Hotforex.com - Market Analysis and News.

[HFM]

Date : 24th November 2014

 

EURUSD TRADING HIGHER IN THE EUROPEAN SESSION. GERMAN IFO BUSINESS CLIMATE ROSE IN NOVEMBER.

 

EURUSD dropped sharply in Monday and closed at 1.2390. The President of the European Central Bank Mario Draghi reiterated his previous statement that the central bank is ready to expand its asset purchases if the low inflation continues to persist in the Euro area.

 

During the weekend the Vice President of the ECB Vitor Constancio stated that the current low inflation is a cause of big concern, but according to him there is no risk of entering a full deflation spiral.

 

Data released today indicated that the German Ifo Business Climate rose to a reading of 104.7 in November.

 

A report from BBG released today says that the Troika team and Greek officials are set to meet tomorrow in Paris.

 

Support for the EURUSD is seen at 1.2362 and resistance is seen at 1.2445.

 

 

Disclaimer: Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of purchase or sale of any financial instrument.

[HFM]

Date : 25th November 2014

 

EURUSD TRADING HIGHER IN THE EUROPEAN SESSION. PRELIMINARY GDP DATA FROM THE UNITED STATES ON FOCUS.

 

EURUSD rose yesterday and closed at 1.2441. The German Ifo Business Climate rose yesterday to a level of 104.7 in November. The ECB Governing Council Member Jens Weidmann urged the EU governments to implement structural reforms arguing about the loose monetary policy of the European Central Bank. According to him the current ECB policies cannot boost the growth prospect permanently.

 

Data released from the United States showed that the Flash Services PMI dropped to a level of 56.3 in November.

 

Investors are now looking forward for the preliminary GDP report and the CB Consumer Confidence report due from the United States later today.

 

Support for the EURUSD is seen at 1.2362 and resistance is seen at 1.2445.

 

 

Disclaimer: Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of purchase or sale of any financial instrument.

[hotforex]

EURUSD RANGING BEFORE THE CPI RELEASES

 

Business confidence in Germany rose for the first time in seven months. On Monday the German IFO business climate survey surprised to the upside being 104.7 instead of 103.0 as expected. The German GDP figures (0.1%) for the last quarter were left well behind of those released in the US on Tuesday. The preliminary GDP in the US was more positive than analysts expected with the figure being at 3.9%. That is 0.6% better than expected. On Thursday we will have preliminary inflation figures from Germany and then the euro area CPI estimate on Friday. The logic from the fundamental side suggests that should these statistics show that there is no inflation the pressure on the ECB to act sooner will grow. The focus of the central bank is now on inflation and therefore signs that the euro area might be heading towards deflation should cause the market participants to adjust their positions accordingly and sell euro.

 

EURUSD, Monthly

From technical point of view EURUSD is now at a major support area that has been able to turn traders from bearish to bullish (and price higher) in several occasions in the past. Since 2006 none of the moves below the current level have been sustainable in medium to long term. In 2009 this very level turned price higher in two occasions and in 2010 we had an attempt to take EURUSD below 1.20. This failed even though the euro crisis was at its worst and market participants sought safety from the US Dollar. Many analysts interviewed in Bloomberg TV at the time shared their views on how they expected EUR to move to parity with the US Dollar (one euro would be worth one US Dollar). Now, we have stimulus promises from the ECB president Mario Draghi that have made analysts suggest that EUR will move as low as 1.15. This would mean euro visiting levels it has not seen since November 2003. Will the coming QE mean it is different this time and this move to 1.15 might actually happen? Obviously this is possible, but in the light of current price action it is not likely to happen immediately. This far Mr. Draqhi has been able to talk the market down but in terms of tangible and meaningful action he has not been able to deliver much. In terms of economic growth prospects in the euro area and the United States it makes sense assume that the Dollar will be favoured by the markets in the long run but as we are looking for short term trading opportunities it makes sense to concentrate on the current price action as it develops and technical setups available for us today and over the rest of the week. The downside momentum has clearly slowed down with market being close to forming a small narrow range bar in monthly time frame. The price is at a monthly pivot from 2010 and at the Bollinger bands. If the support holds for the rest of the week and through the euro area CPI releases, we have a monthly narrow range bar indicating that market is at a turning point. In my experience technical levels will prevail unless some unexpected news exceeds the expectations and traders have to quickly revalue the underlying assets and their strategies. This could cause the market move beyond major technical support and resistance levels.

 

EURUSD, Daily

In the daily chart we can see that EURUSD is forming a bullish wedge. In fact, it can be seen in both weekly and daily charts. Both RSI and Stochastic Oscillator have bullish divergence as price moves below 1.2360 have been rejected twice. This has created a short term double bottom. In addition, the pair has once again moved away from the regression channel, a further indication of momentum slowdown. Resistance levels at daily pivot candle are also weekly resistance levels. As they coincide with a descending trendline and the proximity of Bollinger Bands I am looking for short signals between 1.2512 and the daily Bollinger Bands (1.5 stdv Band currently at 1.2568).

