Market analysis and trade recommendations by FBS

[riki143]

Forex Analytics
EUR/USD: forecast for January 18-24
15 January 2016
By Elizabeth Belugina

The single currency has been rather stable versus the US dollar in the recent weeks as last month the European Central Bank did less monetary easing than expected. In addition, the euro was supported as a safe haven on the back of Chinese equity turmoil. However, the minutes of the ECB’s December meeting showed that the central bank sees the need to cut deposit rate once again if inflation turns out to be below its already reduced forecasts. One of the reasons of weak inflation in the euro area are the oil prices, which hit 12-year lows.

The ECB will meet once again on Thursday. Although its policy is expected to remain unchanged, the prospect of more easing in March is real. As a result, it may be hard for EUR/USD to break above 1.1000/1.1040. On the downside, we’ll focus on 1.0800, the bottom of the daily Ichimoku Cloud at 1.0760 or even 1.0660 if the ECB is very dovish. All in all, technical indicators are mainly in the neutral state, so pick small profit targets while trading.

Other important events in the euro area’s economic calendar next week include the euro area’s and German ZEW economic sentiment indexes on Tuesday and European manufacturing and services PMIs on Friday.

More:
https://fxbazooka.com/en/analitycs/show/7594

 

[riki143]

Forex Analytics
GBP/USD: forecast for January 18-24

By Kira Iukhtenko

British currency remains under bearish pressure for a third week in a row: the cable plummeted below 1.44 on the past week. We see potential for more downside in the coming days. However, note that the pair is approaching a strong long-term support at 1.4220 which was the low in 2010. Many short positions will be closed at these levels.

The pair is strongly oversold these days: pay attention to the daily RSI index.Disappointing news from the US could trigger a strong correction to the upside. Resistance lies at 1.4450. Break higher could open the way for more growth to 1.48, but it’s too early to forecast in such a long prospect these days. Markets change their mind very fast.

As for the economic calendar, watch the UK Inflation figures on Tuesday. On Wednesday, a block of labor market data will be released and don’t miss the UK retail sales on Friday.

Market attention all over the world is now glued to two topics: China and oil. Lack of risk appetite is supporting the US currency versus the risky assets (AUD, NZD, CAD), but limits the upside in pairs with the safe assets (EUR, JPY). This trend is expected to continue until the markets calm down.

Will the Fed hike rates further in March? This is a meaningful question for the market. According to the futures market, the probability is now 40%. However, as the Chinese meltdown continues, the market will not price these expectations in the coming weeks.

US economic calendar for the new week is rather light. Monday is a bank holiday in the US. On Wednesday, watch the December consumer inflation data. Falling oil prices are expected to pull the index into the negative territory. On Thursday, Philly Fed Manufacturing Index will be published.

More:
https://fxbazooka.com/en/analitycs/show/7597

 

[riki143]

Forex Analytics

EUR/USD: weekly wave analysis (18.01)


Roman Petuchov
Daily. The market keeps on forming a corrective wave (4), it is close to its end. The price is expected to grow in a wave Z.

H4. Wave Z takes form of a simple ascending zigzag. Wave [c] of Z is now being developped. Price is expected to grow. Be careful, though: if growth fails to contunue in the first 2-3 days of the week, the forecast will be negated.

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https://fxbazooka.com/en/analitycs/show/7615

 

[riki143]

Forex Analytics

GBP/USD: weekly wave analysis (18.01)
18 January 2016
Roman Petuchov

Daily. After the end of the triangle, we've seen a sharp drop in a descending impulse [C].

H4. The wave [C] hasn't been finished yet, so we expect the market to decline to the downside. Corrective waves are expected to be built.

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https://fxbazooka.com/en/analitycs/show/7616

 

[riki143]

Forex Analytics

USD/JPY: weekly wave analysis (18.01)
18 January 2016
Roman Petuchov

Daily. As expected, the pair keeps on moving to the downside. The final wave [z] of Y is now being developped.

H4. Wave [z] is a simple descending zigzag. We'll now observe the waves (B) and (C).

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https://fxbazooka.com/en/analitycs/show/7617

 

[riki143]

Forex Analytics

AUD/USD: weekly wave analysis (18.01)
18 January 2016
Roman Petuchov

Daily. After the end of the B correction we've seen a strong bearish move in a new descending impulse.

H4. Waves and [ii] were built. Wave [iii] is now under construction. On the new week we expect the bearish trend to be continued.

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https://fxbazooka.com/en/analitycs/show/7618

 

[riki143]

Forex Analytics

Forex trading plan for January 19

Sanctions were lifted from Iran, and oil traded close to 13-year lows, though in general the market has tried to stabilize. On Tuesday the markets will be tested by Chinese statistics. Annual GDP growth rate is expected to stay at 6.9%, while the growth rate slowed down from 6.2% to 6.0%, while the retail sales growth rate slightly increased from 11.2% to 11.3%.

