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USD/JPY: the yen met the dragon

3/31/2017

 

On the USD/JPY daily chart, quotes went our from the downward trading channel and broke up the resistance area of 111.55-111.75. Now, this area serves as a solid support. There is a transformation of the "Shark" pattern into 5-0. To restore the uptrend, the bulls should break the levels of 114.4-114.94. In contrast, a rollback from 38.2% and 50% levels of the CD wave will be a signal for the opening of short positions.

 

Screenshot_2017_03_31_07_52_14.png

 

On the USD/JPY hourly chart, the "Dragon" pattern has been formed. If the bulls manage to keep quotes above 111.6 (the curl of the Dragon's tail - EMA21 and the lower border of the upward trading channel), there will be a great risk of continuation of the rally towards 112.8 and 113.44.

 

Screenshot_2017_03_31_07_52_34.png

 

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Gold: bulls are losing their control

3/31/2017

 

On the daily chart of gold, the bulls failed to update the February high, and at the present time, there is a correction to the uptrend. The nearest support levels are located near the $1,236  and $1,229. The resistance is lying at $1,260. Until the quotes are still within the upward trading channel, the control over the bullion is still in buyers' hands. 

 

Screenshot_2017_03_31_07_52_52.png

 

On the hourly chart of gold, the "Shark" pattern was activated. Its 88.6% and 113% targets help us to identify the convergence zones. The technical outlook for the pair is still bullish, so the drop of quotes to $1,229 and $1,223 will allow us to open long positions. 

 

Screenshot_2017_03_31_07_53_09.png

 

Recommendations:

 

BUY 1229 SL 1220 TP 1254,

 

BUY 1223 SL 1212 TP 1254. 

 

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Morning brief for March 31

3/31/2017

 

The euro suffered substantial losses overnight after we received softer than expected German and Spanish inflation releases. Decreasing inflation rate prove that the ECB still needs a very substantial degree of monetary policy accommodation and relieves markets superfluous idle talks about the QE tapering.  The US economic data was a mixed bag with solid GDP figures and rising number of unemployment claims. EUR/USD dropped to 1.0675 overnight. The technical outlook for the pair is neutral. The prices will likely continue consolidating within the range of 1.0655 – 1.0690. Today traders will be watching for the euro area monthly inflation readings. Consensus forecasts indicate slight declines. The figures are usually scrutinized by the ECB officials trying to assess the sustainability of prices pressures. So, in case of disappointing headlines, the euro might head into the negative territory.

 

The yen was the main mover in the past trading sessions. USD/JPY spiked to 112.20 after we received a rather disappointing data on Japan’s household spending and core CPI. Then, USD lost its ground against the yen and slid to 111.80. US dollar watchers will be waiting for core PCE reading and personal spending data which are due at 12:30 MT time. The Chicago PMI and final University Michigan consumer sentiments are also expected tonight. Another focus will be on the speeches of Fed’s officials.

 

In the early hours of Tokyo morning, we got some comments from the Australian prudential regulator (APRA) on the growth in housing credit. Surging house prices have been a concern for the Australian government.  APRA will try to tighten up lending for housing. What does this news mean for traders? It means that the Reserve Bank of Australia might cut rates further clipping Aussie’s wings. This news didn’t cause and outcry from AUD, but they should be taken into consideration as we approach the next RBA meeting.  AUD/USD dropped to 0.7635, then, partially regained its losses having advanced to 0.7640. There is still a room for further expansion towards 0.7660/0.7680 levels.

 

GBP/USD rose to 1.2475 in the Asian session. Many analysts believe that the pound can still move higher in the near-term due to a squeeze on existing short GBP and investors’ disbelief in Trump’s ability to push through his pro-growth policies. The immediate resistance can be found at 1.2475. on the downside, there are plenty of supports at 1.2410, 1.2360. They might serve the good turn if today US data beats market’s expectations.

 

US dollar/loonie was trading choppily in the past sessions trying to imitate the movements of oil prices. USD/CAD dropped to 1.3320, then, regained its ground and rose to 1.3340. Brent oil futures slipped a few points in the Asian session having fallen to $52.80 from yesterday’s high at $53.10.  A tailwind for oil was the Kuwait’s support of the prolongation of the OPEC-led production cut deal. 

