daily market outlook

[jebat66]

USDX technical analysis for March 7, 2016

The Dollar index has reversed as expected and is now testing the 38% Fibonacci retracement support of the rise from 95.20 to 98.60. More downside is expected.

Blue lines - bullish channel

The Dollar index has broken the bullish channel downwards and is testing the 1st important short-term support at the 38% Fibonacci retracement at 97.30. Next support is at 96.50. If this level is lost, we should then expect a test of the lows at 95.20.

Blue lines - triangle pattern

The Dollar index has made a lower high and has reversed. Price came very close to the Kumo (cloud) resistance but could not break above it. The reversal should bring price towards 95.65 where the lower triangle boundary is found. Daily resistance is at 97.80. Next resistance at 98.60.

On a monthly basis, as long as price closes above 95.20, we remain inside the triangle. If we break the triangle downwards target is at 90. If it breaks upwards, target will be at 104-105.

 

[jebat66]

Gold technical analysis for March 7, 2016

Volatility was high in the Gold market on Friday as price made a strong reversal from $1,275 to $1,250 and back up again to new highs towards $1,280. The trend remains bullish and will be in danger only if the metal breaks below Fridays low.

Blue lines - bullish channel

Gold price is inside an upward sloping blue channel and also above the Kumo (cloud). The Friday lows marks the lower boundary of the bullish channel and is now important support. Resistance is at $1,265-68. Gold is expected to move higher towards $1,300-$1,350.

Yellow line- long-term resistance

Blue lines - downward sloping wedge

Price has broken above the downward sloping wedge and above the weekly Kumo (cloud). Price is approaching the important resistance of 38% Fibonacci retracement at $1,330. Oscillators have turned overbought on a weekly basis and this justifies a pullback even towards $1,100. Bulls need to be very cautious

 

[jebat66]

EUR/USD: Last week, this pair moved down on Monday. It moved sideways from Tuesday to Thursday and afterward rose steeply by 160 pips. This kind of movement is a threat to the recent bearish bias, which would no longer be logical once the price moves further north by 200 pips this week (something which is very much likely).

 

[jebat66]

USD/CHF: This currency trading instrument traded largely sideways last week, not going above the resistance level at 1.0000 and below the support level at 0.9900. The pair is set to make a breakout this week, which would take the price below the aforementioned support level or above the resistance level. Since it is expected that EUR/USD would continue going upwards, the USD/CHF pair is likely to go downwards.

 

[jebat66]

GBP/USD: The GBP/USD pair moved upwards by 400 pips last week, rising from the accumulation territory at 1.3850 and reaching the distribution territory at 1.4250. This upward movement was strong enough to invalidate the recent bearish outlook on the pair, and there is a clean bullish signal in the market. GBP/USD is supposed to continue moving upwards this week.

 

[jebat66]

USD/JPY: Since this currency trading instrument moved sideways last week, the bias on the market has turned neutral in the medium-term. Unlike other JPY pairs, USD/JPY has not traded upwards because the greenback is currently weak. This week, however, would determine the next direction in the market.

 

[jebat66]

EUR/JPY: There is a bullish signal leading to a Bullish Confirmation Pattern on this cross, which closed at 125.23 on Friday, March 4, 2016. Since the EMA 11 has crossed the EMA 56 to the upside and the RSI period 14 has moved above the level 50, it is assumed that the cross would continue trending upwards, just as it is expected of some other JPY pairs.

 

[jebat66]

Intraday technical levels and trading recommendations for GBP/USD for March 8, 2016



In November 2015, a bearish engulfing weekly candlestick closed below the level of 1.5200 (neckline of the Head and Shoulders pattern). This enhanced the bearish side of the market in the long term.

Extensive bearish pressure was applied to the demand levels of 1.4620 and 1.4360. Both of them were broken to the downside.

On January 21, after the GBP/USD pair moved below 1.4220, evident signs of a bullish recovery were expressed around 1.4075. Hence, previous weekly candlesticks closed above 1.4220 and 1.4360 again.

Bullish persistence above 1.4360 was mandatory to maintain enough bullish strength in the market. The first bullish target was seen at 1.4615 where the current strong bearish momentum was initiated.

