Market analysis and trade recommendations by FBS

[riki143]

USD/JPY: OUTLOOK FOR MAY 1-5
11:19 28.04.2017

USD/JPY hit 111.75 in the beginning of the past week boosted by a market-friendly first round French election result. Then, USD erased some of its gains following the release of one-page Trump's tax plan. On Thursday, the Bank of Japan released its monetary policy statement. Policymakers kept their interest rate and long-term yield target unchanged pledging to maintain its massive monetary stimulus until inflation rises to 2%. A flood of first-tier data the day after the Bank of Japan’s meeting indicated that the modest recovery in Japan’s economy is continuing, yet inflation is still low. USD/JPY stayed almost untouched following the data releases.
Next week the US dollar will be a bellwether of the pair since yen’s economic calendar is extremely light. Japan’s banks will be on holidays from Wednesday to Friday. On Monday, US Treasury Secretary Mnuchin will speak at the Milken Conference. His remarks have become proven market drivers since Trump’s inauguration, so you should probably cast a glance at the headlines of his speech. The Fed’s rate announcement and US labor market report will be in the spotlight next week. Markets don’t expect significant changes from the Fed’s policymakers this time. US NFP, unemployment rate, and wage growth are expected to produce a greater effect. Being overwhelmed with the US events and economic releases, don’t overlook the BoJ’s annual inflation figures coming on Tuesday.
On the USD/JPY technical chart, the short-term consolidation phase is still intact. 50-day SMA located near 111.80 might once again attract buying interest. If quotes manage to clear this hurdle, there will be a continuation of the rally towards 113.40, 114.00. The downside potential is limited to 109.90 (100-H4 MA). In case of the US government shutdown, escalation of global tensions, or disappointing economic figures, the quotes might slide towards 109.90, 109.10 levels.

More:
https://fbs.com/analytics/articles/usd/jpy:_outlook_for_may_1_5_770

 

[riki143]

EUR/USD: "EVENING STAR" STOPPED BULLS
12:41 28.04.2017

The price has reached the nearest resistance area, but there isn’t any reversal pattern so far. Therefore, there’s an opportunity to have a local correction in the short term. Nevertheless, bulls are likely going to continue pushing the market even higher until any bearish pattern arrives.

The 55 Moving Average has acted as a support, so the price is rising. At the same time, we’ve got an “Evening Star”, but a confirmation of this pattern is a quite weak. In this case, bears are likely going to test the closest support, which could be a departure point for another bullish price movement.

More:
[URLhttps://fbs.com/analytics/articles/eur%2fusd%3a_%22evening_star%22_stopped_bulls_771]https://fbs.com/analytics/articles/eur/usd:_"evening_star"_stopped_bulls_771[/URL]

 

[riki143]

GBP/USD: OUTLOOK FOR MAY 1-5
12:41 28.04.2017

The British pound spiked to 1.2940 despite a disappointing UK GDP figures for the first quarter of 2017. Although GBP is overbought it has room for an extension to 1.2950 in the short term. In the longer term, the upward momentum might disappear as soon as the Brexit negotiations play out. GBP/USD currency pair regained its ground after UK Prime Minister Theresa May surprised markets by calling a snap general election on June 8.
While the election might strengthen the Conservative party’s position it will be extremely challenging for the UK to get a satisfactory agreement in the talks. German Chancellor Angela Merkel laid down a tough line for Brexit talks with the UK striving to remind Britain that it can’t expect a soft Brexit. A summit of EU leaders to conclude their response to the UK’s notification of exit will be held on April 29. So, the pound might be hurt on Monday in the early hours of the Asian session. In terms of economic data, we will be waiting UK manufacturing and construction purchasing managers’ indexes in the beginning of the week. The main focus will be on Wednesday’s FOMC meeting and Friday’s labor market report from the US. The Fed is widely expected stay on hold. So, the USD shouldn’t experience significant changes. NFP, unemployment rate and wage growth figures might bring some moves to the chart.
On the GBP/USD technical chart, we might notice that Splash and ledge pattern was implemented. Prices broke the upper border of the ledge (1.2900) and moved higher towards 1.2950 There is a small room for extension towards 1.3000/1.3020. The current upward momentum shouldn’t last long, though. Stochastic is trading in the overbought area for a long period of time. So, we will be waiting for some pullbacks towards the recent resistance levels, or lower, towards 1.2800, 1.2750 levels.

