Daily analysis of the Forex market, Aud-Nzd daily chart
Aud-Nzd: after the clear downward movement started last March, the pair is drawing a 2-month laterality pushing the price to a very important chart area. As a matter of fact we are very close to the 1.12/1.1250 support area which represents the bottom of the last five years. After having seen a new test of this level, last week, and the following upward correction to the intermediate resistance zone drawn here in Forex Friends, the price turned down below the EMA21 both in the weekly chart as in the daily and H4. Any violation of the aforementioned support would represent an excellent opportunity to look for one of my short trading signals and enter a bearish continuation move to the target on level 1.09.
Macroeconomics news
This week will be characterized by a high volatility, as it’s often happening in the first week of the last months. The economic calendar today showed the industrial production in Japan (below the forecasts), the inflation in the euro zone (also declining to 1.1%) and the Canadian’s gross domestic product (better than expected).
The Asian stock markets had a negative close (affected by the strength of the Yen with a -2% for the Nikkei) as well as the European and American indices which had a very weak session also due to the upcoming Italian political crisis.
The Forex market today shows an uncertain session for euro and Usoil, weakness for Usdollar and precious metals.
Tomorrow we will have a very important day for Australia with the central bank’s monetary policy meeting (we should not see a reduction in interest rates) and with the Chinese manufacturing production that will certainly affect the daily trend of the correlated Australian dollar. Other manufacturing data will arrive from the United States, Great Britain and the euro zone. We will also receive the labor market data from Germany and the tax decision announce by the Japanese Prime Minister Shinzo Abe.
Daily analysis of the Forex market, Gbp-Cad daily chart
Gbp-Cad: the general situation of the pound is considered, for some analysts, in a strong appreciation (especially in relation to the us dollar) and many are expecting an imminent profit taking. The reality of this cross, however, looks a little different: the recent breakout of the 1.64 area was particularly important as it represents the top level of a long-term laterality (clearly visible in the weekly and monthly chart) and could let Gbp-Cad rise up to the 1.70 resistance area in the short term and to a higher appreciation in the medium term, considering the actual price level in the historic series of this pair. The trading strategy might be the following one: to look for a possible new price action signal after a temporarily correction in the intermediate support 1.6670 (H4) or better yet in the 1.66 area; alternatively we might expect the arrival in the resistance zone 1,70 with a possible reversal setup to open a very short-term countertrend entry. As always it’s up to the same price to clarify the situation and to decide the correct strategy to adopt!
Macroeconomics news
Today’s economic calendar shows the second monetary policy meeting of the week, the rate decision of the European Central Bank. According to the forecasts, Mario Draghi kept the interest rate level unchanged confirming, as said on several occasions, the ECB’s aim to continue the current monetary policy measures, even with another LTRO operation.
We also remember the speech that chairman Ben Bernanke will make later (near the end of U.S. session) at the St. Louis Federal Reserve.
Stock markets ended the day negatively with a better session for the Italian index, thanks to the confidence that Mr. Letta’s government obtained today by the Congress avoiding, for now, a new political crisis.
The Forex market has shown a weak dollar and a recovery for the euro, the New Zealand dollar and the precious metals.
Tomorrow among the major market movers we can remember the retail sales in the euro zone, the US. jobless claims and non-manufacturing index .
The current week has been characterized by a high volatility, as often happens in the first week of each month, but not only because of the usual monetary policy meetings, but also for the difficult situation occurring in the United States.
In the last days we had three meetings of rate decision in Australia, Japan and the euro area, with a general confirmation of the expansionary monetary policy and also the availability of the ECB governor Mario Draghi for new monetary measures that could include a third round of LTRO for the banking system and its liquidity crisis.
At the same time in the United States, due to the lack of a deal between President Obama and the Republicans, we had the interruption of the public sector financing that already led 800 thousand federal employees without job and could generate a major (global) crisis if there will be no deal to the raise of the debt ceiling before October 17.
This serious situation (called “Shutdown”) also caused, among other things, the delay of the important US labor market data release (Non Farm Payrolls) originally scheduled for today.
Next week we’ll have pay attention to the volatility of the pound, with the british central bank meeting for rate decision. Let take a look to this and other market movers in my usual weekly video together with my simple and disciplined analysis of the daily charts!