As previous weekly candlesticks maintained their bearish persistence below the depicted demand zone (below 1.4200), the next weekly demand level was located at 1.3845 (historical bottom that goes back to March 2009).

As expected, an evident bullish recovery and a bullish engulfing weekly candlestick were expressed around 1.3850 (prominent weekly demand level). Hence, a valid buy entry was suggested near the same price level.

On the other hand, the price zone of (1.4222-1.4360) now constitutes a significant supply zone to be watched for possible short-term bearish rejection.

Otherwise, further bullish advancement towards 1.4620 should be expected.



The GBP/USD pair was trapped between 1.4620 and 1.4220 until a recent lower high was established at the level of 1.4530. This applied extensive bearish pressure to the price level of 1.4220.

Hence, an extensive bearish breakout below 1.4220 was expressed on the daily chart (GBP/USD looked oversold last week).

That is why, signs of bullish recovery and a possible long entry were expected around 1.3850. A recent bullish swing is currently being expressed towards 1.4220.

The broken demand zone (1.4222-1.4360) now constitutes a significant supply zone to offer bearish rejection on the short-term perspective.

Early signs of a bearish rejection have been already expressed around 1.4250 (50% Fibonacci level depicted on the daily chart).

Note that the level of 1.4030 is now standing as a prominent key level to offer bullish support if any bearish pullback occurs soon.

Trading Recommendations:

Price action should be watched around the price zone of 1.4222-1.4360 for an intraday sell entry. S/L should be placed above 1.4370. Initial T/P levels should be located at 1.4100 and 1.4050.

On the other hand, risky traders can wait for signs of bullish recovery around 1.4030 to buy the GBP/USD pair if any bearish pullback occurs soon

 

[jebat66]

Intraday technical levels and trading recommendations for EUR/USD for March 8, 2016



In January 2015, the EUR/USD pair moved below the major demand levels near 1.2100 and 1.2000 where historical bottoms had been previously set in July 2012 and June 2010. Hence, a long-term bearish target is projected towards 0.9450.

In March 2015, EUR/USD bears challenged the monthly demand level of 1.0570, which had previously been reached in August 1997.

Later in April 2015, a strong bullish recovery was observed around the mentioned demand level.

April's monthly candlestick came as bullish engulfing one. However, next monthly candlesticks (September, October, and November) reflected a strong bearish rejection in the area around 1.1400.

December's candlestick came as bullish engulfing one allowing the current bullish pullback to take place towards 1.1370.

The zone of 1.1350-1.1400 stood as a significant supply zone to be watched during the recent bullish pullback. As we expected, an evident bearish rejection was recently manifested in February's monthly candlestick (An Inverted hammer candlestick).

The level of 0.9450 will remain a long-term bearish target in case the current monthly candlestick closes below the depicted demand level of 1.0570.



In October 2015, the daily supply zone of 1.1360-1.1400 produced significant bearish pressure shortly after the EUR/USD pair spiked above the level of 1.1500 (daily supply level).

A bearish breakout of the depicted uptrend was performed later on October 23. This enhanced a long-term bearish scenario with targets at 1.0800 and 1.0600.

In November 2015, daily persistence below the level of 1.0800 (prominent key level) ensured enough bearish momentum towards 1.0550 (monthly demand level) where the most recent bullish swing was initiated.

During the last few weeks, a consolidation range extending between 1.1000 and 1.0800 was established on the daily chart. On February 3, a bullish breakout was executed above this consolidation range.

That is why, a quick bullish movement took place towards the zone of 1.1350-1.1400 where previous daily bottoms and the backside of the broken uptrend are depicted on the daily chart.

On February 12, a strong bearish engulfing daily candlestick was expressed near the mentioned supply level. Hence, a quick bearish decline towards 1.1000 was executed.

A bearish breakdown below 1.1000 (upper limit of the broken range) was manifested on the daily chart. A quick bearish decline was expected towards 1.0820 where the current bullish recovery was initiated.

Currently, daily fixation above 1.1000 is mandatory to allow further bullish movement towards the level of 1.1150 initially.

Once the daily fixation above 1.1000 is achieved, more bullish targets should be expected around 1.1130 and 1.1250. Otherwise, sideways consolidation will continue between 1.1000 - 1.0820.

