daily market outlook

[jebat66]

USD/JPY is expected to trade in a higher range, moving toward 109.95. Overnight, US stocks were mixed, with bank, transportation and energy shares trading higher, and shares in real estate, food & beverage, and semiconductor sectors being under pressure. The Dow Jones Industrial Average rose 0.1% to 17926, the S&P 500 was broadly flat at 2082, and the Nasdaq Composite was down less than 2 points at 4945.

Nymex crude oil declined another 0.6% to $41.50 a barrel, gold fell 1.0% further to $1,227 an ounce, while the benchmark 10-year Treasury yield settled at 1.781%, up from 1.760% in the previous session.

On the economic front, the US government reported that the CPI rose 0.1% month-on-month in March (vs +0.2% expected, -0.2% in February).

Meanwhile, the US dollar maintained its strength against most major currencies. EUR/USD edged down 6 points to 1.1266, USD/JPY gained 4 points to 109.37, and GBP/USD was down 0.4% to 1.4153. At the same time, USD/CAD rose 0.2% to 1.2843 and NZD/USD plunged 1.1% to 0.6842.

Boosted by a robust jobs report in Australia (the jobless rate dropped to a 2.5-year low of 5.7% in March), AUD/USD climbed 0.6% to 0.7695. The pair has just shot above the upper Bollinger band, calling for an acceleration to the upside. At the same time, the 20-period (30-minute chart) moving average is crossing above the 50-period one, and the intraday relative strength index is well directed above the neutrality level of 50, suggesting a new upleg. As long as the pair maintains its upward momentum, it should rise toward the first upside target at 109.95 (around the high of April 7) and then the second one at 110.50 (key resistance seen on April 6).

Trading Recommendation:

The pair is trading above its pivot point. It is likely to trade in a wider range as long as it remains above its pivot point. Therefore, long positions are recommended with the first target at 109.95 and the second one, at 110.50. In the alternative scenario, short positions are recommended with the first target at 108.45 if the price moves below its pivot points. A break of this target is likely to push the pair further downwards, and one may expect the second target at 107. The pivot point is at 108.80.

Resistance levels: 109.95, 110.50, 111

Support levels: 108.45, 108.05, 107.75

 

[jebat66]

USD/CHF is expected to trade in a higher range above 0.9630. The pair remains in an uptrend above its major support base around 0.9630. Even though a continuation of the consolidation cannot be ruled out, its extent should be very limited. Besides, the relative strength index is around its neutrality area at 50 but lacks downward momentum. In these perspectives, as long as 0.9630 is not broken, the pair is likely to advance to 0.9710 and 0.9740 in extension.

Trading Recommendations:

The pair is trading above its pivot point. It is likely to trade in a wider range as long as it remains above its pivot point. Therefore, long positions are recommended with the first target at 0.9710 and the second one, at 0.9740. In the alternative scenario, short positions are recommended with the first target at 0.9590 if the price moves below its pivot points. A break of this target is likely to push the pair further downwards, and one may expect the second target at 0.9560. The pivot point is at 0.9610.

Resistance levels: 0.9710, 0.9740, 0.98

Support levels: 0.9590, 0.9560 , 0.95

 

[jebat66]

Global macro overview for 15/04/2016:

The Crude Oil Inventories data came as a big surprise when the stockpiles jumped to 6634k from -4937k a week ago. Nevertheless, the recent report from the EIA Institute suggest some analysts predict that in the second part of the year, the global surplus of crude oil will fall drastically (this may be an impulse for a further rebound in oil prices, even around $50 per barrel). Clearly, this weekend's meeting in Doha might be a breakthrough in negotiations regarding the output freeze as Russia said it sees a deal to freeze oil output as possible when it meets other producers, regardless of whether Iran - which has said it plans to boost output - joins the deal. In conclusion, this might be the most important OPEC and non-OPEC countries' meeting this year and it is worth to keep an eye on its outcome.

