Market analysis and trade recommendations by FBS

[riki143]

AUD/USD: bears slackened opposition
11/22/2016

On the AUD/USD daily chart, after the target on the short positions has been fulfilled, quotes moved towards the support at 0.7304 (23.6% Fibonacci retracement level from the medium-term downward wave). The "bears" failed to test it, however, they remain their control over the pair.

On the AUD/USD hourly chart, "Deepwater Shark" pattern has been implemented. Its transformation into the model 5-0 can lead to the correction towards 23.6%, 38.2% and 50% from CD wave. There are resistance levels near these marks.Rollbacks should be used for the opening of short positions.

Recommendations: SELL 0,749 SL 0,7555 TP 0,73 SELL 0,7545 SL 0,76 TP 0,73.

More:
https://fxbazooka.com/analytics/11397

 

[riki143]

EUR/USD: euro is dreaming of the balance of powers
11/22/2016

On the EUR/USD daily chart, there are two long-term patterns - "Head and shoulders" and "Crab". Target 161.8% in the "Crab" pattern corresponds to 1,004. The outlook for this pair is still "bearish", so, correction should be used for the opening of short positions.

On the EUR/USD hourly chart, there is an acceleration of the downtrend which increases the risk of implementation of reversal pattern "Splash and reversal with acceleration". However, until the quotes rise above the upper boundary of the last downward channel, the "bears" will retain their control over the market.

Recommendations:

SELL 1,073 SL 1,0785 TP1 1,05 TP2 1,004

SELL 1,076 SL 1,0814 TP1 1,05 TP2 1,004.

More:
https://fxbazooka.com/analytics/11398

 

[riki143]

Morning brief for November 22, 2016.
11/22/2016

EUR/USD rose to 1.0650 on the session helped by news that Angela Merkel will run for a fourth term as German chancellor. The dollar has weakened due to the fall of 10Y US Treasuries yields. On Monday, ECB President Mario Draghi didn’t offer support to the euro as traders got convinced of the possibility of QE extension in December. Today’s rise of the euro is more profit-taking after large moves. IF US statistical releases coming on Wednesday are strong, the dollar will likely reclaim its leadership against the euro. Today’s focus will be on the US existing home sales and Richmond manufacturing index.

An earthquake and tsunami in Japan quickly sent USD/JPY down to 110.61 from 111.00 on Monday. Earlier this morning the pair was nudged up above 110.80 by the news indicating minimal damage and no injuries.

AUD/USD popped up to 0.7400 on the latest session. We don’t expect great moves from this pair today as there are no data releases/significant events that could weigh on the Aussie’s growth.

GBP/USD soared above 1.2500. The pound is now one of the best performers against USD since the election. The UK economic and political fundamentals are rather robust. It looks like GBP in crosses like EUR/GBP can be a gainer. So, if there is a further downside, you may buy on the dip of this currency pair.

Today traders will be watching for the UK data on the net borrowing of the public sector and CBI industrial order expectations. The forecast indicates a narrower budget deficit than it used to be last month.

Oil climbed to $50 as investors bank on the output cut after the OPEC meeting. Iranian Oil Minister said it’s “highly probable” OPEC will strike a deal at the talks. Libyan OPEC Governor said that discussions went well leaving the group’s Vienna headquarters on Monday evening. USD/CAD sank to 1.3383 as crude inched higher. Now the US dollar is trying to regain its momentum.

More:
https://fxbazooka.com/analytics/11399

 

[riki143]

GBP/USD: testing the upper boundary
11/22/2016

Technical levels: support – 1.2410/20; resistance – 1.2520, 1.2490.

Trade recommendations:

1. Buy — 1.2420; SL — 1.2400; TP1 — 1.2520; TP2 — 1.2610.

Reason: bullish Ichimoku Cloud; cancelled dead cross of Tenkan-sen and Kijun-sen; a support of Senkou Span B.

More:
https://fxbazooka.com/analytics/11400

 

[riki143]

AUD/USD: correction in Tenkan-Kijun range
11/22/2016

Technical levels: support – 0.7360; resistance – 0.7440.

