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Morning brief for March 15
3/15/2017

151216094004-yellen-rate-hike-780x439.jp

A range of huge sessions is coming up for the market with the FOMC rate announcement along with projections for the US economy followed by Chair Janet Yellen’s news conference a half-hour later. It seems that the case for quarter-hike is already a baked pie, so, pay closer attention to what Ms. Yellen will say. Also, today the suspension of the US debt limit expenses. Most analysts believe that it will be shifted to the later date. If Treasury officials fail to a reach a new deal in upcoming months, there won’t be any hikes in the nearest future as USD might become extremely expensive in terms of both interest rates and the XCCY basis swap.

The British pound slid overnight to 1.2105 after we got the news that UK Parliament had finally passed the bill giving PM Theresa May the ability to formally start the Brexit process (the Article 50 will likely be triggered before March 27) and news about the resignation of the BoE Deputy Governor as he failed to disclose the conflict of interest. The prices are consolidating in the quite broad 1.2100/1.2300. A break below 1.2100 would demark the start of a bearish phase. Meanwhile, the pound has time to rise to 1.2250, especially if the Fed is moderate in its hawkishness.

Aussie ticked higher in the Asian session. AUD/USD moved to 0.7570. The RBA officials have recently voiced their intention to tighten macro-prudential measures; also, they said that there won’t be any additional cuts this ear. For the time being, the risks are tilted to the upside. The nearest resistance can be found at 0.7595. If the atlas USD shrug, the pair will drop towards the supports at 0.7530/0.7505 levels.

USD/CAD dipped to 1.3460 on the session. Brent oil futures jumped to $51.70 earlier today having partially recouped their losses (yesterday’s low was at $50). The collapse of oil prices followed after the release of the OPEC report that stated that Saudi Arabia increased oil production in February on the jitters that it might lose its market share. The economic calendar promises as to deliver the US CPI and retail sales. The EIA Oil Market Report for March has the potential to move oil prices higher.

EUR/USD is trading in the range of 1.0590/1.0715 this week. Dutch parliamentary elections have taken the central stage this week. The Polls close at around 10 pm MT time Thursday and we will likely get the results throughout the day. We will particularly be interested in how Geert Wilders’ Eurosceptic Freedom Party does. The recent polling gives the Freedom Part 15.7% of the vote which would give it 20-24 seats. If the far-right politicians get something higher the euro might suffer some losses. Today’s economic calendar for the Eurozone is extremely light. So, the focus will be shifted to the US with FOMC meeting and a bunch of economic releases coming soon.  

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Key option levels for Wednesday, March 15th
3/15/2017

EUR/USD

EURUSD(144).png

Main trend    Short-term period    Medium-term period
Bearish    Neutral
Changes in the open interest     + 19 557 ?     + 61 973 ?
Closest resistance levels    1.0660; 1.0693; 1.0721; 1.0740
Closest support levels    1.0628; 1.0600; 1.0571; 1.0553
Trading recommendations
Baseline scenario    Short EUR/USD below 1.0628 (or from 1.0660), with target points at 1.0600 and 1.0571
Alternative scenario    Moving above 1.0660 can be considered as a signal to Buy the pair, with target at 1.0693 and 1.0721
 
GBP/USD

GBPUSD(113).png

Main trend    Short-term period    Medium-term period
Bearish    Bearish
Changes in the open interest     - 12 ?     + 248 ?
Closest resistance levels    1.2242; 1.2273; 1.2316; 1.2342
Closest support levels    1.2189; 1.2159; 1.2135; 1.2098
Trading recommendations
Baseline scenario    Short GBP/USD below 1.2189, with target points at 1.2159 and 1.2135
Alternative scenario    Moving above 1.2242 can be considered as a signal to Buy the pair, with target at 1.2273 and 1.2316
 
USD/CAD

USDCAD(124).png

Main trend    Short-term period    Medium-term period
Bullish    Bullish
Changes in the open interest    + 54 ?     - 23 ?
Closest resistance levels    1.3470; 1.3492; 1.3512; 1.3543
Closest support levels    1.3444; 1.3394; 1.3349; 1.3291
Trading recommendations
Baseline scenario    Long USD/CAD above 1.3470, with the target points at 1.3492 and 1.3512
Alternative scenario    Moving below 1.3444 can be considered as a signal to Sell the pair, with target at 1.3394 and 1.3349

