Market analysis and trade recommendations by FBS

[riki143]

EUR/USD: the euro is gaining momentum
1/24/2017

On the EUR/USD daily chart, quotes continue to move within the short-term trading channel. In order to continue the rally "bulls" need to test the resistance at 1.085.If they manage to do so, the "Shark" inverted pattern will be activated. Its 88.6% target is located near the 1.12 mark.

On the EUR/USD hourly chart, the return of the quotes to 1.071 will determine a further direction of the movement. A rebound can lead to the restoration of the short-term upward trend. In contrast, a breakout will activate the "Crab" pattern with the target located at 1.064 (88.6%).

Recommendations:

SELL 1,071 SL 1,0765 TP1 1,064 TP2 1,058,

SELL 1,085 SL 1,0905 TP 1,071

More:
https://new.fxbazooka.com/analytics/12157

 

[riki143]

Morning brief for January 24
1/24/2017

Trade was subdued overnight due to the scantiness of economic reports. Trump’s executive orders have added some fuel to the technical charts and have provided feedstock for news flow.

EUR/USD hopped to 1.0755 after Mr. Trump formally withdrew from the Trans-Pacific Partnership. The newly elected US President promised to start the talks with Canadian prime minister Justin Trudeau and Mexican President Enrique Pena Nieto (the political leader of NAFTA member countries) as soon as possible. The talks of Trump’s protectionism favored safe-haven US Treasuries, gold, and the Japanese yen. Today’s focus will on the manufacturing data coming from the Eurozone.

USD/JPY skidded below 112.80 not paying attention Trump’s policies of massive cuts in taxes and deregulations.

Th pound peaked above 1.2510 against its US peer as the UK’s Supreme Court is expected that parliament should have a say in triggering Article 50. The decision will be delivered at 11:30 MT time. If the ruling is in line with market’s expectations, the GBP may gain some support as parliamentary involvement should delay disorderly Brexit (but not to stop it). Also, pay attention to the UK public sector net borrowing data.

Aussie and kiwi both popped up on the weakening of the greenback. The former one managed to break 0.7575 resistance, another one made some modest gains having risen to 0.7235.

The Canadian dollar is surprisingly showing some signs of rallying. USD/CAD slipped below 1.4330. Oil prices made a dip overnight as signs of the resurgence of the US drilling industry have become more evident. The OPEC and non-OPEC announcements of their results on meeting output reduction goals do little to support the oil. Brent oil futures are now around $55.48 from Monday’s $55.75.

More:
https://new.fxbazooka.com/analytics/12158

 

[riki143]

EUR/USD: "Double Top" stopped bullish rally
1/24/2017

We’ve got a “V-Top” pattern, which has been formed right under a resistance at 1.0745. So, the market is likely going to test the nearest support at 1.0719 – 1.0697 in the short term. If a pullback from this area happens, there’ll be an opportunity to have another upward price movement towards the resistance at 1.0795.

The price is consolidating, but we’ve got a possible “Double Top” pattern. If it confirms, bears are likely going to reach a support at 1.0719 – 1.0710. Considering a possible pullback from this level, bulls will probably try to achieve a resistance at 1.0771 – 1.0795 later on.

More:
https://new.fxbazooka.com/analytics/12159

 

[riki143]

GBP/USD: downtrend has been broken
1/24/2017

The last downtrend has been broken, so the price faced a resistance at 1.2548. In this case, the pair is likely going to decline in the direction of the nearest support at 1.2468 – 1.2432. If we see a pullback from this area, there’ll be a chance to have a bullish price movement towards a resistance at 1.2548 – 1.2619.

We’ve got a local “Double Top”, which has been confirmed. Therefore, bears are likely going to test the nearest support at 1.2468 – 1.2432 during the day. However, this area could be a departure point for another upward movement towards a resistance at 1.2548 – 1.2581.

More:
https://new.fxbazooka.com/analytics/12160

 

[riki143]

GBP/USD: pound reached daily resistance[/]
1/24/2017

Technical levels: support – 1.2420; resistance – 1.2530.