Trade recommendations:

1. Sell — 0.7440; SL — 0.7460; TP1 — 0.7360; TP2 — 0.7320.

Reason: bearish Ichimoku Cloud and falling Senkou Span A; dead cross of Tenkan-sen and Kijun-sen; the prices are in the range of Tenkan-sen and Kijun-sen.

More:
https://fxbazooka.com/analytics/11401

 

[riki143]

USD/JPY: on the 6-W highs
11/22/2016

Technical levels: support – 110.60, 109.90; resistance – 111.40, 111.90.

Trade recommendations:

1. Sell — 111.90; SL — 112.10; TP1 — 110.60; TP2 — 109.90.

Reason: bullish Ichimoku Cloud; a golden cross of Tenkan-sen and Kijun-sen; but there is an overbought market and all lines of Indicator Ichimoku are horizontal.

More:
https://fxbazooka.com/analytics/11402

 

[riki143]

EUR/USD: "Diamond" at the low
11/22/2016

The price faced a support at 1.0565, which led to the current consolidation. Also, it’s likely to see a reversal pattern. If it confirms, there’ll be an opportunity to have an upward correction in the direction of the nearest resistance at 1.0673 - 1.0710. If a pullback from this area happens, we should keep an eye on a support at 1.0636 – 1.0600 as a local bearish target.

There’s a consolidation, which is taking place between the closest support at 1.0565 and the local downtrend. Moreover, we’ve got a “Diamond”, which was confirmed by two “Pennants”. Therefore, the market is likely going to reach a support at 1.0673 – 1.0710 in the short term. Considering a possible pullback from these levels, there’s an opportunity to have an achievement of the 55 Moving Average afterwards.

More:
https://fxbazooka.com/analytics/11403

 

[riki143]

GBP/USD: bullish "Pennant"
11/22/2016

We’ve got a “Double Bottom” pattern, so the price faced a resistance at 1.2476. Nevertheless, the pair is likely going to achieve the next resistance at 1.2556 – 1.2621. If a pullback from this area happens, then bears will probably try to reach a support at 1.2476 – 1.2439.

Bulls found a resistance at 1.2486 – 1.2507, so the price is consolidating. Also, we’ve got a “Pennant” pattern, so the market is likely going to reach the next resistance at 1.2556 – 1.2591 in the short term. If we see a pullback from these levels, there’ll be an opportunity to have a bearish correction.

More:
https://fxbazooka.com/analytics/11404

 

[riki143]

Key option levels for Tuesday, November 22th
11/22/2016

EUR/USD

Main trend Short-term period Medium-term period
Bearish Neutral
Changes in the open interest + 58 061 ? + 103 433 ?
Closest resistance levels 1.0633; 1.0661; 1.0688; 1.0705
Closest support levels 1.0595; 1.0575; 1.0542; 1.0494
Trading recommendations
Baseline scenario Short EUR/USD below 1.0595, with target points at 1.0575 and 1.0542
Alternative scenario Moving above 1.0633 can be considered as a signal to Buy the pair, with target at 1.0661 and 1.0688


GBP/USD

Main trend Short-term period Medium-term period
Neutral Bearish
Changes in the open interest + 136 ? + 185 ?
Closest resistance levels 1.2498; 1.2525(16?); 1.2565; 1.2608
Closest support levels 1.2450; 1.2423; 1.2403; 1.2381
Trading recommendations
Baseline scenario Short GBP/USD below 1.2450, with target points at 1.2423 and 1.2403
Alternative scenario Moving above 1.2498 can be considered as a signal to Buy the pair, with target at 1.2525 and 1.2565


USD/JPY

{IMG]https://fxbazooka.com/img/articles/11406/USDJPY(64).png[/IMG]


Main trend Short-term period Medium-term period
Bullish Bearish
Changes in the open interest + 935 ? + 421 ?
Closest resistance levels 111.14; 111.33; 111.69; 111.88
Closest support levels 110.30; 110.07; 109.79; 109.46
Trading recommendations
Baseline scenario Long USD/JPY above 111.14, with the target points at 111.33 and 111.69
Alternative scenario Moving below 110.30 can be considered as a signal to sell the pair, with target at 110.07 and 109.79


