Technical Analysis by Alpari

[Alpari]

Euro/Dollar: After Rebound, Expect Fall to 1.1030

Hourly

Yesterday’s Trading:

On Thursday the euro/dollar fell by 230 points. In the second half of the day, Mario Draghi made the euro drop to 1.11.

The ECB kept its interest rate unchanged. Mario Draghi announced that the ECB is ready to extend QE in December and a drop in the base rate and deposit rate was discussed.

Main news of the day:

• From 10:00 to 11:00 EET, EU PMIs for the service sector in October will be out;
• At 15:30 EET, Canada’s September CPI will be out;
• At 16:45 EET, the US is releasing its October business activeness index in the manufacturing sector.

Market Expectations:

The euro fell below 1.1086. Now it needs to close the day below 1.1070 and then the sellers will see the road to 1.0970 open up, with a EURUSD nosedive to 1.0461 following it. There’s no important news out in Europe today (I don’t see the PMI as important) which could change the fate of the euro/dollar, so after a rebound, I’m waiting for a continuation of yesterday’s tendency to 1.1035.

Technical Analysis:

• Intraday target maximum: 1.1125, minimum: 1.1035, close: 1.1055;
• Intraday volatility for last 10 weeks: 121 points (4 figures).

The euro/dollar has fallen below the D4 and has stopped still near 270 degrees. There’s no AO divergence with the price, meaning we should consider a correction after a fall in the rate to 1.1035. We could see it head straight to 1.0965, so don’t be caught out on the downward knife edge.

Daily

On 15th October, Ewald Nowotny flipped the euro rate on its head, on 22nd October, Mario Draghi set the fall in stone. Yesterday saw the trend line and the LB broken. The eurobulls tested the 3rd September minimum (1.1086). The euro is now above the support. The dotted line is the trend for the closing prices. A close below 1.1050 will be enough to open the road to 1.0965. We can see a bearish impulse on the monthly time frame which could be compounded towards the end of the month. Now to the weekly.

Weekly

The euro/dollar tested the lower limit of the 1.1086-1.1494 channel after Draghi’s press conference. I’m waiting for a close below 1.1086 and then we can prepare for a break in the trend line which takes its beginnings from a 1.0461 minimum.

Vladislav Antonov, Alpari

 

[Alpari]

Pound/Dollar: 1.5207 Target

Hourly

The UK pound on Thursday contrived to return to 1.55. From here the pound followed the euro against the dollar by falling to 1.5368. The lower limit of the channel was broken. A fall to the 135th degree to 1.5320 is expected. If we take the euro’s fall against the dollar into account, the pound’s closest target is 1.5207.

Daily

The pound can’t rise due to the fall of the euro. On the forecast I’ve gone for a fall of the GBPUSD to the trend line at 1.5207.

Weekly

Changes for the pound aren’t noticeable, but I’m expecting a return of the rate to the LB.

Vladislav Antonov, Alpari

 

[Alpari]

Short-term Trading Idea FX EUR/USD – Bear Speculation: Break in Trend Line

Trading opportunities for currency pair: after a break in the trend line, a fall for the euro to 1.0807 – 1.0838 is expected. It’s better to wait for a rebound to 1.1050/1.1060 on Monday. The idea will no longer be valid if the day closes above 1.1140.

Background

The last idea I did on the EUR/USD came out on [URL deleted]19th October. The price at the moment of publication was around 1.1348. In the idea, I looked at a weakening of the euro to 1.1250, then 1.1086 (by the middle of November) and 1.0290 in the medium term. The first two targets were reached following the ECB meeting. Mario Draghi had the biggest effect on the euro. Due to this I have made a new review with a 1.0807-1.0838 interim price zone.

Current situation

The price at the moment this idea was published was 1.1012. We have a break in the trend line as part of a correctional movement from 13th March, 2015’s minimum (1.0461). Trader attention is now focussed on the incoming FOMC meeting which will take place on 27-28 October.

Draghi frightened market participants by stating the possibility of a deposit rate decrease and an extension of QE in December. Here we need to take into account the fact that the next ECB meeting will take place on 4th December with an FOMC meeting due to follow it on 15-16 December. The ECB in this case has to take its decision before the FOMC, without knowledge of what the Fed will do.

The ECB could surprise us on 4th December, so don’t get caught out. The Swiss National Bank (SNB) is keeping its finger on the pulse since it doesn’t like it when the Swiss franc becomes too strong against the euro.