Daily analysis of the Forex market, S&P daily chart
S&P: the daily chart shows a clear upward trend originated just over a year ago and which has contributed to generate new tops in early May, in August and September this year. This bullish trend is currently in a correction phase and right on a static and dynamic level represented by the important area 1670. A bullish trading signal could be analyzed to evaluate a potential long entry with a take profit target in 1710 firstly and in 1730 level later. However we must pay attention to the possibility of a bearish breakout, with consequent change in the medium term trend, which could be caused by fundamental reasons: the problem of the US “shutdown” and the debt ceiling could generate very speculative movements in the dollar; for that reason it’s always better to wait for the “confirmation” of our operating signals.
Macroeconomics news
The economic calendar today was very quiet and we highlight, in particular, the monthly report by the Bank of Japan and the investor confidence in the euro zone. In the first case, the Japanese central bank showed moderate recovery of the national economy, which is expected to continue, as well as exports. No special mention was made about the exchange rate but it was only considered the appreciation of the yen in the last month. From the euro zone we has a negative investors’ confidence, which fell to 6.1 below the previous data and the forecasts.
Stock markets, after the rebound of last Friday, closed downward with worst performance for the Nikkei index.
The Forex market today highlighted a weakness for the usdollar and a strong session for the precious metals.
Always waiting for a solution to the US issue of the debt ceiling (before October 17) we would have being receiving tomorrow the data on the labor market (Non Farm Payrolls) but they are still delayed.
Among the other important data we will have the Swiss labor market news and the confidence in the economy of Australia.
Daily analysis of the Forex market, Gold daily chart
Gold: although the medium term is pretty confused, the yellow metal is in an evident short term downtrend (under the EMA21 and the resistance $1.345) that could have been strengthened with the maintenance of the intermediate resistance in the level $1.320. A slight rebound after today’s negative candle might be interesting to get into the resumption of the downward movement of the gold with possible profit taking levels on areas $1.270 and $1.200 .
Macroeconomics news
The economic calendar today showed different important data from the UK : the gross domestic product and the industrial production (below expectations) and the manufacturing output (slightly better but not as the forecast). Also from Germany we received the data on industrial production, that was much better than expected.
From the United States we just had the publication of the Fed’s Minute, about the last monetary policy meeting, highlighting what was already mentioned by chairman Ben Bernanke two weeks ago about the continuation of the accommodative policy with a possible reduction before the end of the year.
From North America we have also received the communication that President Obama nominated Janet Yellen as new Fed’s chairman to replace Ben Bernanke (currently his vice).
Stock markets closed a contrasted session with a positive performance for Tokyo, New York, Milan and Madrid; negative close for the others.
The Forex market showed a weakness for euro and pound, a strong session for the USD that also affected negatively the major commodities.
Today (in the European night ) and tomorrow we will have two speeches by the ECB Governor Mr.Mario Draghi in the United States, the first one in the state of Massachusetts at the Harvard Kennedy School and the second one at the Economic Club of New York. Also the governor of the Bank of Japan Mr.Kuroda will have a speech in New York at the CFR (Council on Foreign Relations).
Tomorrow our economic calendar will also show the monetary policy meeting in the UK (no change in interest rate is expected by the Bank of England), the labor market data in Australia, the US jobless claims and the European Central Bank’s monthly report.
We have six more days to reach an agreement over the US debt ceiling problem. This situation is certainly responsible of the financial markets’ volatily in these days. As I told you last week, the shutdown is just a “little” aspect of a much more dangerous potential technical default by the U.S. government because of the failure to pay federal salaries . President Obama and the Republicans are looking for a way to avoid a possible national crisis (and not only domestic…) and maybe the last republican plan might be successful.
The volatility of these days in the stock markets and the dollar was also due to the confirmation of Janet Jellen as the next chairman of the U.S. central bank , from January 2014 , instead of its current chief Ben Bernanke, assuring a continuation of the current monetary policy.
From the US we also received yesterday the weekly unemployment data (the Non Farm Payrolls have not been released yet!) showing a slight decrease in the employment situation.
From Europe we had a good German production and the confirmation, by the ECB’s monthly report, of a gradual improvement in the economic situation even if the unemployment is still too high.
No change in the British monetary policy with chairman Mark Carney confirming both the level of interest rates (0.50 %) as well as the asset purchase plan of 375 billion pounds per month.
I leave you my weekly video to see the upcoming economic calendar and to analyze some of my naked charts of the Forex market!