USD/CAD

Main trend Short-term period Medium-term period
Neutral Bullish
Changes in the open interest + 478 ? + 55 ?
Closest resistance levels 1.3446; 1.3495; 1.3535; 1.3591
Closest support levels 1.3396; 1.3376; 1.3349; 1.3312
Trading recommendations
Baseline scenario Long USD/CAD above 1.3446, with the target points at 1.3495 and 1.3535
Alternative scenario Moving below 1.3396 can be considered as a signal to Sell the pair, with target at 1.3376 and 1.3349

More:
https://fxbazooka.com/analytics/11406

 

[riki143]

Goldman Sachs’ trade ideas for 2017
11/22/2016

USD forecasts

2017 is promising to be auspicious for the US dollar with the fiscal stimulus, immigration rhetoric and more protectionism spurring inflation rates and offsetting monetary policy tightening. The greenback should have a good advantage in light of the incoming political reshufflings in Europe, ongoing uncertainty over the Brexit process and potentially ground-shaking Italian referendum. The main risks to this forecast are the ECB monetary policy tapering and a delay in triggering Article 50 to start the actual Brexit.

Trump win will send yuan down

China’s currency is under threat of depreciation in relation to USD. Analysts from Goldman Sachs advise buying the 12-month non-deliverable forward contract. The US dollar is expected to hit 7.07 yuan and then 7.30.

Bet on the emerging market currencies

The GS’s strategists recommend buying an equal-weighted basket of the Brazilian real, Russian ruble, Indian rupee, South African rand against the South Korean won and Singapore dollar. Some of the relatively high-yielding currencies look worn out after the US election amid the selloff of EM assets, making a good time for long positions. Goldman is short on South Korean won and Singapore dollar as this is another bet on weaker China.

Buying opportunities in stock market

The analysts recommend choosing emerging market stocks, which are less vulnerable to China’s economic slowdown. According to the bank, investors should consider buying Brazilian, Polish and Indian markets (an equal-weighted, currency unhedged basket composed of the Warsaw Stock Exchange Total Return Index, the Ibovespa Brasil Sao Paulo Stock Exchange Index, and the NSE Nifty 50 Index targeting a gain of 20% and exiting if the position falls 10% from the present levels).

US Treasuries promise high spreads

Analysts advise investors going long 10-year US bonds. The spread between nominal and inflation-protected Treasury yields is expected to rise to 230 basis points; if it falls to 160, you should exit the market. Strategists are also recommending a version of the same trade for inflation in Europe using swaps. The fundamental reasoning for rising inflation rates in Europe: firm energy prices, the end of austerity measures, central banks might start tolerating the above-target inflation.

Based on Bloomberg's article

More:
https://fxbazooka.com/analytics/11407

 

[riki143]

USD/CAD: fundamental and technical analyses
11/22/2016

USD/CAD slumped to 1.3383 as contradictions within OPEC started to fade away pushing the oil crude prices higher. US dollar gained momentum on the Asian session and leapfrogged the Loonie.

We see more USD upside going forward mainly on the monetary policy divergence (high probability of the Fed’s hike in December vs. BOC’s neutral monetary stance skewing at the “dovish” side) and uncertainty over Trump’s trade policy. The election of Republican nominee increased the likelihood of Canadian economic underperformance next year. Yesterday US President-elect released a video laying out actions he will take on his first days in office, including the renegotiation of the North American Free Trade Agreement (NAFTA). This may weigh on the Loonie in the foreseeable future (especially at the end of January, when Trump becomes the US president).

In the short-term, CAD will likely be affected by the oil prices and Canadian statistical releases. Rising Canadian 5-year bond yields will allow Bank of Canada to stay on hold for a while. Today traders will be watching for the monthly retail sales data from Canada which should offer support to the Canadian dollar. The upbeat releases can move USD/CAD downwards to the nearest support at 1.3316 (38.2% Fibo retracement from the May 3 low), 1.3337 (located against 200 4H MA). Alternatively, tomorrow’s data releases from the US (if there are strong) can push quotes higher towards the nearest resistance lines at 1.3437 (100 4H MA), 1.3481 (50 4H MA).