 

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Key option levels for Friday, March 31st

3/31/2017

 

EUR/USD

 

EURUSD(156).png

 

ain trend Short-term period Medium-term period

Neutral Neutral

Changes in the open interest + 21 248 ? + 39 453 ?

Closest resistance levels 1.0713; 1.0761; 1.0786; 1.0829

Closest support levels 1.0662; 1.0628; 1.0608; 1.0585

Trading recommendations

Baseline scenario Short EUR/USD below 1.0662 (or from 1.0713), with target points at 1.0628 and 1.0608

Alternative scenario Moving above 1.0713 can be considered as a signal to Buy the pair, with target at 1.0761 and 1.0786

 

GBP/USD

 

GBPUSD(124).png

 

Main trend Short-term period Medium-term period

Bullish Bearish

Changes in the open interest + 126 ? - 42 ?

Closest resistance levels 1.2473; 1.2501; 1.2531; 1.2568

Closest support levels 1.2434; 1.2405; 1.2371; 1.2331

Trading recommendations

Baseline scenario Long GBP/USD above 1.2473, with target points at 1.2501 and 1.2531

Alternative scenario Moving below 1.2434 can be considered as a signal to Sell the pair, with target at 1.2405 and 1.2371

 

USD/CAD

 

USDCAD(136).png

 

ain trend Short-term period Medium-term period

Neutral Bullish

Changes in the open interest + 619 ? - 9 ?

Closest resistance levels 1.3330; 1.3356; 1.3373; 1.3401

Closest support levels 1.3286; 1.3261; 1.3215; 1.3189

Trading recommendations

Baseline scenario Long USD/CAD above 1.3330 (or from 1.3286), with the target points at 1.3356 and 1.3373

Alternative scenario Moving below 1.3286 can be considered as a signal to Sell the pair, with target at 1.3261 and 1.3215

 

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EUR/JPY: bears are moving south

4/3/2017

 

On the daily chart, EUR/JPY is trading within descending channel. The bears keep the pair under control, and successful test of support at 118.6 will strengthen the risks of decline towards 117.35 and 116.6. The bulls still have chances to change the situation and make the pair form the inverted 5-0 pattern. To do that they will firstly need to overcome resistance at 119.95.  

 

Screenshot_2017_04_03_06_25_23.png

 

On H1, EUR/JPY keeps forming the reversal widening wedge pattern. For this wedge to be formed the pair should overcome resistance at 119.8. On the other hand, decline below March low would allow the bears to keep going south.

 

Screenshot_2017_04_03_06_25_40.png

 

Recommendation: SELL 118,6 SL 119,15 TP1 117,35 TP2 116,6 BUY 119,8 SL 119,25 TP 120,8. 

 

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NZD/USD: bulls are running out of power

4/3/2017

 

On the daily chart, NZD/USD made several attempts to bring the quotes outside of the descending channel but failed. In order to break the short-term descending trend, the buyers need a successful test of 0.7070. On the other hand, the return of the quotes to 0.6975 and its following break will increase the risks of a 5-0 pattern.

 

Screenshot_2017_04_03_06_25_59.png

 

On H1, NZD/USD successful test of support at 0.6975 will trigger the Shark pattern. Its 113% target is close to 0.687. To resume the medium-term bullish trend the buyers need to return the price inside the previous uptrend channel.

 

Screenshot_2017_04_03_06_26_16.png

 

Recommendation: BUY 0,707 SL 0,7015 TP 0,7205, SELL 0,6975 SL 0,703 TP 0,687. 

 

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Key option levels for Monday, April 3rd

4/3/2017

 

EUR/USD

 

EURUSD(157).png

 

Main trend Short-term period Medium-term period

Bullish Neutral

Changes in the open interest + 18 496 ? - 36 800 ?

Closest resistance levels 1.0706; 1.0752; 1.0778; 1.0820

Closest support levels 1.0660; 1.0628; 1.0609; 1.0586

Trading recommendations

Baseline scenario Long EUR/USD above 1.0706 (or from 1.0660), with target points at 1.0752 and 1.0778

Alternative scenario Moving below 1.0660 can be considered as a signal to Sell the pair, with target at 1.0628 and 1.0609

 

USD/CAD

 

USDCAD(137).png

 

Main trend Short-term period Medium-term period

Neutral Bullish

Changes in the open interest + 78 ? + 259 ?