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Banks' forecasts ahead of the FOMC meeting
3/15/2017

After Friday’s US job market report investors priced in 100% probability of a hike at the FOMC meeting scheduled for March 15, 8:00 pm MT time. Fed Chair Janet Yellen in her last speech made it clear that she wouldn’t be against interest rate increase as long as the US economy progressed as expected. If we take a look at the economic data, we will see that inflation on the rise, sentiment holding firm, core spending is growing, stock prices peaked to their highest levels. So, it’s now or never, dear FOMC officials.

Assuming the high probability of Fed’s hikes, the markets’ focus will on the future monetary policy projections of the Federal Reserve. The market pricing in a 12% chance of the second rate increase in May and 67% in June. But what’s interesting is that market participants are not really concerned about the exact timing of a next hike; they are mostly preoccupied with the number of hikes to be delivered this year.

Ahead of the FOMC rate announcement, there will be one of the top-tier releases –  CPI, core CPI and retail sales. Many top-notch analysts that they might become market triggers since the rate hike is already well priced in (the FOMC meeting might be a non-event).

Banks’ forecasts

Most of the bank analysts expect a more aggressive Fed tomorrow saying that with Trump’s presidency the times of old cuddly Federal Reserve are gone.

Bank of America Merrill Lynch FX strategy

The Fed officials have already sent lots of signals to assure market participants in their true intentions. So, the strategists believe that FOMC meeting will be a non-event. The main focus will be on the Summary of Economic Projections and the press conference.

Bank’s analysts expect a substantial shift higher in the dots and hawkish wording of the summary offering a fierce support to the greenback. In contrast, Chair Yellen’s speech will be balanced and not favoring further USD appreciation, according to them.   

Nordea bank forecast

Bank’s analysts hold expectations of a 25 bp increase in the Fed’s benchmark; the rate hike is well priced in by the markets; the focus will on the Fed’s projections for the future. The Fed will likely emphasize a gradual pace of the rate hike.

TD analysts

They don’t expect substantial support to the USD; there will be only modest one. Also, they said that they prefer fading the recent gains on the major USD counterparts (EUR, CAD, GBP).

Nomura

The hike is priced in by the market participants. The bank analysts are hawkish on USD if there is no dots downgrade.

Danske

Analysts note that we are entering the period of fiscal uncertainty as the suspension of the US debt limit expires tomorrow. So, the Fed’s officials will be hesitant to raise interest rates without e new deal on the extension of the government debt freeze.

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EUR/USD: "V-Bottom" launched bullish correction
3/15/2017

15-3-2017-EUR-H4.png

The Moving Averages acted as a support, so we’ve got a “V-Bottom” pattern. Therefore, the market is likely going to test a resistance at 1.0678 in the short term. If a pullback from this level happens, there’ll be an opportunity to have a decline towards a support at 1.0588 – 1.0578.

15-3-2017-EUR-H1.png

There’s a “V-Bottom” pattern, which has been confirmed, so the price is consolidating. In this case, bulls are likely going to achieve the nearest resistance between the levels 1.0655 – 1.0666 during the day. If we see a pullback from this area, bears will probably try to test a support at 1.0588 – 1.0578.

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GBP/USD: bears taking a rest
3/15/2017

15-3-2017-GBP-H4.png

Bears faced a support at 1.2106, so we’ve got a “V-Bottom” pattern. Therefore, the pair is likely going to test the closest resistance at 1.2198. If a pullback from this level happens, there’ll be an opportunity to have another decline.

15-3-2017-GBP-H1.png

There’s a “V-Bottom”, so the price reached a resistance at 1.2168. However, bulls are likely going to reach the next resistance at 1.2198, which could be a departure point for a decline towards a support at 1.2106 – 1.2084.

