low in the medium term. Thus, BoJ might have to consider further changes to monetary policy. Support and resistance A decline in the pair has stopped at the support level of 120.55 (EMA200 on the daily chart and 61.8% Fibonacci) which is also the lower border of an ascending channel on the daily chart. While the price remains above this level, it tends to grow in the medium term. The breakout of the resistance levels of 121.35, 121.50 (50.0% Fibonacci), 122.00 (EMA200 and EMA144 on the 4-hour chart), 122.50 (38.2% Fibonacci) would allow the price to strengthen to 123.70 (23.6% Fibonacci), 124.50 and 125.00 (upper border of the ascending channel on the daily chart). On the 4-hour, daily and weekly charts, OsMA histogram is near the zero line. Amid a decline in trading activity due to the upcoming holidays, the pair is likely to remain near the level of 121.00. Support levels: 120.55, 120.00, 118.85. Resistance levels: 121.35, 121.50, 122.00, 122.50, 123.00, 123.70. Trading tips Long positions can be opened from the level of 121.60 with targets at 121.90, 122.00, 122.50, 123.00, 123.50, 123.70, 124.00, 124.50, 125.00 and stop-loss at 121.20. Short positions can be opened from the level of 120.35 with targets at 120.00, 118.85, 118.00 and stop-loss at 120.75.

XAU/USD: general analysis Current trend After a strong growth at the beginning of the week, the price of gold declined and was ranging between 1080.68 and 1071.79 on Tuesday. At present, the price remains in the area of 1073.85 and might start correcting up to this week high 1081.60. Durable Goods Orders statistics for November are due today in the US. This data is an important indicator for the market; its growth has a positive effect on the economy. However, analysts expect a decline to -0.7% from 3.0% in October that might affect the USD and ease the pressure on the XAU/USD pair. Support and resistance On the daily chart, the pair is trading between the upper and the middle MA of Bollinger Bands. MA50, MA100 and MA144 remain above the current price and directed down. According to the indicator, the pair is in a negative trend. MACD histogram is in the negative zone with almost no volumes. ADX indicator suggests a decline in the pair. The DI lines are directed parallel and down, ADX is falling. Support levels: 1068.46 (middle MA of Bollinger Bands), 1051.22, 1046.43 (beginning of December low). Resistance levels: 1084.74 (upper MA of Bollinger Bands), 1097.67, 1118.26, 1131.65. Trading tips Long positions can be opened from the current level with the target at 1080.87 and stop-loss at 1068.46. If the price consolidates below the level of 1068.46, short positions would become valid. Open short positions from the level of 1065.60 with the target at 1051.22 and stop-loss at 1073.00.

XAG/USD: growth impulse getting weak Current trend Yesterday, Atlanta Fed President Dennis Lockhart said a hike in US interest rates is seen as a start of a new period in US economic growth. US economy has a solid momentum going into 2016. He also noted the Fed might continue increasing rates not at every meeting but every other meeting. Therefore, the US Dollar tends to strengthen while the price of precious metals will remain under pressure. However, due to geopolitical tensions and global financial markets instability, demand for the safe haven assets might increase. Support and resistance Despite OsMA and Stochastic on the 4-hour and daily charts recommend long positions, the growth impulse is getting weak. The price reached the resistance levels of 14.20 (ЕМА144), 14.30 (ЕМА200 on the 4-hour chart). Theoretically speaking, an upward correction might reach the level of 14.45 (ЕМА50 on the daily chart). The pair is trading in a descending channel on the daily chart with the lower border near the level of 13.50 and in a descending channel on the weekly chart with the lower border below the level of 13.20. After the breakdown of the level of 14.00 (August lows), the fall will accelerate. Support levels: 14.00, 13.80, 13.65, 13.50. Resistance levels: 14.45, 14.80, 15.05, 15.30. Trading tips Short positions can be opened from the level of 14.20 with targets at 14.00, 13.65, 13.50, 13.20 and stop-loss at 14.40. Long positions can be opened from the level of 14.55 with targets at 14.75, 15.00 and stop-loss at 14.40.

EUR/USD: general analysis Current trend The single European currency is trading slightly up against the US Dollar. At present, the pair remains within the range of 1.0910-1.0930. Analysts suggest the USD will continue strengthening as the Fed has started tightening US monetary policy. ECB, in its turn, tends to expand monetary stimulus to boost the EU economy. GDP data for the third quarter is due today in the US. If the indicator comes in above the forecast of 1.9%, EUR short positions should be placed. Support and resistance The support level is 1.0807. The nearest resistance level is 1.1009. Trading tips Short positions can be opened from the level of 1.1009 with the target at 1.0815 and stop-loss at 1.1065.