More:
https://fbs.com/analytics/articles/gbp/usd:_outlook_for_may_1_5_772

 

[riki143]

AUD/USD OUTLOOK FOR MAY 1-5
12:43 28.04.2017

Aussie declined from 0.7585 to 0.7440 in the course of the past week following the disappointing outcome for CPI figures. Annual core inflation data accelerated to just below the lower end of the Reserve Bank of Australia’s target underscoring its decision not to change its current loose monetary policy.
Next week, the RBA is set to deliver its rate and monetary policy statements on Tuesday and Friday accordingly. The bank’s policymakers are expected to stay on hold fearing that additional cuts could further inflame east coast house prices. Another concern of the bank’s officials is a pronounced slack of Australia’s labor market. Keep an eye on China’s manufacturing and non-manufacturing PMI releases coming this Sunday. Disappointing updates might hurt the Aussie. The US dollar will have a very busy calendar next week with Fed’s rate announcement on Wednesday and US labor market report on Friday.
The Aussie was trading rangebound in the last two days consolidating after the sharp fall that started on Monday. While oversold, it might slide lower towards 0.7440 (April 27 low), or towards the solid support at 0.7400. If upper border of 0.7438 – 0.7490 consolidation range is broken, the quotes will rise higher towards 0.7515, 0.7550 levels.

More:
https://fbs.com/analytics/articles/aud/usd_outlook_for_may_1_5_773

 

[riki143]

USD/JPY: STRONG "WINDOW"
12:45 28.04.2017

The last “Engulfing” pattern is still unconfirmed. So, the 89 Moving Average is likely going to act as a support. If a pullback from this line happens, bulls will probably try to test the upper “Window”

There’s a strong support by the lower “Window”. However, we’ve got a “Tweezers” and an “Engulfing” patterns, which both are still on the table. Under this circumstances, bears are likely going to test the “Window” once again.

More:
https://fbs.com/analytics/articles/usd/jpy:_strong_"window"_774

 

[riki143]

EUR/USD: BEARISH WAVE (IV) ABOUT TO START
12:51 28.04.2017

The price is testing 7/8 MM Level, which previously has acted as a resistance. So, wave (iii) is likely going to end soon. If the market finds a lodgment under 7/8 MM Level later on, there’ll be an opportunity to have a bearish correction.

As we can see on the one-hour chart, wave (iii) is taking form of a double zigzag. In this case, wave [C] of y is likely going to end soon. Therefore, we could have wave a or w in the short term, so we should keep an eye on 5/8 MM Level as an intraday bearish target.

More:
https://fbs.com/analytics/articles/eur/usd:_bearish_wave_(iv)_about_to_start_775

 

[riki143]

US DOLLAR: OUTLOOK FOR MAY 1-5
12:53 28.04.2017

The US dollar opened the week with a bearish gap formed on the first round of French presidential election.
Donald Trump has lived through the first 100 years of presidency. His tax plan has disappointed investors with its lack of details. In addition, the markets are skeptical that any comprehensive tax changes will be approved by the Congress. Canadian dollar and Mexican peso strengthened versus their US counterpart on the news that the United States doesn’t immediately plan to withdraw from the North American Free Trade Agreement. As for the geopolitical tensions, Trump said that a major conflict with North Korea is possible, but he would prefer a diplomatic outcome to the dispute. There may be more headlines on this topic in future. In the meantime, US GDP growth has slowed down to 0.7% in the first quarter.
American economic calendar is packed with important events. On Monday, we’ll hear from Treasury Secretary Steven Mnuchin. The US will release core PCE price index, which is the Fed’s preferred inflation indicator, as well as ISM manufacturing PMI. On Wednesday don’t miss ADP non-farm employment change and ISM services PMI. In addition, there will be a meeting of the Federal Reserve. The press conference is not scheduled and the market is not expecting a rate hike. On Thursday, the US will release unemployment claims, trade balance, and factory orders. Then there will be the first Friday of the month, which is usually volatile because of NFP release.
The US dollar index held above the 50-week MA at 98.45, but is now below the former support line from 2016 lows and below 200-day MA. Return above 99.30 is needed for the bulls to return. The next stops will likely be 100.00 and 100.45. Otherwise, bearish pressure will intensify with the greenback remaining vulnerable for a decline to 97.55 (100-week MA, July 2016 highs).