Trading Recommendations:

For conservative traders, a valid buy entry was offered around the lower limit of the broken consolidation range around 1.0800-1.0820.

Initial T/P level is located at 1.1150, while S/L should be advanced to 1.0900 to secure some profits.

 

[jebat66]

USD/JPY is expected to trade in a lower range. The US indices closed mixed on Monday. Shares in the Energy (+2.36%), Materials (+1.17%) and Pharmaceuticals, and Biotechnology & Life Sciences (+1.1%) sectors traded higher, while shares in the Software & Services (-1.29%), Consumer Durables & Apparel (-1.22%), and Food, Beverage & Tobacco (-0.84%) sectors were under pressure. The Dow Jones Industrial Average added 0.4% to 17073.95, the S&P 500 rose 0.1% to 2001.76, and the Nasdaq Composite dropped 0.2% to 4708.25.

Nymex crude oil was up $1.98 to $37.9 a barrel, while gold dropped 0.5% to $1263.2 an ounce. The yield on the 10-year Treasury notes rose to 1.902% from 1.883%.

The US dollar was bearish against most of its counterparts on Monday with the exception of the CHF and the NZD. On the economic data front, labor market conditions fell to -2.4 in February (estimated 1.0) after a 0.8 fall in January. In other news, consumer borrowing rose in January by the least since November 2013 to $10.5 B (estimated $17.0 B) in total credit following a revised $21.4 B gain in the previous month.

The euro was bearish against its major rivals with the exception of the NZD and the CHF. In Europe, the German factory orders dropped 0.1% in January from the prior month, when they slid by 0.2%.

The Australian dollar was bullish against its major rivals. The pair is currently testing its resistance base at 113.50, which has opened doors for a temporary stabilization. As long as 113.50 holds as the key resistance, further downside is expected with the next horizontal resistance and overlap set at 112.50 at first. A breakout below this level would call for further advance toward 112.10.

Trading Recommendation:

The pair is trading below its pivot point. It is likely to trade in a lower range as long as it remains below the pivot point. Short positions are recommended with the first target at 112.50. A break of this target will move the pair further downwards to 112.10. The pivot point stands at 113.50. In case the price moves in the opposite direction and bounces back from the support level, it will move above its pivot point. It is likely to move further to the upside. According to that scenario, long positions are recommended with the first target at 114.25 and the second target at 114.55.

Resistance levels: 114.25, 114.55, 114.85

Support levels: 112.50, 112.10, 111.75

 

[jebat66]

USD/CHF is expected to trade in line with a bearish outlook. The pair has struck against its major resistance at 1.0010, and is now turning downwards following yesterday's rallies. The 20-period moving average also reversed down and crossed below the 50-period one. Besides, the relative strength index is negatively oriented below its neutrality area of 50. In these perspectives, as long as 0.9960 holds on the upside, expect a limited consolidation before further moves to 0.9875 and 0.9850.

Trading Recommendations:

The pair is trading below its pivot point. It is likely to trade in a lower range as long as it remains below the pivot point. Short positions are recommended with the first target at 0.9875. A break of this target will move the pair further downwards to 0.9850. The pivot point stands at 0.9960. In case the price moves in the opposite direction and bounces back from the support level, it will move above its pivot point. It is likely to move further to the upside. According to that scenario, long positions are recommended with the first target at 0.9990 and the second target at 1.0010.

Resistance levels: 0.9990, 1.0010, 1.0030

Support levels: 0.9875, 0.9850, 0.98

 

[jebat66]

NZD/USD is expected to trade with a bullish bias above 0.6730. Trading at 0.6769, the pair remains in consolidation, but still holds above its key support at 0.6730, which is expected to limit any room downside. The relative strength index lacks downward momentum. Therefore, even though a continuation of the consolidation cannot be ruled out, its extent should be limited. As long as 0.6735 holds on the downside, look for further advance to 0.6820 and 0.6860 in extension.

Trading recommendations:

The pair is trading above its pivot point. It is likely to trade in a wider range as long as it remains above its pivot point. Therefore, long positions are recommended with the first target at 0.6820 and the second one at 0.6860. In the alternative scenario, short positions are recommended with the first target at 0.6695 if the price moves below its pivot points. A break of this target is likely to push the pair further downwards, and one may expect the second target at 0.6640. The pivot point is at 0.6730.

