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EUR/USD Forecast – Euro to Break 1.2300 Vs US dollar?

EUR/USD Forecast – Euro to Break 1.2300 Vs US dollar?

  • – The Euro is in a major uptrend and is currently trading above 1.2220 against the US Dollar.
  • – There is a crucial bullish trend line forming with current support at 1.2240 on the hourly chart of EUR/USD.
  • – Recently in the US, the Initial Jobless Claims figure for the week ending Jan 13, 2017 was released by the US Department of Labor.
  • – The outcome was above the forecast of 250K as there was a decline in claims from 261K to 220K.

US Initial Jobless Claims

Recently in the US, the Initial Jobless Claims figure for the week ending Jan 13, 2017 was released by the US Department of Labor. The market was looking for a decrease in claims from the last reading of 261K to 250K.

 

The actual result was above the forecast of 250K as there was a decline in claims from 261K to 220K. On the other hand, the Counting Jobless Claims came in at 1.952M, a bit more than the forecast of 1.900M. The report added that:

 

The advance number for seasonally adjusted insured unemployment during the week ending January 6 was 1,952,000, an increase of 76,000 from the previous week’s revised level.

 

The EUR/USD pair declined a few pips after the release, but the pair remained supported above the 1.2200-1.2240 support area.

 

EUR/USD Technical Analysis

The Euro made a nice upside move and traded above the 1.2100 resistance level against the US Dollar. The EUR/USD pair gained solid upside pace to clear the 1.2250 resistance and the 100 hourly simple moving average.

 

EUR/USD Technical Analysis Euro US Dollar

 

The upside move was strong and the pair traded as high as 1.2322 before starting a downside correction. It traded as low as 1.2169 and is currently moving back higher. On the downside, a crucial bullish trend line is providing support at 1.2240 on the hourly chart.

 

Recently, the pair broke a short-term connecting bearish trend line at 1.2240. Moreover, it broke the 50% Fib retracement level of the last decline from the 1.2325 high to 1.2169 low. It has opened the doors for more gains in the near term above 1.2300.

 

The pair will most likely break the 1.2300 resistance and gain pace towards 1.2325 as long as it is above the 1.2240 support area.

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AUD/USD Forecast – Can Aussie Dollar Hold 0.7940 Support Vs US Dollar?

AUD/USD Forecast – Can Aussie Dollar Hold 0.7940 Support Vs US Dollar?

  • – The Aussie Dollar made a nice upside move and traded as high as 0.8023 against the US Dollar.
  • – Later, there was a downside move below an ascending channel with support at 0.7970 on the hourly chart of AUD/USD.
  • – Recently in Australia, the Employment Change figure for Dec 2017 was released by the Australian Bureau of Statistics.
  • – The outcome was above the forecast of 9.0K as there was change of 34.7K in Dec 2017.

Australia’s Employment Change

Recently in Australia, the Employment Change figure for Dec 2017 was released by the Australian Bureau of Statistics. The market was positioned for a change of 9.0K in Dec 2017 compared with the last 61.6K.

 

The actual result was above the forecast of 9.0K as there was change of 34.7K in Dec 2017. The last reading was also revised up to 63.6K. On the other hand, the unemployment rate in Dec 2017 was up from 5.4% to 5.5%. The report added that:

 

Unemployment increased 20,500 to 730,600. The number of unemployed persons looking for full-time work increased 9,900 to 501,800 and the number of unemployed persons only looking for part-time work increased 10,600 to 228,800.

 

The AUD/USD pair was seen trading a few pips down and it is currently trading near a major support area at 0.7940.

 

AUD/USD Technical Analysis

The Aussie Dollar started a decent upside move from the 0.7847 swing low against the US Dollar. The AUD/USD pair climbed higher and broke the 0.7900 and 0.7940 resistance levels. The upside move was strong as there was a break above the 0.8000 level as well.

 

AUD/USD Technical Analysis Aussie Dollar US Dollar

 

A high was formed at 0.8023 from where a downside correction was initiated. The pair moved down and broke the 23.6% Fib retracement level of the last wave from the 0.7847 low to 0.8023 high.

 

During the downside, the pair broke an ascending channel with support at 0.7970 on the hourly chart. At the moment, the pair is trading near a major support at 0.7940 and the 100 hourly simple moving average, which is also the 50% Fib retracement level of the last wave from the 0.7847 low to 0.8023 high.