Daily analysis of the Forex market, Natural Gas daily chart
Gas: after the strong upward movement of these two weeks, the price returns up to the $3,85 resistance zone. After the break out of the medium-term bearish trendlines, the movement appears to be bullish not only in the daily time frame but also in the weekly and H4 charts (both above the moving average) increasing the possibility of an upward break of the key level mentioned above. If that will occur the strategy might be to identify a bullish trading signal to enter in a buying trade, with target in the next important resistance area $4,30. An opposite strategy, in case of maintenance of the level $3,85 (as it appears at the moment) with a short trading set up, would let me evaluate a countertrend position with a short term take profit at $3,68 intermediate area.
Macroeconomics news
With a very few hours to the default, the U.S. Senate found the agreement about the debt ceiling planning to fund the federal government through January 15 and lifting the debt ceiling through February the 7th; now we will wait for the vote of the Senate and House. Meanwhile we had the release of the Federal Reserve’s Beige Book that reports a slower growth which remains “modest to moderate” for the most of the year.
Among the most important macroeconomic news today we remember the New Zealand inflation rose to 1,4%; the Uk labor market data that highlighted a stable unemployment but with a lower number of jobless claims, meaning a better of the labor situation; the euro zone inflation unchanged at 1.1%.
Stock markets opened contrasted but turned into positive forecasting a positive deal about US debt.
The Forex Market as expected has been quite volatile with a “two speeds” session for the euro and the dollar with a recovery of the latter in the second part of the day. Among the commodities we can remember a new bullish session for the Usoil and a slight decrease for gold and silver.
The macroeconomic calendar tomorrow will present the Australian economic confidence, the retail sales in Great Britain and the US jobless claims.
Today is ending one of the most volatile and uncertain weeks of this 2013 with the danger of an American default that has been avoided at the last minute! After the republican’s attempt to change Obama’s health reform, causing the "shutdown ", and after intransigence of the same president the leaders of the Congress agreed to a deal which let to a re-open of the government until next January 15 and an increase in the debt ceiling until February 7th 2014; a temporary solution that will allow, however, the return of 800,000 government employees and the necessary time to find a final solution between both major U.S. parties.
We also received good macroeconomic news from Europe: a sharp rise in the German ZEW confidence index, a confirmation of the inflation in the euro area and very positive data from the United Kingdom in relation to the labor market and the retail sales.
No special change today in China where there was a little growth in the gross domestic product to 7.8 % and a stable industrial production.
Next week we will have only one monetary policy meeting (in Canada ) in addition to several major market movers that, as always, we can analyze in my weekly video along with the usual analytical study of my naked charts.
Regards
Maurizio Orsini
P.S: for those who were asking to me: my trading activity is realized only in my real account and no demo, as I demostrate (another time) in this video!
Daily analysis of the Forex market, Eur-Usd daily chart
Eur-Usd: last Friday the price has reacted in the interesting resistance level 1.37 (also evident in the weekly chart at the end of January 2013) after the sharp move of the previous session. After a moment of dollar buying because of the US agreement, the euro confirmed its move to the upside in the short-term. A strategy to enter this upward movement could be to find a long trading signal n 1.3620 support area (also taking advantage by the arrival of the moving average) and considering as a potential take profit area that static and dynamic zone 1,3850/1,39 (top of the last two years).
Macroeconomics news
The beginning of the week was pretty quiet in a macroeconomic point of view with a speech of the Bank of Japan’s Governor Mr. Kuroda and data on existing home sales in the United States (which were lower than the previous one but not as analysts were expecting).
Stock markets had a contrasted opening and closed an uncertain session around the parity.
The Forex market showed today a slight recovery for the dollar, a weakness for the oil and a contrasted session for the euro.
Tomorrow’s macroeconomic calendar would have showed a low volatility as today, with the only release of the retail sales in Canada, but on the contrary it will also show us one of the most important market movers: it has been officially announced the release of the Non Farm Payrolls, the U.S. labor market data, after the delay of October 4 due to the US shutdown. So beware the volatility in the U.S. dollar.
Daily analysis of the Forex market, Usd-Yen daily chart
Usd-Yen: the daily chart highlights a clear medium-term triangle whose break out could generate, from a technical poit of view, a strong trend. The situation is not very clear in the weekly time frame, although in the short term
Usd-Yen is in a bearish move, below the moving average, and close to the area of static and dynamic support 96,50. A bullish trading signal in this key level could lead to a purchase entry with a possible return to area 99; on the contrary a bearish break with one of my price action signals could confirm the short term move to the downside with a potential return to 95,80 level.
Macroeconomics news
After yesterday’s negative data on the U.S. labor market (unemployment slightly decreased but new jobs in September were falling) today’s economic calendar has presented the inflation in Australia, the minutes of the Bank of England and the interest rate decision in Canada.
