Solid ECN - Fundamental Analysis

USDCHF Analysis: Bollinger Bands & Bull Markets​


Solid ECN – The USDCHF trades sideways in a narrow range between 0.915 and 0.908. As depicted in the 4-hour chart above, the Bollinger bands are also squeezed. The squeezed Bollinger bands can be interpreted as the market resting and waiting for economic updates from the central banks. It is worth noting that this correction or consolidation phase was signaled by an Awesome Oscillator divergence.

From a technical perspective, the USDCHF is in a bull market, trading inside a rising flag. If the price steps above the 0.915 resistance, the uptrend will likely continue.

Conversely, the Ichimoku cloud or the lower band of the flag stands between the bull and bear markets. Should the price dip and stabilize itself below 0.906, the bull market would be invalidated, and the decline would aim for the 0.8991 mark.​

Bitcoin Price Fails at Key Resistance Levels​


Solid ECN – Bitcoin price failed to surpass the EMA 50 and the 50% Fibonacci resistance level in the previous trading session. Consequently, the digital gold dipped below the 23.6% Fibonacci support level and traded at about $62,800 when writing.

The technical indicators give mixed signals. The RSI hovers below 50, and the awesome oscillator bars are green and approaching the signal line. This can be interpreted as uncertainty in the market.

As shown in the BTCUSD 4-hour chart above, the pair trades with a wide bearish flag in red, which widens the trading range and increases the risk. This is the downside of trading cryptocurrencies.

Therefore, we suggest waiting for the Bitcoin price to reach critical support levels before entering the market. Since the trend is bearish in the short term, the market dip might extend to the lower band of the flag or to April's low, the $60,500 area.​

Bearish Outlook: AUDUSD Tests Critical Supports​


Solid ECN – The Australian dollar started today's trading session with an uptick in momentum against the U.S. Dollar and is trading at about 0.641. The AUDUSD 4-hour chart above shows that the pair is rising to test the previously broken supports at the 0.6443 and 0.6473 marks.

Considering the primary trend, which is bearish, the above-mentioned price points offer a decent opportunity to join the bear market. Therefore, we suggest monitoring these levels closely and looking for bearish candlestick patterns on a smaller time frame, such as the 4-hour chart.​

USDCHF Dips but Bullish Trend Holds​


Solid ECN – The USDCHF currency pair experienced a slight decline, reaching approximately 0.910. This movement brings it close to the lower boundary of the bullish flag—a pattern suggesting a potential rise in value. This specific price point is bolstered by additional support at 0.908 and further underpinned by the Ichimoku cloud.

Despite the dip, no significant candlestick patterns used to forecast price direction changes were observed on the USDCHF 4-hour chart. This absence typically indicates that the current upward trend may continue, provided the price remains above the Ichimoku cloud. Should this scenario hold, the U.S. Dollar will likely climb toward the 0.915 mark, aiming next for the upper boundary of the bullish flag.

However, there is a flip side to consider. If the price falls below 0.9062, it would signal an end to the bullish trend, transitioning into a bear market. Such a drop could increase selling pressure, potentially pushing the price to around 0.899.​

Critical Resistance Tests for USD/MXN's Bullish Trend​


Solid ECN – The U.S. Dollar broke out from the bearish channel against the Mexican Peso in yesterday's trading session. The USD/MXN pair currently trades at about 16.97 inside the Ichimoku cloud, which represents the resistance area.

The technical indicators are bullish; the relative strength index hovers above 50, and the awesome oscillator bars are green. Therefore, we can interpret that the bearish market is paused, and there might be a shift in trend from bearish to bullish.

However, for the uptick in momentum to continue, the bulls face the 38.2% Fibonacci barrier. Failure to overcome this resistance area will likely lead to the continuation of the downtrend.

