IFC Markets Analytics

[IFCM]

Trend continues

Let us consider the GBP/USD currency pair on the H4 chart. The H4 and daily trends have a bearish momentum: we observe synchronizing scales that make us more confident about short position opening. ParabolicSAR values are moving along the current trend, confirming its negative bias. The last fractal support, strengthened by the lower boundary of Donchain Channel, is tracing an important level. Its breakout is likely to result in a strong volatile movement towards the red zone. The 1.49802 mark may be used for placing a pending sell order. We recommend conservative traders to wait for confirmation from RSI-Bars oscillator, which has to breach the 34.4285% level simultaneously. In such a manner, we will get verification from every analytical instrument available.

Stop loss may be placed in advance at 1.51003 support level. We would like to point out that this mark is confirmed by two Bill Williams’s fractals (double bottom), the upper boundary of Donchain Channel and by Parabolic historical values. This level can be broken up only in case of fundamental changes in market structure. If this occurs, the price will cross both the daily and H4 trend lines, with bulls taking the initiative. Taking the current situation into account, this is unlikely to happen. After pending order placing, stop loss is to be moved every four hours near the next fractal low, following Parabolic signals. Thus, we are changing the probable profit/loss ratio to the breakeven point. If the price meets stop loss level without reaching the order, we recommend canceling the position: market sustains internal changes that were not considered.

Position Sell
Sell stop below 1.49802
Stop loss above 1.51003

 

[IFCM]

ADP Non-Farm

Today at 14:45 CET ADP Non-Farm Employment Change indicator will be issued in the US. The index is provided by Automatic Data Processing every month and is based on reckoning anonymous data of about 400 000 American business clients. Agriculture and government sectors are not included in the filing. The preliminary estimate is announced 2 days ahead of official Non-Farm Employment Change release. That is why the indicator deserves a closer look. Employment is a key factor, affecting consumer demand in the USA; a worse-than-expected decline in Non-Farm Employment Change is likely to pull down the American currency. We recall that Canada’s Ivey PMI will become public today at 16:00 CET. A survey among 175 purchasing managers from different economy sectors evaluates employment, production, new orders, prices, supply and reserves. This indicator estimates expansion or contraction in production together with purchasing managers’ activity. The USD/CAD currency pair is expected to become more volatile after the data publication.

Let us consider the USD/CAD:H4 chart. After leaving the triangle, the price crossed the H4 resistance line. At the moment we observe a pullback as oil prices sagged: reduced number of US oil wells and strike of several trade unions resulted in crude oil rally. Yet, $50-55 a barrel keep 80% percent of American oil pumps cost efficient, so we expect a downward movement to be on the way. Bullish momentum will be continued if 1.28112 fractal resistance is breached; you may place a long pending order at this mark. However, we advise you to keep an eye on the RSI-Bars oscillator, which latest bar broke through the support line. Conservative traders are recommended to wait until the price is back into the bullish trend corridor. Stop loss may be placed at the previous resistance level, which can be now considered as the support line – 1.22514. After pending order placing, Stop loss is to be moved every four hours near the next fractal low, following Parabolic signals. Thus, we are changing the probable profit/loss ratio to the breakeven point. If the price meets stop loss level without reaching the order, we recommend canceling the position: market sustains internal changes that were not considered.

Position Buy
Buy stop above 1.28112
Stop loss below 1.22514

 

[IFCM]

Pound reversal

Today at 12:00 СЕТ the Bank of England is to hold a regular meeting. Investors expect the interest rate to remain the same (0,5%) and are moderately pessimistic about English economy current state. Pound has been strengthening against dollar for 3 consequent days, owing to good Manufacturing, Construction and Services PMI, issued on Monday, Tuesday and Wednesday, respectively. Jobless Claims and Q4 Non-Farm Productivity are announced at 13:30 CET today in the USA: estimated data are relatively weak. At the same time US Trade Balance for December will become public. It is likely to be positive, but overall statistics may undermine the American currency. Our analysts believe the data publication will reinforce GBP/USD. Over the last six months pound has lost 11% against greenback. It is high time for the pound to rebound.