In Australia we had an increase of the inflation at 1,2%, even more than analysts were expecting, and this reduces the likelihood of a new interest rate cut in the next RBA’s meeting of November.
From the Bank of England’s release of the Minute we knew that the decision not to change the rates and the asset purchase has been taken unanimously by the members and that the reduction of the monetary stimulus will be considered only with an unemployment below 7%.
In Canada, the central bank chairman Stephen Poloz confirmed the actual level of 1% in the interest rates and the current monetary policy without announcing future rates increase.
The major stock exchanges had a negative close, especially Milan and Madrid.
The Forex market showed a slight recovery for the Usd, a strength of the euro and another weak session for the UsOil.
Tomorrow we will have the US jobless claims and several manufacturing production data (in China, Germany, euro zone and United States).
This week we had the release of the Non Farm Payrolls initially planned in October the 4th and then delayed by the U.S. Shutdown problem .
This important market mover showed a sharp decline in new employees in the month of September (also October’s expectations are not positive) generating between the operators the conviction that the Federal Reserve will be “forced” to delay its plans to reduce the monetary stimulus for economy. The reaction of the financial markets was immediate: a return of the risk appetite, an appreciation of the euro and a selloff of dollars that let to new historical tops (S&P, Dax, etc) and the return of the Eur-Usd to the 2-year top level.
In addition to the release of several manufacturing data (which showed a confirmation in the Chinese growth) we can also remember the monetary policy meeting in Canada and the Minute in Great Britain. In Canada we had the confirmation by the central bank of the current interest rate level (1%) which should not be increased at the moment; also from the UK we had the confirmation of the current monetary policy (through the minutes of the last meeting of October 8 ) and the unanimous consensus of the Bank of England’s Committee to keep rates unchanged as well as the asset purchase plan at £75 billion per month.
I leave you with my weekly video to analyze all the fundamental and technical data about the upcoming trading opportunities.
Daily analysis of the Forex market, Eur-Cad weekly chart
Eur-Cad: after the meeting of the Bank of Canada and the fall of the WTI price, last week, we had a very strong depreciation of the Canadian dollar dropped against other major currencies. In relation to the euro, the pair rose in a few sessions from 1,4070 to 1,4420 breaking an important weekly resistance level in area 1,4350. The price of Eur-Cad is making a slight correction candle and it might be interesting to analyze the strength of the level just mentioned above (which is now a support) to evaluate, always in the presence of a long trading signal, a buying entry with a target in the next area of weekly resistance 1,47. In case of a downward breakout we can still consider a buying opportunity in the next key level 1,4170 this time supported by the moving average 21 that would come very close to the price (both in the daily and in the weekly chart).
Macroeconomics news
The last week of October begins with a quiet economic calendar highlighting a couple of U.S. data: the industrial production and the manufacturing output. Both rose in September 0,6% and 0,1% but especially the first one realized the better performance since February 2013.
The stock indices, waiting for the Fed’s meeting of Wednesday, had a contrasted session with a positive close in Asia and a negative one in Europe. Us indices around the parity.
The Forex market showed a positive session for the dollar, the WTI and precious metals.
Also tomorrow the main market movers will arrive from the United States with the retail sales and the consumer confidence.
Daily analysis of the Forex market, Usd-Chf daily chart
Usd-Chf: last week we had a good recovery of the dollar that pushed the currency pair with the Swiss franc up to the static and dynamic level 0,9150. The daily chart also shows the price of Usd-Chf above the moving average but slightly below the level of resistance; the weekly time frame seems to be more bearish, with the same EMA21 above the price. Considering the shape of today’s candle we might also see a new move to the downside, recovering the bearish medium term trend, with a target down to 0,89 support zone.
On the contrary, only with the confirmed break out of the resistance level 0,9180 (and a long trading signal) I would evaluate a purchase entry for a possible return up to area 0,9450.
Macroeconomics news
Waiting for the monetary policy meetings of the next days, the economic calendar today shows only medium volatility market movers among which we can remember the Australian retail sales and the manufacturing output in Germany and the euro zone. The data from Australia were well above expectations with a 0.8% in September. The manufacturing output in Germany grew while it was stable, as expected, in the euro zone.
The European stock indices closed a positive session after the negative close of the main Asian markets; Us indices around the parity.
The Forex market showed a weak session for the Usdollar, a very strong day for the Australian and an uncertain one for the WTI and precious metals.