 

Therefore, the 0.7940 support holds a lot of importance. The pair must stay above 0.7940 to avoid declines in the near term.

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Market Update – January 17, 2018

Market Update – January 17, 2018

Despite the week starting with a holiday in the United States, there’s plenty of activity across various financial markets. It all started with the crypto-world, as a sea of red marked the beginning of the most severe correction.

 

To put things into perspective, bitcoin slumped over 50% from the historical highs. Sigh…

 

The Forex market enjoys unusual volatility levels. And, once again, the Euro holds the key to everything.

 

It is no secret here I like Euro for quite some time now as the patterns it forms on various currency pairs look like continuation ones. And the price did continue.

 

1.23 EURUSD

 

The previous Asian session saw the EURUSD printing highs above 1.23 level. One could have only dreamed about such values twelve months ago. Yet, here we are.

 

The rise has been nothing but remarkable. Negative interest rates didn’t matter, like the Fed hiking the federal funds rate on the dollar didn’t matter either.

 

Traders chose to focus on expectations, and everyone now looks at the ECB to end the bond buying program and, even to start thinking at some hikes.

 

Before getting too enthusiastic, let’s step back a bit. The Euro can’t continue at the same pace, without disrupting some other markets.

 

Inflation is a worry. However, it shouldn’t be.

 

A steady rise in the Euro will have a negative effect on the inflation level the ECB considers. However, there’s an ally for Euro bulls. That’s oil.

 

With oil prices above $70, any rise in the common currency’s value will be offset.

 

Bank of Canada Hiking Rates

 

Bank of Canada followed the Fed and hiked the rates today. Again.

 

The USDCAD did dip on the news, but it was highly expected. So, it bounced back and now sat middle of 1.24 range.

 

The thing is that the move in oil barely mattered for the CAD. The conditions aren’t the same as when the oil price dropped from $100 to $30.

 

In the meantime, world’s economy got better, Bank of Canada got used with the situation and the interest rate levels aren’t the same either. Look for this correlation to deteriorate in the future still.

 

Conclusion

 

Being only the second trading week of the year, it is too early to draw any kind of conclusion. With no critical release until the end of the week, chances are technical levels will influence trading.

 

Out of everything on the Forex dashboard, the EURJPY cross seems to be positioned for yet another leg higher.

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EUR/JPY Forecast – Euro to Break Past 136.00 Vs Japanese Yen?

EUR/JPY Forecast – Euro to Break Past 136.00 Vs Japanese Yen?

  • – The Euro is gaining pace above the 135.00 level against the Japanese Yen.
  • – There is a major bullish trend line forming with support at 135.50 on the hourly chart of EUR/JPY.
  • – Today in Japan, the Machinery New orders figure for Nov 2017 was released by the Cabinet Office.
  • – The outcome was above the forecast of -1.4% as there was a rise in orders by 5.7% (MoM).

 

Japan’s Machinery New Orders

Today in Japan, the Machinery New orders figure for Nov 2017 was released by the Cabinet Office. The market was positioned for a decline of 1.4% in orders in Nov 2017 compared with the previous month.

 

However, the actual result was above the forecast of -1.4% as there was a rise in orders by 5.7%. Looking at the yearly change, there was an increase of 4.1% in the Machinery New orders, which was a lot better than the forecast of -0.7%. It was even better than the last reading of 2.3%.

 

The EUR/JPY pair remains in an uptrend and it is very likely to break the 136.00 resistance area for more gains in the near term.

 

EUR/JPY Technical Analysis

The Euro started an upside wave from the 133.00 swing low against the Japanese Yen. The EUR/JPY pair traded higher and was able to move above the 134.50 and 135.00 resistance levels. It even traded a few pips above the 136.00 level and settled above the 100 hourly simple moving average.

 

EUR/JPY Technical Analysis Euro Japanese Yen

 

The pair formed a high at 136.09 from where it corrected lower towards 135.00. A low was formed at 134.97 from where a fresh upside wave was initiated. The pair is now above the 50% Fib retracement level of the last decline from the 136.09 high to 134.97 low.

 

On the downside, there is a major bullish trend line forming with support at 135.50 on the hourly chart of EUR/JPY. The trend line support at 135.50 is a decent buy zone in the short term.

