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Re: Market news and trade recommendations by FBS
EUR/USD: bearish "Harami"
12/6/2016 https://fxbazooka.com/img/articles/1...12eurusdh4.png We’ve got a “Shooting Star” at the local high, but this pattern hasn’t been confirmed yet. Therefore, the market is likely going to get the nearest support line, which could be a departure point for another upward movement. As we can see on the Daily chart, we don’t have any reversal pattern so far. In this case, the pair will probably test the 21 Moving Average later on. https://fxbazooka.com/img/articles/1...12eurusdh1.png There’s a “Harami” at the last high, which has been confirmed enough. Also, we’ve got a “Three Methods” here, so the market is likely going to continue moving up until any bearish pattern arrives. More: https://fxbazooka.com/analytics/11600 |
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USD/JPY: local "Engulfing"
12/6/2016 https://fxbazooka.com/img/articles/1...12usdjpyH4.png The 21 Moving Average acted as a support. Moreover, we’ve got a “Harami” pattern, but its confirmation is a quite weak. So, bears are likely going to move on. As we can see on the Daily chart, here’s a “High Wave” pattern, so there’s an opportunity to have a local bearish correction. https://fxbazooka.com/img/articles/1...12usdjpyH1.png We’ve got a local “Engulfing” pattern. If it confirms, bears will probably try to deliver a new low. More: https://fxbazooka.com/analytics/11601 |
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EUR/USD: wave 2 ended
12/6/2016 https://fxbazooka.com/img/articles/1...6152028001.png It seems like wave 2 ended in a form of a flat, so we’ve got a bullish impulse in wave [c]. If the price finds a lodgement under 0/8 MM Level, there’ll be an opportunity to have another bearish impulse in wave [i]. The nearest intraday target is -1/8 MM Level. https://fxbazooka.com/img/articles/1...6152028002.png As we can see on the one-hour chart, wave (v) of [v] finished near +1/8 MM Level. The price is declining, so we could have wave (i) in progress. In this case, we should keep an eye on 6/8 MM Level as the nearest bearish target. More: https://fxbazooka.com/analytics/11602 |
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Consequences of the Italian referendum
12/6/2016 https://fxbazooka.com/img/articles/1...8036463(1).jpg The euro managed to recover from early losses following the uncanny NO vote to the changes in Italian constitution. Polls showed that an overwhelming majority regarded the referendum as a chance to express dissatisfaction with the Renzi’s government performance. PM Matteo Renzi will have to resign now. Italy will face a new election which could finish with preposterous win of the populist, far-right Five movement party. What does it mean for Italia and Eurozone? As we can see market managed to digest the negative outcome of the referendum. There was no clamoring for havens. Investors managed to go through this Tumplike, Brexitlike shock. But the question is still open whether the European monetary union manages to survive an era of populist politicians and diverging economies or not. Many strategists believe that the currency union is strong enough to pass through the avalanche effect of the populist wins, as Europeans appreciate the benefits of the single currency. Despite multiple pledges to return national currencies, they will unlikely be able to bring their plans into an effect. Take a look at the left-wing Syriza party which took control of Greece in 2015 promising its electorate to return to the drachma. Yet Greece stomached capital controls, numerous bailouts and didn’t leave the euro area. However, the rise to power of the populist Five Star Movement may not lead to “Grexit” and Eurozone crumbling, the consequences of the recent referendum still can bring some troubles. Many observers believe that Renzi’s defeat worsens the problems of Italy’s banking system, and particularly of its most tittering, crisis-prone bank, Monte dei Paschi di Siena (MPS). The government has solicited institutional investors to recapitalize it, but many had made investment conditional on a Yes vote. So, as you can see there will be unlikely any bail-out for MSC from the government. MPS can be nationalized now, or rescued under new European Union rules that would hit investors in the pockets who hold MPS’s subordinated debt. So far, the euro has already survived one of the ground-shaking events that we’ve identified in our previous article. Next year will pose some more tests for the euro area. There will be elections in Germany, France and the Netherlands. So, it is probably too early discard the risk of the Eurozone breakup. Time will show, and we, from our side, will keep our fingers crossed for the euro. More: https://fxbazooka.com/analytics/11603 |
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EUR/USD rising inside minor corrective wave (iv)
12/6/2016 EUR/USD rising inside minor corrective wave (iv) Next buy target – 1.0850 EUR/USD recently rose sharply inside the minor corrective wave (iv) – which started earlier – when the pair reversed up from the powerful, long-term support level 1.0550, which stopped the earlier strong downtrend in December of 2015, as can be seen below. The support zone near the support level 1.0550 was strengthened by the lower daily Bollinger Band and by the support trendline of the weekly down channel from May. EUR/USD is expected to rise further toward the next buy target at the resistance level 1.0850 (previous strong support from October), intersecting with the 38.2% Fibonacci correction of the previous sharp downward impulse from August. https://fxbazooka.com/img/articles/1...PM_(1_day).png More: https://fxbazooka.com/analytics/11604 |
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GBP/AUD broke resistance zone
12/6/2016 GBP/AUD broke resistance zone Next buy target - 1.7650 GBP/AUD continues to rise after the recent breakout of the resistance zone lying between the resistance level 1.6960 (which stopped the previous a-wave of the active minor ABC correction 2 from the end of October) and the 61.8% Fibonacci correction level of the previous sharp minor impulse wave 1 from the middle of September. The breakout of this resistance zone accelerated the active minor c-wave. GBP/AUD is expected to rise further in the active c-wave toward the next buy target at the strong resistance level 1.7650, which reversed the previous waves A and (2), as can be seen below. https://fxbazooka.com/img/articles/1...PM_(1_day).png More: https://fxbazooka.com/analytics/11605 |
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USD/CAD & BoC Interest Rate Decision: Further bullish momentum for the Loonie?