More:
https://fbs.com/analytics/articles/us_dollar:_outlook_for_may_1_5_776

 

[riki143]

EUR/USD: OUTLOOK FOR MAY 1-5
13:14 28.04.2017

EUR/USD opened the week with a bullish gap on the news that a pro-European candidate Emmanuel Marcon won the most votes in the first round of French presidential election. In the second round of the vote on May 7 Macron is expected to win against the Eurosceptic Marine Le Pen. Already at this point, many think that the European political risks have diminished. This is a bright spot for the euro.
Among other important things, we have to mention the European Central Bank’s meeting. The ECB left monetary policy unchanged. President Mario Draghi pointed out that euro zone’s recovery was increasingly solid and downside risks had diminished. On the other hand, he underlined that removal of the bank’s easing bias was not discussed, stressing the fact that inflation remains too low. This ambiguous statement led to a mixed response from the euro: the single currency declined, but later managed to pare the losses.
The European economic calendar for the upcoming days is light, there are only events of medium and low importance. Among them, pay attention to the region’s preliminary Q1 GDP. Main drivers for EUR/USD will come out of the United States, where will be a lot of market-moving releases, the Federal Reserve’s meeting, and some political news.
EUR/USD keeps attacking this year’s resistance line. A weekly close above the 50-week MA in the 1.0900 area will be a positive sign. The next obstacles for the bulls lie at 1.0995 (100-week MA) and 1.1057 (bottom of the daily Cloud). A significant weakness of the US dollar may bring the pair up to 1.1150. Support is at 1.0825 and 1.0770.

More:
https://fbs.com/analytics/articles/eur/usd:_outlook_for_may_1_5_777

 

[riki143]

GBP/CAD BROKE RESISTANCE LEVEL 1.7540
15:31 28.04.2017

GBP/CAD broke resistance level 1.7540
Next buy target - 1.8000
GBP/CAD has been rising sharply in the last few trading sessions inside the minor accelerated impulse wave 3, which belongs to the intermediate (C)-wave from the start of April. The price earlier broke through the three consecutive resistance levels: 1.7100, 1.7240 (two previous buy targets) and 1.7540 (which reversed the previous waves 4 and (2))
GBP/CAD is expected to rise to the next buy target at the next resistance level 1.8000 (former key support level from June). Buy stop-loss can be placed below 1.7540.

More:
https://fbs.com/analytics/articles/gbp/cad_broke_resistance_level_1.7540_782

 

[riki143]

USD/CAD REACHED BUY TARGET 1.3600
15:32 28.04.2017

USD/CAD reached buy target 1.3600
Next buy target - 1.3800
USD/CAD has been under bullish pressure lately – after the earlier breakout of the powerful resistance level 1.3600 (which reversed the previous waves 3 and (A) and which was set as the buy target in our previous forecast for this currency pair). The breakout of the resistance level 1.3600 accelerated the active impulse waves 3 and (C) – which belong to the primary ?-wave from last year.
USD/CAD is expected to rise to the next buy target at the next resistance level 1.3800 (target price for the completion of the active minor impulse wave 3).

More:
https://fbs.com/analytics/articles/usd/cad_reached_buy_target_1.3600_783

 

[riki143]

EUR/USD: POSSIBLE "TRIPLE TOP"
09:59 01.05.2017

The price is still consolidating under a resistance at 1.0951. Also, there’s a developing “Triple Top”. If this pattern confirms, the market is likely going to decline towards a support at 1.0819 – 1.0729, which is near the last “Breakaway Gap”. If a pullback from this area happens, there’ll be an opportunity to have an upward price movement towards a resistance at 1.0851.

There’s a “V-Top”, which led to a consolidation between the 34 Moving Average and the nearest resistance at 1.0910. At the same time, we’ve got a “Flag”, so bears are likely going to test the 89 Moving Average in the short term. If we see a pullback from this line, bulls will probably try to test a resistance at 1.0882.