 

On the upside, the pair is likely to break the 136.00 level and the 136.09 high for more gains. Above 136.09, the pair could accelerate toward the 136.50 level.

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USD/JPY Forecast – US Dollar in Downtrend below 111.20 Vs Japanese Yen

USD/JPY Forecast – US Dollar in Downtrend below 111.20 Vs Japanese Yen

  • – The US Dollar faced a lot of selling pressure recently and it moved below 111.00 against the Japanese Yen.
  • – There are two bearish trend lines forming with resistances at 111.10 and 111.15 on the hourly chart of the USD/JPY pair.
  • – Recently in Japan, the Domestic Corporate Goods Price Index for Dec 2017 was released by the Bank of Japan.
  • – The outcome was below the market forecast of 0.4%, as there was a rise of 0.2% in the Domestic Corporate Goods Price Index (MoM).

 

Japan’s Domestic Corporate Goods Price Index

Recently in Japan, the Domestic Corporate Goods Price Index for Dec 2017 was released by the Bank of Japan. The market was positioned for the index to increase by around 0.4% in Dec 2017 compared with the previous month.

 

The result was below the market forecast of 0.4%, as there was a rise of 0.2% in the Domestic Corporate Goods Price Index. Looking at the yearly change, the index increased by 3.1%, which was less than the forecast of 3.2%. It was also less than the last reading of 3.5%.

 

 

The USD/JPY pair is currently in the bearish zone, and it will most likely decline further if it fails to move above 111.20.

 

USD/JPY Technical Analysis

The US Dollar faced renewed selling pressure from the 113.40 swing high against the Japanese yen. The USD/JPY pair started a fresh downside wave and moved below the 112.00 and 111.00 support levels. The decline even accelerated below the 111.00 level and the 100 hourly simple moving average.

 

USD/JPY Technical Analysis US Dollar Japanese Yen

 

The pair traded as low as 110.32 and is currently correcting higher. It moved above the 23.6% Fib retracement level of the last drop from the 111.69 high to 110.32 low.

 

However, there are many resistances on the upside around 111.00 and 111.20. There are also two bearish trend lines forming with resistances at 111.10 and 111.15 on the hourly chart. At the moment, the 50% Fib retracement level of the last drop from the 111.69 high to 110.32 low at 111.00 is acting as a hurdle for buyers.

 

Overall, it seems like USD/JPY may continue to face sellers in the near term around 111.00-111.20. On the downside, the pair could test 110.20.

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NZD/USD Forecast – New Zealand Dollar In Uptrend above 0.7250 Vs US Dollar

NZD/USD Forecast – New Zealand Dollar In Uptrend above 0.7250 Vs US Dollar

  • – The New Zealand Dollar is currently in an uptrend above the 0.7250 support against the US Dollar.
  • – There is a major bullish trend line forming with support at 0.7255 on the hourly chart of the NZDUSD pair.
  • – Today in New Zealand, the Food Price Index (FPI) for Dec 2017 was released by the Statistics New Zealand.
  • – The outcome was below the market forecast of -0.5% as there was a decline in the index by 0.8% (MoM).

 

New Zealand Food Price Index

Today in New Zealand, the Food Price Index (FPI) for Dec 2017 was released by the Statistics New Zealand. The market was looking for the index to decline by around 0.5% in Dec 2017 compared with the previous month.

 

The actual result was below the market forecast of -0.5% as there was a decline in the index by 0.8%. Looking at the Fruit and vegetable prices, there was a decline of 1.7%, Meat, poultry, and fish prices declined by 0.4%.

 

Overall, the NZD/USD pair is currently under a short-term correction, but it remains supported above 0.7250.

 

NZD/USD Technical Analysis

The New Zealand Dollar made a major bottom near the 0.7140 support area against the US Dollar. The NZD/USD pair started an upside move and moved above the 0.7200 and 0.7250 resistance levels. It also broke the 0.7260 resistance and settled above the 100 hourly simple moving average.

 

NZD/USD Technical Analysis New Zealand Dollar US Dollar

 

The pair traded as high as 0.7282 before it started a downside correction. It corrected lower and is currently trading near the 50% Fib retracement level of the last wave from the 0.7235 low to 0.7282 high.

 

On the downside, there is a major bullish trend line forming with support at 0.7255 on the hourly chart of the NZDUSD pair. The trend line support is around the 61.8% Fib retracement level of the last wave from the 0.7235 low to 0.7282 high.