Closest resistance levels 1.3310; 1.3358; 1.3403; 1.3430

Closest support levels 1.3273; 1.3250; 1.3210

Trading recommendations

Baseline scenario Long USD/CAD from 1.3310, with the target points at 1.3358 and 1.3403

Alternative scenario Moving below 1.3273 can be considered as a signal to Sell the pair, with target at 1.3250 and 1.3210

 

AUD/USD

 

AUDUSD(8).png

 

Main trend Short-term period Medium-term period

Neutral Bearish

Changes in the open interest + 86 ? + 3 ?

Closest resistance levels 0.7636; 0.7655; 0.7676; 0.7710

Closest support levels 0.7610; 0.7581; 0.7542; 0.7497

Trading recommendations

Baseline scenario Short AUD/USD below 0.7610 (or from 0.7636), with the target points at 0.7581 and 0.7542

Alternative scenario Moving above 0.7636 can be considered as a signal to Buy the pair, with target at 0.7655 and 0.7676

 

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GBP/USD: bears are pulling down

4/5/2017

 

On the daily chart bears managed to lead the quotes out of the descending channel. This increases the risks of triggering "Bat" pattern with a target at 88.6%. The necessary condition of this scenario is the successful test of support at 1.2370. On the other hand, the pound's return above resistance at $1.2495 will increase the risks of uptrend resumption.

 

Screenshot_2017_04_05_08_16_42.png

 

On H1, patterns "Bat' and AB=CD allow determining potential of the downward movement. Their targets are close to 1.2305 and 1.2160. The break of support at 1.2420 will increase the risks of a decline.

 

Screenshot_2017_04_05_08_16_58.png

 

Recommendation: SELL 1,242 SL 1,2475 TP 1,2305. 

 

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AUD/USD: will Aussie catch a crab?

4/5/2017

 

On the daily chart, bears managed to reach 78.6% target of the Gartley pattern. If the current support at 0.7540 doesn's stop them, Gartley will transform into Crab pattern will increase the risks of decline towards 0.7315. The necessary condition for this scenario is a successful test of resistance at 0.7515.

 

Screenshot_2017_04_05_08_17_14.png

 

On H1 AUD/USD is trading within a downtrend channel. The bears retain control for the pair. The best strategy is to sell Australian currency on its advance to 0.7595.

 

Screenshot_2017_04_05_08_17_29.png

 

Recommendation: SELL 0,7595 SL 0,765 TP1 0,75 TP2 0,7315.  

 

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Key option levels for Wednesday, April 5th

 

EUR/USD

 


 

Main trend Short-term period Medium-term period

Neutral Neutral

Changes in the open interest + 6 193 ? - 28 558 ?

Closest resistance levels 1.0693; 1.0738; 1.0764; 1.0808

Closest support levels 1.0649; 1.0619; 1.0579; 1.0554

Trading recommendations

Baseline scenario Long EUR/USD above 1.0693 (or from 1.0649), with target points at 1.0738 and 1.0764

Alternative scenario Moving below 1.0649 can be considered as a signal to Buy the pair, with target at 1.0619 and 1.0579

 

GBP/USD

 

GBPUSD(126).png

 

Main trend Short-term period Medium-term period

Bullish Bearish

Changes in the open interest + 291 ? - 228 ?

Closest resistance levels 1.2464; 1.2492; 1.2533; 1.2567

Closest support levels 1.2414; 1.2380; 1.2340; 1.2295

Trading recommendations

Baseline scenario Long GBP/USD above 1.2464 (or from 1.2414), with target points at 1.2492 and 1.2533

Alternative scenario Moving below 1.2414 can be considered as a signal to Sell the pair, with target at 1.2380 and 1.2340

 

AUD/USD

 

AUDUSD(10).png

 

Main trend Short-term period Medium-term period

Bearish Bearish

Changes in the open interest + 63 ? + 80 ?