Tomorrow we will have the first of the three interest rate decisions, in Australia, with the consensus of the analysts for the maintenance of the current 2.50%. We will also receive the labor market data from New Zealand and the U.S. non-manufacturing index.
Daily analysis of the Forex market, UsOil daily chart
UsOil: after the confirmed break out of areas $100 and $98, the Usoil continues its downward movement touching yesterday the level $93. The trend is clearly bearish and a new sale opportunity could be found after a technical correction up to $95 (H4 resistance) with a short trading signal to continue the depreciation to a possible first target in the level of support $92. If, on the contrary, the price will continue to fall straight to the just mentioned key area we could evaluate a long countertrend entry, but only in the presence of a strong bullish trading signal.
I also have a short trade in the UsOil: it’s been opened last week after a bearish set up below area $98 and I moved down my stop loss to breakeven a couple of days later. Last night I closed half my position almost at the bottom price of the day, moving a little bit down my stop profit (to ensure a greater profit) and also my take profit (originally above $92) in order to try to follow the fall of the UsOil as long as possible.
The current week has been characterized by three meetings of monetary policy with two confirmations and one surprise. The confirmations came from Australia and the UK where the respective governors Glenn Stevens and Mark Carney left the interest rates unchanged as well as the current guideline of intervention in the economy.
The surprise came from the European Central Bank which decided to cut the rates by 25 basis points to 0.25% which represents the historical minimum for the euro zone. Mario Draghi adopted this measure to stop the decline in inflation (and other positive macroeconomic data) also announcing that the rates level will remain constant over a long period of time.
In my weekly video I analyze the current situation both from a macroeconomic and technical point of view!
Daily analysis of the Forex market, Aud-Usd daily chart
Aud-Usd: after having seen a movement to the upside, began in late August and taking the Australian against the dollar to the relative top in late October, the Aud-Usd returned back below the moving average both in the daily chart as in the weekly. The price is approaching the 2-month minimum level at 0,93 which represents a significant level tested several times in the past also as a resistance. A long signal in this level could lead to the opening of a long countertrend position in order to negotiate a possible sideways range with a target on 0,9750 area. In case of a bearish breakout (in this case with a short trading signal) I would consider a selling opportunity to see again the Aud-Usd price in the next support level 0,89.
Macroeconomics news
This week should be much quieter than the previous one and also today we didn’t receive any market mover of special relevance.
The stock indices have shown a moderately positive session, especially Asian markets, with the US indices around the parity.
The Forex market shows today a rebound of the euro after the falling of the last week, a stable dollar, a recovery for the UsOil and a weak session for the pound and the precious metals.
Tomorrow we will have the release of the Australian economic confidence, the confidence of Japanese consumers, the inflation in Germany and the United Kingdom.
Daily analysis of the Forex market, Eur-Usd daily chart
Eur-Usd: the daily chart has shown in the last days the bearish break out of the bullish medium-term trendline, with a price below the moving average 21. In line with this move we can find one of my short trading signals in the resistance area 1.3420/1.3470, taking advantage of the current technical correction which could test the trend line (now dynamic resistance). Let’s look for clear signals only as in the weekly time frame the price of Eur-Usd is still slightly above the EMA21.
Macroeconomics news
After the Australian consumer confidence (in slight recovery) we received today several market movers from the UK in relation to the labor market and the inflation. In the first case we had a lower unemployment at 7,6% (as expected) and a better employment level; in the second case the Bank of England, in its report, has announced that inflation expectations remain well anchored.
In the euro zone the industrial production has been much higher than the forecast.
The major stock indices had a very weak session both in Europe as in the United States (at the moment).
The Forex market shows a weak session for the USdollar, a positive movement for the UsOil and the Pound, a contrasted session for the euro.
The economic calendar will show tomorrow the GDP in Japan, Germany and in the euro area; Japan’s industrial production; UK’s retail sales; the ECB monthly report; the U.S. jobless claims.
The week ending today showed several interesting macroeconomic news from the UK which have generated an appreciation of the British pound. Besides the decline in retail sales, we remember the good English labor market data, with a slight fall in unemployment (a little more closer to the target of 7%) and an increase in the level of employment.
We also received several Gross Domestic Product data highlighting a slower growth in Japan and a recovery in the euro zone and Germany.
Next week, among other news, we will have the monetary policy meeting in Japan and the publication of the Fed’s minutes of the last rate decision in United States.
As always, we can see everything in my weekly video along with some trading opportunities from my naked charts.