 

Overall, it seems like the NZD/USD pair remains in a decent uptrend above the 0.7250 level. On the upside, the pair has to break the 0.7280 resistance to surpass the 0.7300 level in the near term.

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EUR/USD Forecast – Euro Breaks Key Resistance Vs US dollar

EUR/USD Forecast – Euro Breaks Key Resistance Vs US dollar

  • – The Euro made a nice upside move and broke the 1.2000 resistance against the US Dollar.
  • – There was a break above a major bearish trend line with resistance at 1.1990 on the hourly chart of EUR/USD.
  • – Recently in China, the Trade Balance report for Dec 2017 was released by the General Administration of Customs of the People’s Republic of China.
  • – The outcome was above the forecast of $37.00B as there was a trade surplus of $54.69B.

China’s Trade Balance

Recently in China, the Trade Balance report for Dec 2017 was released by the General Administration of Customs of the People’s Republic of China. The market was looking for a trade surplus of $37.00B compared with the last reading of $40.21B.

 

The actual result was above the forecast of $37.00B as there was a trade surplus of $54.69B. China’s Imports of goods and services in Dec 2017 increased by 4.5%, which was less than the forecast of 13.0%. Moreover, exports of goods and services in Dec 2017 increased by 10.9%, which was more than the forecast of 9.1%

 

The EUR/USD pair is currently placed nicely in the bullish zone and the pair may continue to rise as long as above 1.2000.

 

EUR/USD Technical Analysis

The Euro started a decent upside move from the 1.1928 swing low against the US Dollar. The EUR/USD pair traded higher and broke the 1.1950 and 1.1960 resistance levels. It initiated a nice uptrend and the pair was able to break the 1.2000 level.

 

EUR/USD Technical Analysis Euro US Dollar

 

During the upside move, there was a break above a major bearish trend line with resistance at 1.1990 on the hourly chart. The pair is now well above the 1.2000 level and the 100 hourly simple moving average. It traded as high as 1.2065 recently and it looks set for more gains.

 

An initial support on the downside is around the 23.6% Fib retracement level of the last wave from the 1.1928 low to 1.2065 high.

 

If the pair corrects lower from the current levels, it is likely to find support around 1.2020 and 1.2000. On the upside, a break above 1.2065 could push EUR/USD towards 1.2100.

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AUD/USD Forecast – Aussie Dollar Placed in Bullish Zone Vs US Dollar

AUD/USD Forecast – Aussie Dollar Placed in Bullish Zone Vs US Dollar

  • – The Aussie Dollar recently gained upside momentum and moved above 0.7850 against the US Dollar.
  • – There was a break above a major bearish trend line with resistance at 0.7850 on the hourly chart of AUD/USD.
  • – Recently in Australia, the Retail Sales for Nov 2017 was released by the Australian Bureau of Statistics.
  • – The outcome was above the forecast of +0.4% as there was an increase in sales by 1.2% (MoM).

Australia’s Retail Sales

Recently in Australia, the Retail Sales for Nov 2017 was released by the Australian Bureau of Statistics. The market was positioned for an increase of 0.4% in sales compared with the previous month.

 

The actual result was above the forecast of +0.4% as there was an increase in sales by 1.2%. The actual was also above the last increase of 0.5%. The report added that:

 

There were rises for clothing, footwear and personal accessory retailing (1.6 per cent) and cafes, restaurants and takeaways (0.4 per cent). Department stores fell (-1.1 per cent) whilst food was unchanged in November 2017.

 

The AUD/USD pair remains nicely placed in the bullish zone above 0.7850 and it looks set for more gains.

 

AUD/USD Technical Analysis

The Aussie Dollar formed a short-term bottom at 0.7805-10 against the US Dollar. The AUD/USD pair made a nice upside move, traded above the 0.7850 and 0.7870 resistance levels, and closed above the 100 hourly simple moving average.

 

AUD/USD Technical Analysis Aussie Dollar US Dollar

 

During the upside move, there was a break above a major bearish trend line with resistance at 0.7850 on the hourly chart. The pair traded as high as 0.7881 before correcting lower. It traded below the 23.6% Fib retracement level of the last wave from the 0.7809 low to 0.7881 high.