12/7/2016 Today at 15:00 GMT will be released the Bank of Canada’s interest rate decision, which overnight rate is expected to remain on hold at 0.5%. The cCentral bank could bring some hints about current export situations that could see some slowdown because of current global demand and also, the Canadian government is looking to stabilize housing market and it should be interesting to read what the BoC has to say about it. Our technical analysis for USD/CAD at H4 chart is showing a bearish consolidation in progress below the 200 SMA and that should put in danger further bullish outlooks for the Loonie, at least in the short-term. If the pair manages to break below the support level of 1.3234, it can extend the decline to test the 1.3172 level, while a hawkish statement by the Bank of Canada can make the USD/CAD pair to test the 200 SMA once again. https://fxbazooka.com/img/articles/1...DCADH4(17).png More: https://fxbazooka.com/analytics/11606 |
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USD/JPY: yen lost its way in broad daylight
12/7/2016 On the USD/JPY daily chart, there is a consolidation within an uptrend. An update of the December high will allow prices to continue their rally towards 119. Alternatively, a successful test of the correction minimum at 112.85 can lead to the rollbacks towards 111.35. https://fxbazooka.com/img/articles/1...7_08_28_28.png On the USD/JPY hourly chart, AB = CD patterns indicate near-term targets of the uptrend. They are located at 116.9 and 117.15. A return of quotes in the borders of rising trading channel followed by the test of the resistance at 114.75 will be a signal for opening long positions. https://fxbazooka.com/img/articles/1...7_08_28_58.png Recommendations: BUY 114,75 SL 114,2 TP 116,9, BUY 113,15 SL 113,7 TP1 112 TP2 111,35. More: https://fxbazooka.com/analytics/11607 |
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USD/CAD: bears are developing correction
12/7/2016 On the USD/CAD daily chart, there is a correction towards the uptrend. If the "bulls" fail to keep the quotes above the lower boundary of the rising trading channel, the "Shark" pattern may be realized. Its 88.6% target is located near the 1,305 level. https://fxbazooka.com/img/articles/1...7_08_29_19.png On the USD/CAD hourly chart, "Shark" and "Crab" patterns, as well as the levels of Fibonacci retracement to the last upward wave indicate the location of the convergence areas. They are located near the 1,318 and 1,308 marks. Rebounds from these levels will be a signal for opening long positions. https://fxbazooka.com/img/articles/1...7_08_29_36.png Recommendation: BUY 1,318 SL 1,3125 TP1 1,34 TP2 1,36, BUY 1,308 SL 1,3025 TP1 1,3275 TP2 1,34. More: https://fxbazooka.com/analytics/11608 |
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Morning brief for December 7, 2016
12/7/2016 AUD/USD slumped to 0.7417 after Q3 GDP data indicated the biggest decline in over 5 years. Many analysts expect it to rebound in Q4 pointing at surging metal prices. NZD/USD changed only a little on the session. The pair is trading below 0.7125. We will hear RBNZ Governor Wheeler speaking at 10:00 pm GMT+2. His speech should bring some moves to the chart. EUR/USD moved higher to 1.0725 on the Asian session. The US dollar is still one of the strongest currencies as market cherishes a thought of the Fed’s rate hike. The euro is on the razor’s edge as the ECB is expected to announce an extension of QE on Thursday. Today’s focus is on the US JOLTS job openings. USD/JPY took a few baby steps towards 114.20. There should some more JPY weakening versus USD. Earlier this morning we had BOJ deputy Governor Iwata on the wires who said that BOJ will continue its powerful monetary easing actions via asset purchases and interest rates. GBP/USD fell below 1.2660 in the course of the session. The pound managed to stabilize earlier. Brexit minister David Davis indicated recently that the government could consider paying to the EU to remain access to the single market. This announcement pushed GBP higher. At the present moment, the market is waiting for the Supreme Court’s decision on whether the government needs an approval of Parliament before triggering Article 50. Strategists believe that if parliament wins the case it may delay Brexit beyond 2017 March. Today you should keep an eye on the UK manufacturing production. USD/CAD edged up to 1.3290 on the session. Today, the Bank of Canada will announce its decision on the interest rate at 5:00 pm GMT+2. It is expected to remain on hold at 0.5%. We see more USD/CAD upside going forward driven by the Fed hike, tepid pace of Canadian growth and uncertainty over US-Canada trade relationships. The oil prices will unlikely offer support to loonie; the OPEC’s push should fade away soon. More: https://fxbazooka.com/analytics/11609 |
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EUR/USD: "Breakaway Gap" going to act as a support
12/7/2016 https://fxbazooka.com/img/articles/1...016-EUR-H4.png We’ve got a “Double Top”, which has been formed under the 89 Moving Average. Therefore, the market is likely going to decline towards a support area at 1.0655 – 1.0594 in the short term. If a pullback from these levels happens, there’ll be an opportunity to have another bullish movement in the direction of the next resistance at 1.0815 – 1.0850. https://fxbazooka.com/img/articles/1...016-EUR-H1.png The 34 Moving Average acted as a support, so the price is consolidating. Also, we’ve got a “Flag” pattern, so bears are likely going to reach a support at 1.0666. At the same time, if we see a pullback from this level, bulls will probably try to test a resistance at 1.0795 – 1.0815. More: https://fxbazooka.com/analytics/11610 |