 

EURUSD, 240 min

In the four hour chart the pair is in a range, so selling the resistance levels and buying at support is the preferred strategy. The price is now approaching the 1.2512 resistance (weekly and daily pivot) with the Bollinger bands stalling the current move a bit. Pay attention to the area between weekly resistance at 1.2512 and a daily high at 1.2568 that also coincides with the descending trend line. I am looking for short signals at or above 1.2512 (a momentum reversal confirming the trade idea). As we are in a range I would look to buy either in the region of 1.2400 or close the support at 1.2360. Again the momentum changes in 15 min and or 60 min resolutions will help us to decide whether to stay short or cover.

Conclusion:

From technical point of view EURUSD is now at a major support area that has been able to turn traders from bearish to bullish (and price higher) in several occasions in the past. The downside momentum has clearly slowed down with market being close to forming a small narrow range bar in monthly time frame. The price is at a monthly pivot from 2010 and at the Bollinger bands. If the support holds for the rest of the week and through the euro area CPI releases, we have a monthly narrow range bar indicating that market is at a turning point. In weekly and daily chart we can see that EURUSD is forming a bullish wedge. In the four hour chart the pair is in a range, so selling the resistance levels and buying at support is the preferred strategy. I am looking for short signals at or above 1.2512 (a momentum reversal confirming the trade idea). As we are in a range I would look to buy either in the region of 1.2400 or close the support at 1.2360. Momentum changes in 15 min and or 60 min resolutions will help us to decide whether to stay short or cover.

Disclaimer: Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of purchase or sale of any financial instrument.

Janne Muta
Chief Market Analyst
HotForex

 

 

[HFM]

Date : 26th November 2014

 

EURUSD PUSHING LOWER IN THE EUROPEAN SESSION. US UNEMPLOYMENT CLAIMS ARE SCHEDULED TO BE RELEASED TODAY DUE TO THE THANKSGIVING DAY IN THE UNITED STATES.

 

EURUSD rose yesterday and closed at 1.2473. Data released from the Germany yesterday showed that the nation avoided recession after the German Final GDP for the 3rd quarter of the 2014 came out in line with the market expectations recording a rise of 0.1 percent. The Retail Sales in Italy registered a drop on a monthly basis coming at a reading of -0.1 percent in September.

 

The biggest surprise in the session yesterday was the preliminary GDP data from the United States. The second estimate for the 3rd quarter of 2014 showed an increase of 3.9 percent against the market expectations of a 3.3 percent rise. On the other hand the CB Consumer Confidence in the largest economy in the world dropped to a level of 88.7 in November.

 

Investors are now looking forward for the Unemployment Claims report from the United States which is scheduled to be released today, because of the Bank Holiday in the US tomorrow. Banks in the United States will be closed due to the observance of the Thanksgiving Day.

 

Support for the EURUSD is seen at 1.2362 and resistance is seen at 1.2487.

 

 

Disclaimer: Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of purchase or sale of any financial instrument.

[HFM]

Date : 28th November 2014

 

EURUSD TRADING HIGHER ON FRIDAY. CPI FLASH ESTIMATE IN THE EU IN LINE WITH THE MARKET EXPECTATIONS.

 

EURUSD dropped yesterday and closed at 1.2645. The German Preliminary Consumer Price Index remained flat in November. The GfK German Consumer Climate rose to a reading of 8.7 in November.

 

 

During his speech the President of the European Central Bank Mario Draghi urged the EU governments to implement economic reforms. He also cautioned that the unemployment, the lack of productivity and the structural reforms are the main risks surrounding the economy in the currency union.

 

Data released today showed that the CPI Flash Estimate in the Eurozone dropped to a level of 0.3 percent on an annual basis in November.

 

Support for the EURUSD is seen at 1.2362 and resistance is seen at 1.2487.

 

 

Disclaimer: Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of purchase or sale of any financial instrument.

[hotforex]

Disappointing Black Friday sales turns S&P 500 futures lower

 

 

Retailers struggled to entice shoppers with their Black Friday offerings. Spending dropped by an estimated 11% over the weekend. Consumer spending fell to $50.9 billion from $57.4 billion in 2013 and made this the second Black Friday in the row that saw the sales figures tumbling. Even though retailers had aggressive discounts and longer opening hours many of the shoppers stayed at home. It was estimated that more than six million shoppers that had been expected to come did not want to or just simply could not afford to join the Black Friday shopping circus. This has raised concerns of how well the recovery in the US economy is doing.

 

 

S&P 500, Weekly

 

The S&P 500 emini future (ES) created a narrow range candle last week. This implies no demand at those levels and increases probabilities of a sizeable correction. Up volume in the NYSE (New York Stock Exchange) has moved to so high levels that in the light of recent history cannot be sustained. In the past this has caused the market to move sideways and/or correct lower. ES has now moved below the last week’s low of 2060.75 which should limit any immediate rally attempts while the Stochastic Oscillator is overbought and about to roll over. A more significant weekly support level can be found at September high of 2014.50 with a Fibonacci level nearby at 2010.44, while weekly resistance levels are at 2060.75 and 2075.25 (the range of this weekly pivot high).