What’s interesting at the moment?

The euro/dollar has broken through the trend line with its correctional movement. The break renewed the fall of the euro along the trend which takes its beginnings from a 1.3992 maximum from May 2014.

The euro/dollar often corrects against Friday’s movements on a Monday. As such, it’s better not to sell euros today. I’m leaning towards saying the hourly is forming another minimum (double bull divergence) with the last recoil to 1.1090. Overall, it’d be better for it to stay below 1.1050. However this is more likely to take place on Tuesday than Monday. The FOMC meeting which will take place from 27-28 October and before we see the outcome of the meeting, there will be unpredictable movements of the price.

Now about the new targets. Nothing difficult. I’ve copied the length of the wave from 1.1712 to 1.1086 and I’ve put a clone of it at the 1.1494 maximum. By using this line I get a target price of 1.0838. This is where the lower limit of the channel is set up at three points: 1.1712, 1.1494 and 1.1086. The next support zone is at 1.0807-1.0818 (27th May and 20th July minimums). As soon as this zone has been passed, the road to 1.0520 (13th April, 2015 minimum) will open up.

Vladislav Antonov, Alpari

 

[Alpari]

Short-term Trading Idea FX USD/SEK – Bull Speculation: Expected Forming of W-shape Pattern

Trading opportunities for currency pair: the USD/SEK has broken away from the support. A double top didn’t quite form. I’ll risk saying that we’ll see a W form with an 8.8359 target. This idea for growth will become invalid if we see a close of the weekly candle below 8.5544.

Background

My last USD/SEK idea came out [URL deleted] on 24th August, 2015. Back then the price was 8.3516 and a double top was beginning to form on the weekly. I expected to see an initial fall to 8.0571 and then to 7.7231. The USD/SEK fell to 8.0924. At 2592 points the position went into the positive. It missed the first target by a whisker. The idea became invalid and we came out evens.

Current situation

At first a hammer formed. Then Draghi let us know his thoughts and market participants began to buy USD throughout the market. On 28th October, the US Fed will make a decision on its base rate. Buyers are currently pushing the dollar rate towards the 8.8359 resistance.

What’s interesting at the moment?

After the pinbar, the USD/SEK rose to 8.4995. With the current price pattern, there’s reason to believe that the USD/SEK will return to 8.8359. The triangle to crisis is a rare pattern, so I’m going for a W shaped pattern forming.

Vladislav Antonov, Alpari

 

[Alpari]

Short-term Trading Idea FX USD/JPY – Bull Speculation: Expected Break in Resistance

Trading opportunities for currency pair: the USD/JPY has edged towards the 121.68 resistance. A break in this resistance is expected before the FOMC convenes (28th October). The target zone is 123.48 – 124.51. This idea will become invalid if the daily candle closes below 120.20.

Background

The last USD/JPY idea I made came out on [URL deleted]19th October, 2015. The USD back then was trading at 119.47 against the yen. The USD/JPY had broken away from the 118.40 support. According to the pinbar that was forming and activated, I expected the dollar to strengthen to 120.60 and to 121.60. The current price is 121.46. We can say that the two targets were reached.

Current situation

After the ECB convened, the bullish setup on the dollar started to dominate. On Thursday and Friday the candle closed with a large shade. Gearing up for the consequences of the FOMC meeting has already begun.

What’s interesting at the moment?

The USD/JPY has neared the 121.68 resistance. I expect to see the resistance passed before the FOMC meeting. To calculate the targets, we need to make a channel. I’ve put a line through 116.13 and 118.05 and then a parallel line at the 121.56 maximum. According to the channel, the target is 124.51. A projection of the line with 125.85 and 125.27 peaks heads through this level.

We now need to deduct 116.13 from the 121.56 maximum. We get 5.43 and by adding this to the 118.05 minimum we have a single target of 123.48.

I’ve put a cut-out of a Brent daily graph below. Why? Because the patterns are similar. Have a look at how when Brent was up to 54.03, a U-turn took place and oil started to fall due to the dollar strengthening. If the dollar unexpectedly starts correcting, we’ll see exactly the same pattern on the USDJPY. As such, the growth scenario will become invalid with a close of the daily candle below 120.20.