Let us consider the GBP/USD currency pair on the H4 chart. Leaving behind the down trend, the price breached the H4 resistance line. We observe a surge, which followed pullback to the trend line. Bullish momentum will be continued if 1.52757 fractal resistance is crossed: you may place a long pending order at this mark. However, we advise you to keep an eye on the RSI-Bars oscillator, which is overbought. Conservative traders are recommended to wait until the price gap (which was developed in January, 2-5) is bridged. Stop loss may be placed at the level of 1.511, indicated most recently by Parabolic. This mark can be now considered as the support line. After pending order placing, Stop loss is to be moved every four hours near the next fractal low, following Parabolic signals. Thus, we are changing the probable profit/loss ratio to the breakeven point. If the price meets Stop loss level without reaching the order, we recommend canceling the position: market sustains internal changes that were not considered.

Position Buy
Buy stop above 1.52757
Stop loss below 1.511

 

[IFCM]

Avoiding false breakouts

Let us consider the USD/CHF H4 chart. The instrument clearly moves sideways, depreciating trend indicators. That is why our attention is drawn mainly to graphic patterns and oscillators, able to filter out false breakouts. At the moment we observe a bearish-biased triangle. The trend is also confirmed by the RSI-Bars oscillator, indicating the movement towards the red zone. In this regard we deal with sell signals only.

An important support line is formed currently at 0.91532. It is confirmed by the Donchian Channel lower boundary and 2 Bill Williams fractals. We recommend making sure the support breakout is accompanied with breaching the oscillator support of 42.2748%. A sell pending order may be placed at this level. Stop loss may be placed at the triangle height of 0.93475. This mark is also confirmed by the Parabolic values. You may partly close the position at 0.89824, which conforms to historical fractal support. After pending order activation, Stop loss is to be moved every four hours near the next fractal high, following Parabolic signals. Thus, we are changing the probable profit/loss ratio to the breakeven point. If the price meets Stop loss level without reaching the order, we recommend canceling the position: market sustains internal changes that were not considered.

Position Sell
Sell stop below 0.91532
Stop loss above 0.93475

 

[IFCM]

Trend continues

Let us analyze the USD/JPY pair on the H4 chart. This morning Japan announced several minor economic indicators. They appeared to be negative. Q4 Housing Loans and Tertiary Industry Index for December turned out to be worse-than-expected. To be noted, Industrial Production for December will be released on Wednesday at 23:50 CET in Japan. The tentative outlook is positive for yen, resulting in USD/JPY currency pair downward movement. It is to be considered when trading, as well as the fact that no important Japanese macroeconomic data are expected this week. Today at 15:00 CET Wholesale Inventories will be issued in the USA. The forecast is neutral. Market may react, if real figures deviate widely from estimated ones.

On the H4 time frame the USD/JPY steadily moved far above the triangle. Then it showed a slight pullback and formed a “flag” pattern. As a rule, it implies the current trend, which is the uptrend now, to continue. The RSI-Bars oscillator shaped a combination of similar figures, which confirms the trend in our judgment. The RSI latest bars didn’t go below 50. This is a good “bullish” sign, supposing yen to weaken further. To be kept in mind, Industrial Production may affect the trend, if data appear to be too positive. Probably, conservative traders had better wait for the data release. Yet, we don't rule out further “bullish” momentum after the fractal resistance is breached at 119.216: you may place a buy pending order there. Stop loss may be placed at 117.777, indicated most recently by Parabolic. This mark can be considered as a support line at the moment. After pending order activation, Stop loss is to be moved every four hours near the next fractal low, following Parabolic signals. Thus, we are changing the probable profit/loss ratio to the breakeven point. If the price meets Stop loss level without reaching the order, we recommend canceling the position: market sustains internal changes that were not considered.

Position Buy
Buy stop above 119,216
Stop loss below 117,777

 

[IFCM]

Awaiting "flat" ending

Let us consider the EUR/CHF currency pair on the H4 chart. We have chosen it because no important macroeconomic data are expected today from the USA. Yesterday Switzerland announced several economic indicators for January. They turned out to be slightly better-than-expected. Among other things, deflation marked a decrease. Our analysts suggest that it is a factor underpinning the franc. Forthcoming Swiss important data will be issued only on February, 18-19. Until then, Swiss franc may strengthen against euro. The single currency can be undermined by crisis in Greece and tomorrow Germany inflation report.