 

 

 

S&P 500, 240 min

 

Money Flow Index and Stochastics have had bearish divergence while volume has been trending lower over the month of November. This means that there has been less participation in this market and has had obviously bearish implications. Since 21st November the decline in the average volume has been intensifying but it can be at least partly explained by the long weekend due to the thanks giving day in States. However, the bearish indication that this kind of development has was confirmed by the creation of a weekly narrow range candle last week and price now moving below it. Trading started this week with a gap opening lower, which is a further indication of weakness in demand. The last time we’ve had a gap opening lower after a period of rising prices, was on 22nd of September and lead to a 9% correction in the S&P emini and stocks in general.

 

 

 

 

S&P 500, 60 min

 

Daily high from 18th November has provided some support this morning but the intraday resistance between 2057.50 and 2059.50 has at the time of writing provided a short term sell signal (a 15 min shooting star in the insert) and confirmed the downward bias for today.

 

Conclusion

 

A narrow range candle last week is an implication that there is no demand at those levels and increases probabilities of a correction. At the same time oscillators are rolling over from overbought zone and trading started this week with a gap opening lower, all these are further indications of weakness in demand. The last time we’ve had a gap opening lower after a period of rising prices, was on 22nd of September. This lead to a 9% correction in the S&P emini and it therefore makes sense to therefore look for a correction to at least to the next important weekly support level at 2014.50, the weekly pivot high from September. If the price keeps on making lower highs in the intraday charts and keeps on giving sell signals at resistance levels (similar to the 15 min insert) I would keep on trading them and look to go long only if this pattern is broken or ES moves to the 2014.50 support where I believe we have some potential of finding more lasting support. Always look for momentum reversal signals to confirm the support and resistance levels.

 

Disclaimer: Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of purchase or sale of any financial instrument.

 

Janne Muta

Chief Market Analyst

HotForex

[HFM]

Date : 1st December 2014

 

EURUSD ATTEMPTING TO BREAK HIGHER IN THE EUROPEAN SESSION. US ISM MANUFACTURING PMI ON TAP IN THE AFTERNOON.

 

EURUSD dropped on Friday and closed at 1.2450. The Retail Sales in Germany rose 1.9 percent on a monthly basis in October. The Unemployment Rate in the Eurozone remained unchanged in October in line with the market expectations at 11.5 percent.

 

The ECB Policymaker Jens Weidmann stated that the monetary policy of the central bank cannot spur sustainable growth or create jobs in the economy.

 

 

Data released today indicated that the Final Manufacturing PMI in the Eurozone dropped to a level of 50.1 in November.

 

Investors are now looking forward for the ISM Manufacturing PMI data due from the United States later today.

 

Support for the EURUSD is seen at 1.2409 and resistance is seen at 1.2488.

 

 

Disclaimer: Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of purchase or sale of any financial instrument.

[HFM]

Date : 2nd December 2014

 

EURUSD TRADING LOWER ON TUESDAY. NO MAJOR ECONOMIC RELEASES FOR THE SESSION AHEAD.

 

EURUSD rose yesterday and closed at 1.2469. The Final Manufacturing PMI in the Eurozone dropped a level of 50.1 in November. The Italian Manufacturing PMI dropped in November to a reading of 49.0. On the other hand the Spanish Manufacturing PMI rose in November to a level of 54.7.

 

Data from the United States revealed that the ISM Manufacturing PMI in the largest economy in the world dropped to a level 58.7 in November from 59.0 during the previous month, but still came better than the market expectations of a drop to 57.9.

 

The President of the United States Federal Reserve in New York William Dudley opined that he expects the central bank to hike the interest rates in the middle of 2015.

 

Support for the EURUSD is seen at 1.2418 and resistance is seen at 1.2558.

 

 

 

Disclaimer: Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of purchase or sale of any financial instrument.

[HFM]

Date : 4th December 2014

 

EURUSD TRADING LOWER AHEAD OF THE ECB INTEREST RATE DECISION.

 

EEURUSD dropped yesterday and closed at 1.2310. The Retail Sales in the Eurozone rose less than the market expectations reaching 0.4 percent on a monthly basis in October. The Final Services PMI dropped to a level of 51.1 in November. In Germany the Services PMI remained unchanged in November holding a level of at 52.1 in line with the market expectations.

 

Data from the United States revealed that the ISM Non-Manufacturing PMI rose to a level of 59.3 in November against the market expectations of a rise to 57.5. The ADP Non-Farm Employment release indicated 208K jobs added in November. Market had expected a larger expansion to a level of 223K.

 

Investors are now looking forward for the ECB Minimum Bid Rate decision and the ECB Press Conference due later today. Meanwhile EURUSD printed new lows touched the 1.2995 level.

 

Support for the EURUSD is seen at 1.2294 and resistance is seen at 1.2391.

 

 

Disclaimer: Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of purchase or sale of any financial instrument.

[hotforex]

“There is a tremendous shortage of physical gold in the world”

 

https://blog.hotforex.com/there-is-a-tremendous-shortage-of-physical-gold-in-the-world/

 

This week started with a big rally in the price of gold even though the news that Swiss voters rejected the proposal to buy more physical Gold should have sent the price lower. The upsurge in the price of Gold from 1141 to 1221 (a move of 7%) has been credited by analysts with the price of Crude Oil surging higher at the same time. With the price of Crude Oil being an important component in inflation measurements an up move in the price of oil would therefore create a need to hedge against inflation, which is what Gold is widely thought to be.