Vladislav Antonov, Alpari

 

[Alpari]

Euro/Dollar: Readying for a Fall

Hourly

Yesterday’s Trading:

My Monday’s expectations came off fully. The euro/dollar lifted to 1.1055 and then fell to 1.1003. From here it renewed to 1.1067 due to weak US housing data. Sales of new homes fell to 468,000. The previous value was reassessed down from 552k to 529k.

Main news of the day:

• At 11:30 EET, the UK is releasing preliminary Q3 GDP data;
• At 14:30 EET, the US will release a report on durable goods orders for September;
• At 15:00 EET, the US will see S&P/Case-Shiller’s index for housing price changes in August;
• At 15:45 EET, the US will see Markit’s October business activity index in the service sector;
• At 16:00 EET, the Richmond Fed of the US will release its October consumer confidence index and its manufacturing index.

Market Expectations:

Trader attention this Tuesday is on the publication of economic indicators form the US and UK. Sharp fluctuations on the currency market could be caused by the UK’s preliminary GDP report for Q3. Weak data will cause a growth of the dollar against both the pound and the euro. Correspondingly, strong data will see a dollar correction which will continue until Wednesday.

Today a two-day FOMC meeting commences. The interest rate decision will be made clear on Wednesday. The market expects that the rates will be left unchanged. There will be no press conference, just a press release. The text of the release will be very important for traders and investors.

Technical Analysis:

• Intraday target maximum: 1.1075, minimum: 1.1005, close: 1.1030;
• Intraday volatility for last 10 weeks: 119 points (4 figures).

The euro/dollar has slid to the LB. Above it is the 67th degree. Taking the state of the hourly indicators and the lack of euro news into account, in my forecast I’ve gone for a test of 1.1075 and a fall of the rate to 1.1005. A growth to 1.11 will be a negative thing for the dollar across the market as a whole. Realization of the euro trading idea will delay it.

Daily

The euro/dollar has broken away from 1.0996 and is now in a correctional phase. We want to see the rate return to 1.10 on Tuesday but growth higher wouldn’t be ideal. The next support zone is at 1.0807-1.0818 (27th May and 20th July minimums). Now to the Weekly tab.

Weekly

Since the lower limit of the 1.1104 consolidation was broken, I’m waiting for a fall in the euro to 1.0807-1.0818. A close of the day above 1.1115 will mean we will have to wait and see what the Fed comes out with.

Vladislav Antonov, Alpari

 

[Alpari]

Pound/Dollar: Expected Update of Friday’s Minimum

Hourly

After a fall to 1.5305, the pound/dollar rebounded to the LB. My yesterday’s expectations rang true. At 12:30 EET, preliminary UK GDP data for Q3 will come out. It’s expected to be down QoQ and unchanged YoY. After yesterday’s correction, the pound is readying itself for a fall. My money is on GDP coming out worse than expected and the GBP/USD falling below 1.53.

Daily

I’m leaving this as was and am waiting for a fall of the GBP/USD to the trend line at 1.5207.

Weekly

The weekly indicators are in the neutral zone. The decisive factor belongs to the daily.

Vladislav Antonov, Alpari

 

[Alpari]

Euro/Dollar: Euro readying for Fall

Hourly

Yesterday’s Trading:

On Thursday, the euro/dollar shot upwards without updating the minimum. The fixation of profit led to a fall in the dollar rate against many pairs. I did allow for such a scenario. The dollar weakened in the second half of the day after weak US Q3 GDP results and the same for the housing market numbers in the country. The euro/dollar renewed to 1.0985.

The preliminary number for US GDP in Q3 of 2015 was set at 1.5% (forecasted: 1.6%, revised: 3.9%).

The index for incomplete housing sales in the US fell by 2.3% (forecasted:1.0%, previous: -1.4%).

Main news of the day:

• At 09:00 EET: German retail sales;
• At 12:00 EET, Eurozone October CPIs and September unemployment level;
• At 14:30, Canadian August GDP, US base index on personal expenditure and changes in personal income levels for September;
• At 15:45, the Chicago October PMI;
• At 16:00 EET, Reuters/Michigan October consumer confidence index and FOMC member Williams is speaking.

Market Expectations:

In Asia the euro/dollar has shifted its maximum to 1.0997. The balance line was reached and in doing so the euro fell to 1.0965. I suppose that the euro is set to fall against the dollar until the end of the day. Of today’s news: it’s worth picking out Canadian GDP and Eurozone inflation figures.