Trade recommendations:

1. Buy — 1.2420; SL — 1.2400; TP1 — 1.2530; TP2 — 1.2580.

Reason: bullish Ichimoku Cloud with narrowing diapason; a golden cross of Tenkan-sen and Kijun-sen; the prices are under pressure of the strong daily resistance (waiting for correction); support of Tenkan and Kijun.

More:
https://new.fxbazooka.com/analytics/12161

 

[riki143]

USD/JPY: Dollar supported by 112.60[/B}
1/24/2017

Technical levels: support – 112.60; resistance – 113.70.

Trade recommendations:

1. Sell — 113.70; SL — 113.90; TP1 — 112.60; TP2 — 112.30.

Reason: bearish Ichimoku Cloud; a new dead cross of Tenkan-sen and Kijun-sen; the prices are on the strong support (expected a correction) in a negative area.

More:
https://new.fxbazooka.com/analytics/12162

 

[riki143]

Key option levels for Tuesday, January 24th
1/24/2017

EUR/USD

Main trend Short-term period Medium-term period
Bearish Neutral
Changes in the open interest + 98 595 ? + 151 961 ?
Closest resistance levels 1.0768; 1.0804; 1.0826; 1.0859
Closest support levels 1.0730; 1.0703; 1.0663(85?); 1.0609
Trading recommendations
Baseline scenario Short EUR/USD below 1.0730, with target points at 1.0703 and 1.0663
Alternative scenario Moving above 1.0768 can be considered as a signal to Buy the pair, with target at 1.0804 and 1.0826

GBP/USD

Main trend Short-term period Medium-term period
Bullish Neutral
Changes in the open interest + 1 288 ? - 39 ?
Closest resistance levels 1.2516; 1.2537; 1.2572; 1.2611
Closest support levels 1.2449; 1.2428; 1.2403; 1.2374
Trading recommendations
Baseline scenario Long GBP/USD above 1.2516, with target points at 1.2537 and 1.2572
Alternative scenario Moving below 1.2449 can be considered as a signal to Sell the pair, with target at 1.2428 and 1.2403

USD/CAD

Main trend Short-term period Medium-term period
Neutral Bullish
Changes in the open interest + 330 ? + 44 ?
Closest resistance levels 1.3268; 1.3293; 1.3332; 1.3387
Closest support levels 1.3224; 1.3189; 1.3156; 1.3108
Trading recommendations
Baseline scenario (High risk of reversal) Long USD/CAD above 1.3268, with the target points at 1.3293 and 1.3332
Alternative scenario Moving below 1.3224 can be considered as a signal to Sell the pair, with target at 1.3189 and 1.3156

More:
https://new.fxbazooka.com/analytics/12163

 

[riki143]

Trump vs. China: a trade war ahead?
1/24/2017

Throughout the election campaign, Mr. Trump was threatening to get tough on China for its manipulation with yuan and unfair trade policy. And what a surprise! Instead of putting additional pressure on China’s People Republic, newly elected President gave it a gift having formally withdrawn from the Trans-Pacific partnership, a costly free trade agreement aiming at countering China’s increasing economic clout. So, has Trump changed his mind in relation to the US greatest trading partner? We would doubt it. The worst is yet to come. Mr. Trump will do his best to force the world’ biggest exporter to the negotiating table and win concessions for his beloved America.

For this to happen he will need to officially slap China with a currency manipulator label. As of today, according to the US regulation, China is not a manipulator as its trade surplus is not in excess of $20 bln with the US; a current account surplus doesn’t exceed 3% of its GDP; China wasn’t taken red-handed on the persistent interventions in currency markets. So, Mr. Trump will have a stiff job to impose a comprehensive tariff on China’s imports.

But what If Mr. President manages to put into effect his intentions? What would be China’s response? That’s a mug’s game! China would certainly push back against imposed trade restrictions and raise its tariffs against the US or restrict the purchase of the US goods and service. So, it is going to be a “lose-lose” game.

According to the World Banks estimates, the US protectionist stance in relation to China can burden the outlook for the US economy. China won’t reap any benefits from the trade war with the US as well. In fact, China’s economic growth will slow down significantly.