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GBP/USD: "Double Top" led to decline
12/7/2016 https://fxbazooka.com/img/articles/1...016-GBP-H4.png The price faced a resistance at 1.2770, so we’ve got a “V-Top” pattern here. In this case, the market is likely going to decline towards a support by the trend. If bears be stopped here, there’ll be an option to have another bullish movement, so we should keep an eye on a resistance at 1.2770 – 1.2795 as a possible intraday target. https://fxbazooka.com/img/articles/1...016-GBP-H1.png There’s a “Double Top” pattern, which has been confirmed. Meanwhile, the 55 Moving Average is acting as a support, but the price is likely going to continue falling down in the direction of the 89 Moving Average. If a pullback from this line be on the table, bulls will have a chance to deliver a new high. More: https://fxbazooka.com/analytics/11611 |
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EUR/USD: correction may continue
12/7/2016 Technical levels: support – 1.0690, 1.0640; resistance – 1.0790, 1.0830/40. Trade recommendations: 1. Buy — 1.0690; SL — 1.0670; TP1 — 1.0790; TP2 – 1.0840. 2. Buy — 1.0730; SL — 1.0710; TP1 — 1.0790; TP2 – 1.0840. Reason: bearish mood of Ichimoku Cloud and rising Senkou Span A; a new golden cross of Tenkan-sen and Kijun-sen and the rising Tenkan-sen; the prices are on the support of Tenkan. https://fxbazooka.com/img/articles/1...rusdh4(63).png More: https://fxbazooka.com/analytics/11613 |
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AUD/USD: bulls have lost its positions
12/7/2016 Technical levels: support – 0.7430; resistance – 0.7490. Trade recommendations: 1. Buy — 0.7450; SL — 0.7430; TP1 — 0.7490; TP2 — 0.7540. Reason: bearish Ichimoku Cloud and falling Senkou Span B; a golden cross of Tenkan-sen and Kijun-sen, but the prices breaking down the Tenkan’s support. https://fxbazooka.com/img/articles/1...dusdh4(58).png More: https://fxbazooka.com/analytics/11614 |
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USD/CAD: forecasts from banks ahead of the BOC meeting
12/7/2016 Today, the Bank of Canada will announce its decision on the interest rate at 5:00 pm GMT+2. The market expects the BOC to keep policy rates on hold at 0.5%. The focus will be on the tone of the board’s statement. The recent data releases are half-and-halfer. Q3 GDP outpaced the BOC’s October forecasts, driven by the increase in exports from Q2 and relatively strong household consumption. The business sentiment is still weak, however. This will likely make the board’s members cautious about a strong upsurge in manufacturing in the upcoming quarters. Labor data is rather strong. The Merrill Lynch analysts expect a sustained move higher in USD/CAD towards the end of the year driven by the following factors: a faster pace of Fed hikes because of Trump’s expansionary fiscal policies; a tepid pace of Canadian growth; heightened uncertainty with respect to Canadian trade with the USA. Surging US yields will probably be the main hurdle for the BOC’s cuts in the nearest future. The CAD may be supported, however, in the near-term, if oil prices continue their rally. BofA Merrill USD/CAD targets are following: at 1.36 by the end of the year; at 1.38, 1.40, 1.41, 1.43 by the end of Q1, Q2, Q3 and Q4 of 2017 accordingly. Nomura analysts believe that the BOC will leave its policy rate at o.5 %. They point at Stephen Poloz’s recent comments. The BOC Governor said Canada’s data little changed since the October meeting, suggesting the Communique is likely to be little changed. https://fxbazooka.com/img/articles/1...Carmichael.jpg Credit Agricole says that CAD has become really vulnerable to significant interest rate differentials (the divergence existing between the monetary stances of BOC and Fed). So, they believe that this will keep USD/CAD close to 1.35 into the year-end remaining rather bearish outlook for oil prices in the near-term. More: https://fxbazooka.com/analytics/11615 |
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EUR/USD: wave [i] started
12/7/2016 https://fxbazooka.com/img/articles/1...7113128001.png We’ve got wave 2, which has formed a flat pattern. So, there’s an opportunity to have a bearish impulse in wave [i] in the short term. In this case, the price is likely going to break -1/8 MM Level soon. https://fxbazooka.com/img/articles/1...7113128002.png As we can see on the one-hour chart, wave (v) of [c] is truncated. Also, there’s a downward impulse in wave (i). Therefore, bears are likely going to deliver wave (iii) during the day. The main intraday target is 4/8 MM Level. More: https://fxbazooka.com/analytics/11618 |
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Fifth element and Power Ranger swing trading strategies
12/7/2016 Fifth element The main advantage of the fifth element strategy is that tells you ahead of time when the entry price will be, so you should spend lots of time in front of the screen waiting for the right to snatch a whaling sum of money. Key Ingredients: Timeframe – H1, H4. Trading tools – fast EMA 12, slow EMA 26, MACD SMA 9 Currency pairs – EUR/USD, USD/JPY, GBP/USD. USD/CHF, USD/CAD. AUD/USD, NZD/USD. Strategy concept MACD histogram indicates the direction and momentum of the market. If the MACD histogram switches from negative to positive, this is a signal of the possible upward shift in momentum. You should wait for 5 positive bars on the histogram to confirm the momentum before going long on the fifth bar (that’s why this strategy is dubbed “fifth element”; it’s not after Luc Besson’s film). If the MACD histogram switches from positive to negative, this means that you should open short positions (the rule of the fifth bar remains in