EUR/USD remains generally in range. On the upside the single currency is limited by the ECB meeting on Thursday: monetary easing this time is unlikely, though Mario Draghi will likely share bearish comments. Risk of weaker data from China is a supportive factor for the euro. The euro area will release ZEW economic sentiment index. Support is at 1.0880 and 1.0800, resistance is at 1.0940 and 1.1000.

GBP/USD fell to the bottom of the descending channel and the 2010 low at 1.4228. The pound is oversold, but taking into account the general situation, there’s the risk that support won’t hold. The UK will release inflation data at 09:30 GMT, but these data are unlikely to provide pound with significant support. If pound breaks below 1.4228, selling will accelerate and the pair will fall to 1.4100 and lower. Resistance is at 1.4360 and 1.4400. We'll look for buying opportunities at EUR/GBP in case of return to 0.7500.

USD/JPY found support at 116.50, but is in no hurry to get higher. The technical picture remains negative. Resistance is at 117.50/75 and 118.00. Support is at 117.00 and 116.50.

AUD/USD broke below the bottom of the previous trading range on Friday (1.6926) and fell below 2015 low (0.6896). The main scenario is the continuation to the downside, to 0.6775. The next resistance after0.6926 is at 0.7000.

More:
https://fxbazooka.com/en/analitycs/show/7623

 

[riki143]

Forex Analytics

USD/JPY: buy target - 118.70
19 January 2016
By: Dmitriy Chernovolov

-USD/JPY reversed from support zone
-Next buy target - 118.70

USD/JPY continues to rise after the recent sharp upward reversal from the support zone lying at the intersection of the following support levels – the major long-term support level 116.20 (which has been reversing the price from December of 2014), the lower daily Bollinger Band and the 38.2% Fibonacci correction of the previous weekly upward impulse from the middle of 2014.

The upward reversal from the aforementioned support zone completed the previous minor correction 2 of the intermediate impulse wave (3) from August. USD/JPY is likely to rise further from the current levels toward the next buy target at the resistance level 118.70.

More:
https://fxbazooka.com/en/analitycs/show/7633

 

[riki143]

Forex Analytics

GBP/CHF: buy target - 1.4530
19 January 2016
By: Dmitriy Chernovolov

-GBP/CHF completed primary ABC correction ②
-Next buy target - 1.4530

GBP/CHF recently reversed up sharply from the strong support zone lying between the lower daily Bollinger Band and the support level 1.4230 (which also previously stopped the second intermediate correction (2) in June of 2015, as you can see below). The upward reversal from the support level 1.4230 stopped the earlier sharp intermediate (C)-wave – which belongs to the extended primary ABC correction ② from last August.

GBP/CHF is likely to rise further in the active impulse waves 1 and (1) toward the next buy target at the next resistance level 1.4530 (previous strong multi-month support from last October).

More:
https://fxbazooka.com/en/analitycs/show/7634

 

[riki143]

Forex Analytics

Forex trading plan for January 20

By Kira Iukhtenko

EUR/USD consolidates around the 1.0900 mark. Market volatility remains subdued these days, but we expect the pair to break out of the current range in the coming sessions. The forthcoming ECB meeting on Thursday is a negative factor for the euro. Get ready to SELL the pair when the selling momentum increases ahead of the meeting. Major support lies at 1.0800.

GBP/USD remains a SELL as well. The BOE governor Marc Carney killed the optimism by saying that “it’s not the right moment” to discuss a rate hike in the current market conditions. Watch the UK labor market data on Wednesday. Average earnings growth are expected to have slowed down. If confirmed, the news will likely pressure the UK currency. Next support to watch is 1.4100.

USD/CAD will be influenced by the Bank of Canada decision tomorrow. According to the consensus forecast, the regulator will cut interest rates to 0.25%. That is why we expect the pair to grow after the current short-term consolidation.

More:
https://fxbazooka.com/en/analitycs/show/7637

 

[riki143]

Forex Analytics

USD/CAD: buy targets - 1.4800 and 1.5000
20 January 2016
By: Dmitriy Chernovolov

-USD/CAD reached buy target 1.4600
-Next buy targets - 1.4800 and 1.5000

USD/CAD continues to rise – after the earlier sharp breakout of the resistance level 1.4600, which was set as the buy target in our previous forecast for this currency pair. The breakout of this resistance level continues the active minor impulse waves (iii) and 5 – which are a part of the intermediate impulse wave (3) from October of 2015. The breakout of the resistance level 1.4600 is likely to accelerate the upward movement of this currency pair in the coming trading sessions.