GBP/USD: important statistics Current trend Important data on the UK economy is expected during the week. Tomorrow data on the Current Account is due. According to forecasts, in November the budget deficit increased by about 4.7 billion Pounds. On Wednesday, data on the third quarter GDP is out. The figure is expected to remain at 0.5%, unchanged from the previous quarter. At the same time, latest data on consumer inflation showed a near-zero growth, while producer price indices significantly fell. Therefore, absence of inflation growth and poor macroeconomic statistics shift the expectations of monetary policy tightening in the UK to the second half of 2016 that will continue pressuring the pair. Support and resistance On the daily chart, the pair is falling towards the lower border if a descending channel near the level of 1.4860. An upward correction in the pair could continue up to the levels of 1.5000 (ЕМА50 on the 4-hour chart), 1.5085 (ЕМА144), 1.5120 (ЕМА200), 1.5230 (23.6% Fibonacci correction and upper border of the descending channel). At the same time, a breakdown of the level of 1.4860 will accelerate the fall towards 1.4800, 1.4750 and 1.4600 (year lows). On the daily and weekly charts, OsMA and Stochastic recommend short positions, while on the 4-hour chart the indicators are turning to purchases. Support levels: 1.4860, 1.4800, 1.4750. Resistance levels: 1.4960, 1.5000, 1.5085, 1.5100, 1.5120, 1.5230. Trading tips Open short positions from current prices with targets at 1.4860, 1.4800, 1.4750 and stop-loss at 1.4930. Long positions can be opened from the level of 1.4940 with targets at 1.5000, 1.5085, 1.5100, 1.5120, 1.5190 and stop-loss at 1.4890.

USD/JPY: BoJ loose monetary policy Current trend At the meeting on Friday, the Bank of Japan decided to keep its monetary policy mostly unchanged. BoJ Governor stated the Regulator aims at achieving an inflation rate of 2 per cent; however, much depends on the price of oil. Therefore, Japan’s Central Bank might start taking more decisive action soon. Today, the US Dollar is gaining back its losses against the Japanese Yen. As the Federal Reserve and the Bank of Japan have different approaches to monetary policy, the USD/JPY pair tends to be strengthening in the medium term. Support and resistance Strong support levels are 121.35 (EMA on the daily chart) and 120.55 (EMA200 and the lower border of an ascending channel on the daily chart, 61.8% Fibonacci). After the consolidation below the level of 120.55, the price might decline further to 120.00 and 118.85. If the price overcomes the resistance levels of 121.50 (50.0% Fibonacci), 122.10 (EMA200 and EMA144 on the 4-hour chart), 122.50 (38.2% Fibonacci), an upward trend might resume towards 123.70 (23.6% Fibonacci), 124.50 and 125.00 (the upper border of the ascending channel on the daily chart). On the daily chart, OsMA and Stochastic recommend short positions; on the 4-hour chart, the indicators are turning to long positions, suggesting a downward correction is, possibly, nearing the end. Support levels: 121.35, 121.00, 120.55, 120.00, 118.85. Resistance levels: 121.50, 122.10, 122.50, 123.00, 123.70. Trading tips Long positions can be opened from the current level with targets at 121.90, 122.10, 122.50, 123.00, 123.50, 123.70, 124.00, 124.50, 125.00 and stop-loss at 121.20. Short positions can be opened from the level of 121.10 with targets at 120.55, 120.00, 118.85 and stop-loss at 121.60.

XAU/USD: general analysis Current trend On Thursday, the XAU/USD pair was falling, being under pressure from the Fed’s decision to increase the interest rate to 0.5 percent from 0.25 percent. Having lost more than 2500 points, the price for gold was moving down towards its year lows, reached at the beginning of December. At present, the price has started correcting up in the area of 1054.35. Support and resistance On the daily chart, the pair is trading between the lower and the meddle MAs of Bollinger Bands. MA50, MA100 and MA144 are above the current price and directed down. MACD histogram is in the negative zone. The DI lines of ADX are crossing each other and directed down. The indicators confirm a downward trend in the XAU/USD pair. Today, the price is likely to remain within the channel between the lower and the middle MAs of Bollinger Bands. Support levels: 1049.85 (lower MA of Bollinger Bands), 1049.98 (December low). Resistance levels: 1067.73 (middle MA of Bollinger Bands), 1084.65, 1099.14, 1120.41, 1133.94, 1165.35, 1191.93. Trading tips Long positions can be opened at the current level with the target at 1060.50 and stop-loss at 1051.00. Validity – 1 day.