 

However, the fact that this move in the price of Gold took place after it was confirmed that the 7% annual demand increase for physical Gold by the Swiss central bank is not going to happen is an important indication that the market participants are now willing to step in and buy Gold futures (paper gold).

 

This brings the paper market in Gold more in line with reports that there is actually a global shortage of Gold. According to McAlvany Financial Group, a firm specializing in physical precious metals markets, gold buyers in Far East are currently paying premium prices for physical Gold. This means that buyers are not only willing to pay the market price for their physical Gold but actually add some on top. At the same time central banks, such as China are buying physical gold and others are repatriating their gold reserves that have been stored abroad. Global Research, a research center for globalization; published an article this week saying that “Netherlands has moved 122 tons of gold worth $5 billion from New York, and similar demands are now being made in France. Last year, Germany asked to have 680 tons of gold repatriated, which is mostly kept in the United States, but some also in the United Kingdom and France. Berlin receives only 5 tons, with the promise to get the rest back by 2020.”

 

According to Global Research ““And even those 5 tons Germany got back was not the same they had given to the Fed, those were newly cut bars. So it does mean that the Fed clearly did not have anywhere near the gold necessary to send back to Germany. Because it was most probably either leased to the market or sold – this is what central banks are doing – they are lending gold to the market or selling gold in order to push the price of gold down,” Egon von Greyerz said stressing that there is a tremendous shortage of physical gold in the world.” One day when the people who hold paper gold ask for delivery, there will not be any physical gold to deliver.

 

 

Gold, Monthly

 

Gold is at historical support (provided by a monthly pivot candle high from February 2010. The monthly candle for November was a narrow range candle with open and close only $4 apart. This indicates that supply and demand were in balance in November and now this balance could be tipping over to favour the demand side, at least temporarily. This price action coincided with the monthly Bollinger Bands which also limited the move lower and was then followed by a strong rally in the price of Gold higher after the news from Switzerland (the Swiss rejected the law to increase the country’s Gold reserves) caused the market to gap open slightly lower than the close on Friday. If market rallies strongly after news that on face value is negative for Gold, then we have reason to conclude that the market participants are collectively ready to defend (to buy) the recent lows of 1230 – 1240 and they see Gold representing value even if the additional boost of demand from Switzerland is not going to be there.

 

We still have this market trending lower in the technical sense as it still has lower highs and lower lows. However, the monthly narrow range candle at Bollinger bands suggests that we might have a turning point at hand and Gold could move higher towards the upper end of the down sloping trend channel. There is bullish divergence in RSI even though Gold has been moving lower for four months since July this year, therefore it might well be the time for a move higher after so many downward months.

 

Longer term Fibonacci levels are clustering at three different areas. The supporting cluster is between 1045 and 1090, while clusters between 1270 and 1306 and again at higher levels between 1383 and 1406 are likely resistance areas in the longer term picture. I have left these levels off the chart to keep it more readable.

 

The resistance area (1204 to 1226) above the current price action is created by monthly lows and closing prices from this and last year. This level obviously needs to be cleared before Gold can advance sustainably but the fact that we now have a narrow range candle with Bollinger Bands right below and a very positive price reaction to negative news increases possibilities of this happening. However, should the price stay below this level for a one more week it would negate the bullish indications we now have had and increases possibilities of supporting demand eroding at the 1230 to 1240 support area.

 

 

Gold, Weekly

 

Trend the weekly Gold price is lower both in short to medium term and longer term as well. The medium term weekly trend lower is defined by descending regression channel from the pivot in July this year. Currently the price is close to the lower end of long term downtrend channel and a historical monthly pivot candle as well as both monthly and weekly Bollinger Bands near the current lows. These technical factors limit the immediate downside and have in November translated into a narrow range candle (or a Doji as it is also known) with a rising RSI line (bullish divergence). On the upside the weekly pivot high at 1226 from November has acted as a resistance and sent the price to the current levels. The latest high (1221) that was just 3 dollars shy of the low of this pivot candle. The medium term down sloping regression channel top is also close which could mean that Gold needs to have more sideways fluctuation before more upside can be gained.

 

 

 

Gold, 240 min

 

Price is fluctuating above a recent 4h pivot (green arrow) and below the pivot high from Monday. The 1191 used to be a level that supported price earlier and it acts as a support again. The price being between two pivots has created a very narrow range which on a daily chart looks like a pennant (flag) formation. If this pennant is resolved to the upside it gives us a target of about 1280, a former support level from July and August this year. If Gold corrects lower, look for buy signals at or near to the 1159.50 support created by the 4h pivot.

 

Conclusion:

 

Gold is close to an important support with several technical factors supporting the price. If the current narrow range is resolved to the downside (which looks likely to me based on the current market action), the pivot low between 1141 and 1159.50 is a potential support and should be monitored as an exit level for shorts and entry level for long trades. Look for hammers and bullish wedges in 15 and 60 min timeframes to confirm the momentum reversal. If the DXY, US dollar index moves strongly to the upside the bullishness of the above technical indications is negated and it is more likely that the price of Gold will move below the recent lows.

 

Disclaimer: Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of purchase or sale of any financial instrument.