If we look at the H4 chart, the EUR/CHF has been traded at a narrow neutral range for quite a long time. The corridor was shaped by Swiss franc pulling back after the intense growth. To recap, the Swiss National Bank abandoned the fixed euro-franc exchange rate on Jan. 15, 2015. The EUR/CHF chart shows a sharp fall this day, followed by rebounding to 61.8% Fibonacci level. We suppose this movement to be succeeded with decline. The RSI-Bars oscillator displays downtrend as its bars went below 50. This is a good “bearish” sign implying euro to weaken against Swiss franc. Consequently, we do not exclude further downward momentum after the fractal support is breached at 1.04116: you may place a sell pending order there. Stop loss may be placed at 1.0592, indicated most recently by Donchian channel. This mark can be regarded as the resistance line at the moment. After pending order activation, Stop loss is to be moved every four hours near the next fractal high, following Parabolic or Donchian signals. Thus, we are changing the probable profit/loss ratio to the breakeven point. If the price meets Stop loss level without reaching the order, we recommend canceling the position: market sustains internal changes that were not considered.

Position Sell
Sell stop below 1,04116
Stop loss above 1,0592

 

[IFCM]

Sideways escape

Today at 10:30 СЕТ the Bank of England will issue inflation report and hold a press-conference with Mark Carney (the governor). Most market participants expect inflation forecast to be cut and focus attention on Mark Carney's account for the prospective of the Bank of England rate hike. He is supposed to comment on real estate market and mortgage rate dynamics. It's hard to predict the effect it may produce on the pound.
It has slumped by 13% since mid-July and is currently traded in a narrow range. The pound may strengthen against the dollar after the release of British economic data today. Important indicators also become public today in the US: Retail Sales and Jobless Claims at 13:30 CET and Business Inventories at 15:00 CET. Our analysts believe the tentative outlook is positive for the dollar. Careful investors are recommended to wait for the data publication though. To be noted, less important Construction Output will be released in the UK tomorrow. It may underpin the pound (in case today it advances).

If we look at the H4 chart, the GBP/USD has been traded in a narrow neutral range for quite a long time. The corridor was shaped by the pound rebounding after the sharp fall. We do not rule out that the GBP/USD may finish the sideways trend moving higher, backed with today's positive macroeconomic news. Consequently, a “bullish” momentum may continue as the fractal resistance is breached at 1.52985: a buy pending order may be placed there. Stop loss may be placed at 1.5195, indicated most recently by Donchian channel. This mark can be regarded as the support line at the moment. After pending order activation, Stop loss is to be moved every four hours near the next fractal low, following Parabolic or Donchian signals. Thus, we are changing the probable profit/loss ratio to the breakeven point. If the price meets Stop loss level without reaching the order, we recommend canceling the position: market sustains internal changes that were not considered. Since our forecast relies on fundamental analysis, we leave the room for opening sell positions. It is possible, if the Bank of England statement and American statistic fail to meet expectations. In this case the fractal levels indicated are to be swapped.

Position Buy
Buy stop above 1,52985
Stop loss below 1,5195

 

[IFCM]

New trend in progress

Let’s examine the EUR/USD currency pair on the D1 chart. The support level at 1.10951 acts as a turning point: the bearish trend is over and bulls are taking action. A V-shaped trend reversal is observed. The trend indicator changed the bias into the bullish one followed by the trend line reversal. The reversal is also confirmed by the RSI-Bars(13) oscillator: the next bar is ready to break the key resistance level at 46.7954%. We expect it to coincide with the price level breakout at 1.15486, which can be used for placing a pending buy order.

Conservative traders are recommended to confirm the breakout based on the oscillator signal 47%. Stop loss is to be placed below the fractal at 1.12449. This mark is confirmed by the latest Bill Williams fractal, Donchian Channel lower boundary and the intersection of two trend lines. The mark is worth paying a closer look as this is where the bullish pattern called “absorption” was formed (marked in yellow on the chart). The value of this pattern is strengthened by the fact that the bearish candlestick in it is the doji. After pending order activation, Stop loss is to be moved near the next fractal low, following ParabolicSAR values. Thus, we are changing the probable profit/loss ratio to the breakeven point. If the price meets Stop loss level without reaching the order, we recommend canceling the Buy position: market sustains internal changes that were not considered and bears are gaining ground.