USD/CAD: review and forecast Current trend During yesterday’s session, the pair significantly grew. The pair was supported by strong data on the US labour market, where the number of Initial Jobless Claims fell from 282 to 271 thousands, against a forecasted decline to 275 thousands. In addition, the pair is supported by strengthening after the Fed decision on interest rates US Dollar and falling oil prices. In current conditions, the Bank of Canada might decide to continue with monetary policy easing and cut the interest rate to -0.5% that would add to the pressure on the Canadian Dollar. Today attention needs to be paid to data on the Consumer Price Index for November in Canada. Support and resistance On the 4-hour chart, MACD’s histogram is above the zero and its signal lines indicating strong upward trend. The K% line of Stochastic is about to cross over the D% line suggesting a possibility of a correction in the pair. Support levels: 1.3900, 1.3840, 1.3800. Resistance levels: 1.4000, 1.4050, 1.4100. Trading tips Long positions can be opened above the level of 1.4000 with targets at 1.4050, 1.4100. Short positions can be opened below the level of 1.3900 with targets at 1.3840, 1.3800.

AUD/USD: in contracting triangle Current trend Yesterday, the Federal Reserve raised US interest rates. This decision confirms the Fed is confident that US economic recovery is sustainable and suggests the Regulator has a favorable outlook for the global economy. RBA, in its turn, is likely to keep loose monetary policy due to weak inflation. Moreover, the Australian Dollar is under pressure from a continuous fall in commodity prices, in iron ore price in particular, as Australia remains the largest exporter of this raw material. Therefore, the AUD/USD pair tends to continue declining. Support and resistance On the daily chart, a contracting triangle has formed with the lower border near the level of 0.7190 and the upper border at 0.7335 (EMA144). The price is likely to breakdown the lower border of the triangle and continue declining to 0.7100, 0.7030, 0.6980 and 0.6910 (year lows). In case of a correctional growth, the price might reach the level of 0.7335 (EMA144 on the daily chart). An upward trend would resume only after the consolidation above the levels of 0.7465 (EMA200 on the daily chart) and 0.7510 (23.6% Fibonacci). Support levels: 0.7215, 0.7170, 0.7100, 0.7030, 0.6980, 0.6910. Resistance levels: 0.7300, 0.7350, 0.7400, 0.7500. Trading tips Short positions can be opened from the current level with targets at 0.7170, 0.7150, 0.7110, 0.7090, 0.7030, 0.6950, 0.6910 and stop-loss at 0.7250. Long positions can be opened from the level of 0.7260 with targets at 0.7300, 0.7335, 0.7410, 0.7450, 0.7490 and stop-loss at 0.7190.

EUR/USD: general analysis Current trend The single European currency continues declining against the US Dollar. The main factor which affects the EUR/USD pair is the Fed’s decision to raise interest rates by 0.25 points. Moreover, Fed Chair Janet Yellen stated that more rate hikes are possible over the next year if US economy continues strengthening. Therefore, the European currency will remain under pressure for quite a long period of time. Economists suggest that US Unemployment Rate will decline to 4.7% during 2016-2018, while economic growth will reach the level of 2.2%. Support and resistance Support level: 1.0858 (1/8 Murray level). The nearest resistance level is 1.0900 (0/8 Murray level). Trading tips Short positions can be opened after the breakdown of the level of 1.0800 with the target at 1.0740 and stop-loss at 1.0825.