 

However, the downside move was protected by the broken bearish trend line at 0.7850. Moreover, the 38.2% Fib retracement level of the last wave from the 0.7809 low to 0.7881 high also acted as a support area.

 

Overall, it seems like the pair remains in the bullish zone above 0.7850 and the 100 hourly SMA. It will most likely resume its uptrend and it could move back above the 0.7880 level to challenge the 0.7900 handle.

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Market Update – January 10, 2018

Market Update – January 10, 2018

Slowly but surely the Forex market enters normality as traders come back from vacation. A lot happened over the holidays, and the recent price action that followed the last NFP release tells us why the holiday period is a tricky one to trade.

 

Old traders know that there is a saying stating that the last week of the year and the first trading week of the new year don’t represent the true trend. Well, if we consider this being true, then the recent EURUSD failure at the same 1.2080 area, might be regarded as the second part of a double top.

 

If that’s the case, the measured move already was completed, while the today’s market reaction tells us the price action is still subject to a lot of uncertainty.

 

Inflation Data to Come

 

U.S. inflation data follows this Friday, with an interested forecast. While the headline inflation is expected to drop significantly, (0.1% from 0.4%), the market expects the Core CPI to rise from 0.1% to 0.2%.

 

If that’s the case, what would be the right number to follow? Traders know that the Fed focuses on the Core data (inflation that doesn’t consider the price of energy and transportation), but the drop in the headline data might offset the rise in the core one.

 

So, what to do?

 

As always, the key stays with the EURUSD. Being the most critical currency pair, most traders take clues from what it does during a trading week.

 

For this pair, the most critical days are Thursday and Friday. Typically, Monday and Tuesday small retail traders get to be tested to extremes.

 

If anything, on Wednesday a sharp move in the opposite direction follows, only for the real deal to come Thursday and Friday.

 

So far, the pair managed to trade following this pattern: squeezing bulls Monday and Tuesday, only to attempt a reverse on Wednesday.

 

What’s interesting is that the reversal today failed at, where else, the 1.20 level. This may be good or bad for both bulls and bears.

 

Reversal patterns typically form around psychological levels. If that’s the case, bulls have a problem.

 

On the other hand, if the pair keeps an eye on the 1.20 mark, it’ll use any excuse to trip stops above 1.2090.

 

Conclusion

 

If I were to choose,, I would argue for the second option, if the price keeps 1.20 in focus. A sharp move higher would be a good reason to buy some more.

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Gold Price To Extend Correction Toward $1300 Vs US Dollar

Gold Price To Extend Correction Toward $1300 Vs US Dollar

  • – Gold price climbed higher toward $1325 before starting a correction against the US Dollar.
  • – There is a major descending channel forming with resistance at $1315 on the hourly chart of gold versus the USD.
  • – Recently in China, the Consumer Price Index for Dec 2017 was released by the National Bureau of Statistics of China.
  • – The outcome was below the forecast of +1.9% as there was a rise in the index by 1.8% (YoY).

 

China’s Consumer Price Index

Recently in China, the Consumer Price Index for Dec 2017 was released by the National Bureau of Statistics of China. The market was positioned for a rise of 1.9% in the CPI in Dec 2017 compared with the same month a year ago.

 

The actual result was below the forecast of +1.9% as there was a rise in the index by 1.8%, but it was better than the last 1.7%. In terms of the monthly change, there was a rise of 0.3% in Dec 2017, which was lower than the forecast of 0.4%, but more than the last 0%.

 

Overall, gold price might correct a few pips in the short term, but it is likely to extend declines toward $1300 in the near term.

 

Gold Price Technical Analysis

Recently, we saw a major upside move in gold price above the $1300 level against the US Dollar. The price gained a lot of momentum, settled above $1300 and traded towards the $1325 level where it faced sellers.

 

Gold Price Technical Analysis

 

The price is now well below the $1315 level and the 100 hourly simple moving average. There was also a break below the 76.4% Fib retracement level of the last wave from the $1305 low to $1325 high. At the moment, it seems like there is a major descending channel forming with resistance at $1315 on the hourly chart of gold versus the USD.

 

On the downside, the price could accelerate declines and it could even trade towards the 1.236 Fib extension of the last wave from the $1305 low to $1325 high, which is near $1305.

 

On the upside, any recovery is likely to face a strong selling interest near $1315 and $1320.

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