 

Janne Muta

Chief Market Analyst

HotForex

[hotforex]

HotForex Free Webinar | How to Use Multi Time Frame Analysis 10/12/14 at 12:30 GMT

 

Join Janne Muta, HotForex’s Chief Market Analyst, at our next webinar – How to Use Multi Time Frame Analysis – and learn the importance of using multiple time frames in your analysis and trading:

 

- Read price action in different time frames; 

- Discover the key drivers behind significant intraday price moves;

- Learn how to use Multi Time Frame Analysis to identify high probability trades.

 

Register now https://www.hotforex.com/en/landing-pages/webinar-trading.html?refid=37217

 

[HFM]

Date : 5th December 2014

 

ECB KEEPS THE INTEREST RATES UNCHANGED. EURUSD TRADING LOWER AHEAD OF THE NON-FARM PAYROLLS AND UNEMPLOYMENT RATE DATA.

 

EURUSD rose yesterday and closed at 1.2377. Yesterday the European Central Bank held its key interest rate steady at 0.05 percent. During his statement, the President of the European Central Bank Mario Draghi indicated that the policymakers would reassess the stimulus measures early next year and decide if there is a need of additional measures to be taken. Draghi also hinted that the European Central Bank would act even if it does not find unanimity among the policymakers.

 

The Unemployment Claims in the United States fell to 297K during the last week from a reading of 314K during week before.

 

Investors are now looking forward for the Non-Farm Payrolls, the Unemployment Rate and the Trade Balance data due from the United States. All of the releases are scheduled at the same time and investors should be fully aware of the potential high volatility on the market prior and after the time of the data.

 

Support for the EURUSD is seen at 1.2294 and resistance is seen at 1.2391.

 

 

Disclaimer: Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of purchase or sale of any financial instrument.

[HFM]

Date : 8th December 2014

 

US DOLLAR KEEPS PRINTING NEW HIGHS AGAINST THE EURO. EUROGROUP MEETINGS ON FOCUS TODAY.

 

EURUSD dropped on Friday and closed at 1.2285. The German Factory Orders rose 2.5 percent on a monthly basis in October. The Industrial Production in Spain rose 1.2 percent on an annual basis in October.

 

No matter the positive releases from the Eurozone the US dollar traded on a strong foot after the positive NFP data. The US Non-Farm Payrolls recorded an increase of 321K in November beating the market expectations of a 230K increase. The Unemployment Rate in the United States remained steady at 5.8 percent in November.

 

The President of the United States Federal Reserve in Cleveland Loretta Mester sounded very optimistic about the US economy and also added that she sees an interest rate hike in 2015.

 

Investors are looking forward for the Eurogroup Meetings taking place in Brussels today.

 

Support for the EURUSD is seen at 1.2250 and resistance is seen at 1.2391.

 

 

 

Disclaimer: Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of purchase or sale of any financial instrument.

[HFM]

Date : 9th December 2014

 

EURUSD IS TRADING HIGHER IN THE EUROPEAN SESSION. ECOFIN MEETINGS ARE TAKING PLACE IN BRUSSELS TODAY.

 

EURUSD rose yesterday and closed at 1.2314. The Sentix Investor Confidence index in the Eurozone improved to a reading of -2.5 in December. That its highest reading in 4 months. The German Industrial Production rose 0.2 percent on a monthly basis in October.

 

The ECB Governing Council member Ewald Nowotny opined yesterday that there is a high probability that the inflation growth in the region would slow down further in the first quarter of 2015.

 

 

In the United States the President of the United States Federal Reserve in Atlanta Dennis Lockhart expressed his confidence in the US economy and stated that he expects Fed to start increasing the interest rates in the middle of 2015.

 

Investors are now looking forward for cues from the outcome of the ECOFIN Meetings taking place in Brussels today.

 

Support for the EURUSD is seen at 1.2250 and resistance is seen at 1.2391.

 

 

 

Disclaimer: Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of purchase or sale of any financial instrument.    

[hotforex]

Employment in focus on both sides the border https://blog.hotforex.com/employment-in-focus-on-both-sides-the-border/

 

In Canada the central bank’s focus is on employment and the recent figures don’t encourage the Bank of Canada to raise rates even though the inflation figures have lately been positive. The employment change reported last Friday was -10.7K instead of positive expectation of 5.3K. This compares quite badly to the same period a year earlier with employment increasing by 146K. On the southern side of Canada’s border the US employment figures are developing above expectations. Non-Farm Payrolls increased by 321.000 instead of 231.000 jobs expected by analysts and the average hourly earnings came in last Friday at 0.4% instead of 0.2% expectations. At the same time the analysts are expecting the Fed to drop their “low rates for considerable time” language soon. It is expected that the Fed will raise rates in six months’ time should this happen. The Bank of Canada’s governor Poloz speaks this Thursday (11th December). He is known to be dovish and the markets are expecting that after the last Friday’s employment figures he will continue with dovish statements. All this is likely to support USDCAD which is still trending higher.