force). https://fxbazooka.com/img/articles/1...RUSDH4(37).png Long trade setup Wait until the MACD histogram goes from negative to positive. Wait for 4 positive bars to appear on the histogram before entering the market long on the opening of the fifth bar. You should place the stop loss at the last low of the histogram. You have 2 profit targets with risk to reward ratios – 1:1 and 1:2 accordingly. For example, the risk of you trade is 150 points, and the reward is 300 points if both targets are fulfilled. The risk to reward ratio is 1:2, which yields a tidy 6% return if we take a 3% risk. Power Ranger strategy The strategy works with the hourly and 4-hourly chart. Trading tools – we use stochastic for this strategy with the following settings: %K period = 10 %D period = 3 Slowing = 3 Price field = high/low MA method = simple Levels 20 and 80 Reminder – stochastic is an indicator that measures overbought and oversold conditions in the market. Currency pairs – EUR/USD. USD/JPY, GBP/USD, USD/CHF. USD/CAD, AUD/USD, NZD/USD The basic concept of the strategy is that a range should be formed after the market stops trading. Stochastic helps us to identify a possible range formation. We also should pay attention to the current market momentum to tell us whether we should go long or short. If the market is moving up, we may go long in the range. The entry point can be found with the help of Stochastic (it should be below level 20 - in the oversold area). If the market is moving down, we should go short in the range. The entry point can be found in the overbought area (above level 80) of the Stochastic indicator. The power ranges strategy has two profit targets – the first one should be taken within the range. The second target is located beyond the range in anticipation of a breakout. https://fxbazooka.com/img/articles/1...DDaily(27).png Long trade setup Identify an uptrend line Take a look at the stochastic for %K and %D to go below level 20 (oversold area). Find support and resistance of the range. You may enter long when stochastic steps into the oversold area (above 20 level) You should place your first profit target at the 75% mark of the range. The stop loss should be set at a risk to reward ratio of 1:2. After calculation, the stop loss must be placed below the support level. If not, the trade is considered invalid. Beware! It doesn’t mean that you go long whenever the stochastic is in the oversold region or go short whenever the stochastic is in the overbought region. You should identify momentum before entering the market. More: https://fxbazooka.com/analytics/11619 |
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Key option levels for Wednesday, December 7th
12/7/2016 EUR/USD https://fxbazooka.com/img/articles/11620/EURUSD(79).png Main trend Short-term period Medium-term period Neutral Neutral Changes in the open interest -No data- -No data- Closest resistance levels 1.0733; 1.0749; 1.0782; 1.0807 Closest support levels 1.0707; 1.0684; 1.0640; 1.0609 Trading recommendations Baseline scenario Short EUR/USD below 1.0707, with target points at 1.0684 and 1.0640 Alternative scenario Moving above 1.0733 can be considered as a signal to Buy the pair, with target at 1.0749 and 1.0782 USD/JPY https://fxbazooka.com/img/articles/11620/USDJPY(72).png Main trend Short-term period Medium-term period Neutral Neutral Changes in the open interest -No data- -No data- Closest resistance levels 114.08; 114.26; 114.44; 114.73 Closest support levels 113.83; 113.61; 113.25; 112.79 Trading recommendations Baseline scenario Short USD/JPY below 113.83, with the target points at 113.61 and 113.25 Alternative scenario Moving above 114.08 can be considered as a signal to Buy the pair, with target at 114.26 and 114.44 USD/CAD https://fxbazooka.com/img/articles/11620/USDJPY(73).png Main trend Short-term period Medium-term period Neutral Bullish Changes in the open interest -No data- -No data- Closest resistance levels 1.3300; 1.3319; 1.3365; 1.3435 Closest support levels 1.3259; 1.3217; 1.3149; 1.3070 Trading recommendations Baseline scenario Long USD/CAD above 1.3300, with the target points at 1.3319 and 1.3365 Alternative scenario Moving below 1.3259 can be considered as a signal to Sell the pair, with target at 1.3217 and 1.3149 More: https://fxbazooka.com/analytics/11620 |
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EUR/USD: local "Harami"
12/7/2016 https://fxbazooka.com/img/articles/1...12eurusdh4.png We’ve got a “Shooting Star” and a “Tower”, which both have been confirmed. So, the current bearish correction is likely going to move on towards the nearest “Window”. As we can see on the Daily chart, here’s a “Harami” at the local high, so bears are likely going to deliver a new local low. At the same time, there’s an opportunity to have another upward movement in the direction of the 21 Moving Average. https://fxbazooka.com/img/articles/1...12eurusdh1.png The price is consolidating, but we have a “Harami” at the last high, so the market is likely going to test the Moving Averages. If a pullback from these line happens, bulls will probably try to reverse the price movement into an upward direction. More: https://fxbazooka.com/analytics/11621 |
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USD/JPY: bearish "Tower"
12/7/2016 https://fxbazooka.com/img/articles/1...12usdjpyH4.png The 13 & 21 Moving Average acted as a support, so there’s a bearish “Engulfing”, but this pattern hasn’t been confirmed yet. Therefore, the market is likely going to decline towards the nearest support. If a pullback from this level happens, there’ll be an opportunity to have another bullish movement. As we can see on the Daily chart, there isn’t any bearish pattern so far. In this case, bulls are likely going to move on. https://fxbazooka.com/img/articles/1...12usdjpyH1.png We’ve got a “Tower”, a “High Wave” and a “Two Crows”, which all have been confirmed enough. Under this circumstances, the 55 Moving Average is likely going to act as a support, which could be a departure point for another bullish rally. More: https://fxbazooka.com/analytics/11622 |