For the present moment, nobody knows how the US-China trade relationships will change. We will continue to monitor this issue as China’s influence on the global markets is crucial.

More:
https://new.fxbazooka.com/analytics/12164

 

[riki143]

Uncovering Gann indicators
1/24/2017

Have you ever heard about one of the most mysterious and successful traders of all times – William Gann? He is well-known for using geometry, astrology and ancient mathematic to predict the movement of quotes in the financial markets. He was brought up in an impoverished extended family.

To earn crust he had to work on the farm, selling cigars and newspapers in the trains. From travelers, he knew about the investment, financial markets and great possibilities they can offer. Gann started wondering if it were possible to predict the future. Later on, he moved to New York and started working at a major Wall Street Brokerage house and attending business school at night. A compulsive idea of predicting the future has always been on his brain. So, he began studying the basic principles of price patterns and philosophy on how to accumulate the wealth, then, he proceeded with studying ancient geometry, astrology, mathematic. As a result, he managed to achieve his goal – he became a very successful trader, a real guru who managed to accumulate over 50 mln dollars and open his own brokerage firm. Trying to decipher the secret of his success, traders looked through his numerous writings and found some very efficient tools and trading techniques. In this article, we will tell you about so-called Gann indicators (line, angle, fan) that you can find on your trading platform.

Why are the Gann indicators valuable?

With their help, a trader can forecast support and resistance lines.

Uncovering Gann angles and lines

The primary Gann angles are the 1x2, the 1x1, and the 2x1. The 1x2 combination means that the angle is moving one unit of price for every 2 units of time. The same logic applies to other angles: the first number account for the one price interval, the subsequent one – for the unit of time.

Trading on 1x1, a so-tooth Gann line (refers to the 45-degree angle) means that the market is balanced (the Gann line represents a long-term trend). If price crosses this balance line it means that the dominant trend is about to reverse.

Building Gann line and Gann angle

Choose “Insert-Lines-Trendline by angle” in the toolbar of your trading platform and plot the line for the 45-degree angle from the top or bottom.

For the bullish trend, it looks it looks as follows, your balance 45-degree line serves as support (hint: after you plotted the line you should rotate it until you reach the degree you need – in your case it is 45°.

Once you’ve got you’ve built your balanced “one-to-one” line you can lay up the Gann fan.

Choose “Insert – Gann – Gann fan” and plot the fan in accordance with the Gann line you drew earlier. The middle line of the fan should correspond to the 45° Gann line.

For bullish trend, it looks as follows, the rays of the Gann fan determine your support levels.

More:
https://new.fxbazooka.com/analytics/12166

 

[riki143]

Trading JPY: tips from banks
1/24/2017

Long-term projections

Bank of America Merrill Lynch

The bank is long on USD/JPY (buy 113.36, target 120.00, stop loss 110)

Reasoning:

The bank believes that USD/JPY should rise towards 120.00 by the end of the winter; buying at the current levels should yield profits in the future.

The exchange rate of the currency pair managed to stabilize; it corresponds to the value of the US dollar taking account of the existent interest rate differentials and the situation at the US stock market;
The seasonality factor will start to play out at the end of January and will influence the rate till April. In February, investors tend to reallocate their assets and invest them in shares, if they sure in the absence of risk.
Despite numerous contradictions, we believe that economic and fiscal policies of Trump’s administration will push the US dollar higher in the end.
We believe that the Bank of Japan will decide to continue its current stimulus program at the next meeting scheduled for January 31. In contrast, the Fed will be willing to raise its current interest rate further (the next hike could be in March).
Citi: trading in the short-term

The bank advices its clients to sell EUR/JPY this week (sell at 122.05 with a target at 119.60, place stop loss at 123.60).

More:
https://new.fxbazooka.com/analytics/12169

 

[riki143]

EUR/USD: bearish "Engulfing"
1/24/2017

We’ve got a “Harami”, which has been confirmed. Therefore, the price is likely going to test the 21 Moving Average in the short term. If a pullback from this line happens, there’ll be an opportunity to have another upward price movement.

There’s an “Engulfing” at the local high, which has been confirmed by the last “Three Methods” pattern. So, bears are likely going to test the nearest support during the day. However, if a pullback from this level be on the table, bulls will probably try to deliver an upward correction.