 

 

USDCAD, Weekly

 

The market has been trending higher since June and the pair has pushed through a pivot high that was accompanied with a very long term 50% Fibonacci level (calculated from March 2009 peak to July 2011 low). USDCAD is now approaching levels of a weekly pivot from July 2009 (61.8% Fibonacci retracement level at 1.1674 coincides with this pivot). In terms of nearest support and resistance levels, the proximity of the low of the pivot at 1.1544 is likely to cause some resistance while the peak from March this year (at 1.1278) is a major support.

 

 

USDCAD, Daily

 

The pair is trending steadily in a channel with a recent breakout from a triangle formation. The width of this formation points to the weekly resistance level of 1.1544 and suggests that we need to pay attention to price action at this resistance area. It could be a good target level for short term trades after the pair pulls back a bit. Stochastics Oscillator is getting to the overbought territory suggesting that the price move is nearing levels that we should not consider as entry levels for long trades. Rather it would make sense to buy retracements back to support levels. Pull backs close to the weekly support of 1.1278 should be monitored closely for momentum reversal signals in smaller time frame charts. The 23.6% and 38.2% Fibonacci retracement levels coincide with two other technical levels. The 23.6% retracement is roughly at level with the two recent peaks when considered on closing basis (focusing on daily closing prices rather than the high values) while the 38.2% Fibonacci level coincides with a pivot in a four hour chart.

 

 

USDCAD, 240 min

 

If the momentum stays strong the market can find support at higher levels (closer to the current price). However, should we get moves to the lower levels such as 1.1278 it the risk of further corrections after our entries would be smaller. We should obviously feel therefore more confident deeper pull backs closer to the major support level at 1.1278.

 

Conclusion

 

USDCAD is in an uptrend but approaching a higher time frame historical resistance area that has potential to cause this market to correct closer to the lower end of the up trending channel. We are looking for long opportunities at the levels identified in different timeframes. The fundamentals favour this trade idea with the US economy being stronger than the Canadian. Look for corrections to the support levels and then intraday momentum reversal signals before entering long trades.

 

Disclaimer: Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of purchase or sale of any financial instrument.

 

Janne Muta

Chief Market Analyst

HotForex

[HFM]

Date : 11th December 2014

 

EURUSD TRADING HIGHER ON THURSDAY. RETAIL SALES AND UNEMPLOYMENT CLAIMS DATA FROM THE UNITED STATES ON TAP.

 

EURUSD rose yesterday and closed at 1.2447. The ECB Executive Board Member Benoit Coeure urged the EU governments to implement structural reforms in order to promote growth and overcome the period of low inflation in the Eurozone. Data released from France indicated that the Industrial Production in the country fell to a reading of -0.8 percent in October.

 

 

A report from the United States indicated that the Federal Budget Balance dropped to 56.82 billion USD in November.

 

Investors are now looking forward for the Retails Sales data and the Unemployment Claims report due from the United States later today.

 

Support for the EURUSD is seen at 1.2361 and resistance is seen at 1.2491.

 

 

 

Disclaimer: Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of purchase or sale of any financial instrument.  

[HFM]

Date : 15th December 2014

 

EURUSD TRADING LOWER IN THE EUROPEAN SESSION. EMPIRE STATE MANUFACTURING INDEX ON TAP.

 

EURUSD rose on Friday and closed at 1.2460. The Industrial Production in the Eurozone rose less than the market expectations by 0.1 percent on a monthly basis in October. The Wholesale Price Index in Germany dropped 0.7 percent on a monthly basis in November.

 

Data from the United States showed that the University of Michigan Consumer Sentiment Index rose to a level of 93.8 in December, posting its highest reading since January 2007. The Producer Price Index in the US dropped by 0.2 percent on a monthly basis.

 

Late on Friday the ratings agency Fitch Ratings cut the credit rating of France by a notch to AA from AA+.

 

Investors are now looking forward for the Empire State Manufacturing Index release due from the United States.

 

Support for the EURUSD is seen at 1.2361 and resistance is seen at 1.2491.

 

 

 

Disclaimer: Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of purchase or sale of any financial instrument.    

[HFM]

Date : 16th December 2014

 

EURUSD MAKING NEW HIGHS IN THE EUROPEAN SESSION. GERMAN ZEW ECONOMIC SENTIMENT ON TAP.

 

URUSD dropped yesterday and closed at 1.2436. The Industrial Production in the United States rose more than the market expectations registering a 1.3 percent rise on a monthly basis in November – its highest rise since 2010. On the other hand the Empire State Manufacturing Index registered a sharp drop to a level of -3.6. The NAHB Housing Market Index also dropped to 57.0 in December.

 

Investors are now looking forward for the German ZEW Economic Sentiment and also the US Building Permits report.

 

Support for the EURUSD is seen at 1.2414 and resistance is seen at 1.2522.

 

 

Disclaimer: Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of purchase or sale of any financial instrument.                                   

[HFM]

Date : 19th December 2014

 

EURUSD CONTINUES TO PRINT NEW LOWS ON FRIDAY.

 

EURUSD dropped yesterday and closed at 1.2285. Data released yesterday indicated that the German Ifo Business Climate rose to a level of 105.5 in December. Data from the United States indicated that the Unemployment Claims during the last week dropped to 289K. On the other hand the Philly Fed Manufacturing Index dropped more than the market expectations to a level of 24.5 in December. The Flash Services Purchasing Managers Index also recorded a drop to a level of 53.6 in December. The CB Leading Index month over month came out in line with the market expectations at a reading of 0.6 percent in November.