Closest resistance levels 0.7608; 0.7653; 0.7701; 0.7751

Closest support levels 0.7576; 0.7547; 0.7523; 0.7491

Trading recommendations

Baseline scenario Short AUD/USD below 0.7576 (or from 0.7608), with the target points at 0.7547 and 0.7523

Alternative scenario Moving above 0.7608 can be considered as a signal to Buy the pair, with target at 0.7653 and 0.7701

 

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USD/JPY: a further downfall is not ruled out

4/6/2017

 

On the USD/JPY daily chart, the bulls failed to push quotes outside the downward trading channel. The 5-0 pattern has been fulfilled. Rollback from the 38.2% level of the CD wave allowed us to open short positions. The update of March lows will increase the risks of continuation of the downward movement towards108.8 and lower.

 

Screenshot_2017_04_06_08_29_34.png

 

On the USD/JPY hourly chart, the attack on the important resistance at 111.45 has failed. A successful test of the support at 110.25 will activate the AB = CD pattern with target 109.6.

 

Screenshot_2017_04_06_08_30_12.png

 

Recommendations:

 

SELL 110,25 SL 110,8 TP1 109,6 TP2 108,8,

 

BUY 111,45 SL 110,90 TP 112,85.

 

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USD/CAD: bulls are forcing their way through

4/6/2017

 

On the USD/CAD daily chart, a breakout of the resistance at 1.3405 will allow us to talk about the continuation of the implementation of the 5-0 pattern. After a rollback in the direction of 50% level of the CD wave, the bulls managed to restore the uptrend. They might extend their gains to 1.354 and 1.357.

 

Screenshot_2017_04_06_08_30_23.png

 

On the USD/CAD hourly chart, if quotes manage to go out from the 1.328-1.34 consolidation range within "Splash and ledge" pattern, we will be able to open long positions. If the bulls manage to update the March highs and activate the AB = CD pattern, there might a continuation of the rally towards 1.36 direction.

 

Screenshot_2017_04_06_08_30_36.png

 

Recommendations: hold long positions  (BUY 1,34 SL 1,3345 TP 1,352).

 

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Morning brief for April 6

4/6/2017

 

Traders were toiling like galley slaves overnight as there were plenty of economic releases that led to some intraday moves. ADP payrolls showed a gain of 263K vs consensus 184K.  It is a great result for the current point of the business cycle, and since the correlation between official and ADP prints has improved in the past months, we might wait for something like “the data beats market expectations” from Friday’s NFP.

 

Non-manufacturing ISM was worse than expected. Then, there was the FOMC Minutes showing that the Fed is going to trim its $4.5 trillion balance sheet well into the end of this year, or even earlier. This was interpreted as implying less need for Fed’s rate increases as a phasing down of the reinvestment policy can act as a de facto tightening.

 

There was also a disappointing headline in the news. Senate Majority Leader Paul Ryan said that the House, Senate and Mr. Trump are definitely not on the same wavelength with regard to tax policy. So, It would take more time for policymakers to decide on the tax reform than on the repeal of Obamacare bill (which is still not resolved). The English of this is there won’t be any repeal of healthcare, no wall, no lower corporate tax rates in the near-term. It seems that we will have to arm ourselves with lots of patience.  

 

This session will be as busy as previous one (mid-week time, what else to expect from it). There will be the much-hyped first meeting between Xi and Trump. The US President might touch upon China’s currency manipulations and unfair trade policy, or might not if we believe on his bare word addressed to FT journalists (in the recent interview, Trump told that he would prefer not to talk about tariffs at the upcoming meeting with Xi). North Korea is likely mentioned – especially after yesterday’s missile test.

 

EUR/USD ticked up in the course of Tokyo session from 1.0667 to almost 1.0690. The downward pressure is still present though, another drop towards the 1.0595 support is not ruled out until prices manage to test 1.0730/1.0770 levels successfully. Euro watchers will be waiting for the ECB President Draghi’s speech which is due at 9:00 pm MT time.

 

Aussie/greenback outlook is neutral for the present moment. The quotes are trading around 1.0765. The immediate pressure is still on the downside towards 0.7615.  A break of resistance at 0.7650 will allow us to talk about a further upsurge towards 0.7660. The Australian economic calendar is light. The pair is likely driven by USD fundamentals today.