Technical Analysis:

• Intraday target maximum: 1. 0997 (current Asian), minimum: 1.0915, close: 1.0930;
• Intraday volatility for last 10 weeks: 119 points (4 figures).

The euro/dollar is trading by the LB. The MA line is heading downwards, so on my forecast I’ve gone for a weakening of the euro. If we see a break of 1.1005, stave off sales.

Daily

The euro/dollar spent Thursday in a correctional phase. The oscillator stochastic has flipped upwards, but the CCI is still minus 100. The target zone for the sellers it 1.0807-1.0818 (minimums from 27th May and 20th July). Now to the weekly.

Weekly

The line has been broken, now we’re waiting for a shift below 1.0818.

Vladislav Antonov, Alpari

 

[Alpari]

Pound/Dollar: Break From 1.5142

Hourly

The pound updated the minimum at the American session, but didn’t make it to the level we wanted. Due to this there was a recoil that was bigger than expected. The trend line was broken. The pound/dollar lifted to the LB after weak US stats came out. If the pound will even lift any higher, I reckon it’ll be via a rebound to 1.5275. This is why on my forecast I’ve indicated a fall for the GBPUSD to the trend line at 1.5275.

Daily

On the daily I’m keeping the target at 1.5207.

Weekly

I’m awaiting a break in 1.52 with a 1.5080 target.

Vladislav Antonov, Alpari

 

[Alpari]

Euro/Dollar: Nearing Important Support Zone

Hourly

Yesterday’s Trading:

Expectations of a euro weakening rang true. Strong service PMI data from the US’ ISM and ADP and comments made by Yellen lent support to the dollar.

Employment creation in the US private sector was down from 190k to 182k (forecasted: 180k).

The ISM’s index for October stood at 59.1 (forecasted: 58.0, previous: 59.0).

Main news of the day:

• 09:00 EET, German industrial orders;
• 12:00 EET, Eurozone retail sales;
• 13:45 EET, ECB’s Draghi to speak;
• 14:00 EET, BoE’s interest rate decision, MPC minutes, Carney to speak at 14:45 EET;
• 15:30 EET, US initial unemployment benefit applications and Fed’s William Dudley to speak;
• 16:10, Fed’s Vice President Fischer to speak;
• 16:50, US consumer confidence index;
• 17:00, Canadian PMI from Ivey;
• 20:30 EET, US FOMC member Lockhart to speak.

Market Expectations:

The dollar is receiving support from a growth in the likeliness that the US interest rates will be increased in September, in addition to a relaxing of ECB monetary policy which is on the cards.

Today’s key event for the financial market is the Bank of England meeting. Forecasters expect the base rate to be left unchanged at 0.5%. The results of the MPC voting and what Carney has to say afterwards will bear importance for traders.

Technical Analysis:

• Intraday target maximum: 1. 0880, minimum: 1.0813, close: 1.0840;
• Intraday volatility for last 10 weeks: 119 points (4 figures).

The euro/dollar has dropped beneath 28th October’s minimum. Now it just needs to break through the 1.0807-1.0838 support zone and open the road to 1.0520 up. The AO indicator isn’t showing bull divergence, so I expect to see an update of the minimum. My target is 1.0813. If the euro/pound cross doesn’t interfere, we could quite possibly see a test of 1.0800. Although, I highly doubt this will happen before the NFP comes out tomorrow.

Daily

The minimum has been updated. Now we can target 1.0812/15. Now to the Weekly.

Weekly

The euro is gathering pace. The target is still 1.0818-1.0838. As soon as we pass this level, we can start to set our sights on 1.0520.

Vladislav Antonov, Alpari

 

[Alpari]

Pound/Dollar: Waiting for BoE Decision

Hourly

My forecast worked a treat. The pound/dollar dropped to 1.5360 from the LB. The pound didn’t fall too much because the euro/pound was holding it back.

Today’s key event for the financial market is the Bank of England meeting. Forecasters expect the base rate to be left unchanged at 0.5%. The results of the MPC voting and what Carney has to say afterwards will bear importance for traders.

It would be quite risky to trade pounds this afternoon. The rate could quite easily return to 1.5420 and then fall to 1.5305. Taking dollar growth throughout the market into account, I expect to see the pound weaken to 1.5305.

Daily

The stochastic has flipped upside down which is a signal to sell. I reckon we’ll see the GBP/USD reach 1.5285.