Let's now take a look at the technical picture of crude oil on the H4 time frame. The market rallied during the entire last week and managed to break above the 21.50 and 100 moving averages. Currently, it is trading near the record-high levels of the year and if OPEC seals the deal at this weekend's meeting, then the bulls might rally even higher towards the psychological level of $50 a barrel

 

[jebat66]

NZD/USD is under pressure below 0.6920. Technically, the pair remains capped by its falling 50-period moving average and is likely to post new weaknesses. The relative strength index is below its neutrality area at 50 and lacks upward momentum. Furthermore, the previous key support at 0.6920 now acts as resistance, which should maintain the strong selling pressure. Therefore, as long as 0.6920 holds on the upside, look for further decline to 0.6840 and 0.6820 in extension.

Trading recommendations:

The pair is trading below its pivot point. It is likely to trade in a lower range as long as it remains below the pivot point. Short positions are recommended with the first target at 0.6840. A break of this target will move the pair further downwards to 0.6820. The pivot point stands at 0.6920. In case the price moves in the opposite direction and bounces back from the support level, it will move above its pivot point. It is likely to move further to the upside. According to that scenario, long positions are recommended with the first target at 0.6950 and the second target at 0.6975.

Resistance levels: 0.6950, 0.6975, 0.7015

Support levels: 0.6840, 0.6820, 0.6790

 

[jebat66]

Technical outlook and chart setups:

The EUR/JPY pair is trading at 123.40 levels at the moment, looking to rally through 125.35 levels at least from here on. Please note that the pair is just in a countertrend rally and bears would remain in control till prices stay below 128.25 levels, from here on. Also note that the pair had broken below earlier support at 123.08 levels and hence a pullback is quite probable from here, before resuming the downtrend. Hence it is recommended to remain flat for now and look to sell again at 125.30 levels. Immediate resistance is seen at 125.00.30 levels, while support is seen through 122.50 levels respectively.

Trading recommendations:

Remain flat for now and look to sell higher.

Good luck!

 

[jebat66]

EUR/JPY is expected to trade with a bearish bias. The pair is heading lower and stays below its key resistance at 155.75. Meanwhile, the relative strength index lacks upward momentum. The first target to the downside is set at the horizontal support and overlap at 153.95. A break below this level would open way to further weakness toward 153.45.

Trading Recommendations: The pair is trading below its pivot point. It is likely to trade in a lower range as long as it remains below the pivot point. Short positions are recommended with the first target at 153.95. A break of this target will move the pair further downwards to 153.45. The pivot point stands at 155.75. In case the price moves in the opposite direction and bounces back from the support level, it will move above its pivot point. It is likely to move further to the upside. According to that scenario, long positions are recommended with the first target at 156.70 and the second target at 158.05.

Resistance levels: 156.70, 158.05, 159

Support levels: 153.95, 153.45, 152.60

 

[jebat66]

Global macro overview for 15/04/2016:

The Bank of England decided yesterday to keep the benchmark rate at the level of 0.5% and asset purchase facility at 375bln. Moreover, the official bank rate votes were nine to zero (0-9) in favor of no change in interest rates. It is not hard to conclude from the monetary policy summary that the BoE acknowledged that the economy has lost some momentum. Growth for Q1 is expected at the level of 0.4% which is below the fourth quarter's average of 0.5%. Moreover, the BoE suggests that the uncertainty about the referendum may already be taking an economic impact. In conclusion, the long-anticipated interest rate hike is currently off the table as the greater domestic risks are putting pressure on the BoE's monetary policy.

Let's now take a look at the GBP/USD technical picture on the H4 time frame. We can see a sharp decline after a false breakout above the technical resistance at the level of 1.4324, but still, the golden trend line hasn't been violated yet. Nevertheless, it looks like the bears are in control over this market and it will be confirmed with the daily candle close below the golden trend line (below 1.4000 levels).

 

[jebat66]

Technical outlook and chart setups:

The GBP/CHF pair has rallied higher and seems to have formed a meaningful bottom around 1.3380 levels. The pair is trading at 1.3690 levels at the moment, looking to drop lower towards 1.3520 levels before turning higher again. Structurally, the pair had rallied into resistance at 1.3740 levels earlier before pulling back. The pair may still rally one last time above 1.3740 levels and then produce a meaningful retracement lower. In any case, it is recommended to buy lower towards 1.3500/20 levels from here. Immediate interim resistance is seen at 1.3740 levels, while support is at 1.3600 levels respectively.

Trading recommendations:

Remain flat for now and look to go long at 1.3500/20 levels.

Good luck!