Resistance levels: 0.6820, 0.6860, 0.69

Support levels: 0.6695, 0.6640, 0.6590

 

[jebat66]

GBP/JPY is expected to trade with a bullish bias above 160.30. The pair stands firmly above its nearest support at 160.30, and is likely to post a new rebound after the recent consolidation. The 20-period moving average is also turning up, and is about to cross the 50-period one. The intraday relative strength index remains bullish, calling for a new rise. Hence, as long as 160.30 is not broken, an advance is likely to challenge 162.45 in sight, if a breakout, looking for 163 in extension.

Trading Recommendations:

The pair is trading above its pivot point. It is likely to trade in a wider range as long as it remains above its pivot point. Therefore, long positions are recommended with the first target at 162.45 and the second one at 163. In the alternative scenario, short positions are recommended with the first target at 159.35 if the price moves below its pivot points. A break of this target is likely to push the pair further downwards, and one may expect the second target at 158.60. The pivot point is at 160.30.

Resistance levels: 162.45, 163, 164

Support levels: 159.35, 158.60, 157.50

 

[jebat66]

USDX technical analysis for March 8, 2016

The US dollar index has broken the short-term support at 38% Fibonacci retracement and is moving lower to test the 50% retracement. Big support at the 61.8% Fibonacci retracement. A trend has reversed to bearish and we are now looking for a deep pullback if the 61.8% Fibonacci retracement fails to hold.



Blue lines - bullish channel

The US dollar index has not only broken the bullish channel, but has also broken below the 38% Fibo and the Kumo (cloud) support. The trend is bearish in the short-term. Short-term resistance is seen at 97.65. If the price breaks above it, then we will see a bullish reversal.


Blue lines - triangle pattern

In the weekly chart above, we see how the price has broken below the tenkan- and kijun-sen indicators. This implies that the Kumo (cloud) will be tested. The target is where the Kumo (cloud) and the lower triangle boundary are found. This intersection is at the level of 96. Breaking below it will open the way to a new low below 95.20.

 

[jebat66]

On January 28, the depicted support at 0.6400 acted as a prominent key level offering a valid buy entry. A bullish breakout above 0.6550 was executed a few weeks ago.

Bullish persistence above 0.6550 (depicted recent support) was needed to keep the price moving towards higher bullish targets.

The price zone of 0.6750-0.6840 constituted a significant resistance zone where recent signs of a bearish rejection were seen during the previous few weeks (triple-top reversal pattern).

On February 9, the NZD/USD pair failed to consolidate below the depicted support level of 0.6560.

Moreover, an obvious bullish recovery was expressed around the depicted temporary support level. Hence, the recent bullish swing towards 0.6750 was initiated.

Note that bullish persistence above 0.6750 (upper limit of the consolidation range) will allow further bullish advancement towards 0.6880.

Otherwise, the NZD/USD pair will remain trapped within the depicted consolidation range (0.6560-0.6750) until a breakout occurs in either direction.

 

[jebat66]

Overview:

The NZD/USD pair sharply rose from the level of 0.6723 towards 0.6790. Now, the price is set at 0.6779. The resistance is seen at the level of 0.6820. Moreover, the price area of 0.6820 - 0.6815 remains a significant resistance zone. So, if the trend is able to break out through the first resistance level at 0.6790 (yesterday's top), we should see the pair climbing towards the double top (0.6820) to test it. Therefore, buy above the level of 0.6790 with the first target at 0.6820 in order to test the daily resistance 1. Also, it might be noted that the level of 0.6820 is a good place to take profit.
On the other hand, if the pair fails to pass through the level of 0.6820, the market will indicate a bearish opportunity below the strong resistance level of 0.6820.
Sell deals are recommended below the level of 0.6820 with the first target at 0.6765. If the trend breaks the support level of 0.6765, the pair is likely to move downwards continuing the development of a bearish trend to the level 0.6723.