Position Buy
Buy stop above 1.15486
Stop loss below 1.12449

Dear traders. For the detailed report of the strategy based on analytical issues of technical analysis click here.

 

[IFCM]

Coming out the triangle

We would like to draw your attention to AUD/USD currency pair on the H4 chart. US financial markets were closed yesterday in observance of Presidents’ Day. Today the trading is performed on a regular basis, but there is no special US macroeconomic statistics released today. Monetary policy meeting minutes were published early this morning by the Reserve Bank of Australia (RBA). We deem that no significant information was announced; anyway this was precisely what has pushed the Aussie higher. According to previous surveys, more than 60% of investors expected the RBA to cut again the rate to 2% at the next meeting scheduled on the third of March. In our opinion, it is now difficult to state certainly whether it happens or not. Especially that the most important Australian economic data will be released only on the second of March, just before the RBA meeting, and before that less significant statistics will be published. The lower the probability of a rate cut, the more chances has the Australian dollar to strengthen.

The AUD/USD was confident enough moving higher on the H4 chart and leaving the triangle. After that, there was a slight pullback and early this morning quite a noticeable white candlestick was formed. As we can observe, the triangle leaving takes place within the bullish channel. We believe this confirms trend. The bullish divergence is observed on the RSI-Bars chart: it was observed almost all the time until the price formed a triangle. Note also that the RSI-Bars last bar hasn’t deepened lower than 50. This is a good bullish sign which means the strengthening of the Australian dollar. Further development of the bullish momentum is not ruled out after the fractal resistance breakout at 0.7815. This mark can be used for placing a pending buy order. Stop loss may be placed at the last Parabolic signal, which can currently act as a support line – 0.7726. After pending order activation, Stop loss is to be moved every four hours near the next fractal low, following Parabolic values. Thus, we are changing the probable profit/loss ratio to the breakeven point. If the price meets Stop loss level without reaching the order, we recommend canceling the position: market sustains internal changes that were not considered.

Position Buy
Buy stop above 0.7815
Stop loss below 0.7726

 

[IFCM]

Sideways trading

Today we would like to focus your attention to Personal Composite Instrument (PCI) &BRENT_RUB, i.e. Brent crude oil to Russian ruble on the H4 chart. They are highly interconnected because Russia is the third largest oil producer after Saudi Arabia and the United States. The share of hydrocarbons in the country’s exports is 73%. When Brent crude oil price (denominated in USD) advances, as a rule, Russian ruble is sagging on the USD/RUB chart. This means that it is strengthening against the US dollar. You can implement the &BRENT_RUB PCI downloaded from our website in NetTradeX.

BRENT/RUB has formed the graphic pattern called “flag” on the H4 chart, and the price is currently located next to its upper boundary. Since the two assets of this PCI are highly correlated, they are mainly traded sideways. Therefore, we don’t expect a strong bullish momentum. BRENT/RUB will most likely return to its long-term moving average (200). There is a decline in volatility on the MACD chart. The histogram is below the signal line, which can be considered a bearish signal. There is a timid bearish divergence on the RSI chart. Bollinger Bands indicator shows narrowing. Further development of the bearish momentum is not ruled out after the fractal resistance breakout at 3910. This mark can be used for placing a pending sell order. Stop loss may be placed at the top line of Bollinger Bands indicator, which can currently act as a resistance line – 4073. After pending order placing, Stop loss is to be moved every four hours near the next fractal high, following Parabolic and Bollinger signals. Thus, we are changing the probable profit/loss ratio to the breakeven point. If the price meets Stop loss level without reaching the order, we recommend canceling the position: market sustains internal changes that were not considered.

Position Sell
Sell stop below 3910
Stop loss above 4073

Dear traders. For the detailed report of the strategy based on analytical issues of technical analysis click here.