More:
https://fxbazooka.com/analytics/11408

 

[riki143]

EUR/USD: correction going to move on
11/22/2016

There’s a reversal “Doji” at the local low, which has been confirmed enough. So, the price is likely going to test the 21 Moving Average line soon. As we can see on the Daily chart, we’ve got an “Engulfing” pattern. If it confirms, there’ll be an opportunity to have an upward correction.

The 34 Moving Average acted as a resistance, so we’ve got a “Shooting Star” on this line. However, a confirmation of this pattern is a quite weak. Therefore, the current local correction is likely going to be continued. In this case, we should keep an eye on the 89 Moving Average as a possible bullish target.

More:
https://fxbazooka.com/analytics/11412

 

[riki143]

USD/JPY: "Shooting Star" pushing correction lower
11/22/2016

The price is consolidating above the nearest “Window”. At the same time, we’ve got an “Engulfing” and a “High Wave” patterns, but both of them haven’t been confirmed yet. So, the price is likely going to test the closest Moving Average shortly. If a pullback from this line happens, there’ll be an opportunity to have another bullish rally. As we can see on the Daily chart, here’s a “High Wave”, but this pattern doesn’t have a confirmation. So, there’s an option to have another test of the support nearby.

There’s a consolidation, which is taking place on the one-hour chart. Also, there’re bearish patterns such a “Tweezers”, a “Tower”, a “Harami” and a “Shooting Star”. In this case, the current correction is likely going to move on towards the 55 Moving Average. If this line acts as a support, bulls will probably try to deliver another high.

More:
https://fxbazooka.com/analytics/11413

 

[riki143]

EUR/USD: wave [iii] going to move on
11/22/2016

The market has been declining since a triangle in wave (Y) ended. Therefore, wave [iii] is likely going to be continued. In this case, we should keep an eye on -2/8 Murrey Math Level (P=200).

As we can see on the one-hour chart, there’s a double zigzag in wave (iv). Previously, an extension in wave (iii) was formed. So, bears are likely going to deliver an impulse in wave (v) of [iii] in the short term.

More:
https://fxbazooka.com/analytics/11414

 

[riki143]

USD/CHF rising inside multiple impulse waves
11/22/2016

USD/CHF rising inside multiple impulse waves
Next buy target – 1.0200
USD/CHF has been rising strongly in the last few trading sessions – following the earlier breakout of the powerful resistance zone lying between the resistance levels 1.0000 and 0.9950 (this resistance zone has been reversing the price from May, as can be seen below). The breakout of this resistance area accelerated the active minor impulse wave 3, which belongs to the intermediate impulse (3) of the primary impulse wave ? from June.

USD/CHF is expected to rise further in the direction of the next buy target at the resistance level 1.0200 (forecast price calculated for the completion of the active minor impulse wave 3).

More:
https://fxbazooka.com/analytics/11415

 

[riki143]

USD/CAD reversed from powerful resistance level 1.3560
11/22/2016

USD/CAD reversed from powerful resistance level 1.3560
Next sell targets - 1.3350 and 1.3270
USD/CAD continues to fall after the earlier downward reversal from the powerful resistance level 1.3560, which also reversed the price sharply in the middle of this month. The previous downward reversal from the resistance level 1.3560 created the strong daily Japanese candlesticks reversal pattern Evening Star (the middle candle of which is also the single-candle Japanese candlesticks reversal pattern – Shooting Star).

Having recently created the second consecutive Evening Star near the resistance level 1.3560 - USD/CAD can be expected to correct down to the next sell target at the support level 1.3350 – the breakout of which can lead to further losses toward 1.3270.

More:
https://fxbazooka.com/analytics/11416

 

[riki143]

EUR/USD & FOMC Minutes: The ground is ready for a rate hike!
11/23/2016

Today at 19:00 GMT we’ll have the FOMC minutes, which are from November’s meeting, where the central bank decided to keep unchanged interest rates, before the US elections. Traders will be looking for further hints about a possible rate hike in December’s meeting, as current Fed’s rhetoric remains unchanged: the case for raise rates has continued “to strengthen”. No major surprises are expected, but we’ll be aware of how market’s volatility will act after the release.