More:
https://new.fxbazooka.com/analytics/12170

 

[riki143]

USD/JPY: bears going to test the last low
1/24/2017

The price faced a support on the nearest “Window”, so we’ve got a “Piercing Line” on this level, which has been strongly confirmed. In this case, the market is likely going to test the 21 & 34 Moving Average in the short term.

There’s an “Engulfing” at the local low. Considering a confirmation of this pattern, bears are likely going to test the nearest support, which could be a departure point for un upward price movement towards the 89 Moving Average.

More:
https://new.fxbazooka.com/analytics/12171

 

[riki143]

NZD/USD reached buy target 0.7230
1/24/2017

NZD/USD reached buy target 0.7230
Next buy target – 0.7400
NZD/USD continues to rise after the recent breakout of the resistance level 0.7230 (which reversed the pervious wave (ii) and which was set as the buy target in our previous forecast for this currency pair). The breakout of the resistance level 0.7230 is expected to accelerate the active minor (c)-wave which belongs to the ABC correction 2 from the end of December.

NZD/USD is expected to rise further toward the next buy target at the strong resistance level 0.7400 (which reversed the pervious intermediate ABC correction (2) at the start of November, as can be seen below).

More:
https://new.fxbazooka.com/analytics/12172

 

[riki143]

NZD/CAD approaching resistance level 0.9630
1/24/2017

NZD/CAD approaching resistance level 0.9630
Next buy target - 0.9800
NZD/CAD continues to rise after the recent breakout of the resistance level 0.9500 (which was set as the buy target in our previous forecast for this currency pair). The breakout of the resistance level 0.9500 accelerated the active minor impulse wave 3, which belongs to the intermediate impulse wave (3) from the start of January.

The pair is currently approaching the resistance level 0.9630 (which stopped the B-wave of the previous intermediate ABC correction (2) in November). If the price closes today above the resistance level 0.9630 - NZD/CAD can then be expected to rise further toward the next buy target at the next resistance level 0.9800.

More:
https://new.fxbazooka.com/analytics/12173

 

[riki143]

EUR/USD: wave 2 ended
1/24/2017

The price hasn’t found a lodgement above 4/8 MM Level, so wave 2 could be ended. In this case, bears are likely going to deliver a downward impulse in wave . The main intraday target is 2/8 MM Level.

As we can see on the one-hour chart, the price is moving up and down along 8/8 MM Level. Also, a bullish impulse in wave [c] of 2 has been ended. Therefore, the market is likely going to decline in wave (iii) of .

More:
https://new.fxbazooka.com/analytics/12174

 

[riki143]

USD/JPY: yen was stopped by the double bottom
1/25/2017

On the USD/JPY daily chart, a double bottom has been formed. The bears' attack was stopped and revealed the important support located at 112.5. A successful test of this support will lead to the continuation of the corrective movement towards 111.15 and 108.8. On the other hand, a breakout of the resistance at 114.05 will allow the bulls to take a rest.

On the USD/JPY hourly chart, buyers are going to test the resistance at 114. If they succeed "Shark" inverted pattern with 88.6% and 113% targets will be activated. A necessary condition for this to happen is the need to go beyond the upper boundary of the downward trading channel.

BUY 114,05 SL 113,5 TP1 115,1 TP2 115,65.

More:
https://new.fxbazooka.com/analytics/12178

 

[riki143]

Morning brief for January 25
1/25/2017

The main focus of the Asian session was Australian CPI. There was no sign of inflation moving towards cherished RBA’s target. The headline of the release fell out of the market’s expectation and sent Aussie lower towards circa 0.7540.

EUR/USD skipped to 1.0725. The greenback experienced a rebound overnight as Mr. Trump shifted his focus from protectionist policies to growth initiatives including tax cuts, deregulation. In a meeting with the CEOs of major car producers, President called on them to build more cars persistently repeating his mantra of buy only American, hire Americans. In addition, Mr. Trump signed some executive orders aiming to advance the construction of the Keystone XL and Dakota Access. Environmentalists rave and storm bitterly lamenting the end of the term of nature-friendly Democratic administration.