Weekly

The GBP/USD has been trading in a sideways for four weeks. I think we’ll see a break in 1.52 with a 1.5080 target.

Vladislav Antonov, Alapri

 

[Alpari]

Euro/Dollar: Hammer on the Daily

Hourly

Yesterday’s Trading:

The calendar was empty on Tuesday, so the euro/dollar headed unhindered to the 90th degree. My yesterday’s expectations were fulfilled in full, but the daily closed with a hammer after there was a bounce from 1.0673.

Main news of the day:

• 11:30 EET, UK labor market data: number of unemployment benefit applications for October, ILO unemployment level; average earnings level, September employment creation;
• 12:30 EET, BoE’s Mark Carney to speak;
• 15:15 EET, ECB’s Mario Draghi to speak.

Market Expectations:

The hammer means that there’s a upward correction to 1.0830. The signal for a strengthening of the euro is already active. There is just one little thing: the bulls have met the trend line. To get past it, the euro needs to rebound to 1.0716. The bounce will allow for the indicators to unload.

Wednesday is also bare from a news point of view. Although, Draghi and Carney are set to speak. If they don’t mention monetary policy, the low market volatility will remain until tomorrow. Today is a holiday in the US, so it would seem silly to risk opening new positions. The market could swing on UK labor market data.

Technical Analysis:

• Intraday target maximum: 1.0775, minimum: 1.0715, close: 1.0740;
• Intraday volatility for last 10 weeks: 119 points (4 figures).

The euro/dollar has renewed from a minimum of 1.0673 to the trend line. A hammer has formed on the daily. This means that the risks of a deep correction are there. The holiday in the US could cancel the bull signal. As we know, on a thin market like today it’s easy for stops to be set off above 1.0790. On my forecast I’ve gone for a return of the rate to the 45th degree and then a sideways until Thursday.

Daily

The bears didn’t manage to reach the interim 1.0650 target. The fall stopped at 1.0673. Due to the hammer, it’s now worth considering a correction. It would be better if the price stopped below 1.0790 until Friday. In this case it could be cancelled. Now to the Weekly.

Weekly

The euro/dollar has updated the minimum but didn’t manage to pass through the support. I’m still waiting for the euro to fall to 1.0520 (14/04/15 minimum).

Vladislav Antonov, Alpari

 

[Alpari]

Euro/Dollar: Expected Fall to 1.0737 by Day’s End

Hourly

Yesterday’s Trading:

On Thursday, trading of the euro/dollar closed up. Sharp fluctuations on the euro were caused by ECB president Draghi’s speech and by speeches from US Fed representatives. Draghi promised to reassess QE in December and the Fed speakers came out with conflicting words: they don’t know exactly when the US interest rate will be increased. Yellen kept her lips tight with regards to US monetary policy.

The number of US initial unemployment benefit applications for the week ending 7/11 stood at 276,000 (forecasted: 276k, previous: 276k).

Main news of the day (EET):

• 09:00, German Q3 preliminary GDP;
• 11:00, ECB representatives Nowotny and Constancio to speak;
• 12:00, Eurozone trade balance for September and Eurozone Q3 preliminary GDP;
• 14:15, ECB representative Mercsh to speak;
• 15:30, US retail sales and PMI for October;
• 17:00, US November Reuters/Michigan Consumer confidence index;
• 20:00, Baker Hughes data on operational drilling rigs.

Market Expectations:

The euro/dollar closed the day having lifted to 1.0829. The price pattern from 1.0707 has a complex formation, so we really need to have a look at previous situations on the pair. If we do this, the patterns which we find with a 250 bar window indicate that the euro will continue to fall, but there is a possibility that there will be a rebound to 1.0850. We need to keep an eye on German and Eurozone GDP data; it could increase market volatility.

Technical Analysis:

• Intraday target maximum: 1.0850, minimum: 1.0737, close: 1.0765;
• Intraday volatility for last 10 weeks: 119 points (4 figures).

The euro/dollar is down from a maximum of 1.0829 to 1.0784. The 1.0673 and 1.0690 bases can be considered as a double bottom. As I see it, the price should go higher to 1.0890. However, I have limited the rise to only 1.0850 and then a fall to 1.0737. If the GDP data comes out worse than expected, the euro could head straight down. The fundamental data is more important than the technical signals.

Daily

The hammer target worked. Now we need to wait for the stochastic to turn around downwards in order to short the euro. Especially since the trend line has been broken and the euro could lift higher than 1.0877 (23.6% from 1.1494 to 1.0673). Now to the Weekly.