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EUR: Dutch parliamentary election guide
3/15/2017

The Dutch will go to the polls today to cast their votes for the parties that will rule the country for the next 4 years. The outcome of the Dutch election is expected to be a bellwether for Europe; they might set a pattern for other key elections across the EU starting with the first round of the French presidential election.

Clash of the titans

bb0a5458-4b7a-428e-939f-7720422f9a53.jpg

The two heavy favorites of the election race are liberal Mark Rutte and far-right leader of the Freedom Party Geert Wilders.

The former one is the incumbent prime Minister who touted the country’s economic stability under the People’s Party for Freedom and Democracy.

The later one is branded as a Dutch Trump for his goldilocks hair, freakish hairstyle and his tough talk against migrants and Islam professors.

The issues at stake

The election debates are centered on the problems of immigration, help for refugee and asylum seekers, membership in the EU, crime, and security. Geert Wilders is advocating for leaving the EU, curbing migration flows and prohibiting projection of Islam’s values. It seems that Mark Rutte caught up the strategy of his opponent and pushed himself a bit to the right saying that the immigrants not willing to assimilate in the country should behave normally or leave the Netherlands.  

What are the scores of the two candidates according to the latest polls?

Geert Wilders is neck to neck with the Mark Rutte according to the last polls. The anti-islam, anti-EU leader Wilders has been riding high on a wave of populism, but then gave in some votes to his major counterpart. The latest poll predicted that Wilder’s Party for Freedom is three seats less (in total 22-23 seats) than Rutte’s People’s Party for Freedom and Democracy.

The latest prediction from the Dutch Poll Indicator

860707(1).png

Source: peilingwijzer.tomlouwerse.nl

Could Geert Wilders become the next PM if he manages to win the race?

It’s unlikely, simply because Geerts Wilders hasn’t got allies in the Parliament. Dutch parties made it clear; they would not collaborate with Wilders unless he drops his radical anti-immigration views (which is the centerpiece of his political manifesto).

What will be the euro’s reaction?

As it has been already said, the recent polling puts Wilders’ party at 15.7% of the vote which gives it approximately 20 – 24 seats in the parliament – anything higher will likely start to pressure the euro and lead to some changes in the views of how Le Pen would go in the French Presidential election.

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EUR/USD: bulls going to test "Window" once again
3/15/2017

1503eurusdh4.png

The price found a lodgement under the “Window”, but we’re got a “Harami” on the 34 & 55 Moving Averages. Considering a confirmation of this pattern, bulls are likely going to test the upper side of the “Window”, which could be a departure point for another decline.

1503eurusdh1.png

The upper “Window” is acting as a resistance, so there’s a bearish “Harami”, but a confirmation of this pattern is a quite week. Therefore, the market is likely going to decline towards the 144 Moving Average. If a pullback from this line happens, bulls will probably try to deliver a new local high.

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USD/JPY: "Window" acting as a resistance
3/15/2017

1503usdjpyH4.png

We’ve got a bearish “Engulfing” on the upper “Window”. Considering a confirmation of this pattern, the market is likely going to test the nearest support line. If any bullish pattern arrives afterwards, there’ll be an opportunity to have a local upward price movement.

1503usdjpyH1.png

There’s a “Doji”, which has been confirmed. So, the pair is likely going to reach the 89 Moving Average once again. If a pullback from this line happens, bulls will probably try to test the upper “Window”.

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Review on Grace Cheng's book
3/15/2017

grace_book_window.jpg

"7 winning trading strategies for trading Forex" is a real pickup for WHYers, WHATers and HOWers, simply because in this book you will find the answers to all possible questions about trading Forex. How to trade various candlestick patterns, breakouts; how to identify sturdy support and resistance lines; what is margin, rollover; what are the three foundations of trading in FX markets. Grace ?heng, the author of the book and the heaven-born trading coach, will answer all these and many other questions within the covers of two hundred length book. She will explain you all the trading subjects in just a few bullet points, so as you won’t need to refer to any other sources for further clarifications. In the end, you will like this book so much that it becomes your trading desk companion (addressing here mostly to novice traders), a book for constant reference and rereading.