 

 

No major economic releases are due from Europe and the United States for the rest of the trading day, but investors should be fully aware that any potential market commentary may bring volatility on the market.

 

Support for the EURUSD is seen at 1.2258 and resistance is seen at 1.2369.

 

 

Disclaimer: Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of purchase or sale of any financial instrument.  

[hotforex]

The Fed pushed the US stocks to recent highs https://blog.hotforex.com/the-fed-pushed-the-us-stocks-to-recent-highs/

 

Janet Yellen promised that the Fed would keep the interest rates low, or at least that it would not rush to hike the rates. This helped the stocks to rally to levels that we are interested in selling should the price action justify that. We are already seeing momentum reversal and it seem that this is a low risk area to take a contrarian view to the latest rally. Yes, the US economy is doing better than the rest of the world but a quick rally to levels that in the recent past have not been attractive enough for investors to keep buying could very well be followed by a technical correction lower. Let’s see what the charts are telling about the current market activity.

 

 

S&P 500, Weekly

 

After a long term trend higher the S&P 500 futures market is experiencing a higher volatility with the price taking back the ground lost during the previous week’s sell off. This move has taken the market to a weekly pivot high between 2063 (open) and 2079 (high). This looks like a return move, meaning that the chances are it gets sold right at the current levels. This weekly pivot high has been an area that I have called a no demand zone earlier this month and judging from the price action in the four hour chart we might get another move lower from here.

 

 

S&P 500, Daily:

 

The Stochastics Oscillator is getting into the overbought territory and the daily candle looks like it is forming into a shooting star. This will happen if the price cannot close much higher than the current levels. If the market cannot penetrate this (weekly pivot) resistance level but moves lower from here, then the risk of price actually moving much further down increases. The potential support levels are as follows: 2011.25, 1961 and 1883.25.

 

 

S&P 500, 240 min

 

The 240 min chart has already a Doji candle (open and close near to each other) with the Stochastics about to roll over. Both of these signal momentum slowdown and quite possibly momentum reversal taking place. With the price being close to a recent market high, inside a weekly pivot high and very close to a long term (weekly) channel top, I would not be looking to buy at these levels. Rather it makes sense to sell against the recent intraday highs with a view of taking partial profits when price approaches the former intraday resistance (now a potential support) at 2011.25. This is the very same level that provided us with two nice short setups until on the third attempt the price went through. This could be the target one for short trades opened at the current levels.

 

 

S&P 500, 60 min

 

We have already had a 60 min Shooting Star inside this weekly pivot high. This implies that the momentum reversal is actually taking place. There is some minor support at the current levels which might mean that there will be another attempt to take the market slightly higher intraday. This could provide a great short entry level at (or inside) the 60 min pivot candle, therefore my preference would be to short between 2068 and 2073.75 with the first target near to the previous resistance at or around 2011.25, and should the price action justify then I would look to close the rest of the shorts at either 1961 or close to the daily pivot from 15th November at 1883.25.

 

Conclusion:

 

Price is inside a recent weekly pivot high and close to the long term channel top. This has been a no demand zone in the past. The 240 and 60 min charts have signs of momentum reversal. I would look to short against the current levels with an aim to close some the short positions at or close to 2011.25 or should there be no signs of momentum reversing, then the next target would be at 1961 or area close to the 1883.25 pivot.

 

Disclaimer: Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of purchase or sale of any financial instrument.

 

Janne Muta

Chief Market Analyst

HotForex

[hotforex]

The Fed pushed the US stocks to recent highs https://blog.hotforex.com/the-fed-pushed-the-us-stocks-to-recent-highs/

 

Janet Yellen promised that the Fed would keep the interest rates low, or at least that it would not rush to hike the rates. This helped the stocks to rally to levels that we are interested in selling should the price action justify that. We are already seeing momentum reversal and it seem that this is a low risk area to take a contrarian view to the latest rally. Yes, the US economy is doing better than the rest of the world but a quick rally to levels that in the recent past have not been attractive enough for investors to keep buying could very well be followed by a technical correction lower. Let’s see what the charts are telling about the current market activity.

 

 

S&P 500, Weekly

 

After a long term trend higher the S&P 500 futures market is experiencing a higher volatility with the price taking back the ground lost during the previous week’s sell off. This move has taken the market to a weekly pivot high between 2063 (open) and 2079 (high). This looks like a return move, meaning that the chances are it gets sold right at the current levels. This weekly pivot high has been an area that I have called a no demand zone earlier this month and judging from the price action in the four hour chart we might get another move lower from here.

 

 

S&P 500, Daily:

 

The Stochastics Oscillator is getting into the overbought territory and the daily candle looks like it is forming into a shooting star. This will happen if the price cannot close much higher than the current levels. If the market cannot penetrate this (weekly pivot) resistance level but moves lower from here, then the risk of price actually moving much further down increases. The potential support levels are as follows: 2011.25, 1961 and 1883.25.