Weekly

The sellers need to be active this Friday. If the weekly candle closes higher than 1.0790, the oscillator stochastic will form a buy signal for the euro.

Whilst the price is below 1.0840 and the CCI is below -100, I expect to see a fall of the euro to 1.0520 (14/04/15 minimum).

Vladislav Antonov, Alpari

 

[Alpari]

Pound/Dollar: Expected Fall to 1.5145

Hourly

On Thursday the pound/dollar was trading above the LB in a range of 70 points. In the first half of the day the rate dropped to 1.5173 and in the second it returned to 1.5240. It’s now at 1.5199. If European trading sees a break of the 1.5191 support (LB and trend), I’ll be expecting a weakening of the pound to the 67th degree at 1.5145 (technical signal without any fundamental news)..

There is no important macro-economic data set to come out of the UK today. We could well see a calm correction against the growth from the 1.5026 minimum. The pound so far has corrected too high.

Daily

The pound/dollar has met the trend line with its wall (this trend line was broken on 6th November). The sellers now need to quickly strengthen below 1.5173 (yesterday’s minimum). This would allow them to push the buyers back to 1.5130 and from there we would have to take a look at the setup of market participants. If the buyers run from the market, it means that we will head to 1.5026, if not: we should assess what will come about on the 4h timeframe.

Weekly

There’s no change o the weekly graph. The closest target is still at 1.4900.

Vladislav Antonov, Alpari

 

[Alpari]

Euro/Dollar: Expected Renewal of 1.0762 Maximum

Hourly

Yesterday’s Trading:

On Thursday the euro/dollar rose to 1.0762. The euro/dollar was down to 1.0668 after the publication of ECB minutes but then it quickly restored itself. The strengthening of the euro is linked to a fixing of profit on short positions. The ECB announced that it is ready to alter its monetary policy at its December meeting. The US statistics were ignored.

Initial unemployment benefit applications in the US for last week were down from 276,000 to 271,000.

The Philadelphia Fed’s business activity index was up from -4.5 to 1.9.

The Index for leading US indicators for October stood at 0.6% (forecasted: 0.6%, previous: -0.1%.

Main news of the day (EET):

• 10:00, ECB’s Mario Draghi to speak;
• 15:30, Canadian September retail sales;
• 17:00, Eurozone November consumer confidence index;
• The Fed’s Bullard and Dudley are set to speak.

Market Expectations:

The long-term picture on the EUR/USD is still a bearish one. The bulls are trying to turn around the current downward trend by buying euros on the bounce. The bears still do have a chance at the moment to turn the situation around and put it under their control. They just need to close the day around 1.0650 and then the weekly candle won’t look interesting for the buyers. I believe that the bulls won’t settle down until the rate returns to 1.0829 (12th November maximum). In this case every trader will see an upside down head and shoulders model on the daily.

Technical Analysis:

• Intraday target maximum: 1.0775, minimum: 1.0709 (current Asian), close: 1.0750;
• Intraday volatility for last 10 weeks: 103 points (4 figures).

The growth of the EUR/USD has stopped around the U3 near the 135th degree. The pair has corrected, the hourly indicators have offloaded: now we could see a return to 1.0775. Draghi is speaking today, but it’s unlikely that he will say anything new. From 20th November, everything is in the bulls’ hands.

Daily

The trend line has been broken. The next target is at 1.0820 as part of a rebound. According to the cycle, from 20th November the bear phase has switched into a bull one. Now to the Weekly.

Weekly

If the sellers aren’t able to take the rate back to 1.0650, a pinbar will form on the weekly. As part of the pinbar, the conditions for a growth of the EUR/USD to 1.0820/50 will be created.

Vladislav Antonov, Alpari

 

[Alpari]

Pound/Dollar: Expected Growth to 1.5357

Hourly

My expectations for the pound came off in full. The GBP/USD rose to 1.5335 at the US session. From a 1.5335 maximum, the pound rebounded to 45 degrees. For us to see a continuation of this strengthening against the dollar, we need to see it rebound lower.

If we take a look at the technical picture on the daily, the closest target is 1.5390. The fundamental side is bare, so I’ve gone for a GBP/USD rise to 1.5357 on my forecast. The CIF dollar rate is down due to a closure of long positions after the FOMC minutes were published.