Why am I so sure about this? Simply because it is written in a very structured way; it contains a very succinct explanation of all things traders should know, and, what’s more important, it’s not boring. Grace Cheng is not mind-boggler, not Immanuel Kant, not Thucydides, she is a full-time trader and brilliant blogger. So, you won’t find any difficulties with comprehension of the material of the book. But don’t think that ‘7 winning strategies for trading Forex’ is the book full of truisms and trading basics. It also fits intermediate traders those who see Forex trading not just as a casual role of the dice or leisure pursuit, but also as their principal earner.

To better familiarize yourself with the content of Ms. Cheng’s book, we suggest you looking at the following print screen

content.png

DOWNLOAD THE BOOK

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USD/JPY: yen launches the counterattack
3/16/2017

On the USD/JPY daily chart, the bulls failed to hold the quotes above 114.65; it was a signal of their weakness. "Bears" launched a counterattack. Now they are ready to return the pair to the borders of the previous descending channel. The breakout of the 111.75 and 111.55 supports will activate the AB = CD pattern. Its target 200% is located near the 108 mark.

Screenshot_2017_03_16_08_04_31.png

On the USD/JPY hourly chart, a successful test of the current support at 113.15 will send the quotes lower towards the 88.6% and 161.8% targets in the Shark and Crab patterns. They are located near the 112.4 and 112 levels.

Screenshot_2017_03_16_08_04_49.png

Recommendations: SELL 113,15 SL 113,7 TP1 112 TP2 108.

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USD/JPY: yen launches the counterattack
3/16/2017

On the USD/JPY daily chart, the bulls failed to hold the quotes above 114.65; it was a signal of their weakness. "Bears" launched a counterattack. Now they are ready to return the pair to the borders of the previous descending channel. The breakout of the 111.75 and 111.55 supports will activate the AB = CD pattern. Its target 200% is located near the 108 mark.

Screenshot_2017_03_16_08_04_31.png

On the USD/JPY hourly chart, a successful test of the current support at 113.15 will send the quotes lower towards the 88.6% and 161.8% targets in the Shark and Crab patterns. They are located near the 112.4 and 112 levels.

Screenshot_2017_03_16_08_04_49.png

Recommendations: SELL 113,15 SL 113,7 TP1 112 TP2 108.

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Gold's minute of fame
3/16/2017

On the daily chart of gold after the implementation of the intermediate target 78.6% in the "Shark" pattern, the correction in the direction of 50% of the CD wave has started. Theoretically, it can lead to the transformation of the Shark pattern into the pattern 5-0; If the bulls manage to push the quotes above the $1,238 and $1,249 levels, it might lead to the restoration of the uptrend.

Screenshot_2017_03_16_08_05_53.png

On the hourly chart of gold, the inverted "Bat" or  "Crab" patterns have been activated. If the offensive attack of the bulls dies down, and prices slide towards $1,233 mark, then we can start talking about the first graphic configuration. Otherwise, the risks of the continuation of the rally towards $1,263 per ounce will increase.

Screenshot_2017_03_16_08_06_07.png

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Morning brief for March 16
3/16/2017

Three-2-440x308.jpg

Three is the magic number said FOMC officials and disappointed markets that had been aggressively pricing in 3 or 4 additional hikes this year. Fed Chair Janet Yellen was her usual self repeating Fed’s favorite “gradual” while describing the future path of monetary tightening. Although the Fed wasn’t dovish per se, the US dollar suffered sharp losses across the trading desk. Don’t expect that today’s session will be a moment of peace. There are plenty events in the schedule. Later we are supposed to receive the outline of the Trump administration budget ambitions. The blueprint will address only discretionary programs the detailed version not promised before later in May. Also, we will be waiting for the US building permits, Philly Fed manufacturing Index and unemployment claims.

yellen-meme(1).png

The euro climbed to 1.0745 from 1.0600 against USD overnight thanks to the absence of any overt hawkish guidance in the Fed’s statement and EU-positive early results of the Dutch elections. The recent returns showed that far-right Wilders’ party won fewer seats than it was expected (19 instead of 22). This means that the shift towards populism may be slowing, or reversing. You may heave a sigh of relief. But the downward pressure on the euro is still in place; the prices are about to slide towards the nearest support at 1.0680/1.0600 levels.