 

[jebat66]

GBP/CHF overall trend is bearish and currently the corrective wave up might be just about to end as the price has rejected 64.8% Fibonacci resistance level applied to the descending channel breakout.

At the same time, the price broke below the S3 (1.3500) support and now it is rejecting not only Fibs, but also a downtrend trend line.

Consider selling GBP/CHF while the price is near R1, targeting either S2 (1.3590), S3 (1.3500) or S4 (1.3565) as the final target. The stop loss should be just above R2 (1.3810).

Support: 1.3660, 1.3590, 1.3500, 1.3365

Resistance: 1.3730, 1.3810

 

[jebat66]

NZD/CHF continues moving sideways without any signs of a long- or mid-term direction. This tendency is likely to continue and the price might once again move down after the price rejected the R1 (0.6700) resistance area.

Consider selling NZD/CHF near 0.6700 to target 61.8% Fibonacci retracement where support previously was formed. The stop loss should be well above 0.6700, at 0.6750 or higher.

Support: 0.6645, 0.6610, 0.6580, 0.6555

Resistance: 0.6700

 

[jebat66]

On January 28, the depicted support at 0.6400 acted as a prominent key level offering a valid buy entry. A bullish breakout above 0.6550 was executed a few weeks ago.

Bullish persistence above 0.6550 (depicted recent support) was needed to keep the price moving towards higher bullish targets.

The price zone of 0.6750-0.6840 constituted a significant resistance zone where signs of a bearish rejection were seen during the previous few weeks (triple-top reversal pattern).

On February 9, the NZD/USD pair failed to consolidate below the depicted support level of 0.6550.

Moreover, an obvious bullish recovery was expressed around the depicted temporary support level. Hence, the recent bullish swing towards 0.6750 and 0.6860 was initiated.

In March, an obvious bullish breakout above 0.6750 and 0.6860 was executed. Hence, these price levels now constitute recent support levels to be watched for valid BUY entries.

Conservative traders were advised to have a valid BUY entry around the price level of 0.6760. It's already running in profits. S/L should be elevated to 0.6800 to secure some profits.

Today, bullish persistence above 0.6850 is mandatory to ensure further bullish advancement towards 0.7070 and 0.7170 where a prominent consolidation range was previously established in June 2015.

On the other hand, a daily closure below 0.6850 brings the NZD/USD pair again towards the price level of 0.6760.

 

[jebat66]

A bullish breakout above the previous consolidation zone between 1.2400 and 1.2800 was performed on July 15 (shown on the weekly chart).

A significant bearish rejection was observed around 1.3450. Hence, another consolidation range was established from 1.3450 down to 1.2800.

On December 7, a bullish breakout above 1.3450 (upper limit of the recent consolidation range) enhanced the bullish side of the market. Hence, a bullish visit to the resistance at 1.4120 (Fibonacci Expansion 100%) occurred.

Bullish persistence above 1.4150 enhanced the bullish side of the market towards 1.4650 (141.4% Fibonacci expansion) where an evident bearish rejection was expected (bearish engulfing weekly candlestick).

The 1.4120 level (Fibonacci Expansion 100%) stood as a significant resistance level where significant bearish rejection was applied.

Although the area of 1.3050-1.3250 was expected to offer bullish support for the USD/CAD pair, bearish breakdown of the same price zone was executed as depicted on the daily chart.

The price level of 1.3300 constituted a significant resistance as it corresponds to the 50% Fibonacci level and the backside of the broken weekly uptrend where a valid sell entry was suggested on March 24.

Since March 18, the USD/CAD pair has been trapped within the consolidation range between 1.3300 - 1.2970 until recent bearish breakdown occurred on April 11.

Traders who missed the initial entry around 1.3300 should wait for a bullish pullback towards 1.2975 (61.8% Fibonacci level) as a valid signal to sell the USD/CAD pair.

Initial T/P levels should be located at 1.2770 and 1.2550.

 

[jebat66]

In November 2015, daily persistence below the level of 1.0800 (the prominent key level) ensured enough bearish momentum towards 1.0550 (the monthly demand level) where the most recent bullish swing was initiated.

During the last few weeks, a consolidation range between 1.1000 and 1.0800 was established on the daily chart. On February 3, a bullish breakout was executed above this consolidation range.

