The pair has steadily grown throughout yesterday’s trading session. It seems that Franc has tested the bottom and now, based on existing grounds it will lay a course for the rise. Minutes of the FOMC indicated that the US Fed has not yet made final decision on the dates for phasing down economic stimulus program. Only a few members of the Committee said that it would be possible to reduce the volume of bond purchase in the near future. Majority stated that there should not be any rush in regards to this issue. However, Fed officials noted that following the launch of a new stimulus program, unemployment rate has reduced significantly and reached the level of 7.4% in July.
Market participants are confident that considering current pace of economic recovery in America volumes of stimulus programs will be gradually reduced. Given the fact that efficiency of the program is decreasing, investors started to buy the USD, which became a driver for the rise in the pair.
2. Important levels: support and resistance
At the moment the pair consolidates near resistance level of 0.9250. Next obstacle on the “bulls’ way will be the level of 0.9280. The target for growth is the level of 0.9390. Support levels are 0.9200 and 0.9150.
3. Technical indicators
Given the current trend it is advisable to place buy orders today. It is recommended to enter the market after the breakdown of the resistance level. Attention shall be focused on the data on US labour market. This information can either heat up or dent investors’ interest to the American currency.
This Wednesday the pair AUD/USD has hit three-week lows at 0.8930 reacting to the FOMC Meeting Minutes release. The majority of the Comittee shared the opinion that QE program can be curtailed at the end of the year. Thursday morning the pair has won back its positions due to positive statistics from Heavenly Empire. China manufacturing index has overcome the level of 50 points first time for 4 months, showing the revival of the industry.
2. Important levels: support and resistance
The price is descending now. A small rise to 0.9050 is possible, but we expect the price to go down to support level at 0.8860, which coincide with lower line of Bollinger Bands. Reversal of the trend can happen at this level. Keeping in mind current situation, I would recommend to open long positions at current price with Take Profit orders at 0.8860. Sell limit orders can be placed at 0.9050.
3. Technical indicators
On the daily chart Bollinger Bands are directed downwards, price chart is within the lower band. MACD histogram is in oversold zone, it can soon cross signal line, forming a signal to buy. Stochastic lines are in overbought zone and give us the same signal.
This week the NZD/USD has hit three-week lows at 0.7800. The fall was determined by the RBNZ decision. National banks are to limit mortgage lending in order to reduce price bubble in real estate. Under additional pressure from FOMC Meeting Minutes Kiwi went further down. FRS announced the start of the curtailment of the QE program at the end of the year. The pair still has a potential to downward movement due to experts’ confidence that the volumes of the quantitive easing program will be reduced in September.
2. Important levels: support and resistance
The pair is trading around support level of 0.7800, trying to break through it. Next week we expect fall down to level of 0.7700 and a reverse of the trend from this point. I would recommend to open short trades with targets at 0.7700.
3. Technical indicators
On the daily chart technical indicators confirm the possibility of price fall. Bollinger Bands has turned down, the price chart is moving along the lower line of the indicator. MACD histogram is in oversold zone, giving a signal to buy. Stochastic lines are also in the oversold zone, confirming buy signal.
Look at the daily chart of the currency pair USD/CAD. The pair has been in the large ascending channel with the long-term corrections. The pair had repeatedly tried to break down the lower limit of the channel, but did not succeed. After that the pair rebounded sharply and is now trading at the level of 1.0550. Similar leap took place about two months ago. This time the pair reached the upper limit, but failed to break it down and started to decline. Therefore, we cannot rule out repetition of the old scenario.
MACD indicator shows continuation of uptrend. Histogram is in the positive zone, volumes continue to increase. The signal line is in the negative zone but directed upward and will soon go beyond it. All three moving average lines indicate further growth. Stochastic is in the overbought zone. Its lines are coming closer to each other and if they intersect, we will get a signal of correction.
2. Levels of support and resistance
The nearest support levels are 1.0560 and 1.0580; the key level for the “bulls” is 1.0608. Resistance lines are 1.0530 and 1.0490. The main target of the “bulls” is to go back to the level of 1.0450.
3. Trading tips
Many analysts believe that the pair is too overbought and correction will take place soon. However, it is also likely that the pair will test the local highs, therefore I would recommend to place limit sell orders at the level of 1.0600.
At the opening of European trading session GBP/USD rate has slightly rose and reached the lower boundary of the ascending channel. Today the data on a number of approvals for mortgage lending and GDP in UK will become known. According to experts forecast gross domestic product will retain the increase of 0.6%, number of approved mortgage lending will increase by 1.5 thousand. These facts can add momentum to the pair and the price can go up.
At the opening of the American session attention shall be paid to a number of sales of new houses in the USA, which can decrease by 10 thousand. This fact can trigger the rise in the pair.
2. Levels of support and resistance
The pair is supported by the lower boundary of the channel, close to which is located the red line MA of the Envelopes (1.5560). Resistance levels are the local highs of 1.5651 and 1.5671.