USD/JPY fell to 113.05 in the Asian session. The Bank of Japan held its meeting today and left the monetary policy unchanged as it had been forecasted. The recent decline might be extended to 112.85. The level 111.65 is likely out of reach, however.

GBP/USD spiked to 1.2307 overnight, but in the early hours of Asian session eased off a bit having slid to 1.2265. The Bank of England is due to deliver its rate announcement at 2:00 pm MT time. It’s expected to be non-event. There won’t be Mark Carney’s press conference to put on steam to the BoE’s interest rate announcement.

Aussie erased all the March selling overnight having jumped to 0.7720 from 0.7555. In the Asian session, it failed to advance higher as we got a really disappointing February employment report. The headlines paint not a good picture for Australia’s labor market. There are sturdy support levels at 0.7650/0.7600 levels.

Loonie gained lots of strength from the recent USD depreciation. USD/CAD dropped to the strong support at 1.3280 (the upper border of Ichimoku cloud on the daily timeframe). A further decline can be extended no further than 1.3200. Most likely the USD manages to win back its earlier losses and tick towards the resistance at 1.3333 (100 H4 MA). Brent oil futures hopped to $52.15 on the USD weakness.

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Key option levels for Thursday, March 16th
3/16/2017

EUR/USD

EURUSD(145).png

ain trend    Short-term period    Medium-term period
Bullish    Neutral
Changes in the open interest     + 175 766 ?     + 41 660 ?
Closest resistance levels    1.0753; 1.0776; 1.0797; 1.0831
Closest support levels    1.0705; 1.0667; 1.0630; 1.0609
Trading recommendations
Baseline scenario    Long EUR/USD above 1.0753 (or from 1.0705), with target points at 1.0776 and 1.0797
Alternative scenario    Moving below 1.0705 can be considered as a signal to Sell the pair, with target at 1.0667 and 1.0630
 
GBP/USD

GBPUSD(114).png

Main trend    Short-term period    Medium-term period
Bearish    Bearish
Changes in the open interest     + 720 ?     + 852 ?
Closest resistance levels    1.2299; 1.2320; 1.2357; 1.2382
Closest support levels    1.2248; 1.2227; 1.2201; 1.2172
Trading recommendations
Baseline scenario    Short GBP/USD below 1.2248 (or from 1.2299), with target points at 1.2227 and 1.2201
Alternative scenario    Moving above 1.2299 can be considered as a signal to Buy the pair, with target at 1.2320 and 1.2357
 
USD/CAD

USDCAD(125).png

Main trend    Short-term period    Medium-term period
Bullish    Bullish
Changes in the open interest    + 67 ?     - 180 ?
Closest resistance levels    1.3291; 1.3321; 1.3342; 1.3369
Closest support levels    1.3270; 1.3236; 1.3189; 1.3129
Trading recommendations
Baseline scenario    Long USD/CAD above 1.3291, with the target points at 1.3321 and 1.3342
Alternative scenario    Moving below 1.3270 can be considered as a signal to Sell the pair, with target at 1.3236 and 1.3189
 
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EUR/USD: bulls going to test the next resistance
3/16/2017

[/img]

Bulls faced a resistance at 1.0754, so we’ve got a “V-Top” pattern, which pushed the price towards a support at 1.0713. In this case, the market is likely going to test a support at 1.0702 – 1.0678 in the short term. If a pullback from these levels happens, there’ll be an opportunity to have an upward movement in the direction of the nearest resistance at 1.0774 – 1.0797.

17-3-2017-EUR-H1.png

We’ve got a “Double Top”, so the price is consolidating. Therefore, the market is likely going to decline towards a support at 1.0707 – 1.0698 during the day. Considering a possible pullback from this area, bulls will probably try to test a resistance at 1.0754 – 1.0774 afterwards.