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GBP/CAD reversed from resistance zone
12/7/2016 GBP/CAD reversed from resistance zone Next sell target – 1.6400 GBP/CAD continues to decline – after the recent downward reversal from the resistance zone lying between the round resistance level 1.7000, upper daily Bollinger Band, resistance trendline of the wide daily down channel from January and the 38.2% Fibonacci correction of the previous downward impulse from June. The downward reversal from this resistance zone stopped the previous minor ABC correction 2. GBP/CAD is expected to fall further to the next sell target at the support level 1.6400 (which stopped the B-wave of the previous ABC correction (2) in November). https://fxbazooka.com/img/articles/1...(1_day)(1).png More: https://fxbazooka.com/analytics/11623 |
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EUR/GBP reversed from support zone
12/7/2016 EUR/GBP reversed from support zone Next buy target - 0.8600 EUR/GBP recently reversed up sharply from the support zone lying between the support level 0.8350 (which also earlier reversed the previous minor correction 4 at the start of September), the lower daily Bollinger Band and the 50% Fibonacci correction level of the previous sharp upward impulse wave (C) from the end of May. The upward reversal from the aforementioned support zone stopped the previous minor impulse waves (iii) and 3, which belong to the intermediate (C)-wave from the start of November. EUR/GBP is expected to rise further to the next buy target at the resistance level 0.8600. https://fxbazooka.com/img/articles/1...PM_(1_day).png More: https://fxbazooka.com/analytics/11624 |
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EUR/USD & ECB interest rate decision - Next step: parity zone?
12/8/2016 Today’s ECB meeting at 12:45 GMT will be the last of the year, but also, it will be one of the most important, ahead of next week’s Federal Reserve meeting. The central bank has been keeping unchanged the interest rates but at the same time, according to Mario Draghi’s words, it keeps the doors opened to further stimulus and that could get materialized in today’s meeting. Some analysts are expecting that the ECB will extend it’s QE program. Our technical analysis for EUR/USD at H4 chart is showing a recovery ongoing and it’s heading towards the 200 SMA. If the meeting comes in with hawkish words for Eurozone’s economy, the pair may attempt a breakout above the resistance level of 1.0859, while some negative words or drastic measures could weigh on the Euro and it could consolidate below the 1.0600 psychological level. https://fxbazooka.com/img/articles/1...RUSDH4(38).png More: https://fxbazooka.com/analytics/11625 |
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AUD/USD: bulls are dreaming of revenge
12/8/2016 On the AUD/USD daily chart, a breakout of the resistance at 0.749 can activate the "Bat" inverted pattern followed by the return of quotes to the lower boundary of the last upward trading channel. There is 88.6% target of the "Bat" pattern. The outlook for this pair is still "bearish", so the sales on the rebounds are relevant. https://fxbazooka.com/img/articles/1...8_08_31_39.png On the AUD/USD hourly chart, quotes are moving within the upward trading channel. The roll back from its upper boundary or unsuccessful test of the resistance at 0.757 (target 161.8% in the AB = CD pattern) will be the signal for the opening short positions. https://fxbazooka.com/img/articles/1...8_08_31_53.png Recommendations: SELL 0,7545 SL 0,761 TP 0,74, SELL 0,757 SL 0,7625 TP 0,75. More: https://fxbazooka.com/analytics/11626 |
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EUR/USD: euro waits for a rollercoaster ride
12/8/2016 On the EUR/USD daily chart, there is a correction towards the downtrend. A breakout of the upper boundary of the bars, formed on December 5-6, will increase the risk of rollback towards 1,093. This mark corresponds to the 38.2% Fibonacci retracement level formed from the last downward wave. https://fxbazooka.com/img/articles/1...8_08_31_09.png On the EUR/USD hourly chart, an expanding wedge reversal pattern has been formed on the basis of the "Three Indians". A successful test of the resistance at 1,08-1,0815 will pave the way towards the 1.091-1.093 convergence area (50% Fibo level from the last downward wave and target 224% in the pattern AB = CD). https://fxbazooka.com/img/articles/1...8_08_31_25.png Recommendations: BUY 1,0815 SL 1,076 TP 1,0925, SELL 1,0925 SL 1,098 TP1 1,077 TP2 1,05. More: https://fxbazooka.com/analytics/11627 |
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Morning brief for December 8, 2016