Consequently, a quick bullish movement started towards the zone of 1.1350-1.1400 where previous daily bottoms and the backside of the broken uptrend were depicted on the daily chart.

On February 12, a strong bearish engulfing daily candlestick was expressed near the mentioned supply zone. Hence, a quick bearish decline towards 1.1000 was executed.

A temporary bearish breakdown below 1.1000 (upper limit of the broken consolidation range) was seen on the daily chart. A quick bearish decline was expected towards 1.0820 where the most recent bullish swing was initiated.

Recently, bullish fixation above 1.1000 has been mandatory to allow bullish movement to continue. Bullish targets were projected towards 1.1320 and 1.1400.

Similar to what happened on February 12, the supply zone of 1.1320-1.1400 stood as a significant resistance zone for the EUR/USD pair which offered bearish rejection and a valid sell entry on April 12.

Moreover, a Head and Shoulders reversal pattern is being expressed around this supply zone. Hence, another valid entry can be offered at retesting of the price level of 1.1320 (the right shoulder of the reversal pattern).

Daily persistence below the depicted uptrend line (the level of 1.1320) is needed to ensure more bearish momentum in the market.

Trading Recommendation:

In previous articles, a valid sell entry was suggested around the supply zone of 1.1400. It's already running in profits. T/P levels should be placed at 1.1200 and 1.1070. S/L should be lowered to 1.1360 to secure some profits.

Conservative traders should consider the current daily closure below 1.1300 (a prominent demand level and the uptrend line) as a valid SELL signal. Initial T/P levels should be located at 1.1150 and 1.1080.

 

[jebat66]

Overview:

The NZD/USD pair movement was clear as it took place in an uptrend channel for a while. The market showed signs of stability above the support levels of 0.6822 and 0.6886. Amid the previous events, the price is still moving between the levels of 0.6822 and 0.6967. The daily resistance and support are seen at the levels of 0.6967 and 0.6822 respectively. In consequence, it is recommended to be cautious while placing orders in this area. Hence, the NZD/USD pair is still trading in a bullish trend from the new support level of 0.6886; to form a bullish channel. According to the previous events, we expect the pair to move between 0.6886 and 0.6987. Also, it should be noted that major resistance is seen at 0.6999, while immediate resistance is found at 0.6987. Then, we may anticipate potential testing of 0.6987 to take place soon. Moreover, if the pair succeeds in passing through the level of 0.6987, the market will indicate a bullish opportunity above the level of 0.6987. A breakout of that target will move the pair further upwards to 0.6999 and 0.7031.
Buy orders are recommended above the area of 0.6886 with the first target at the level of 0.6967; and continue towards 0.7031. On the other hand, if the NZD/USD pair fails to break out through the resistance level of 0.6987; the market will decline further to the level of 0.6822.

 

[jebat66]

Overview:

The USD/CHF pair set above strong support at the level of 0.9597, which coincides with the daily pivot. This support has been rejected for three times confirming uptrend veracity. Hence, major support is seen at the level of 0.9597 because the trend is still showing strength above it. Accordingly, the pair is still in the uptrend from the area of 0.9597 and 0.9615. The USD/CHF pair is trading in a bullish trend from the last support line of 0.9597 towards the first resistance level at 0.9724 in order to test it. This is confirmed by the RSI indicator signaling that we are still in the bullish market. Now, the pair is likely to begin an ascending movement to the point of 0.9724 and further to the level of 0.9796. The level of 0.9796 will act as second resistance and the double top is already set at the point of 0.9888. At the same time, if a breakout happens at the support levels of 0.9597 and 0.9590, then this scenario may be invalidated. But in overall, we still prefer the bullish scenario today.

Intraday key levels:

Resistance 3:0.9866
Resistance 2:0.9796
Resistance 1:0.9724
Pivot Point:0.9597
Support 1:0.9500
Support 2:0,9460
Support 3:0,9400

 

[jebat66]

Overview:

The GBP/USD pair is showing signs of strength following a breakout of the highest level of 1.4150. On the H1 chart, the level of 1.4150 coincides with 23.6% of Fibonacci, which is expected to act as minor support today. Since the trend is above the 23.6 % Fibonacci level, the market is still in an uptrend. But, major support is seen at the level of 1.4082. Furthermore, the trend will show strength as long as it is still above the moving average (100). Thus, the market is indicating a bullish opportunity above the above-mentioned support levels. The bullish outlook remains the same as long as the 100 EMA is headed to the upside. Therefore, strong support will be found at the levels of 1.4082 and 1.4150 providing a clear signal to buy with a target seen at 1.4214. If the trend breaks the minor resistance at 1.4214, the pair will move upwards continuing the bullish trend development to the level of 1.4340 in order to test the daily resistance 1.