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Post-FOMC comments from banks
3/16/2017

Danske

Danske expects the Fed “to hike twice more this year (July and December) and three-four times next year.” The bank’s analysts is bullish on EUR/USD in the short term. In the longer time, the prices are projected to move to the upper level of the 1.0350 – 10850 range.

EUR/USD bounced on the Fed announcement, Danske notes that technically short-term momentum indicators for EUR/USD are turning bullish and we could see a near-term move to the upper end of the recent 1.0350-1.0850 range.

Barclays

Barclays notes that the Fed took a moderate pace of the monetary tightening taking advantage of favorable financial market conditions. In general, the Fed remains focused on trends in core inflation when deciding on subsequent rate increases.

SEB

After the Fed hike, SEB Research maintains its forecast of two more hikes this year and three hikes next year. "For the time being, we view today’s rate hike as an early June hike and expect the next hike in September followed by one more in December."

CIBC

CIBC analysts note that the Fed’s hike wasn’t a surprise for market participants. Also, they point out to the fact that the vote wasn’t unanimous (Neel Kashkari dissented in favour of leaving the rates unchanged).

Comment on the post-FOMC decline of the US dollar:

"All told, given how well this was telegraphed to the market, fixed income has actually caught a slight bid and the dollar has sold off," CIBC concludes.

Comment from BofA Merrill analysts:

"On balance, the signal from the meeting was more cautious than expected. Given that the rates market was already pricing 3 full hikes for 2017, the lack of revision to the dots led to a dovish response with a particularly large rally in the belly of the curve."

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GBP/USD: Moving Average acted as resistance
3/16/2017

17-3-2017-GBP-H4.png

There’s a “V-Top” pattern, which has been confirmed, so the price reached a support at 1.2260. Therefore, the pair is likely going to achieve the 34 Moving Average. If a pullback from this line be on the table, there’ll be an option to see an upward price movement. In this case, we should keep an eye on the 89 Moving Average as a possible intraday bullish target.

17-3-2017-GBP-H1.png

We’ve got a “V-Top”, so the price achieved a support at 1.2260. Meanwhile, the market is likely going to test the next support at 1.2231 during the day. If a pullback from this level happens, bulls will probably try to approach the nearest resistance at 1.2315 – 1.2347.

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EUR/USD: "Window" acting as a support
3/16/2017

1603eurusdh4.png

The lower “Window” is acting as a support. Also, we’ve got a developing “Three Methods”. Considering that there isn’t any reversal pattern so far, bulls are likely going to continue moving up until a bearish model arrives.

1603eurusdh1-1.png

We’ve got a “Shooting Star”, which led to the current bearish correction. However, there’s a bullish “Doji”, which has been confirmed. So, the pair is likely going to achieve the nearest resistance area during the day.

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USD/JPY: bullish "Hammer"
3/16/2017

1603usdjpyH4.png

There’s a bullish “Hammer”, but this pattern hasn’t been confirmed yet. So, the market is likely going to test the Moving Averages. However, bears will probably try to deliver a new local low.

1603usdjpyH1.png

We’ve got a “Hammer”, so the pair is likely going to test the upper “Window”, which could be a departure point for another decline in the direction of the last low.

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EUR/USD: wave [ii] going to end

Image20170316171704001.png

https://new.fxbazooka.com/img/articles/12890/Image20170316171704001.png

As we can see on the one-hour chart, there’s a developing flat pattern in wave [ii]. Also, we’ve got a diagonal triangle in wave © of [ii]. If a pullback from the upper side of this pattern happens, wave (i) is going to begin.

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AUD/NZD reached buy target 1.1000
3/16/2017

    AUD/NZD reached buy target 1.1000
    Next buy target - 1.1100

AUD/NZD continues to rise after the earlier breakout of the resistance level 1.1000, which was set as the buy target in our previous forecast or this currency pair. The breakout of the resistance level 1.1000 should accelerate the active minor impulse wave 3 which earlier broke through the resistance zone lying at the intersection of the key resistance level 1.0900 and the resistance trendline of the wide daily up channel from September.

AUD/NZD is expected to rise to the next buy target at the resistance level 1.1100. Buy stop-loss can be placed below the aforementioned price level 1.1000.