 

Kiwi was one of those who little changed on the session, although it did take a shot to rise higher. NZD/USD is now ranging within 0.6975 – 0.6995 levels.

 

USD/JPY was lower on the session from 112.20 to 111.65. The support at 111.50 is still intact. If it is broken the quotes will slide towards the restraint at 110.00. The technical outlook will change from neutral to bullish if prices go out of their 110.00/112.20 consolidation range.

 

USD/CAD dropped to 1.3295 in the course of this week due to the recent rally in oil prices. Brent oil futures hit $55.06 yesterday but then skipped some points after US government reported a sudden increase in US crude inventories. Loonie watcher should focus their attention on Canadian building permits coming out at 12:30 pm today. 

 

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Ahead of Donald Trump-Xi Jinping meeting

4/6/2017

 

US President Donald Trump is meeting China’s President Xi Jinping at his Mar-a-Lago resort later today. While Trump treated Japan’s PM Abe to golf, no such outing is planned for the leader of China. So, it is going to be all business, nothing personal.  

 

The meeting for Xi Jinping

 

It is an opportunity to establish a personal rapport with Trump and prevent an imminent trade war that threatens to pull China's economy to pieces and make the current economic slowdown more painful. There is also a potential risk for Xi’s reputation as General Secretary of the communist Party of China. Some party members are not satisfied with Xi’s reform plans. They will be searching for some “ammunition” in Trump-Xi meeting for the political debates in which they will try to thwart the introduction of new reforms. A conflict with the US leader could potentially undermine Xi’s leadership credential he has been forging during his tenure as China’s President.

 

The meeting for Trump

 

It is an opportunity to rebuke Chinese government for its manipulation of the currency, unfair trade policies, militarization of the South China Sea and failing to make more efforts to stop North Korea’s aggression. Most likely US President will use the One-China policy regarding Taiwan as a bargaining chip to strike a better trade deal with China.

 

China will probably try to deny Trump’s evidence-free accusations of currency manipulation. And it would be fair. While yuan was long viewed as undervalued, now it is no longer the case. In the recent years, Beijing allowed the renminbi to appreciate. Moreover, if China refused to control the exchange rate of its nation’s currency, it would have considerable adverse ramifications for trade and global growth.

 

What would be the market reaction?  

 

In the last interview with the FT Trump said that he wouldn’t be surprised if he and Xi did something that would appear “really dramatic and good for both country”.  It might happen given the Trump’s willingness to flaunt his influence after numerous failures on the legislation front.

 

If this happened, it would definitely be positive for traditional safe-haven currencies, gold and Treasuries. 

 

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EUR/USD outlook after today’s Draghi’s speech

4/6/2017

 

ECB Governor Mario Draghi made a scheduled speech earlier today. Overall, his comments were dovish. It seems that the central bank officials are starting to talk down markets’ taper expectations. The CB head Draghi said that there is no need to deviate from the present wording of bank’s monetary policy stance.  

 

Ultra-loose ECB measures proved to be effective. The general outlook for the euro area economies is gradually improving. The unemployment rate did decrease in the past years, but it is still unclear how quickly lower jobless figures feed into wages. The inflation rate is still well below the coveted 2%; there is scant evidence that it is steady enough (we saw inflation figures hitting ECB target in February; in March, we saw them slowing dramatically driven by lower energy prices), thus, a substantial degree of monetary accommodation is still needed. So, according to Mario Draghi, it is too early to snap into the reassessment of the current monetary policy stance; the ECB policymakers will wait for more evidence before leaving the path of their current ultra-loose monetary policy.

 

EUR/USD skipped some points on Mario Draghi’s dovishness. Going ahead the euro will probably stay under some pressure in light of the release of ECB monetary policy meeting accounts. At the present moment, the pair is still going through its consolidation phase – it is trading around 1.0690. The immediate resistances can be found at 1.0730 (100-H4 MA) and 1.0770 (23.6% Fibo level traced from this year low). On the flip side, there are several supports located at 1.0655 (200-H4 MA) and 1.0620 (50% Fibo retracement level). They are likely tested if the wording of the minutes is extremely dovish. 