EUR/USD: waiting for Fed meeting Current trend Yesterday the pair fell and lost about 150 points, which was the result of a publication of strong data in the US. The Consumer Price Index grew to 0.5% that was 0.1% higher than forecasts. Today attention of traders is focused on the Fed meeting where the regulator could increase its key interest rates for the first time since 2006. Usually, a rate increase significantly supports the national currency. The Fed Interest Rate Decision is due at 9 pm (GMT+2), its press conference is planned for 9:30 pm (GMT+2). Very high volatility is expected on the market. Support and resistance On the 4-hour chart, the pair is trading between the lower and middle MA’s of Bollinger Bands. Moving averages with 100 and 144 periods remain below the price and directed up. MACD histogram is in the positive zone but its volumes are rapidly falling. Support levels: 1.0907 (lower MA of Bollinger Bands), 1.0871 (MA100), 1.0794, 1.0565, 1.0527. Resistance levels: 1.0930 (MA50), 1.0970 (middle MA of Bollinger Bands), 1.1035 (upper MA of Bollinger Bands), 1.0959 (current week high). Trading tips Short positions can be opened from the level of 1.0907 with the target at 1.0800 and stop-loss at 1.0930. Long positions can be opened after the breakout of the level of 1.0970 with the target at 1.1035 and stop-loss at 1.0930. Validity – 1 day.

GBP/USD: general analysis Current trend Yesterday, the British Pound declined against the US Dollar. The pair was under pressure amid the publication of favorable statistics on Redbook index which grew by 1.5% from the previous 1.9%. Consumer Price Index was up by 0.5% that is 0.1% above the forecast. Today, attention needs to be paid to Unemployment Rate and Average Earnings data, released in the UK. Unemployment Rate is expected to remain unchanged at 5.3%. However, the most important news is due in the US – the Fed announces its interest rate decision. Amid this publication, the market will be highly volatile. However, until the Fed decision is released, the pair is likely to continue moving down. Support and resistance The nearest support level is 1.4965 (8 December support level). The resistance level is 1.5082 (MA24, 4 December low and 7 December high). Trading tips Short positions can be opened from the level of 1.5046 with the target at 1.4965 and stop-loss at 1.5082.

USD/JPY: pair returned to growth Current trend Yesterday the USD/JPY pair significantly strengthened. Trading in the pair was very volatile due to a large number of macroeconomic publications that was coming out and approaching US Fed meeting at which, as expected, the regulator will increase its key interest rate. The pair was supported by strong data on consumer inflation in the US. The Consumer Price Index for November grew from 0.2% to 0.5% that was better than economists forecasted. Support and resistance Bollinger Bands on the daily chart is moving down while the price range is slowly narrowing. MACD is growing and giving a buy signal. Stochastic bounced off the oversold zone and growing. The indicators recommend long positions. Support levels: 121.48, 121.00, 120.56, 120.34 (14 December low), 120.00 (22 October low), 119.62, 119.39. Resistance levels: 122.00 (local high), 122.22 (11 December high), 122.60, 122.93, 123.35, 123.66 (2 December high), 124.00. Trading tips Long positions can be opened after the breakout of the level of 122.22 with targets at 123.25, 123.66 and stop-loss at 121.40. Validity – 2-4 days. Short positions can be opened after the price rebound from the level of 122.00 with targets at 121.00, 120.50, 120.30 and stop-loss at 122.60. Validity – 2-3 days.

USD/CAD: review and forecast Current trend On Monday, the USD/CAD pair hit its highest levels in more than 11 years. The demand for the US Dollar is strong ahead of the Fed meeting. The Canadian Dollar, in its turn, is under enormous pressure from falling oil prices. Most investors expect a hike in US interest rate by 0.25 basis points. It is the tone of Fed’s Chair Janet Yellen’s comments that still raises doubts. If she points to a slow-paced series of rate increases, the USD will strengthen slightly. Otherwise, in case of a more hawkish view, a surge in the USD is expected. Consumer Price Index is due today in the US. In monthly terms, zero inflation is expected; in annual terms, analysts forecast an increase from 0.2% to 0.4%. More positive data will strengthen the USD. Later on, BoC Governor Stephen Poloz gives his speech. Low oil prices are strongly affecting the country’s economy, and the Regulator might reduce its interest rate to minus -0.5%. If such a possibility is confirmed, the CAD would weaken more against the USD. Support and resistance On the daily chart, a doji pattern has formed that suggests the possibility of a downward correction. Support levels: 1.3675, 1.3623, 1.1355. Resistance levels: 1.3780, 1.3823, 1.3900. Trading tips Long positions can be opened above the level of 1.3785 with targets at 1.3825 and 1.3900. Short positions can be opened below the level of 1.3675 with targets at 1.3630 and 1.3560.