If the pair stabilizes itself above the Ichimoku cloud and the Fibonacci level mentioned earlier, the bullish wave is likely to extend further, aiming for the 50% Fibonacci level.​

Tracking the Dip: U.S. Oil's Technical Outlook​

Solid ECN – Oil is trading within a bullish flag pattern, indicating potential for future gains. However, it's crucial to note that it remains above the 50-day Exponential Moving Average (EMA 50), a key indicator that suggests bullish momentum is intact. Nevertheless, the plot has a twist as the technical indicators hint at a bearish trend. The Relative Strength Index (RSI) has dipped below 50, and the Awesome Oscillator shows red bars declining toward the signal line. This combination of signals might indicate a potential shift towards bearish territory, especially if prices continue to fall towards the 50% Fibonacci level, which coincides with the EMA 50.​


Short-Term Forecast and Trading Suggestions​

The market appears to be entering a consolidation phase, with a possible decline to the lower boundary of the bullish flag at $76.0. For the bearish trend to gain momentum, prices must breach significant support levels, including the EMA 50 and the psychological $80.0 mark. Traders should keep a close eye on these levels as they could dictate the market's short-term direction.

Today's expectations are that the downward trend could extend to the $80.0 support level. Should this level fail, further declines could push the price to approximately $77.0 per barrel. Keeping up-to-date on these developments is crucial for traders and market analysts alike.​

GBPUSD Sideways Movement: Bearish Signals Despite Consolidation​


Solid ECN—The GBPUSD currency pair trades sideways between 1.249 and 1.240. The Bollinger Bands are squeezed and clearly demonstrate the range area on the 4-hour chart. Other technical indicators, except Standard Deviation, signal and promise a bullish trend while the uptick momentum is weak, and we don't see strength from the buyers.

From a technical standpoint, the primary trend is bearish while the pair hovers below EMA 50 and the Ichimoku cloud. However, the current consolidation phase might test the EMA 50 again in today's trading session, potentially forming a double-top pattern on the 4-hour chart.

Consequently, a failure to stabilize the price above 1.2499 will likely lead to a decline, and initially, the pair would test this week's low at 1.240 support.​

Australian Dollar's Struggle Below EMA 50 Explained​


Solid ECN – The Australian dollar trades at about 0.644 against the U.S. dollar as of writing, slightly below the broken support level of 0.6455. Interestingly, the AUDUSD 4-hour chart shows a doji candlestick pattern, highlighted in the image above.

The Relative Strength Index still hovers below 50, but the Awesome Oscillator bars are green, giving mixed signals. Despite the contradiction between the technical indicators, the primary trend is bearish, and the pair trades below EMA 50. Based on price action analysis, our first bearish signal is the doji candlestick pattern.

Therefore, from a technical standpoint, selling pressure will likely increase if the AUDUSD remains below EMA 50. Should the market shift downwards, its initial target would be this week's low of 0.6389.

Conversely, EMA 50 is the dividing line between bull and bear markets. The bear market could be considered over if the price crosses and stabilizes above EMA 50. In this scenario, the uptick momentum that began this week at 0.6389 could extend to 0.652.​

Analyzing the Canadian Dollar's Recent Performance​


Solid ECN – The Canadian dollar gained ground against the U.S. dollar in today's trading session, while its value had been declining for almost three weeks. Currently, the USDCAD trades at about 1.37, clinging to the lower band of the bullish flag and testing the 78.6% Fibonacci support.

The technical indicators are bearish. The Relative Strength Index hovers below 50, while the Awesome Oscillator shifts below the signal line, signaling a continuation of the downtrend. However, the bear market faces a barrier at 1.374, followed by the EMA 50. If the price maintains its position above these levels, the uptrend will likely resume, initially targeting April's high at 1.3844.​

ECB to Cut Rates as Euro Nears Five-Month Low​


Solid ECN—The euro is trading at about $1.065, close to its five-month low. This is due to the European Central Bank (ECB) and the Federal Reserve taking conflicting paths. On Tuesday, ECB President Lagarde announced plans to reduce interest rates soon, noting that geopolitical events have not significantly influenced commodity prices.