3. Trading tips
Amid expectations of the news from UK and US I would recommend to open long positions at the current price with the target of 1.5651. If this level is broken down, I would recommend to move stop-loss to the loss-free zone.
Rate of crude oil Brent has almost reached the level of $111.20 per barrel, which is the highest point for the 5 months — last time the instrument had reached this point on the 2nd of April 2013.
Last Friday Brent went up due to the unstable situation in the Middle East. Israel air force has bombarded Beirut territory in retaliation for the attack from Lebanon. Investors are concerned about the supply disruptions.
The situation is complicated with UN investigation on chemical weapons attack in Syria. Besides, US DOD has announced the possibility of intervention in Syria civil war.
Middle East situation will determine the movement of the instrument.
2. Support and resistance
Resistance levels: 111.30, 111.80, 113.40.
Support levels: 110.70, 109.80, 109.00.
Alexander Freis
Analyst of LiteForex Group of Companies
GPB/USD: further fall is expected 1. Current trend
UK GDP data released on Friday were better than expected. Quarter index has risen up to 0.7% against predicted 0.6%, and annual index has risen up to 1.5% against 1.4%. Favorable data on export and manufacturing sector have also been published last week. All those factors pushed the pair up, it overcame the level of 1.5600, and reached the point of 1.5636, but several hours later bounced back to the level of 1.5539. The pair was saved from the further fall by the negative macroeconomic statistics from US.
Regardless the support from fundamental data Pound couldn’t consolidate above the level of 1.5700, so we expect the price to stay within a narrow channel. Correction down to 1.5500 is also possible.
2. Support and resistance
The closest resistance levels are 1.5580, 1560 and 1.5650. The main goal for the Bulls is to return to the level of 1.5700. Bears hope to overcome the level of 1.5530, which coincide with 23.6% of Fibonacci lines. If the price breaks through the level, we’re going to witness new lows.
3. Trading tips
I would recommend to sell below the level of 1.5530. Pending orders to buy can be placed at 1.5650 and 1.5750.
Lashenko Ilya
Analyst of LiteForex Group of Companies
On the four-hour chart Tenkan-sen line is above Kijun-sen line and they are both directed steeply downwards. Chinkou Span is below the price chart, current cloud is descending. Despite Golden Cross formation the pair went down, breaking through levels of Tenkan-sen and Kijun-sen lines. The nearest resistance level is the blue line at 0.9000. One of the previous minimums of Chinkou Span line is expected to be a support level at 0.8912.
AUD/USD, D1
Let’s look at the daily chart. Tenkan-sen and Kijun-sen have merged and have been horizontal since last week. Chinkou Span line is below the price chart, current Kumo is still descending. The nearest resistance level is merged Tenkan-sen and Kijun-sen line at 0.9082. One of the previous minimums of Chinkou Span line is expected to be a support level at 0.8903.
Key levels
Support levels: 0.8912, 0.8903.
Resistance levels: 0.9082, 0.9000.
Trading tips
On the four-hour chart we can see a new development of the downward trend. Targets for the short trades are at the 0.8912 level. The chart of the higher timeframe confirms a new wave of the Bears’ movement.
GBP/USD: the pair is preparing to break through 1.5490
1. Current trend of GBP/USD
Since last week the pair has been within downward correction, which had been provoked by the FOMC Minutes publication. ThisTuesday Pound has already lost more than 150 points. Even positive GDP data from UK couldn’t stop the fall. According to the preliminary forecasts, GDP will rise up to 0.7% exceeding the expectations. There are no important releases in trader’s calendar for today, but tomorrow we anticipate the speech of BOE Mark Carney. His speech will probably cause high market volatility.
2. Important levels: support and resistance
We can see a development of the downward movement. The price is moving towards middle MA of Bollinger Bands 1.5490. If this level is broken through, the pair will go further down to the level of 1.5400 and even to the lower border of the uprising channel. Otherwise the price can return to the levels of 1.5600 and 1.5650. Regarding the situation I would recommend to open short trades with Take Profit orders at 1.5400.
3. Technical indicators
On the daily chart indicators confirm the possibility of fall. Bollinger Bands are directed upwards, but the price chart is moving towards the MA. MACD histogram is in overbought zone. It crosses signal line from above, forming a signal to sell. Stochastic lines have entered oversold zone, giving another signal to sell.
[B]USD/CAD: news from the New World will cause another wave of decline[/B]
[B]Current trend [/B]
Since last Friday the pair has been trading near the upper limit of the descending channel, preparing to decline further down. The development of a new wave in the “bearish” movement will be supported by macro-economic statistics from US and Canada. It is expected that retail sales in Canada will grow up to 0.6%, while consumer confidence index in the USA will drop. If the pair breaks down resistance level of 1.0270, which is near the moving average line of “Bollinger bands” indicator, a sell signal will be formed. Quotes will go to the lower line of the indicator (1.0202) encountering resistance at the level of 1.0251 (local lows). The pair will not have sufficient momentum to continue further decline.