 

[IFCM]

ECB and Fed can shift markets

The heads of leading central banks of the world will be delivering their speeches today. The ECB President Mario Draghi is due to speak in Frankfurt at 14:00 CET. At 15:00 CET the Fed Chair Janet Yellen will testify before the US Senate Banking Committee. Investors expect that Draghi will confirm the dates and the amount of targeted longer-term refinancing operations (TLTRO) announced last year. Recall that it is planned to start this March in the monthly amount of 60 billion euro. Market participants expect Janet Yellen to shed light on the timing of the rate hike in the United States. Previously, it was supposed to happen in April 2015. However, FOMC Meeting Minutes released last Wednesday revealed that an early rate hike was doubtful: the world economy is being in a poor state for the first time since January 2013. In general, we consider the situation to be ambiguous. The US dollar index has been traded sideways for a month. As a rule, after leaving this trend, strong movement is expected further on. The statements made by the heads of the ECB and the Fed will probably guide the exchange rate in some direction. Unfortunately, the trend is difficult to predict in advance.

Let’s consider the EUR/USD currency pair on the H4 chart. It was traded sideways on January 26, 2015. The last bars of RSI-Bars are below 50 and form a downtrend. But as we noted above, the final price direction of this currency pair will depend on the monetary policy determined by the Fed and the ECB. We believe a new trend will appear after sideways trading is finished. Let the market choose the price direction. The most significant levels at 1.10974 and 1.15321 are confirmed by Bill Williams fractals and Donchian Channel boundaries. Two positions can be placed at the opposite levels: after one of the orders is opened, the second one can be deleted. It means the market has chosen the direction. After pending order activation, Stop loss is to be moved every four hours near the next fractal high (short position) or low (long position), following Parabolic values. Thus, we are changing the probable profit/loss ratio to the breakeven point.

Position Sell
Sell stop below 1.10974
Stop loss above 1.15321

Position Buy
Buy stop above 1.15321
Stop loss below 1.10974

Dear traders. For the detailed report of the strategy based on analytical issues of technical analysis click here.

 

[IFCM]

Getting ready to finish sideways trading

The Fed Chair Janet Yellen said yesterday that there is no need to hurry with the rate hike. For this reason the US dollar index is slipping but is still traded in a range. CPI will be released in Canada and the US tomorrow at 13:30 СЕТ. According to forecasts, it is expected to be cut in both countries. However, we deem the Canadian inflation indicator looks more preferable. We believe that the reduced US CPI may include deflation risks which can be regarded as a negative factor for the economy. Moreover, deflation could delay further the moment of raising the US base rate which now stands at 0.25%. The rate is higher in Canada and makes up 0.75%.

Let’s consider the USD/CAD on the H4 chart. It has been traded sideways for a month and has no definite direction so far. RSI-Bars shows signs of the downtrend approach, but in general it is also located in a range. It hasn’t reached the oversold zone yet – 30. We do not rule out the bearish momentum being developed in case of the fractal support level breakout at 1.23615: this level can be used for placing a pending sell order. However, the most careful traders should wait for the market reaction on the CPI release in the US and Canada. Stop loss is to be placed at the last Parabolic signal, which can currently act as the resistance line at 1.265. After pending order placing, Stop loss is to be moved every four hours near the next fractal high, following Parabolic signals. Thus, we are changing the probable profit/loss ratio to the breakeven point. If the price meets stop loss level without reaching the order, we recommend cancelling the position: market sustains internal changes which were not considered.

Position Sell
Sell stop below 1.23615
Stop loss above 1.265

Dear traders. For the detailed report of the strategy based on analytical issues of technical analysis click here.

 

[IFCM]

RBA meeting to take place next week

We would like to focus your attention to the AUD/USD currency pair. The Aussie is currently traded 29% below the historical high of 2011 and showed signs of the bullish influence over the last three weeks. Since September 2014 it has dipped 18% with the maintained base rate of 2.5%, kept since August 2013. In February 2015 the Reserve Bank of Australia (RBA) cut the rate only 0.25%, down to 2.25%. Some market participants deem that it is not enough for such a strong depreciation of the Australian dollar. The RBA meeting will take place next Tuesday. Most investors don’t expect additional rate cuts. In our opinion, these forecasts may buoy the Aussie.