12/8/2016 The euro popped up with aplomb above 1.0770 from an early trough at 1.0750. The ECB decision followed by the press conference will be the main story over the next hours. Buckle up for a ride in EUR/USD. The ECB is expected to extend its asset-purchasing program. So, there is a downside risk in this currency pair, if market’s wagers on further easing are realized. "So, what is the program for today? " https://fxbazooka.com/img/articles/1...ago_silvan.jpg USD/JPY slid down below 113.30. Japanese economic releases were half-and-halfer. We got an upbeat current account data earlier this morning followed by weak Q3 GDP and final GDP price index readings. But as we’ve already noticed, the yen didn’t pay much heed to these disappointing headlines. Later on the session, we will receive the unemployment claims release from the US. AUD/USD retreated in the early hours of the Asia session mainly due to the weak Australian trade balance release for Q4 (there was a tangible miss, much wider than expected). Also, we got some distortion in the Chinese trade balance data. At the present moment, the pair is trading along 0.7495 level having partially recovered its losses due to the gains that got bulk commodities overnight. NZD/USD moved higher through the session (above 0.7208 mark). There was some upbringing news from the diary giant Fonterra; it was said that farmer payout this season will total $6.40 kg of milk solids. There won’t be any significant news that could thrill the land under Kiwi’s feet. So, you may switch to another, more volatile currency pair. https://fxbazooka.com/img/articles/11628/Dairy-Cows.jpg USD/CAD slumped below 1.3215. Brent futures made a baby step in the northern direction having added 3 cents to reach $53.03. Today’s focus will be on Canadian building permits and new houses price index. More: https://fxbazooka.com/analytics/11628 |
Re: Market news and trade recommendations by FBS
GBP/USD: in correction to the Cloud
12/8/2016 Technical levels: support – 1.2550; resistance – 1.2670, 1.2730. Trade recommendations: 1. Sell — 1.2670; SL — 1.2690; TP1 — 1.2600; TP2 — 1.2550. Reason: bullish Ichimoku Cloud and horizontal Senkou Span A and B; a cancelled golden cross of Tenkan-sen and Kijun-sen; a strong resistance of Tenkan-sen and Kijun-sen. https://fxbazooka.com/img/articles/1...pusdh4(50).png More: https://fxbazooka.com/analytics/11629 |
Re: Market news and trade recommendations by FBS
AUD/USD: going to Senkou Span B
12/8/2016 Technical levels: support – 0.7460; resistance – 0.7490, 0.7540. Trade recommendations: 1. Buy — 0.7460; SL — 0.7440; TP1 — 0.7490; TP2 — 0.7540. Reason: bearish Ichimoku Cloud and rising Senkou Span A; a golden cross of Tenkan-sen and Kijun-sen and rising Kijun-sen; the prices are breaking out strong resistance of 0.7490. https://fxbazooka.com/img/articles/1...dusdh4(59).png More: https://fxbazooka.com/analytics/11630 |
Re: Market news and trade recommendations by FBS
What will happen with the euro after the ECB meeting?
12/8/2016 Morgan Stanley’s strategists believe that the ECB will keep rates on hold at this week’s meeting, but can expand its QE purchase program. But they consider different scenarios with various responses from the euro. Potential scenarios and the reaction of the euro. 1. QE purchases extension for 6 months after March. This expansion is well priced in by the market participants, so, it wouldn’t be surprising for markets. The reaction of EUR/USD should be restrained. To extend purchases and leave an expectation in the market that they could extend again, the ECB should introduce some changes to its present program. Which kind of changes? - The ECB may announce that it is not going to use the capital key to allocate purchases. This option will be positive for periphery countries of the Eurozone, but bad for the German bund. The reaction of the euro should be positive in this case. The ECB may not express itself explicitly, it can only hint that it is going to be flexible (in this case the euro’s reaction won’t be stormy). If the ECB is more explicit, the euro may react with some moves. - The ECB can recourse to buying bonds below the deposit rate. This decision will be negative for the euro. - The ECB may commit itself to changing the maximum limit on buying per issuer. This approach should be bullish for German bund curve. EUR/USD will fall, if there is a larger decrease in bund yields than US Treasury yields. - The ECB may address the scarcity of bonds. If there is a rise in short end rates (it would dissipate fears over the bond scarcity), the euro may gather momentum. 2. The ECB announces the cut of its interest rate. This scenario is not expected by the market. If it is realized, EUR/USD should fall significantly. 3. ECB decides to extend its QE purchases by more than 6 months beyond March. This option is not expected by the market. EUR/USD will be poised to weakening. 4. ECB doesn’t change its policy stance. This approach will cause German bunds to rise substantially and push EUR higher. 5. ECB extends corporate bond purchases, but not government bond. Basically, in this case, the ECB will commit to the tapering of the bond purchasing program. This scenario is unlikely, and if it’s realized, it will be positive for EUR. The ECB meeting will be held on Thursday, December 8. More: https://fxbazooka.com/analytics/11596 |
Re: Market news and trade recommendations by FBS
Key option levels for Thursday, December 8th
12/8/2016 EUR/USD https://fxbazooka.com/img/articles/11635/EURUSD(80).png Main trend Short-term period Medium-term period Neutral Neutral Changes in the open interest + 62 814 ? + 99 575 ? Closest resistance levels 1.0775(?); 1.0797; 1.0817; 1.0844 Closest support levels 1.0748; 1.0720; 1.0696; 1.0666 Trading recommendations Baseline scenario Short EUR/USD below 1.0748, with target points at 1.0720 and 1.0696 Alternative scenario Moving above 1.0775 can be considered as a signal to Buy the pair, with target at 1.0797 and 1.0817 GBP/USD https://fxbazooka.com/img/articles/11635/GBPUSD(74).png Main trend Short-term period Medium-term period Bullish Bearish Changes in the open interest + 174 ? + 251 ? Closest resistance levels 1.2634; 1.2658; 1.2683; 1.2717 Closest support levels 1.2608; 1.2567; 1.2533; 1.2491 Trading recommendations Baseline scenario Long GBP/USD above 1.2634, with target points at 1.2658 and 1.2683 Alternative scenario Moving below 1.2608 can be considered as a signal to Sell the pair, with target at 1.2567 and 1.2533 USD/JPY https://fxbazooka.com/img/articles/11635/USDJPY(74).png Main trend Short-term period Medium-term period Bearish Neutral Changes in the open interest + 447 ? + 713 ? Closest resistance levels 113.86; 114.03; 114.56; 115.06 Closest support levels 113.56; 113.25; 112.80; 112.27 Trading recommendations Baseline scenario Short USD/JPY below 113.56, with the target points at 113.25 and 112.80 Alternative scenario Moving above 113.86 can be considered as a signal to Buy the pair, with target at 114.03 and 114.56 More: https://fxbazooka.com/analytics/11635 |