 

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Gold resurfaced

4/7/2017

 

On the daily chart of gold, there was a breakout of the important resistance at $1262 per ounce. As a result, the AB = CD pattern has been activated. Its 200% target is located near $1335. To reach this target, the bulls will need to push quotes out of the long-term downward trading channel and test the resistance at $1280. 

 


 

On the hourly chart of gold, the ascending triangle pattern has been realized. The bulls might try to retest the upper border of the triangle located at $1262. In case of breakout, there will be a continuation of the rally. 

 

Screenshot_2017_04_07_08_16_35.png

 

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EUR/JPY: bears play cat and mouse

4/7/2017

 

On the EUR/JPY daily chart, the "bears" have implemented the targets on the short positions and reached support at 117.35. A successful test of this level will lead to the continuation of a downward movement towards the convergence zone 116.55-116.75. Bears remain control over the pair. Traders might consider selling on rollbacks or on breakouts of supports.

 

Screenshot_2017_04_07_08_16_47.png

 

On the EUR/JPY hourly chart, a downward triangle has been formed. A successful test of its lower border can lead to the continuation of the downward movement. The immediate supports can be found near 118.4 and 119.05. 

 

Screenshot_2017_04_07_08_17_18.png

 

Recommendations: SELL 118,4 SL 118,95 TP 116,75,

 

SELL 119,05 SL 119,6 TP 117,35. 

 

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Key option levels for Friday, April 7th

4/7/2017

 

If you have any questions or requests fill out the feedback form.

 

EURUSD(160).png

 

 

Main trend Short-term period Medium-term period

Bearish Neutral

Changes in the open interest + 29 338 ? + 156 643 ?

Closest resistance levels 1.0682; 1.0723; 1.0752; 1.0785-99

Closest support levels 1.0632; 1.0602; 1.0562; 1.0512

Trading recommendations

Baseline scenario Short EUR/USD below 1.0632 (or from 1.0682), with target points at 1.0602 and 1.0562

Alternative scenario Moving above 1.0682 can be considered as a signal to Buy the pair, with target at 1.0723 and 1.0752

 

 

USD/JPY

 

USDJPY(105).png

 

Main trend Short-term period Medium-term period

Bullish Bearish

Changes in the open interest + 165 ? + 70 ?

Closest resistance levels 110.72; 111.04; 111.41; 111.67

Closest support levels 110.34; 110.04; 109.60; 109.30

Trading recommendations

Baseline scenario Long USD/JPY above 110.72 (or from 110.04), with target points at 111.04 and 111.41

Alternative scenario Moving below 110.34 can be considered as a signal to Sell the pair, with target at 110.04 and 109.60

 

 

GBP/USD

 

GBPUSD(127).png

 

Main trend Short-term period Medium-term period

Bullish Bearish

Changes in the open interest + 288 ? + 22 ?

Closest resistance levels 1.2460; 1.2499; 1.2524; 1.2555

Closest support levels 1.2432; 1.2412; 1.2388; 1.2359

Trading recommendations

Baseline scenario Long GBP/USD above 1.2460 (or from 1.2432), with target points at 1.2499 and 1.2524

Alternative scenario Moving below 1.2432 can be considered as a signal to Sell the pair, with target at 1.2412 and 1.2388

 

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EUR/USD: bulls built strongholds

4/10/2017

 

On the EUR/USD daily chart, the bears successfully attacked the bulls' strongholds located near 1.0635. The immediate support is located near 1.05. If it is broken, the "Shark" pattern with target 88.6% will be activated.

 

Screenshot_2017_04_10_07_03_07.png

 

On the EUR/USD hourly chart, after near-term consolidation, there is a continuation of the downtrend. "Bulls" will try to defend 1.058, 1.054 and 1.0495 levels. From each of these levels, a rebound is possible.Then, there will be a development of the correction. The nearest resistance level can be found near 1.0635.

 

Screenshot_2017_04_10_07_03_22.png

 

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NZD/USD: kiwi is losing its ground

4/10/2017

 

 

On the NZD/USD daily chart, there is a realization of 5-0 pattern. The failure of bulls to push quotes beyond the downward trading channel shows their weakness. There can be a continuation of the downward movement towards 0.674. There is 161.8% target in the AB = CD pattern.