Having a look at the H4 chart, the AUD/USD broke the triangle top with confidence. Now it is moving inside the uptrend price channel, so that it can be considered as the trend confirmation. The RSI-Bars chart also indicates the uptrend. Please note that its readings reached the overbought border and performed a pullback: the oscillator has not been below 50. This is a good “bullish” signal which implies the Australian dollar strengthening. We do not rule out the bullish momentum being developed after the fractal resistance breakout at 0.79: this level can be used for placing a pending buy order. Stop loss is to be placed at the last Parabolic signal, which can currently act as the support line at 0.782. After pending order placing, Stop loss is to be moved every four hours near the next fractal low, following Parabolic signals. Thus, we are changing the probable profit/loss ratio to the breakeven point. If the price meets stop loss level without reaching the order, we recommend cancelling the position: market sustains internal changes which were not considered.

Position Buy
Buy stop above 0.79
Stop loss below 0.782

Dear traders. For the detailed report of the strategy based on analytical issues of technical analysis click here.

 

[IFCM]

Waiting for pullback completion

Today we would like to focus your attention to GBP/USD . The pound slid from the seven-year high against the euro, and is down from the eight-week high against the US dollar. It was caused by the decline in real estate prices in February for the first time in five months. Note that last week the pound soared to the six-year high against the basket of major currencies. Now investors believe that the Bank of England rate hike will occur no earlier than in 2016. Moreover, there is a hypothetical possibility that the UK may exit the European Union if the Conservative Party wins the parliamentary elections scheduled in May. We don’t rule out the possibility that the pound might continue rising after the technical pullback is over.

The GBP/USD currency pair shows a pullback on the H4 chart, but the uptrend price channel is still remained. RSI-Bars oscillator is now in a neutral range: the latest bars are located below 50. It might be a sign that it is too early to buy. We do not rule out the bullish momentum being developed after the fractal high breakout at 1.55515: this level can be used for placing a pending buy order. Stop loss is to be placed at the lower border of DonchianChannel, which can currently act as the support line at 1.5383. After pending order placing, Stop loss is to be moved every four hours near the next fractal low, following Parabolic signals. Thus, we are changing the probable profit/loss ratio to the breakeven point. If the price meets Stop loss level without reaching the order, we recommend cancelling the position: market sustains internal changes which were not considered.

Position Buy
Buy stop above 1.55515
Stop loss below 1.5383

Dear traders. For the detailed report of the strategy based on analytical issues of technical analysis click here.

 

[IFCM]

Gold chart

Today let’s consider XAUUSD on the H4 chart. In February gold hit the 5-month low over expectations of an early Fed rate hike for the first time since 2006. Some market participants deem that this might be done in April. However, last week the Fed Chair said there was no need to raise interest rates that early. There is no specific timing and this issue will be discussed on a regular basis at meetings. This appeared to be the reason the majority of investors decided that the interest rates might be raised only in June. After that the gold price stabilized above $1200 per ounce. We don’t rule out the possibility of gold to advance due to high demand in China and India. Note that the US dollar index hit the 11-year high. If it slides, that might also provide support for precious metals.

XAU/USD finished the four-week downtrend, breaking the corresponding resistance level. Now it shows weak signs for bullish hopes and remains in the price channel. RSI-Bars showed bullish divergence: the latest bars are located below 50. This may be a sign that it is too early to go long. We do not exclude the bullish momentum being developed further after the breakout of the upper price channel boundary that coincides with the DonchianChannel upper level and the latest fractal high at 1223.3: this level can be used for placing a pending buy order. Stop loss is to be placed at the lower border of DonchianChannel that coincides with the lower border of the price channel and the latest fractal low, which can currently act as the support line at 1195.4. After pending order placing, Stop loss is to be moved every four hours near the next fractal low, following Parabolic signals. Thus, we are changing the probable profit/loss ratio to the breakeven point. If the price meets Stop loss level without reaching the order, we recommend cancelling the position: market sustains internal changes which were not considered. For the trading volume data please click here.

Position Buy
Buy stop above 1223.3
Stop loss below 1195.4

Dear traders. For the detailed report of the strategy based on analytical issues of technical analysis click here.