Re: Market news and trade recommendations by FBS
Review on David Powell’s book
12/8/2016 https://fxbazooka.com/img/articles/11636/gFY304pb.jpeg Perhaps every trader has his “favorite” currency, the one that brought him lots of money. If you prefer trading currency pairs containing EUR, you’d probably be interested in reading “The trader’s guide to the euro area” written by the chief euro area economist at Bloomberg – David Powell. It’s a very compact and readable book for those who want to get a comprehensive overview of trading-related aspects of the euro area. With this information, you will be able to analyze the recent economic developments in the euro area and predict which impact they may have on your financial assets. The first chapters of the book focus on the leading economic indicators of the euro area. The author explains how the variations in the headlines of the Eurozone economic releases may influence the exchange rate of the euro. The subsequent chapters allow you to know more about the structure of the Euro area – its institutions, composition, operation. Next chapter tells us the story of the euro crisis – its origin, developments. Also, it describes the measures undertaken by the ECB to overcome the consequences of the crisis. Having read this part, you will know about the transmission channels of the ECB monetary policies. So, this chapter is perhaps the most valuable in the books, because with its help you will be able to readily respond to the ECB announcements (without tardy fundamental analysis of the market’s strategists). You know, time is money. It may be no accident that many successful, affluent traders are those people who are well-educated, hungry for knowledge and insatiable of learning. The final chapters contain the information about the particularities/characteristics of German, French economies (key Eurozone countries) as well as the economies of the UK, Switzerland, Sweden, and Norway. So, with these concluding chapters, you will know not only about the trade relating aspects of the euro area but also about the analytical tools for GBP, CHF, NOK currencies. DOWNLOAD THE BOOK More: https://fxbazooka.com/analytics/11636 |
Re: Market news and trade recommendations by FBS
Banks' guidance ahead of the ECB meeting
12/8/2016 It seems that everything is clear the ECB will extend its asset-purchasing program, and send the euro lower. But banks smell a rat in this announcement. The ECB should introduce more easing measures, but it may simultaneously point to the possibility of tapering asset purchases in 2017. And that’s what makes us uneasy. How to decipher this ambiguous announcement? https://fxbazooka.com/img/articles/11637/ecb2.png More: https://fxbazooka.com/analytics/11637 |
Re: Market news and trade recommendations by FBS
EUR/USD: bullish "Flag"
12/8/2016 https://fxbazooka.com/img/articles/1...016-EUR-H4.png The price is consolidating under the 89 Moving Average. Also, there’s a “Flag” pattern, so the market is likely going to continue rising towards a resistance at 1.0815 – 1.0850. If a pullback from this area happens, there’ll be an opportunity to have another test of the 89 Moving Average. https://fxbazooka.com/img/articles/1...016-EUR-H1.png We’ve got a pullback from the 34 Moving Average, so bulls are likely going to reach a resistance at 1.0795 – 1.0815 in the short term. Considering a possible pullback from these levels, bears will probably try to achieve a support at 1.0745 afterwards. More: https://fxbazooka.com/analytics/11638 |
Re: Market news and trade recommendations by FBS
GBP/USD: bulls going to test high
12/8/2016 https://fxbazooka.com/img/articles/1...016-GBP-H4.png There’s a “V-Bottom”, which led to the current upward price movement. In this case, the market is likely going to reach a resistance at 1.2770 – 1.2795 in the short term. If we see a pullback from this area, there’ll be an opportunity to have a downward correction. https://fxbazooka.com/img/articles/1...016-GBP-H1.png We’ve got a “Double Bottom”, which has been confirmed. The 34 Moving Average is acting as a resistance. So, the pair is likely going to rise towards the next resistance at 1.2734 – 1.2770. If bulls be stopped here, bears will have a chance to test a support at 1.2672. More: https://fxbazooka.com/analytics/11639 |
Re: Market news and trade recommendations by FBS
EUR/USD: wave 2 going to be continued
12/8/2016 https://fxbazooka.com/img/articles/1...8130222001.png The price is still rising, so wave 2 could take a form of a flat. In this case, an impulse in wave [c] is likely going to be continued. Therefore, we should keep an eye on 2/8 MM Level as a possible intraday target. https://fxbazooka.com/img/articles/1...8130222002.png As we can see on the one-hour chart, we’ve got a bullish impulse in wave (iii) in progress. So, the market is likely going to continue rising in the short term. If +2/8 MM Level appears to be broken, we’re going to have another Murrey Math indication. More: https://fxbazooka.com/analytics/11640 |
Re: Market news and trade recommendations by FBS
EUR/USD: bearish "Harami"