USD/CAD is likely to rise further toward the next buy targets at the resistance levels 1.4800 and 1.5000 (forecast price calculated for the termination of the active intermediate impulse wave (3)).

More:
https://fxbazooka.com/en/analitycs/show/7641

 

[riki143]

Forex Analytics

GBP/USD: sell targets - 1.4100 and 1.4000
20 January 2016
By: Dmitriy Chernovolov

-GBP/USD falling inside accelerated impulse waves 5 and (3)
-Next sell targets - 1.4100 and 1.4000

GBP/USD has been falling sharply in the last few trading sessions – following the earlier breakout of the support level 1.4500, which was set as the sell target in our previous forecast for this currency pair. The breakout of the support level 1.4500 accelerated the active impulse waves 5 and (3) – leading to the sharp sell-off in the last few trading sessions and the breakout of the support levels 1.4400 and 1.4200.

With the daily Momentum reaching new multi-month lows, GBP/USD is likely to continue to fall in the accelerated downward impulse waves 5 and (3) toward the next sell targets1.4100 and 1.4000 (forecast price for the completion of the active impulse 5).

More:
https://fxbazooka.com/en/analitycs/show/7642

 

[riki143]

Forex Analytics

Trading plan for January 21

EUR/USD is still sold on attempts to approach 1.10, but is holding above the key support of 1.08. The euro needs to go beyond one of these levels in order to emerge from the current sideways trend. Risk aversion is supporting the euro, while the approaching meeting of the European Central Bank of Thursday is limiting the single currency on the upside. The ECB rate decision will be announced at 12:45 GMT. Mario Draghi’s press conference will start at 13:30 GMT. The positive factors for the euro are a bit stronger than the negative ones: we see a series of higher lows. The ECB will likely leave monetary policy unchanged, though Draghi will try to limit the power of the bulls with dovish comments.

GBP/USD closed below 1.4228 on Tuesday. The oversold pound may hold in the current region with the help of better-than-expected UK labor market data. However, there are reasons to expect that the general downtrend will continue to 1.40 and lower. Resistance is at 1.4230 and 1.4350.

USD/JPY fell to 116.00 on the market’s risk aversion, but this area of 2015 lows attracted buyers. Market participants remembered that the Bank of Japan may increase monetary stimulus on January 29 or at least reduce inflation forecast. Still, there’s a series of lower highs and bearish pressure on 116.00 may intensify. The pair hasn’t reached the bottom of the daily Ichimoku at 113.60. Resistance is at 117.00/50.

AUD/USD returnedbelow 0.6900. The targets lie in the 0.6770 area. Resistanceisat0.6950 and 0.7000. NZD/USD is oversold, but the general picture is bearish with targets at 0.6300/0.6240. Resistance is at 0.6430.

More:
https://fxbazooka.com/en/analitycs/show/7645

 

[riki143]

Forex Analytics

GBP/CAD: sell target - 2.0360
21 January 2016
By: Dmitriy Chernovolov

-GBP/CAD reversed from resistance zone
-Next sell target - 2.0360

GBP/CAD recently reversed down strongly from the major resistance zone lying between the resistance levels 2.1000 and 2.0800 (this resistance area earlier reversed the previous sharp impulse waves (1) in August and 1 in December, as can be seen below). This resistance zone was strengthened by the upper daily Bollinger Band. The downward reversal from this resistance zone created the daily Japanese candlesticks reversal pattern Falling Star.

With the clear bearish divergence visible on the daily Momentum indicator - GBP/CAD is likely to fall further in the active minor corrective wave (ii) toward the next sell target at the support level 2.0360 (low of previous wave 2).

More:
https://fxbazooka.com/en/analitycs/show/7654

 

[riki143]

Forex Analytics

EUR/GBP: buy target - 0.7800
21 January 2016
By: Dmitriy Chernovolov

-EUR/GBP rising inside impulse waves 3 and (3)
-Next buy target - 0.7800

EUR/GBP has been rising sharply in the last few trading sessions – following the earlier breakout of the long-term pivotal resistance level 0.7470 (which has been reversing the price from last May, as you can see from the daily EUR/GBP chart below). The breakout of the resistance level 0.7470 greatly accelerated the active minor impulse wave 3 (which belongs to the intermediate impulse wave (3) from the start of January) – leading to the breakout of the next resistance levels 0.7600 and 0.7700.

EUR/GBP is likely to continue to rise in the active impulse waves 3 and (3) toward the next buy target at the next resistance level 0.7800 (target price calculated for the termination of wave 3).

More:
https://fxbazooka.com/en/analitycs/show/7655

 

[riki143]

Forex Analytics

USD/JPY: forecast for January 25-31

By Elizabeth Belugina

USD/JPY fell to the key support at 116.00 and recoiled upwards. This level limited the downside for the entire 2015 and so it constitutes a serious obstacle for the bears. The prospect of more easing by the European Central Bank in March increased expectations of additional monetary stimulus from the Bank of Japan (BOJ) on Friday, January 29.