 

[IFCM]

Reduced spread

Today we would like to focus your attention to the Personal Composite Instrument (PCI) &Brent_WTI on the H4 chart. The instrument reflects price movements of a portfolio composed of two oil futures: Brent in the base part and WTI in the quoted part. In fact, this PCI is a price spread between European and American oil. As widely known, oil prices started to slide in the middle of last year and it was caused by a sharp rise in US shale oil production, meanwhile the production in other regions of the world was maintained at the same pace. WTI was sagging lower much faster than Brent. Earlier this year &Brent_WTI has soared, reflecting the oil trends. The spread between the two types of crude oil increased greatly from its historical values. As there is little difference between them, we don’t exclude reducing of the price spread and PCI sliding. You can import &Brent_WTI PCI into NetTradeX from our website.

&Brent_WTI broke the uptrend support level on the H4 chart. Bollinger bands have already started to widen, but the price has not reached the lower band yet. Note the reduced volatility on the MACD chart: it is below the zero level and the signal line which can be considered a bearish signal. The RSI indicator is going down, but hasn’t reached the oversold level yet. We do not rule out the bearish momentum being developed after the last &Brent_WTI candlestick will close below the lower Bollinger band, which is currently the level at 1.166. Another entry point may be considered the previous uptrend line which acts as the resistance line. Of course, you should go short in case there is no resistance level breakout at 1.199. Stop loss is to be placed at the last Parabolic point, which can now act as the resistance line at 1.232. After pending order placing, Stop loss is to be moved every four hours near the next fractal high, following Parabolic and Bollinger bands signals. Thus, we are changing the probable profit/loss ratio to the breakeven point. If the price meets stop loss level without reaching the order, we recommend cancelling the position: market sustains internal changes which were not considered.

Position Sell
Sell stop below 1.166
Stop loss above 1.232

Dear traders. For the detailed report of the strategy based on analytical issues of technical analysis click here.

 

[IFCM]

Looking forward to US dollar pullback continuation

Today the US dollar index is falling back. American macroeconomic performance looks so sustainable that some market participants began to doubt whether the Fed rate hike is likely to happen soon. In anticipation of the continuing dollar depreciation, a position on any currency pair might be opened. However, we suggest considering the Swiss franc. In comparison with the EU, the Swiss economy looks better. The country’s Q4 GDP rose 1.9% vs 0.9% (yoy). Unemployment rate in Switzerland is 3.2% and in the euro zone – 11.2%. Note that the ECB started printing money in the amount of 60 billion euro per month, but in Switzerland the same program is not carried out. Most likely, the price dynamics of the franc against the US dollar will be determined by the US statistics in the next few days. The next macroeconomic reports will be released in Switzerland on the 16th of March.

The USD/CHF currency pair showed a strong uptrend for a long time on the H4 chart. Now there is a sign of a slight pullback and the price hasn’t formed a fractal high yet. It deviated strongly from its exponential moving average. Donchian Channel boundaries have already widened, but the price has reached neither the upper nor the lower lines. The RSI indicator is going down and out of the overbought level. Besides, it is much higher than the level of 50. We do not rule out the bearish momentum being developed after the last USD/CHF candlestick is closed below the last fractal high at 0.99979. Stop loss is to be placed at the last Parabolic point and/or the upper Donchian Channel boundary, which can now act as the resistance line at 1.0127. After pending order placing, Stop loss is to be moved every four hours near the next fractal high, following Parabolic and Donchian Channel signals. Thus, we are changing the probable profit/loss ratio to the breakeven point. If the price meets stop loss level without reaching the order, we recommend cancelling the position: market sustains internal changes which were not considered.

Position Sell
Sell stop below 0.99979
Stop loss above 1.0127

Dear traders. For the detailed report of the strategy based on analytical issues of technical analysis click here.

 

[IFCM]

Preparing for Fed meeting

We would like to focus your attention to the EUR/USD currency pair. The euro has tumbled almost 25% without any significant retracement movements since May 2014. It was caused primarily by two factors. The expected euro printing as a part of the “quantitative easing” program launched by the ECB, as well as the planned Fed rate hike. The first event has already taken place: this March the ECB has announced the start of the bond-buying program in the amount of 60 billion euro spent monthly. This program will run until September 2016. An old trader saying “Buy on the rumor, sell on the news” worked partially, and now the euro is slightly rising. We don’t rule out the possible continuation of that rising if the Fed drops a hint that there is no need in the prompt rate hike.