12/8/2016 https://fxbazooka.com/img/articles/1...12eurusdh4.png The price is still rising, so we don’t have any reversal pattern so far. In this case, bulls are likely going to move on towards the nearest “Window”. As we can see on the Daily chart, the last “Harami” wasn’t confirmed, so the market is likely going to continue moving up. https://fxbazooka.com/img/articles/1...12eurusdh1.png Bulls are still here, but we’ve got a “Harami” at the local high. If this pattern confirms, the pair is likely going to form a local correction. At the same time, there’s an opportunity to have another high afterwards. More: https://fxbazooka.com/analytics/11641 |
Re: Market news and trade recommendations by FBS
USD/JPY: "Window" going to act as a support
12/8/2016 https://fxbazooka.com/img/articles/1...12usdjpyH4.png We’ve got an “Engulfing”, which has been confirmed enough. Therefore, the price is likely going to decline towards the nearest “Window”. If any bullish pattern forms later on, there’ll be an opportunity to have another bullish movement. As we can see on the Daily chart, the current correction is likely going to test the “Window” nearby. https://fxbazooka.com/img/articles/1...12usdjpyH1.png The 13 Moving Average has acted as a resistance, so we’ve got a “Three Methods” pattern. In this case, the price is likely going to decline in the direction of the closest support. Meanwhile, if any bullish pattern arrives afterwards, bulls will probably try to deliver an upward correction. More: https://fxbazooka.com/analytics/11642 |
Re: Market news and trade recommendations by FBS
Day trading strategies
12/8/2016 Day traders are those who enter into and exit positions several times per day. Their biggest pet peeve Is holding trading positions overnight. They are more concerned with finishing the day without an open position than the actual result of the trade itself. Day traders use a combination of both technical and fundamental analysis. So, if you refer yourself to these traders, you might be interested in the following strategies. GAWK THE TALK Key ingredients: Timeframe: 15-minutes and 30-minutes (news is usually released within the 15-min intervals). Strategy is suitable for all currencies Strategy concept: We compare the forecasted figures with the actual figures. For this strategy, traders go long on the chosen currency when actual figures of the release are much greater than forecasted ones. For example, the Reserve Bank of Australia raises its benchmark. In this case, we should go long on the AUD/USD. Long trade setup You should take following steps to execute the gawk the talk strategy for long. Choose an affected currency to trade the news. Enter long on NZD/USD once the actual figure released is ahead of expectations (if it is higher than the forecasted figure by 20% or more). Set a stop loss of 20 pips from the entry price. A profit target should be placed 40 pips higher from the entry price. The risk for this trade is 20 pips, the reward is 40 pips. The risk to reward ratio is 1:2 (you can expect 6% return from a 3% risk). BALK THE TALK In forex life, everything is topsy-turvy. Even if the news is very bad, you can still earn whaling sums of money. For this strategy, we go short on the certain currency (hit by the news) when actual figures are lower than forecasted ones by a minimum factor of 20%. The “key ingredients” for this strategy are the same we had for gawk the talk strategy. For example, we get a negative GDP for the US. What we should do is to initiate a short trade on the USD/CAD. We set a stop loss of 20 pips from the entry price and a profit target of 40 pips from the entry price. The risk for this trade is 20 pips, and the reward is 40 pips. The risk to reward ratio is 1:2 (you may gain a tidy 6% return haven taken a 3% risk). More: https://fxbazooka.com/analytics/11643 |
Re: Market news and trade recommendations by FBS
NZD/JPY reached buy target 81.00
12/8/2016 NZD/JPY reached buy target 81.00 Next buy target – 83.30 NZD/JPY has been rising sharply in the last few trading sessions inside the minor impulse wave (v) – which recently broke through the resistance level 81.00 (which was set as the buy target in our previous forecast for this currency pair). The breakout of the resistance level 81.00 follows the earlier breakout of the resistance levels 79.00 (intersecting with the resistance trendline of the daily up channel from June) and 80.00. With the daily Momentum near the yearly highs - NZD/JPY can be expected to rise further in the direction of the next buy target at the resistance level 83.30 (forecast price calculated for the termination of the active impulse wave C). https://fxbazooka.com/img/articles/1...PM_(1_day).png More: https://fxbazooka.com/analytics/11644 |
Re: Market news and trade recommendations by FBS
USD/CAD reached sell targets 1.3350 and 1.3270
12/8/2016 USD/CAD reached sell targets 1.3350 and 1.3270 Next sell target - 1.3100 USD/CAD continues to fall after the recent breakout of the support zone lying between the support levels 1.3350 and 1.3270 (both of these support levels were set as the sell targets in our earlier forecast for this currency pair). This support zone was further strengthened by the 50% Fibonacci correction of the previous sharp upward impulse from the middle of October. USD/CAD is expected to fall further in the accelerated C-wave (of the intermediate ABC correction (4) from November) in the direction of the next sell target at the support level 1.3100, intersecting with the support trendline of the wide daily up channel from May. https://fxbazooka.com/img/articles/1...PM_(1_day).png More: https://fxbazooka.com/analytics/11645 |
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