The problems of Japanese regulator look similar to the ECB’s difficulties: low oil prices constraining inflation, expensive yen, decline in stocks. Nikkei 225 entered correction up only on Friday, while the dip since the start of the year is still about 10%.

The expectations of an increase in Japanese central bank's monetary stimulus are getting stronger and will likely support the pair at the upcoming week. Market participants are already sure that the regulator will at least cut inflation forecast for the next fiscal year. If the BOJ disappoints investors, the pair can break down to 113.60 (bottom of the weekly Ichimoku Cloud). At the same time, remember that the BOJ is not interested in USD/JPY falling below 116.00.

One more element of the puzzle is the meeting of the US Federal Reserve on Wednesday. The Fed started the rate hike cycle in December. Although this time US central bank should keep the policy unchanged, comments confirming that the Fed is still on the tightening track will help the greenback. The key resistance is at 118.70 – 50% of the dollar/yen’s decline in the first week of January – and then at 120.00.

More:
https://fxbazooka.com/en/analitycs/show/7664

 

[riki143]

Forex Analytics

EUR/USD: forecast for January 25-31

By Elizabeth Belugina

The ECB left monetary policy unchanged in line with expectations. At the same time, Mario Draghi underlined that the ECB is ready to ease policy on the back of weakening inflation and economic growth. Draghi said that such step is possible already at the next meeting in March. Oil prices and the prospects of the emerging economies will play the key role in the regulator’s decision.

It looks like the ECB President has managed to persuade his colleagues from the Governing Council that they may need additional measures because of the changing global economic reality. We got the confirmation that the ECB doesn’t want to let EUR/USD go above 1.10.

The euro was sold on Draghi’s remarks, but there were still buyers at the support levels, so we can’t say that the euro lost all support. The best strategy for a long time from now will be selling the euro on its attempts to recover. At the same time, negative pressure on the euro at the coming week will likely intensify on the potential break in the market’s risk aversion and divergence in monetary policy between the ECB and the Fed. From the technical point of view, the decline of EUR/USD below 1.0780 (bottom of the daily Ichimoku Cloud) will open the way down to 1.0700 and 1.0650. Resistance is at 1.0950 and 1.1000.

More:
https://fxbazooka.com/en/analitycs/show/7665

 

[riki143]

Forex Analytics

Euro under pressure again
25 January 2016
By Tatiana Norkina, FBS analyst

EURUSD seems to have finally consolidated in the negative area on the four-hour timeframe. Friday's decrease to the lows, after testing of the cloud's lower border levels, triggered a formation of the dead cross by the Tenkan and Kijun lines. The cloud's range has narrowed significantly as well, the cloud itself still being positive. We expect a correctional recovery into the 1.0840 area in the near future, but then the bears are most likely to intensify the pressure.

Technical levels: support – 1.0780; resistance – 1.0840/50.

Trade recommendations:

1. Sell — 1.0840; SL — 1.0860; TP1 — 1.0780; TP2 — 1.0730.

More:
https://fxbazooka.com/en/analitycs/show/7679

 

[riki143]

Forex Analytics

GBP/CHF: sell target - 1.4300
25 January 2016
By: Dmitriy Chernovolov

-GBP/CHF reversed from resistance area
-Next sell target - 1.4300

GBP/CHF today reversed down strongly from the resistance area lying between the major resistance level 1.4540 (former strong support which reversed the earlier intermediate ABC correction (4) in October, as can be seen from the daily GBP/CHF chart below) and the 61.8% Fibonacci retracement of the previous intermediate (C)-wave of the primary ABC correction ② from the middle of November.

Given the strength of the aforementioned resistance area - GBP/CHF can be expected to fall further from the current levels toward the next sell target at the support level 1.4300. Strong resistance remains at 1.4540.

More:
https://fxbazooka.com/en/analitycs/show/7682

 

[riki143]

Forex Analytics

USD/JPY: sell target - 117.50
25 January 2016
By: Dmitriy Chernovolov

-USD/JPY reached buy target 118.70
-Next sell target - 117.50

USD/JPY continues to decline after the recent sharp downward reversal from the resistance zone lying between the resistance level 118.70 (previous strong support from September and October and the earlier buy target set previously for this currency pair) and the 38.2% Fibonacci correction of the previous sharp downward impulse wave C from the pivotal resistance level 123.50.

USD/JPY is likely to fall further toward the next sell target at the support level 117.50 (standing midway between the resistances level 118.70 and the powerful support level 116.20, which reversed earlier waves A and (4), as can be seen below).

More:
https://fxbazooka.com/en/analitycs/show/7681