AUDNZD_-_Primary_Analysis_-_Mar-16_1639_

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USD/CHF reached sell target 1.000
3/16/2017

    USD/CHF reached sell target 1.000
    Next sell target - 0.9890

USD/CHF continues to fall after the recent breakout of the support level 1.0000, which was set as the sell target in our earlier forecast for this currency pair. The breakout of the support level 1.0000 should accelerate the active minor impulse wave 3- which earlier broke the support trendline of the daily up channel from February (which enclosed the previous minor ABC correction 2).

USD/CHF is expected to fall to the next sell target at the support level 0.9890 (which stopped the previous minor impulse wave 1 in January, as can be seen below).

USDCHF_-_Primary_Analysis_-_Mar-16_1637_

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GBP/USD: pound wants to rise higher[//B]
3/17/2017

On the GBP/USD daily chart, the implementation of the targets in the "Crab" and AB = CD patterns resulted in the rebound of the prices. After a short consolidation, the bulls launched the counterattack with the intention to test the upper boundary of the upward trading channel. If they succeed, the risks of the continuation of the rally towards 1.255 and higher will increase.

GBP_daily.png

On the GBP/USD hourly chart, the inverted "Shark" pattern is still relevant. Its 78.6% and 88.6% targets are located near the 1.2475 and 1.252 levels. Most likely, the "bears" will try to protect these levels.

GBP_H1.png

Recommendations:

SELL 1,2475 SL 1,253 TP 1,2315,

SELL 1,252 SL 1,2575 TP 1,2315.

More:
https://new.fxbazooka.com/analytics/12894

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Morning brief for March 17
3/17/2017

The storm after the range of central banks’ meetings died down and a great calm has finally succeeded. USD was a little bit softer against its major peers in the recent session. The reaction to President Trump budget outline released yesterday was really muted. A “wish list” of spending requests for Congress wasn’t long. The US newsmen called it the skinniest skinny budget compared with the 40 years of presidential budgets. It was somewhat 53 pages long containing four slender tables. President Bill Clinton’s first budget document was 145 pages, while Obama’s was 1343 pages. There was no mentioning of “mandatory” spending on programs like Social Security or Medicare, projections about the incoming tax cuts, spending beyond 2018. It promised increase of spending on security and cuts on the international aid.

US industrial production and consumer sentiments are the main data highlights for today. Another focus will be on President Trump and German Chancellor Merkel meeting in the White House. Many analysts believe that it’s going to be a friendly affair, unless Donald Trump takes a similar line to his trade advisor Peter Navarro constantly accusing Germany and other leading nations in currency manipulation.

Also, there will be a commencement of G20 summit in Baden-Baden (Germany). US Treasury Secretary Mnuchin will attend it. The event itself shouldn’t serve market participants lemons unless the US protectionism is not discussed and accusation of currency manipulation is not put on the agenda.

The euro was an absolute gainer in the course of the last two days. EUR/USD jumped to 1.0770 after the election victory of Dutch prime minister Mark Rutte and the debacle of the anti-EU leader Geert Wilders. The ECB Nowotny offered a substantial support to the euro having said that rate increase may be on the way. The ECB’s monetary policy model might differ from those that has recently been adopted by Fed. The European Central Bank can start with rate increases and only then turn to tapering its bond purchase program. Technically, the European currency can extend its earlier gains towards the resistance line at 1.0830. On the downside, a rather sturdy support that can be found near the 1.0700 level.

Commodity currencies were higher in the Asian session. Aussie ticked up to 0.7685. AUD/USD undertone is clearly positive. The bulls may push quotes higher towards the next resistance at 0.7740. While the further uplift seems likely, the recent rally was so rapid that there might be a retracement towards the nearest supports at 0.7660/0.7615.

USD/CAD moved higher to 1.3320 in the Asian session. The bears failed to break the strong support at 1.3280. On the upside, there is a resistance at 1.3420. Oil prices rose slightly supported by the weak US dollar.  

More:
https://new.fxbazooka.com/analytics/12895

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