 

 

S&P 500, 240 min

 

The 240 min chart has already a Doji candle (open and close near to each other) with the Stochastics about to roll over. Both of these signal momentum slowdown and quite possibly momentum reversal taking place. With the price being close to a recent market high, inside a weekly pivot high and very close to a long term (weekly) channel top, I would not be looking to buy at these levels. Rather it makes sense to sell against the recent intraday highs with a view of taking partial profits when price approaches the former intraday resistance (now a potential support) at 2011.25. This is the very same level that provided us with two nice short setups until on the third attempt the price went through. This could be the target one for short trades opened at the current levels.

 

 

S&P 500, 60 min

 

We have already had a 60 min Shooting Star inside this weekly pivot high. This implies that the momentum reversal is actually taking place. There is some minor support at the current levels which might mean that there will be another attempt to take the market slightly higher intraday. This could provide a great short entry level at (or inside) the 60 min pivot candle, therefore my preference would be to short between 2068 and 2073.75 with the first target near to the previous resistance at or around 2011.25, and should the price action justify then I would look to close the rest of the shorts at either 1961 or close to the daily pivot from 15th November at 1883.25.

 

Conclusion:

 

Price is inside a recent weekly pivot high and close to the long term channel top. This has been a no demand zone in the past. The 240 and 60 min charts have signs of momentum reversal. I would look to short against the current levels with an aim to close some the short positions at or close to 2011.25 or should there be no signs of momentum reversing, then the next target would be at 1961 or area close to the 1883.25 pivot.

 

Disclaimer: Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of purchase or sale of any financial instrument.

 

Janne Muta

Chief Market Analyst

HotForex

[HFM]

Date : 22nd December 2014

 

EURUSD TRADING LOWER AHEAD OF THE US EXISTING HOME SALES REPORT.

 

EURUSD dropped on Friday and closed at 1.2227. The German Consumer Confidence Index rose to a level of 9. The Current Account in the Eurozone dropped more than expected to 20.5B in October. In the United States the Kansas Fed Manufacturing Index rose to a level of 8.0 in December, beating the market expectations for a steady reading of 7.0 which was recorded during the previous month.

 

The President of the United States Federal Reserve in Richmond Jeffrey Lacker supported the latest decision of Fed to keep the interest rates steady and added that he would look for a little more data before actually supporting an interest rate hike.

 

Support for the EURUSD is seen at 1.2218 and resistance is seen at 1.2349.

 

 

Disclaimer: Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of purchase or sale of any financial instrument.

[HFM]

Date : 23rd December 2014

 

EURUSD PRINTING NEW LOWS AHEAD OF THE US FINAL GDP REPORT.

 

EURUSD rose yesterday and closed at 1.2229. Data released from the Eurozone indicated that the Consumer Confidence in the single currency bloc rose slightly to -11 in November. In Germany the Import Price Index dropped to -0.8 percent on a monthly basis in November.

 

Data from the United States showed that the Existing Home Sales dropped to a six-month low in December coming at a reading of 4.93M.

 

Investors are now looking forward for the Final GDP data for the 3rd quarter from the United States as well as the Core Durable Goods Orders month over month and the New Home Sales reports. During the time of the releases high volatility may be seen on the market and investors should be fully aware of that.

 

Support for the EURUSD is seen at 1.2205 and resistance is seen at 1.2300.

 

 

Disclaimer: Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of purchase or sale of any financial instrument.

[HFM]

Date : 2nd January 2015

 

EURUSD CONTINUES TO PRINT NEW LOWS IN THE FIRST TRADING DAY FOR 2015. US ISM MANUFACTURING PMI DUE TODAY.

 

EURUSD dropped on Wednesday and closed at 1.2100. The President of the European Central Bank Mario Draghi indicated that ECB is in technical preparations to amend the size and the speed of its measures in 2015. Yesterday Lithuania became the 19th member o the single currency bloc.

 

Data released on the 31st of December indicated that the Unemployment Claims in the United States rose to 298K. The Chicago PMI dropped to a level of 58.3 in December 2014.

 

Investors are now looking forward for the ISM Manufacturing PMI due from the United States later today.

 

Support for the EURUSD is seen at 1.2046 and resistance is seen at 1.2130.

 

 

Disclaimer: Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of purchase or sale of any financial instrument.          

[HFM]

Date : 5th January 2015

 

EURUSD PRINTED FRESH 9 YEAR LOWS ON WORRIES OF GREEK EUROZONE EX.

 

EURUSD dropped on Friday and closed at 1.2001. The Manufacturin PMI in Germany remained unchanged at a reading of 52.1 in December 2014. On the other hand the Manufacturing PMI in the Eurozone dropped to a reading of 50.6 in December. Data released from the United States revealed that the ISM Manufacturing PMI dropped of 55.5. The Final Manufacturing PMI in the US also dropped to a level of 53.9 in December.

 

Over the weekend fears about a potential Greek exit of the Eurozone if the Greek opposition party Syriza wins the elections in January caused large gaps on the market. EURUSD stops were triggered and the pair hit a 9 year low level dropping to 1.1856.

 

Investors are now awaiting the German Preliminary CPI data and the speech of the FOMC Member John Williams.

 

Support for the EURUSD is seen at 1.1869 and resistance is seen at 1.1978.

 

 

 

Disclaimer: Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of purchase or sale of any financial instrument.