AUD/USD: general review Current trend Since the beginning of the week, the pair is growing. Today the pair was supported by strong data from Australia. New Motor Vehicle Sales for November grew to 6%, while the House Price Index came out in line with forecasts at 2%. At the same time, the pair is pressured by expectations of the Fed Interest Rate Decision that is due tomorrow. Markets expect rates to be increased that would add to the pressure on the pair. Today attention needs to be paid to the Consumer Price Index in the US. Volatility on the market is expected to be low. Support and resistance On the 4-hour chart, the pair is trading between the middle and upper MA’s of Bollinger Bands. Moving averages with 100 and 144 periods are above the price and directed horizontally. MACD histogram is in the positive zone and its volumes remain almost unchanged. ADX indicates pair’s decline, DI lines cross over and directed down. Today, the pair is expected to remain within the range of 0.7247-0.7302. Support levels: 0.7247 (middle MA of Bollinger Bands, MA50), 0.7182, 0.7159 (this week low), 0.7133, 06984, 0.6908. Resistance levels: 0.7280, 0.7302 (MA100), 0.7343 (last week low), 0.7353, 0.7385. Trading tips Long positions can be opened after the price consolidation above the level of 0.7280 with targets at 0.7302, 0.7343 and stop-loss at 0.7260. Short positions can be opened after the breakdown of the level of 0.7247 with the target at 0.7182 and stop-loss at 0.7280. Scenario validity – 1-2 days.

AUD/JPY: pair resumed its decline Current trend The AUD/JPY pair has declined from its local lows, reached in the first week of December. The Japanese currency has gained support form speculations over the upcoming Fed meeting. Though a hike in US interest rates is forecasted, investors suggest market reaction might be different than expected. It is possible that monetary policy tightening has already been priced into the market. Last week, the Australian currency was growing only on Thursday amid the publication of unexpectedly favorable labor market statistics for November. Employment Change came in at 74.1K while a decline in the indicator by 10.0K had been forecasted. Unemployment Rate was down to 5.8% from 5.9% against expectations of an increase to 6.0%. Support and resistance Bollinger Bands indicator on the daily chart is turning down, while the price range is widening. However, the indicator has formed a signal for an upward correction. MACD keeps its downward trend. Stochastic is near the border of the oversold zone and trying to turn up. It is recommended to wait for clearer trading signals. Support levels: 87.00, 86.45 (10 November low), 86.00, 85.69, 85.00. Resistance levels: 87.30, 88.00, 88.60, 89.12 (10 December high), 89.59, 90.00, 90.34, 90.71 (4 December high), 91.00. Trading tips Long positions can be opened after the breakout and consolidation above the level of 87.30 with targets at 88.00, 88.60, 89.00 and stop-loss at 86.70. Validity – 2-4 days. Short positions can be opened after the breakdown of the level of 87.00 with the target at 86.00 and stop-loss at 87.50. Validity – 2-3 days.

EUR/USD: general analysis Current trend The Fed holds its finial meeting of the year on Wednesday. Many market participants expect a hike in US interest rates, so if the forecast is confirmed, the European currency is likely to weaken. However, as long as inflation has not reached the target level of 2% yet, it might be seen as a determining factor for a forthcoming decision. Another negative aspect is Manufacturing PMI which came in below the key level of 50 points. This data might indicate a slowdown in economic growth. Thus, in its decision making, the Fed will consider labor market statistics, inflation rate and the world economic situation. Support and resistance Since the opening of the trading day, the European currency has been slightly declining against the US Dollar. The key resistance level is still at 1.1040 the breakout of which would allow the price to continue growing towards 1.1150-1.1200. Support level: 1.0925. The nearest resistance level: 1.1055. Trading tips Short positions can be opened after the breakdown of the level of 1.0925 with the target at 1.0875 and stop-loss at 1.0950.

EUR/USD: general analysis Current trend The Fed holds its finial meeting of the year on Wednesday. Many market participants expect a hike in US interest rates, so if the forecast is confirmed, the European currency is likely to weaken. However, as long as inflation has not reached the target level of 2% yet, it might be seen as a determining factor for a forthcoming decision. Another negative aspect is Manufacturing PMI which came in below the key level of 50 points. This data might indicate a slowdown in economic growth. Thus, in its decision making, the Fed will consider labor market statistics, inflation rate and the world economic situation. Support and resistance Since the opening of the trading day, the European currency has been slightly declining against the US Dollar. The key resistance level is still at 1.1040 the breakout of which would allow the price to continue growing towards 1.1150-1.1200. Support level: 1.0925. The nearest resistance level: 1.1055. Trading tips Short positions can be opened after the breakdown of the level of 1.0925 with the target at 1.0875 and stop-loss at 1.0950.