 

Screenshot_2017_04_10_07_03_37.png

 

On the NZD/USD  hourly chart, the "Shark" pattern is still relevant. Its target 113% is located near 0.687. The nearest resistance levels are 0.6942 and 0.6965. The market is dominated by bears, so you might consider selling on the growth of the quotes.

 

Screenshot_2017_04_10_07_04_54.png

 

Recommendations: hold short positions (SELL 0,6975 SL 0,703 TP 0,687),

 

SELL 0,6965 SL 0,702 TP1 0,687 TP2 0,674.

 

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Key option levels for Monday, April 10th

 

If you have any questions or requests fill out the feedback form.

 

EUR/USD

 

EURUSD(161).png

 

Main trend Short-term period Medium-term period

Neutral Neutral

Changes in the open interest + 28 123 ? + 69 379 ?

Closest resistance levels 1.0617; 1.0663-75; 1.0709; 1.0746

Closest support levels 1.0585; 1.0560; 1.0525; 1.0480

Trading recommendations

Baseline scenario Long EUR/USD above 1.0585, with target points at 1.0617 and 1.0663

Alternative scenario Moving below 1.0585 can be considered as a signal to Sell the pair, with target at 1.0560 and 1.0525

 

GBP/USD

 

GBPUSD(128).png

 

Main trend Short-term period Medium-term period

Bullish Bearish

Changes in the open interest + 511 ? + 304 ?

Closest resistance levels 1.2414; 1.2440; 1.2466; 1.2485

Closest support levels 1.2366; 1.2338; 1.2318; 1.2294

Trading recommendations

Baseline scenario Long GBP/USD above 1.2414 (or from 1.2366), with target points at 1.2440 and 1.2466

Alternative scenario Moving below 1.2366 can be considered as a signal to Sell the pair, with target at 1.2338 and 1.2318

 

USD/JPY

 

USDJPY(106).png

 

Main trend Short-term period Medium-term period

Bullish Bearish

Changes in the open interest + 820 ? + 116 ?

Closest resistance levels 111.63; 111.86; 112.15; 112.49

Closest support levels 111.05; 110.63; 110.34; 109.84

Trading recommendations

Baseline scenario Long USD/JPY above 111.63 (or from 111.05), with target points at 111.86 and 112.15

Alternative scenario Moving below 111.05 can be considered as a signal to Sell the pair, with target at 110.63 and 110.34

 

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Morning brief for April 10

4/10/2017

 

US yields moved higher on Monday as increased geopolitical risks pushed investors to favor safe-haven assets. The US missile strikes were seen as a warning to Syria’s President Bashar al-Assad to stop using chemical weapons in the ongoing civil war. Friday’s labor report hit the markets quite hard as it showed that the economy added 98K jobs in march, the fewest since May 2016. Other important news from the past week was the agreement between the US and China to start a 100-day examination of trade issues. Trump and Xi were both upbeat after the meeting. The former one was happy to hail an “outstanding relationship” with the US major competitor – China. Chinese President was happy to get deeply acquainted and to establish close ties with the American leader. So, this makes us believe that Trump would abstain from applying harsh epithets to China’s currency manipulations and that US-China relationship will be more or less stable for a while.

 

EUR/USD has started the week on a joyful note having rebounded from its Friday’s low at 1.0578. But the single currency remains to be a subject to downside risks ahead of the first round of the French presidential election. The next key level to the downside can be found at 1.0490 (February low). It will be acting as a quite sturdy support. A move above 1.0665 would be a sign that the immediate downward pressure has eased. Today, we would recommend you to set an alarm clock for 11:10 pm MT time as at this time Fed’s Chair Yellen will be speaking at the University of Michigan and answering the audience questions.

 

USD/JPY was a gainer in Tokyo morning. It rose above 111.50 as global market stabilized after the US missile attacks on Syria and Trump’s meeting Xi ran smoothly. The quotes may rise higher at least to 112.20 (March 31 high). On the downside, there is a solid support at 110.60.

 

USD/CAD rose to 1.3412 in the past session having pared its Friday’s losses. Loonie has strengthened significantly on the surge of the oil prices in the course of the past week. Brent oil futures were rallying since the beginning of April due to the talks about extension of output cut deal. Russia energy minister Novak has discussed the possible extension of the deal on Friday. But we will receive more clarifications on whether the deal can be extended or not by the end of April or in the beginning of May ahead of the 172th OPEC meeting.