Intraday technical levels:

R3: 1.4598
R2: 1.4472
R1: 1.4340
PP: 1.4214
S1: 1.4082
S2: 1.3956
S3: 1.3824

 

[jebat66]

Overview:

Today, a major support is seen at the level of 1.1233. Moreover, the double bottom is also coinciding with a major support this week. Additionally, the RSI is still calling for a strong bullish market as well as the current price is also above the moving average 100. In the H1 time frame, a minor resistance is found at the level of 1.1326 which means that the level of 1.1326 will be set above the moving average 100. Therefore, it will be advantageous to buy above the resistance area of 1.1326 with the first target at 1.1376. From this point, if the pair closes above the weekly pivot point of 1.1326, the EUR/USD pair may resume it movement to 1.1420 to test the weekly resistance 1. On the other hand, stop loss should always be taken into account, accordingly, it will be beneficial to set the stop loss below the last bottom at 1.1189.

Daily key levels:

18/04/2016

Major resistance:1.1557
Minor resistance:1.1420
Intraday pivot point:1.1326
Minor support:1.1189
Major support:1.1095

 

[jebat66]

Global macro overview for 18/04/2016:

The New Zealand inflation recovered from the lowest level in 15 years, but it is still below the regulator's targets. The Statistics New Zealand reported that CPI climbed 0.2% in the January-March period that was stronger than the median forecast of a zero change and much higher than the 0.5% decrease seen in the previous quarter. The main contribution to that surge came from tobacco sales ( advancing 9.4%) and fruit sales (advancing 8.2%). In conclusion, this reading has left some room for the RBNZ to cut the rates even further and Governor Graeme Wheeler might cut the rates again if needed after cutting it to a record-low of 2.25% in March.

Let's now take a look at the technical picture of NZD/USD in the daily time frame. The current situation is in the advantage of bulls as the market continues to make higher highs and higher lows. This upward move is not very dynamic, but it shows bulls are still in control over this market. The next resistance is seen at the level of 0.6953 - 0.6965 and the next important support is seen at the level of 0.6558 - 0.6543.

 

[jebat66]

Global macro overview for 18/04/2016:

During the recent meeting in Doha, OPEC and non-OPEC countries failed to agree on an output freeze. The growing tension between Saudi Arabia and Iran and the inability of the other oil producers to agree on a loose commitment to freeze output for a short period of time was the main reason for the talks collapse. In conclusion, the oil was sold heavily after the news and currently there is no real reason for it not to fall even further as Iran strongly claims to return to the pre-sanctions levels. Declining crude oil production in the USA might help support the prices to some extent. The next OPEC meeting is in June.

Let's now take a look at the crude oil technical picture in the 4H time frame. We can see the weekend gap marked as yellow triangle and the broken golden trend line. Moreover the market is trading below the 21,50 and 100 moving averages, so it looks like bears are in control over this market. Any break below the level of 37.41 (H4 candle low) will support this view especially if there will be no intention to fill the gap.

 

[jebat66]

General overview for 18/04/2016:

The wave (b) extended higher during the weekend, but it looks like it was capped around the 50%Fibo at the level of 1.2985. If this is the top for wave (b) blue, then the bears should now break out below the intraday support at the level of 1.2872 and follow towards the level of 1.2743. If the intraday support will hold and only the weekend gap will be filled, then the top for the wave (b) blue might extend higher.

Support/Resistance:

1.2643 - WS2

1.2743 - Local Low

1.2808 - WS1

1.2897 - Intraday Support

1.2912 - Weekly Pivot

1.2989 - Intraday Resistance

1.3080 - WR1

1.3181 - WR2

Trading recommendations:

Day traders should sell the market at the current prices with SL above the level of 1.2999 and TP at the level of 1.2872 (minimum).