EUR/USD showed a strong bearish move on the H4 chart. Now there is a slight retracement movement observed on the chart. There is a possibility of the technical analysis pattern formation called “double bottom”. RSI-Bars oscillator indicates the bullish divergence: it is located above 50. We do not rule out the bullish momentum being developed after the breakout of the fractal high and Donchian Channel upper boundary at 1.0683: this level may be used for placing a pending buy order. Stop loss is to be placed at the level of the Donchian Channel lower boundary and local fractal low, which can currently act as a support line at 1.0461. After pending order placing, Stop loss is to be moved every four hours near the next fractal low, following Parabolic signals. Thus, we are changing the probable profit/loss ratio to the breakeven point. If the price meets stop loss level without reaching the order, we recommend cancelling the position: market sustains internal changes which were not considered.

Position Buy
Buy stop above 1.0683
Stop loss below 1.0461

Dear traders. For the detailed report of the strategy based on analytical issues of technical analysis click here.

 

[IFCM]

Restoring USD/CHF position after retracement

Yesterday the Fed Chair Janet Yellen spoke at the Fed meeting where concerns were expressed over the US economy performance that appears to be worsening. Market participants decided that it implies a possible delay in the rate hike. Previously, they were confident that it would happen in July. Besides, the Fed dropped a hint that even if the rate would be increased, it wouldn’t be raised more than 0.6% by the end of this year. Meanwhile, the majority of investors hoped it to be hiked up to 1.1%. The discordance between the Fed official data and market expectations caused the most abrupt daily US dollar collapse in 18 months. Currently we can observe the opposite movement indicating the currency strengthening, but we regard it as retracement so far. Significant US macroeconomic data is not released today. In theory, in case of counting on the continued US dollar weakening you may open a position on any currency pair. However, we suggest looking at the Swiss franc chart. This morning the Swiss National Bank announced that interest rates were left unchanged, but the bank remarked being ready for foreign exchange intervention if the national currency soars. In turn, we recommend using a relatively close Stop loss level as there is a risk of intervention.

USD/CHF technical analysis: the price showed a strong uptrend for quite a long time on the H4 chart. Now there is a pullback and it tumbled down to its moving average (200) which was followed by a powerful rebound. Donchian Channel has widened greatly, which confirms the increased volatility. RSI oscillator plunged into the oversold zone, but quickly got out of it, although still remaining below 50. We do not rule out the bearish momentum being developed after the rebound is being finished and maintaining the resistance level at the last Parabolic points at 1.0015. Stop loss is to be placed at the level of the Donchian Channel upper boundary, which can currently act as the second resistance line at 1.0089. After pending order placing, Stop loss is to be moved every four hours near the next fractal high, following Parabolic and Donchian Channel signals. Thus, we are changing the probable profit/loss ratio to the breakeven point. If the price meets stop loss level without reaching the order, we recommend cancelling the position: market sustains internal changes which were not considered.

Position Sell
Sell limit below 1.0015
Stop loss above 1.0089

Dear traders. For the detailed report of the strategy based on analytical issues of technical analysis click here.

 

[IFCM]

Soybean: bullish divergence.

Let us consider the continuous futures contract of SOYBM meal: H4. Price has approached the upper boundary of bearish channel and has formed the bullish triple bottom figure (marked in yellow)

At the same time a bullish divergence is the most remarkable signal, formed by RSI-Bars oscillator. After the flat motion pattern started the oscillator signal updated maximums in upward trend channel. In view of the other signals described above, the most probable direction of motion is an upward movement – trend changing is probable. We expect completion of "bear’s holiday". A pending buy order can be placed above the fractal resistance of 326.47 – it was confirmed twice. It should be remarked that the breakdown of this level will eventually lead to updating of Donchian channel maximums. Additionally H4 trend line will be crossed. The last argument in favor of long position is the triangle pattern, formed by the support level of 316.03 and the H4 trend line: the market is consolidating before the new volatile pulse.

We can make a protection of long position by using "triple bottom" figure: a stop loss order can be placed below the 316.03 fractal mark. Stop loss is to be moved every four hours near the next fractal low, following Parabolic signals. Thus, we are changing the probable profit/loss ratio to the breakeven point.

Position Long
Buy stop above 326.47
Sell loss below 316.03