 

GBP/USD got a positive momentum on Monday after having slid to 1.2360 at the end of the past week. The pound has some chances for recovery in the near-term if the upcoming UK CPI figures and labor market data beat market’s expectations. Today’s economic calendar for the pair is light.

 

Aussie suffered significant losses in the course of the past week having dropped to 0.7490. Only a move back to 0.7550 would indicate that immediate downward pressure has eased. The sudden weakness of Aussie can be explained by the tremendous downfall of iron ore and copper prices. Friday was the worst day for iron ore in over a year, as the price of benchmark 62% fines declined by 6.76% to $75.45 per ton. 

 

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GBP/USD: triangle didn't help the bears

4/11/2017

 

On the GBP/USD daily chart, there is a formation of the "Splash and ledge" pattern on the basis of 1-2-3. The pound is consolidating in the range of 1.237-1.256. A breakout of the diagonal resistance (the upper limit of the downward trading channel) near 1.2465 can lead to the continuation of the rally. In contrast, a successful test of the support at 1.237 can lead to the implementation of the 88.6% target in the "Bat" pattern.

 

Screenshot_2017_04_11_07_22_41.png

 

On the GBP/USD hourly chart, the triangle has been formed, it helped bears to lead them away to the downside. A breakout of its lower border led to the drop of quotes towards the support at 1.236, but there was no additional downfall. This shows the weakness of the "bears" and creates the prerequisites for the development of consolidation.

 

Screenshot_2017_04_11_07_22_58.png

 

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USD/CHF: bulls got too excited

4/11/2017

 

On the USD/CHF daily chart, the realization of the Wolf Waves pattern continues An update of the April high will allow the bulls to count on the continuation of the rally and the implementation of the 1.0203 target. If they succeed, the chances for the implementation of the 88.6% target in the Shark reversal pattern will increase significantly. The nearest support can be found near 1.004.

 

Screenshot_2017_04_11_07_23_17.png

 

On the USD/CHF hourly chart, buyers are trying to test an important level of 1.0095. Its breakout followed by the successful test of the resistance at 1.013 can lead to the restoration of the "bullish" trend.

 

Screenshot_2017_04_11_07_23_34.png

 

Recommendation: hold long positions (BUY 1,0035 SL 0,9980 TP1 1,013 TP2 1,0205)

 

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Key option levels for Tuesday, April 11th

4/11/2017

 

If you have any questions or requests fill out the feedback form.

 

EUR/USD

 

EURUSD(162).png

 

Main trend Short-term period Medium-term period

Bullish Neutral

Changes in the open interest - 4 226 ? + 3 136 ?

Closest resistance levels 1.0593; 1.0623; 1.0663-75; 1.0708

Closest support levels 1.0569; 1.0534; 1.0513; 1.0489

Trading recommendations

Baseline scenario Long EUR/USD above 1.0593 (or from 1.0569), with target points at 1.0623 and 1.0663

Alternative scenario Moving below 1.0569 can be considered as a signal to Sell the pair, with target at 1.0534 and 1.0513

 

 

GBP/USD

 

GBPUSD(129).png

 

ain trend Short-term period Medium-term period

Bearish Bearish

Changes in the open interest - 419 ? + 213 ?

Closest resistance levels 1.2447; 1.2467; 1.2490/1.2505; 1.2547

Closest support levels 1.2398; 1.2365; 1.2342; 1.2315

Trading recommendations

Baseline scenario Short GBP/USD below 1.2398 (or from 1.2447), with target points at 1.2365 and 1.2342

Alternative scenario Moving above 1.2447 can be considered as a signal to Buy the pair, with target at 1.2467 and 1.2490

 

 

USD/CAD

 

Main trend Short-term period Medium-term period

Neutral Bullish

Changes in the open interest -14 ? + 321 ?

Closest resistance levels 1.3326-35; 1.3376; 1.3419; 1.3475

Closest support levels 1.3289; 1.3266; 1.3235; 1.3187

Trading recommendations

Baseline scenario OUT OF THE MARKET                                                                                                           

Alternative scenario

 

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