GBP/USD spiked to 1.2517 after the UK Supreme Court announced in its ruling that Parliament must vote to activate the Brexit mechanism. However, the triggering of Article 50 in March 2017 is still on the table as many parliamentarians have already come to terms with the fact that UK will no longer be a member of the EU and seem like to be ready to give the green light for the Brexit process.

NZD/USD experienced some wobbles at the time of Australian data but changed only a little so far. At the present moment, prices are hovering around the 0.7235 level. We expect New Zealand inflation release later today (consensus forecast indicates a modest 0.1% increase in inflation rate).

USD/CAD continues its downward movement towards the nearest support located at 0.3115 (near 200-day MA).

Brent oil futures edged up to $55.30. Renewed sentiments over imminent Trump’s growth policies wiped out the recent gains of safe-haven assets (gold move lower to $1210.65). The US dollar rose against the yen to 113.55 having covered its short-term losses.

More:
https://new.fxbazooka.com/analytics/12179

 

[riki143]

EUR/USD: bearish "Flag"
1/25/2017

The price is consolidating under a resistance at 1.0795. Also, there’s a “Double Top” pattern, which has been confirmed. Therefore, the market is likely going to decline towards a support at 1.0697 – 1.0655. If a pullback from this area happens, there’ll be an opportunity to have an upward movement in the direction of a resistance at 1.0745 – 1.0774.

We’ve got a “Double Top” pattern, which has been confirmed by the last “Flag” pattern, so bears are likely going to test the nearest resistance at 1.0697 – 1.0684. At the same time, this area could be a departure point for another bullish rally.

More:
https://new.fxbazooka.com/analytics/12180

 

[riki143]

GBP/USD: bulls going to move on
1/25/2017

The price faced a resistance at 1.2548, so bears are likely going to test a support at 1.2468 – 1.2432 in the short term. If we see a pullback from this area, there’ll be an opportunity to have a bullish price movement towards the nearest resistance at 1.2548 – 1.2619.

The pair is consolidating between the 34 Moving Average and the level 1.2548. In this case, the market is likely going to decline in the direction of the closest support at 1.2468 – 1.2432. Considering a possible pullback from these levels, we should keep an eye on the next resistance at 1.2548 – 1.2581 as a possible intraday target.

More:
https://new.fxbazooka.com/analytics/12181

 

[riki143]

Key option levels for Wednesday, January 25th
1/2/2017

EUR/USD

Main trend Short-term period Medium-term period
Bearish Neutral
Changes in the open interest + 36 381 ? + 69 650 ?
Closest resistance levels 1.0743/46; 1.0765; 1.0780; 1.0803
Closest support levels 1.0714; 1.0690; 1.0654; 1.0604
Trading recommendations
Baseline scenario Short EUR/USD below 1.0714, with target points at 1.0690 and 1.0654
Alternative scenario Moving above 1.0743 can be considered as a signal to Buy the pair, with target at 1.0765 and 1.0780

GBP/USD

Main trend Short-term period Medium-term period
Bullish Neutral
Changes in the open interest + 230 ? + 157 ?
Closest resistance levels 1.2531; 1.2561; 1.2598; 1.2623
Closest support levels 1.2490; 1.2462; 1.2442; 1.2417
Trading recommendations
Baseline scenario Long GBP/USD above 1.2531, with target points at 1.2561 and 1.2598
Alternative scenario Moving below 1.2490 can be considered as a signal to Sell the pair, with target at 1.2462 and 1.2442

USD/CAD

Main trend Short-term period Medium-term period
Neutral Bullish
Changes in the open interest + 863 ? + 343 ?
Closest resistance levels 1.3172; 1.3198; 1.3238; 1.3293
Closest support levels 1.3137; 1.3118; 1.3099; 1.3067
Trading recommendations
Baseline scenario Long USD/CAD above 1.3172, with the target points at 1.3198 and 1.3238
Alternative scenario Moving below 1.3137 can be considered as a signal to Sell the pair, with target at 1.3118 and 1.3099

More:
https://new.fxbazooka.com/analytics/12184