As a result, investors are expecting the first rate cut from the ECB in June, with two additional cuts planned before 2025. Meanwhile, Federal Reserve Chair Powell mentioned Tuesday that the U.S. might delay reducing its interest rates based on recent inflation trends. He indicated there isn't an urgent need to cut rates, suggesting that reductions might not occur until late 2024.​

EUR Nears $1.07 Amid Easing Middle East Tensions​


The euro moved closer to $1.07, recovering from a recent drop to its lowest point in over five months at $1.06 on April 16th. This change came as worries about increasing tensions in the Middle East began to ease. Investors also examined the differing attitudes of the European Central Bank (ECB), which is more cautious, and the Federal Reserve, which is more aggressive.

ECB officials indicated they might start lowering interest rates as early as June, with some predicting up to three rate cuts by the end of 2024. However, the overall market mood has slightly changed, with reduced expectations for rate decreases by both the ECB and the Federal Reserve. This shift is due to ongoing high inflation and signs of a strong economy in the US.​

AUDUSD Faces Key Resistance: Bearish Outlook​


Solid ECN – The AUDUSD currency pair climbed to EMA 50 on Monday and tested the 0.6455 resistance for the second time this month. As of writing, the pair is trading around 0.645 and declining, trying to stabilize itself below the 23.6% Fibonacci resistance level. Interestingly, the 4-hour chart formed a bearish long wick candlestick pattern, interpreted as a continuation of the downtrend.

The technical indicators are giving mixed signals. The relative strength index hovers below 50, indicating a bearish trend, but the awesome oscillator bars are green and about to flip above the signal line.

From a technical standpoint, the AUDUSD pair is in a bearish trend as long as it trades below the EMA 50. Based on the current data on the chart, the bearish trend should continue, aiming for last week's low, the 0.6361 mark.

The bearish scenario should be invalidated if the Australian dollar climbs above the 50% Fibonacci resistance level.​

Navigating USDCAD's Bearish Momentum & Reversals​


Solid ECN – The USDCAD price dipped below the bullish flag and the EMA 50. The pair is currently trading at about 1.372. This level coincides with the Ichimoku cloud resistance area, which is also close to the 38.2% Fibonacci level. While the RSI indicator hovers below the 50 level, it still has room to drop to 30 or become oversold. Therefore, it can be interpreted that the downward momentum will likely continue but might pause when it reaches the 38.2% Fibonacci level.

From a technical standpoint, going against the primary trend is risky. Traders should wait and monitor the price action around the 38.2% Fibonacci support level and the bearish flag in the 4-hour chart, depicted in black.

We suggest waiting patiently for the price to climb above the EMA 50 and the 23.6% Fibonacci level and join the bullish trend if there is a new breakout.

Watching Bitcoin's Key Fibonacci Levels for Trends​


Solid ECN – Bitcoin has shifted above the EMA 50, and the digital gold has stabilized itself above the 38.2% Fibonacci level and the Ichimoku cloud. However, the BTCUSD price still needs to overcome the upper band of the bearish flag before further growth.

From a technical standpoint, with the Bitcoin price sustained below the 50% Fibonacci support level, the bearish outlook remains valid. In this scenario, the downward pressure should continue, and the initial target will likely be the 23.6% Fibonacci support level.

On the other hand, if the bulls break out from the flag, the uptrend should continue, paving the way to $72,000.

Traders should watch the price action and market behavior around the 50% Fibonacci level.​

Oil Prices Dip as Middle East Tensions Ease​


Solid ECN – On Monday, the price of WTI crude oil dropped below $81 per barrel, hitting a four-week low. This decrease came as tensions in the Middle East seemed to lessen. Iran minimized the impact of recent Israeli strikes on its land and announced it would not retaliate. Despite this, the region remains under close watch by investors since Iran, a major oil producer in OPEC, mainly exports its oil to China and countries outside the US financial system.