Daily

The GBP/USD rate has stopped by the daily LB. The day will close above 1.5255, so I’m starting to consider us seeing a strengthening of the pound to 1.5395-1.5400.

Weekly

After the FOMC minutes were published market participants decided to reduce long positions on the US dollar. A close of the weekly candle above 1.5260 will give us a false break in the trend line.

Vladislav Antonov, Alpari

 

[Alpari]

Euro/Dollar: 1.0567 Target

Hourly

Yesterday’s Trading:

The euro yesterday jumped from a minimum with the dollar from 1.0600 to 1.0656. The rate then fell from the 45th degree to 1.0592 and after trading closed in Europe, the rate renewed to 1.0643. It’s quite difficult to explain such behaviour since there was an unplanned US Fed meeting at 18:30 EET yesterday to discuss US interest rates. Moreover, the oil market was swinging after news came out of Saudi Arabia that the government there is ready to undertake the necessary measures in order to secure price stability on the oil market. The outcome of the US Fed meeting is still unclear.

The US stats disappointed dollar buyers. Housing sales in the US secondary market were down from 5.55 to 5.36 million. The business activity index for the country was also down from 54.1 to 52.6.

Main news of the day (EET):

• 09:00, German definitive Q3 GDP;
• 11:00, German IFO business optimism, economic expectancies, current situation assessment indices for November;
• 11:05, RBA’s Glen Stevens to speak;
• 12:00, parliamentary hearing on inflation in the UK and BoE’s Carney, Haldane and Forbes set to speak;
• 13:00, UK report on November retail sales from CBI;
• 15:30, US reassessed Q3 GDP data;
• 17:00, November consumer confidence indicator and manufacturing index from Richmond Fed.

Market Expectations:

There’s a nice little set of news out today with quite a few speakers ready to let us know what they’re thinking. Don’t forget, this week will be a short one for the US with Thanksgiving set to take place on Thursday. I’m saying that there’ll be a rise of the dollar against the euro.

Technical Analysis:

• Intraday target maximum: 1.0664, minimum: 1.0567 (current Asian), close: 1.0585;
• Intraday volatility for last 10 weeks: 103 points (4 figures).

The euro’s fall has slowed. The daily candle for the euro and pound are showing upturned candles. However, I think that the market isn’t going to turn around immediately and, before heading upwards, the dollar will once again renew minimums against both euro and pound.

The euro/dollar is trading around 1.0627. By putting these two local minimums together with a line, we get a support at 1.0584. I think that a rebound will take place at 1.0567. If there’s a ricochet from 1.0567/70 towards 1.0620 or above, then we’ll have a correction on the cards.

Daily

The euro bulls have updated the minimum. A rebound from 1.0592 is playing against the sellers. They need to act, otherwise the euro will quickly return to 1.0730. According to the cycles, I’ve a bear phase switching into a bull one since 20th November. Now I’m waiting for a flipped price pattern on the hourly. Now to the Weekly.

Weekly

The sellers are outpacing the buyers every day. The CCI indicator is in the zone below at 100. The closest target is still at 1.0520.

Vladislav Antonov, Alpari

 

[Alpari]

Pound/Dollar: Expected Further Fall

Hourly

After a fall to 1.5124, the pound/dollar renewed to 1.5189. From here the rate again weakened to 1.5108. News from the closed Fed meeting about discount rates still hasn’t come out.

I’ll take a risk in saying that the GBPUSD will fall to the 90th degree at 1.5065 today (the support on the daily goes through 1.5054). Yesterday’s pattern was weak for growth. A fall could be cancelled out by Mr. Carney. He is set to speak at 12:00 EET.

Daily

The indicators are showing a fall for the GBP/USD and so I will continue to say that the UK pound is set to weaken to 1.5065/75.

Weekly

At the beginning Friday’s flipped candle has started to work off. If the GBP/USD’s fall hastens and passes 1.5065/75, the next target will become 1.5028. The technical side is looking as good as it can be, but Carney could change things and cut short the downward tendency.

Vladislav Antonov, Alpari

 

[Alpari]

Euro/Dollar: Euro Can’t Strengthen below 1.0600

Hourly

Yesterday’s Trading:

On Wednesday the EUR/USD renewed its minimum after American data came out positive; the number of initial applications from unemployment benefit was down significantly with durable goods orders up along with new housing sales and business activity in the service sector. Since the euro/dollar has reached a support, as the US holiday approached yesterday, a fixing of profit on USD long positions began. The euro/dollar headed back up another 75 points to 1.0641.