Comment:

Amid the previous events, we expect the pair to move between 0.6820 and 0.6723 (around 97 pips)

 

[jebat66]

Overview:

The USD/CHF pair continues to move upwards from the level of 0.9887. The pair rose from the level of 0.9887 to a top around 1.0028. Today, the first resistance level is seen at 1.10075 followed by 1.0125, while daily support 1 is found at 0.9887 (38.2% Fibonacci retracement). According to the previous events, the USD/CHF pair is still moving between the levels of 0.9887 and 1.0125. Therefore, there is a possibility that the USD/CHF pair will move upside and the structure of a fall does not look corrective. The trend is still above the 100 EMA for that the bullish outlook remains the same as long as the 100 EMA is headed to the upside. Therefore, the major support can be found at 0.9887 - 0.9960 providing a clear signal to buy with a target seen at 1.0030. If the trend breaks the minor resistance at 1.0030, the pair will move upwards continuing the bullish trend development to the level of 1.0075 in order to test the daily support 1. Overall, we still prefer the bullish scenario which suggests that the pair will stay above the zone of 0.9887 - 0.9960 today. However, if a breakout happens at the support level of 0.9887, then this scenario may be invalidated.

 

[jebat66]

USD/CAD intraday technical levels and trading recommendations for March 9, 2016



A bullish breakout above the previous consolidation zone between 1.2400 and 1.2800 was performed on July 15 (shown on the weekly chart).

A significant bearish rejection was observed around 1.3450. Hence, another consolidation range was established from 1.3450 down to 1.2800.

On December 7, a bullish breakout above 1.3450 (the upper limit of the recent consolidation range) enhanced the bullish side of the market. Hence, a bullish visit to the resistance level of 1.4120 (Fibonacci Expansion 100%) was executed.

Bullish persistence above 1.4150 enhanced the bullish side of the market towards 1.4650 (141.4% Fibonacci expansion) where an evident bearish rejection was expected (bearish engulfing weekly candlestick).

The level of 1.4120 (Fibonacci Expansion 100%) remains a significant key level to be watched for further price reactions.

On the other hand, the current price zone of 1.3350-1.3370 stands as a significant support zone to be watched for a valid buy entry.

The price zone of 1.3350-1.3370 stands as a significant support zone to be watched for a valid buy entry.

The zone of 1.3350-1.3370 corresponds to a daily uptrend line and the upper limit of the previous consolidation range (Prominent Breakout Level).

Hence, signs of a bullish rejection around it should be considered a valid buy signal.

Trading Recommendations:

Conservative traders should be looking for a valid bullish entry around the current price zone of 1.3350-1.3370.

S/L should be located below 1.3300. Initial T/P levels should be located at 1.3600 and 1.3750.

 

[jebat66]

Overview:

Recently, EUR/NZD has been moving downwards. As I expected, the price tested the level of 1.6141 in a high volume. In the daily time frame, we can observe a supply bar in an average volume. In the daily time frame, I placed Fibonacci expansion levels to find a potential downward station. I got Fibonacci expansion 161.8% at the price of 1.5990 (downward target). We can observe that 10SMA successfully held in the daily time frame. There are a few technical reasons for this strong downward pressure: 1. a massive upthrust in an ultra-high volume bar in the background (supply overcame demand); 2. another upthrust bar from the same zone; 3. confirmed double-top formation. In the H4 time frame, I found weak demand at the level of 1.6335. I am still expecting a downward price movement. Watch for potential selling opportunities on rallies. Fibonacci Pivot Points:

Resistance levels:

R1: 1.6360

R2: 1.6400

R3: 1.6475

Support levels:

S1: 1.6220

S2: 1.6175

S3: 1.6105

Trading recommendation for today: watch for potential selling opportunities on rallies.

 

[jebat66]

Overview :

Since our last analysis, gold has been trading downwards. As I expected, the price tested the level of $1,251.45 in a high volume. In the daily time frame, I found a supply bar (upthrust), which is the sign of weakness and sluggish demand. Intraday buying looks risky at this stage. According to the H4 time frame, the price has reached my second take-profit level of $1,254.00. We may see potential testing of the third intraday target at the level of $1,240.70.

Daily Fibonacci pivot points:

Resistance levels:

R1: 1,272.90

R2: 1,276.00

R3: 1,282.40

Support levels:

S1: 1,261.20

S2: 1,257.00

S3: 1,251.80

Trading recommendations for today: be careful when buying gold at this stage and watch for potential intraday selling opportunities.