More:
https://fbs.com/analytics/articles/eur/usd:_possible_"triple_top"_788

 

[riki143]

GBP/USD: "DOUBLE TOP" STOPPED BULLS
10:10 01.05.2017

Bulls faced a resistance at 1.2945, so we’ve got a “Double Top”, which has been confirmed by the last “Exhaustion Gap”. Therefore, the pair is likely going to decline in the direction of the closest support at 1.2865 – 1.2816. If bears be stopped here, there’ll be an opportunity to have another bullish price movement towards a resistance at 1.2865 – 1.2913.

We’ve got a “Double Top” pattern, which has been confirmed. However, the price faced a support at 1.2900, so bulls are likely going to test the nearest resistance at 1.2935 – 1.2952. If a pullback from this area happens, bears will probably try to reach the closest support at 1.2865 – 1.2844.

More:
https://fbs.com/analytics/articles/gbp/usd:_"double_top"_stopped_bulls_790

 

[riki143]

EUR/USD: "SHOOTING STAR" LAUNCHED CORRECTION
10:16 01.05.2017

The price has tested the nearest resistance ones again. Also, we’ve got a “Shooting Star”, but this pattern hasn’t been confirmed yet. Therefore, the market is likely going to reach the lower “Window” in the short term. If a pullback from this level happens, we could have another bullish rally.

The 34 Moving Average is acting as a support. At the same time, we’ve got a “Doji”, but a confirmation of this pattern is a quite weak. So, the price is likely going to test the closet resistance, which could be a departure point for a local decline.

More:
https://fbs.com/analytics/articles/eur/usd:_"shooting_star"_launched_correction_791

 

[riki143]

USD/JPY: "WINDOW" GOING TO ACT AS RESISTANCE
10:20 01.05.2017

The last bullish “Harami” led to a new high. Therefore, the market is likely going to test the upper “Window” in the short term. If any bearish pattern arrives afterwards, there’ll be an opportunity to have a downward correction.

The lower “Window” has acted as a support, so we’ve got a “Three Methods” pattern. In this case, the market is likely going to continue moving up towards the upper “Window”.

More:
https://fbs.com/analytics/articles/usd/jpy:_"window"_going_to_act_as_resistance_792

 

[riki143]

EUR/USD: BEARS READY FOR WAVE (IV)
13:52 01.05.2017

Wave (iii) has been ended on 7/8 MM Level, so there’s time for a correction. Therefore, the market is likely going to decline in wave (iv) shortly. The main intraday target is 4/8 MM Level, which could be a departure point for wave (c) of [c] of 2.

We’ve got a double zigzag in wave (iii) and a lot of pullbacks from 7/8 MM Level. In this case, bears are likely going to deliver a downward wave a or w in the coming hours.

More:
https://fbs.com/analytics/articles/eur/usd:_bears_ready_for_wave_(iv)_796

 

[riki143]

EUR/AUD REVERSED FROM STRONG RESISTANCE LEVEL 1.4640
15:43 01.05.2017

EUR/AUD reversed from strong resistance level 1.4640
Next sell target - 1.4300
EUR/AUD continues to decline after the earlier downward reversal from the strong resistance level 1.4640 (which also revered the pervious intermediate ABC correction (4) in December, as can be seen from the daily EUR/AUD chart below). The resistance zone near the resistance level 1.4640 was further strengthened by the upper daily Bollinger Band. The downward reversal from the resistance level 1.4640 created the daily Japanese candlesticks reversal pattern Shooting Stat Doji.
EUR/AUD is expected to fall to the next sell target at the next support level 1.4300 (previous powerful resistance level from March).

More:
https://fbs.com/analytics/articles/eur/aud_reversed_from_strong_resistance_level_1.4640_800

 

[riki143]

AUD/NZD REACHED BUY TARGET 1.0850
15:44 01.05.2017

AUD/NZD reached buy target 1.0850
Next buy target - 1.1020
AUD/NZD continues to rise inside the intermediate corrective wave (2) – which earlier broke through the resistance zone lying at the intersection of the resistance level 1.0850 (previous buy target set in our earlier forecast for this currency pair) and the resistance trendline of the daily down channel from March. The breakout of this resistance zone intensified the bullish pressure on this currency pair.
AUD/NZD is expected to rise to the next buy target at the next resistance level 1.1020 (top of the previous primary ABC correction ② from March).