[B]Support and resistance [/B]
Strong support level is the upper limit of the descending channel. Support levels are 1.0270 and 1.0251.
[B]Trading tips [/B]
It is recommended to open short positions with the target of 1.0202. Stop-loss can be placed at the level of 1.0310.
Yesterday, the pair again failed to break down the level of 1.3458. However, it is too early to speak about upward correction or trend reversal. The data on American GDP and number of applications for unemployment benefits will be released today. It is expected that GDP will amount to 0.2%, while number of applications for unemployment benefits will increase by 10 thousand. These indices along with yesterday’s statement by Jacob Lew can trigger the rise in the pair to the winter’s highs of 1.3713. I would remind that yesterday the US Treasury Secretary Jacob Lew said in his speech about the threat of bankruptcy to the USA if the ceiling of the US public debt will not be legally increased.
[B]Support and resistance[/B]
Technical analysis shows that the pair has all chances to rise to the upper limit of the channel, from where downward correction can develop. MACD indicator demonstrates that “bullish” movement will continue. Support level is 1.3458, resistance levels are 1.3568 and 1.3604.
[B]Trading tips[/B]
As a trading strategy I recommend to open long positions with the target of 1.3713. Limit buy orders can be placed near resistance level of 1.3458 since it is not excluded that this level can be tested again.
Kamil Avad
Analyst of LiteForex Group of Companies
[B]Current trend [/B]
Last week the British currency traded in the sideways channel in the range of 1.6000-1.5920. Weak British macro-economic statistics continues to put pressure on the Pound. On the other hand, the UDS is under pressure from unresolved issue on the limit of the national US debt. The time is running out while Democrats and Republicans do not want to compromise. American government will resume work tomorrow and only two days will be left when country’s economy will bump up against the debt ceiling. The pair tried to consolidate above the level of 1.6000, however due to the low demand for the Pound, this attempt was unsuccessful. It is a public banking day in America (Columbus Day), news releases from the UK either are not expected either.
[B]Support and resistance [/B]
Today the pair will continue sideways corrective trend. Later, the price can push off from the upper limit of the downward channel (1.6000) and go down to the key support level of 1.5850 (level of 50% Fibonacci). If the level of 1.5850 is broken down, downtrend will consolidate and the decline can continue up to 1.5750 and 1.5440. Otherwise, correction may take place up to 1.5850, which will be followed by the new ascending wave. MACD indicator confirms downward movement: on the daily chart histogram is below the signal line and is directed downward. Support levels: 1.5910, 1.5850, 1.5750. Resistance levels: 1.6000, 1.6100 and 1.6260.
[B]Trading tips [/B]
In the current situation it is advisable to place sell orders with profit taking at the level of 1.5850. Pending buy orders can be placed above the level of 1.6020 with profit taking at the level of 1.6200.
Dmitry Likhachev
Analyst of LiteForex Group of Companies
Weekly analytical video review for instruments EUR/USD, GBP/USD and USD/JPY based on fundamental analysis and technical indicators (MACD, Stochastic, Bollinger Bands).
Current trend
Following significant decline in the USD caused by changes in the US credit rating, the USD started to regain positions. Experts are pretty confident that the decline in the USD will be short lived and by the end of this year the USD rate will significantly rise. Economic growth rate in Britain has slowed down compared to the growth rate in August and September; however the rate is still high.
Market participant are waiting for the US labour market information. Favourable data on Nonfarm Payrolls can cause the decline in the pair to support level of 1.5950 (recent local lows and the level of 38.2 % Fibonacci).
Support and resistance
MACD indicator confirms forecast for the downward movement: histogram on the daily chart is below the signal line and is directed downward.
Support levels: 1.6100, 1.5950, 1.5880 and 1.5750.
Resistance levels: 1.6200 and 1.6260.
Trading tips
Sell orders can be opened at the current price with profit taking near the level of .5950-1.5880. It is also advisable to place pending buy orders above the level of 1.6200 with profit taking at the level of 1.6400.
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Weekly analytical video review for instruments EUR/USD, GBP/USD and USD/JPY based on fundamental analysis and technical indicators (MACD, Stochastic, Bollinger Bands).
Weekly analytical video review for instruments EUR/USD, GBP/USD and USD/JPY based on fundamental analysis and technical indicators (MACD, Stochastic, Bollinger Bands).
Weekly analytical video review for instruments EUR/USD, GBP/USD and USD/JPY based on fundamental analysis and technical indicators (MACD, Stochastic, Bollinger Bands).
Weekly analytical video review for instruments EUR/USD, GBP/USD and USD/JPY based on fundamental analysis and technical indicators (MACD, Stochastic, Bollinger Bands).