The number of initial applications from unemployment benefit for the week ending 21/11 was 260k (forecasted: 270k, previous: 272k).

The durable goods orders index for October stood at 3.0% (forecasted: 1.5%, previous: -0.8%).

The consumer confidence index from Michigan university was up from 90.0 to 91.3.

The US service index for business activity increased from 54.8 to 56.5.

New housing sales in the US were up from 468k to 495k.

The October US index for personal incomes stood at 0.4% (forecasted: 0.4%, previous: 0.1%). The October US index for personal expenditure was 0.1% (forecasted: 0.3%, previous: 0.1%).

Main news of the day (EET):

• 14:00, December German consumer confidence index from Gfk;
• US Thanksgiving day.

Market Expectations:

Today is a holiday in the US and Friday is a half day. Market participant activeness will be observable in the first half of the day. Due to yesterday’s euro recoil from 1.0565, Thursday looks to bring the rate back to 1.0667 and then to the LB.

Technical Analysis:

• Intraday target maximum: 1.0667, minimum: 1.0615 (current in Asia), close: 1.0630;
• Intraday volatility for last 10 weeks: 103 points (4 figures).

The euro/dollar has returned to the LB. The pair has been consolidating in a narrow range underneath the 67th degree for 10 hours. The price already takes the ECB’s relaxation of monetary policy into account. On Thursday the calendar is empty. In the US it’s a holiday. I see only one scenario: depart upwards to 1.0667 and a rebound to the LB on the American session.

Daily

There’s word going round that the ECB has started to actively debate easing their monetary policy and so the euro/dollar dropped to 1.0565. The price has ricocheted from the hourly support. Looking at the past three daily candles, it’s impossible to tell which direction the price is going because the last bar is external. It closed with its own candle shades for 23rd and 24th November. Now the players will wait and see which direction the price will leave its 1.0565 – 1.0688 range. Now to the Weekly

On news that the ECB is contemplating a further relaxation of its monetary policy, the euro/dollar updated its minimum, but the price couldn’t stay below 1.0600. I’m sure that many traders will close their short positions when the euro drops and then leave with their money.

Vladislav Antonov, Alpari

 

[Alpari]

Euro/Dollar: Expected Test of 1.0530

Hourly

Yesterday’s Trading:

On Monday the euro/dollar didn’t reach the calculated level, but, on the whole, what I expected to happen took place. Due to a weakening of the euro/pound, the euro/dollar fell on the American session to 1.0556 (target was 1.0540). The euro/pound fell to 0.7012.

The euro is continuing to remain under pressure as the ECB meeting approaches in which the market expects additional easing of monetary policy via an extension of QE.

Main news of the day (EET):

• 10:15-11:00, EU November indices for business activity in the manufacturing sector;
• 10:55, German November changes in unemployment and unemployment level taking seasonal factors into account;
• 11:00, BoE’s Mark Carney to speak;
• 11:30, UK November PMI;
• 12:00 Eurozone October unemployment level;
• 15:30, Canadian September and Q3 GDP;
• 17:00, US November manufacturing index from ISM.

Market Expectations:

The euro is back to the LB. I don’t see any inverted pattern for purchases at the moment, so on my forecast I’ve gone for a weakening of the euro to 1.0530. Yesterday I expected to see the fall to 1.0540 and today I expect to see it drop to 1.0530.

Technical Analysis:

• Intraday target maximum: 1.0596 (current Asian), minimum: 1.0530, close: 1.0550;
• Intraday volatility for last 10 weeks: 103 points (4 figures).

Nervousness on the market is set to last until the ECB convenes on 3rd December. The monthly candle closed significantly down. The monthly indicators (stochastic, CCI, AO, AC) are showing a further fall for the euro.

The euro/dollar is trading around the LB. Since the calendar is empty for the euro, the key pairs could see movement in different directions until the end of trading in Asia. Before the ECB meeting I expect to see a fall of the euro to 1.0520/30.

Daily

lower limit of the internal bar from 25th November. Due to this I expect to see a test of 1.0520/30. Now to the Weekly.

Weekly

November closed down for the euro. The monthly indicators are showing a fall for the euro and the weekly are trying to turn things around. It’s likely that after the ECB meeting and the NFP, we will see a correction take place on the dollar.