More:
https://fbs.com/analytics/articles/aud/nzd_reached_buy_target_1.0850_801

 

[riki143]

EUR/USD: EURO MAY GO HIGHER
05:18 02.05.2017

Technical levels: support – 1.0900; resistance – 1.0960.
Trade recommendations:
1. Buy — 1.0900/10; SL — 1.0880; TP1 — 1.0960; TP2 – 1.1000.
Reason: expanding bullish Ichimoku Cloud, rising Senkou Span A; a new golden cross of Tenkan-sen and Kijun-sen; the prices are on support of Tenkan-sen and Kijun-sen.

More:
https://fbs.com/analytics/articles/eur/usd:_euro_may_go_higher_808

 

[riki143]

AUD/USD: BULLS UNDER PRESSURE OF CLOUD
05:19 02.05.2017

Technical levels: support – 0.7500, 0.7450; resistance – 0.7550.
Trade recommendations:
1. Sell — 0.7540; SL — 0.7560; TP1 — 0.7500; TP2 — 0.7450.
Reason: narrowing bearish Ichimoku Cloud, falling Senkou Span A; a new weak golden cross of Tenkan-sen and Kijun-sen; the prices are under strong resistance of the Cloud.

More:
https://fbs.com/analytics/articles/aud/usd:_bulls_under_pressure_of_cloud_809

 

[riki143]

MORNING BRIEF FOR MAY 2
06:26 02.05.2017

A belated happy Labour day, dear traders! We bet you were trading with zeal and special ardor yesterday! Here are the latest news and market moves of today’s Asian session.
AUD/USD spiked to 0.7540 after the Reserve Bank of Australia left its cash rate unchanged at 1.5%. No sign of cut nor a hike has been registered. The statement was neutral maybe with a slight hawkish bias. There is a room for further extension towards firm resistance at 0.7600.
USD/JPY has spent the Asian session in a very narrow range; it edged up to 111.88 but has still not pierced 112. It seems that upward momentum is not as strong as preferred. To strengthen it quotes should hit 112.20. A clear break of the following level will improve the odds for further extension towards 112.90. The concerns about North Korea nuclear testing have lessened. Donald Trump opened the door to meeting North Korea’s young leader Kim Jong Un.
EUR/USD posted a modest gain in the Asian session having risen above 1.0920. The quotes are moving mostly sideways, as bulls lost their momentum. So, the odds for breaking 1.1000 have seriously diminished. Most likely EUR/USD will continue its rangebound movement in the upcoming sessions. A stop loss can be placed at 1.0820 (last Monday low). Emmanuel Macron is still seen as the front-runner over Marin le Pen in the second round of the French presidential race (scheduled for May 7). Today’s focus will be on the EZ countries’ Manufacturing PMI.
USD/CAD slipped a few points in the Asian session. At the present moment, the pair is hovering near 1.3665. Loonie might continue strengthening against USD especially after FOMC meetings (the members will likely vote for staying on hold at the tomorrow’s meeting).
Brent oil futures held weaker on Tuesday following the weak survey on manufacturing in China and revival of the Libya’s crude oil industry. Today, investors will be waiting for the American Petroleum Institute’s report on the US crude and refined product stockpiles. A drop in inventories will be supportive for the oil prices.
GBP/USD rose above 1.2900 in the course of the Asian session. The odds for further extension at least towards 1.3000 are quite high. A slowing domestic economy and upcoming UK election temper prospects of sustained upside though. A disappointing headline of today’s manufacturing PMI out of the UK might send the pound lower towards 1.2750, 1.2610 levels.
Kiwi lost its ground in the morning trading session. NZD/USD slid to 0.6910. A move below 0.6850/55 will be a signal of bears’ strength. A break of the resistance at 0.6965 will be a good sign for us to adopt a bullish stance.

More:
https://fbs.com/analytics/articles/morning_brief_for_may_2_812