Our technical outlook for EUR/USD at H1 chart is sideways in a short-term, but if we check the overall picture, the pair is still weak across the board, with a price action consolidated below the 200 SMA. If we see a slump below the 1.0572 price zone, then further weakness toward the 1.0488 area is highly expected, while a rebound at current levels should take EUR/USD to test the 1.0735 level.

More:
https://fxbazooka.com/analytics/11417

 

[riki143]

NZD/USD: kiwi decided to test the "neckline"
11/23/2016

On the NZD/USD daily chart, quotes came back to the neckline of the "Head and shoulders" pattern. Rollback from the nearest resistance or from the lower boundary of the upward trading channel will allow us to open short positions.

On the NZD/USD hourly chart, there are the expanding wedge and the "Shark" patterns. The transformation in the "Shark" pattern into the 5-0 pattern will lead to the growth of quotes towards 23.6%, 38.2% and 50% Fibonacci retracement levels from the CD-wave. Then, there might be a rollback followed by the restoration of the downtrend (especially if the "bulls" manage to test the resistance at 0.7315).

Recommendations:

SELL 0,7085 SL 0,714 TP 0,68

SELL 0,7145 SL 0,72 TP 0,68

SELL 0,7195 SL 0,725 TP 0,68.

More:
https://fxbazooka.com/analytics/11418

 

[riki143]

GBP/USD: pound is coming back to its previous positions
11/23/2016

On the GBP/USD daily chart, the "bears" was trying to return to the borders of the medium-term consolidation range at 1.21-1.231, but failed to do so. As a result, the second shoulder of the "Head and shoulders" pattern was formed. A successful test of the lower boundary of the upward trading channel can lead to the downfall of quotes towards 1.215.

On the GBP/USD hourly chart, the retest of the diagonal resistance in the form of the lower boundary of the upward trading channel can be used as a buying signal. In this situation, short positions should be opened from 1.2365 and 1.23 levels in the direction of the target 88.6% in the "Shark" pattern.

Recommendations:

SELL 1,2365 SL 1,242 TP 1,215

SELL 1,23 SL 1,2355 TP 1,215.

More:
https://fxbazooka.com/analytics/11419

 

[riki143]

Morning brief for November 23, 2016
11/23/2016

EUR/USD pinned to 1.0622 level only a few points above its one-year low at 1.0564. Much credit must go to the US bond yields that keep rising after the US presidential election. Another factor that contributes to the US strengthening is a divergence between the Fed intending to raise rates in December and ECB maintaining its steady hand and continuing its ultra-loose monetary policy. Today watch for the manufacturing PMI releases coming from the Eurozone and for the bunch of the US data (namely, new home sales, revised UoM consumer sentiment and inflation expectations). Also, we will get FOMC meeting minutes, but it shouldn’t bring much volatility to the chart as the market has already got used to the idea of the Fed’s rate hike in December.

AUD/USD was one of the greatest performers on the session, moving up to 0.7430 level from yesterday’s 0.7400. The main reason of the recent Aussie’s appreciation – rising commodity prices (iron ore futures rose 8%; copper move up towards its 16-month high). The bid for AUD was despite the disappointing data on Q3 construction work. Analysts see more AUD strengthening on the back of rallying commodity prices. The Bloomberg Commodity Index is at its highest level since June. Goldman Sachs Group Inc. expect commodity prices to rise next year in the light of the boosted manufacturing activity around the world

GBP/USD fell yesterday towards the 1.2410 support ahead of the budget update from British Minister Philip Hammond. Now the pair is consolidating along the 1.2415 level (100 4h MA). Strategists expect some modest infrastructure spending and housing stimulus, but nothing that could change expectations of a weaker economy ahead of the “Brexit” talks.

USD/JPY’s move should be subdued today as the Japanese have a holiday today. The pair is trading above 111.00. There can be some more USD upside going forward if today’s statistical data from the US is strong.

USD/CAD edged down below 1.3440 in the course of the Asian session. Oil prices are steady at $49 for the present moment as the market hung in wait for more news from OPEC’s Vienna headquarters.

More:
https://fxbazooka.com/analytics/11420