In the US, Congress approved an aid package for Ukraine and Israel. This package might include sanctions against Iran’s oil industry, although the exact implications are still unclear. Global economic worries and the possibility that the US Federal Reserve might maintain higher interest rates for an extended period dampen the oil market outlook. Additionally, recent figures revealed a significant increase in US crude oil stocks, with a rise of 2.7 million barrels—almost twice what was anticipated.​

Gold Prices Dip Below Key Technical Levels​


Solid ECN—In today's trading session, the yellow metal dipped below the 23.6% Fibonacci support level and the Ichimoku cloud. When writing, the XAUUSD price is floating around $2,336, stabilizing below the EMA 50.

The technical indicators are bearish, with the relative strength index hovering below 50, and the awesome oscillator bars are in red and below the signal line.

From a technical standpoint, the gold market might have entered a consolidation phase that could extend to the 50% Fibonacci level at the $2,289 mark.

Conversely, should the price of gold flip above the cloud, we can consider that the uptrend will likely continue.

Bitcoin Faces Resistance: Can It Break the $67K Barrier?​


Solid ECN – Bitcoin, often called digital gold, has reached a critical resistance level around the $67,236 mark. The upper band of the wide bearish flag and the 50% Fibonacci support level support this barrier.

Technical indicators are signaling the bull market will continue. The BTCUSD price is above the Ichimoku cloud, and the relative strength index and the awesome oscillator hover above 50.

For the uptrend to continue, the price must close and stabilize itself above the 50% Fibonacci level, a task it has failed to achieve in today's trading session. Interestingly, the BTCUSD 4-hour chart has formed a bearish engulfing pattern, a signal that suggests a shift in trend from a bull to a bear market.

Therefore, if the price remains below the flag, a dip in the Bitcoin price is still possible.

We suggest monitoring the price behavior around the 50% Fibonacci level and the EMA 50 in today's trading session.​

Bearish Signs for NZD/USD​


Solid ECN—The New Zealand dollar traded below the Ichimoku Cloud and the 50 EMA against the U.S. Dollar, sitting at around 0.59 during Tuesday's U.K. trading session.

The technical indicators give mixed signals, but they have a more bearish than bullish outlook. The Relative Strength Index hovers below the 50 level, but Awesome Oscillator bars are green and hovering above the signal level. It is worth noting that the AO indicator signals divergence in its bars, which can be interpreted as either a consolidation phase or a potential trend reversal on the horizon. Therefore, traders and investors should approach the NZD/USD market with caution.

From a technical standpoint, the primary trend is bearish as long as the pair stays below the 0.5938 resistance level, as depicted in the 4-hour chart above. In this scenario, the downtrend will likely resume, and the initial target would be to test April's low at the 0.5852 support level.

Conversely, the bearish outlook is invalidated if the NZD/USD price crosses and stabilizes above the 0.5938 mark.​

GBPJPY Tests Resistance: Potential Bullish Breakout​


Solid ECN – The GBPJPY currency pair rebounded from the lower band of the bullish flag today and is now testing the 192.8 barrier.

The technical indicators are bullish, and the pair will likely break out. If this scenario plays out, it would allow GBP buyers to reach the upper band of the flag against the Japanese Yen.​

U.S. Oil Eyes $87 High as Bullish Trends Hold​


Solid ECN Blog – Yesterday, U.S. Crude oil prices formed a bullish long-wick candlestick pattern, as depicted in the daily chart above. This development occurred near the 50% Fibonacci retracement level, coinciding with the 50-day Exponential Moving Average (EMA 50).

The Relative Strength Index (RSI) is poised to rise above 50, signaling a potential uptrend continuation.

From a technical perspective, U.S. Oil remains in an uptrend, supported by the EMA 50. As long as this level holds, the outlook remains bullish, with the next target potentially being the March high of $87.0.

Conversely, should prices fall below the EMA 50, the bullish scenario would be invalidated, potentially leading to a decline toward the lower flag band at the $78 threshold.​