Market analysis and trade recommendations by FBS

[riki143]

Morning brief for December 23
12/23/2016

Financial markets seem to be neglected by their participants in the countdown to major holidays of the year. Today’s Asian session was drowsy. Zzzzzz…………..There is almost nothing to report.All the major macro events now behind us and a spike in volatility is unlikely. But for some traders, this end-year market lull can be very profitable.

After rising on the possibility of softer Brexit GBP/USD dropped below 1. 2280 overnight. The US data released yesterday was mixed. While US Q3 GDP data was revised up to an annualized 3.5% from 3.2% and core durable goods orders moved higher from 0.9% against consensus 0.4%. The November personal income, spending and PCE deflators release fell out of market’s expectations. Today’s focus will be on the UK current account data and final quarterly GDP.

EUR/USD didn’t experience significant moves on the Asian session. The Italian government allotted $21 bln to rescue Italy’s alerted banking sector with Monte dei Paschi being the first in line for help. At the present moment, the pair is trading near the 1.0450 level.

AUD/USD slid down to 0.7205 probably on the falling iron ore prices (were down $2.04 to $76.15) – the main export unit of Australia, and on the strengthening USD.

USD/JPY technical chart is flat. The quotes are moving along 117.40 level. On Tuesday following the BoJ meeting, governor Kuroda was asked about the yen precipitous decline in relation to the US dollar. Kuroda responded the USD/JPY’s current level is a reflection of the USD strength, not the yen’s softening. Japanese markets were closed for the Emperor's birthday holiday.

USD/CAD popped up to 1.3520. Canadian data was a mixed bag. The CPI declined 0.2% in November after rising 0.2% in October. Retail sales reports were upbeat. Brent oil futures edged up slightly, but the US dollar strength overshadowed the CAD’s vain attempts to growth.

More:
https://new.fxbazooka.com/analytics/11822

 

[riki143]

EUR/USD: correction to Cloud complete
12/23/2016

Technical levels: support – 1.0380, 1.0410; resistance – 1.0450, 1.0470/90.

Trade recommendations:

1. Sell — 1.0450; SL — 1.0470; TP1 — 1.0380; TP2 – 1.0340.

Reason: bearish Ichimoku Cloud and horizontal lines of the Ichimoku Indicator; a weak golden cross of Tenkan-sen and Kijun-sen; strong resistance of Senkou Span A.

More:
https://new.fxbazooka.com/analytics/11823

 

[riki143]

GBP/USD: new lows of December
12/23/2016

Technical levels: support – 1.2255, 1.2230; resistance – 1.2330.

Trade recommendations:

1. Sell — 1.2330; SL — 1.2350; TP1 — 1.2255; TP2 — 1.2230.

Reason: bearish character of Ichimoku Cloud, falling Senkou Span A and B; a dead cross of Tenkan-sen and Kijun-sen; falling Kijun-sen; the prices are formed the new lows of the market.

More:
https://new.fxbazooka.com/analytics/11824

 

[riki143]

USD/JPY: on the Cloud’s support
12/23/2016

Technical levels: support – 117.30; resistance – 118.70, 119.20.

Trade recommendations:

1. Buy — 117.30; SL — 117.10; TP1 — 118.70; TP2 — 119.20.

Reason: bullish Ichimoku Cloud; a golden cross of Tenkan-sen and Kijun-sen; the prices are on the Kijun and Cloud’s support.

More:
https://new.fxbazooka.com/analytics/11825

 

[riki143]

EUR/USD: "Thorn" stopped bulls
12/23/2016

The price has faced a resistance at 1.0506, so we’ve got a “Thorn” pattern, which led to a local decline. Therefore, the market is likely going to continue falling down towards a support at 1.0365. If a pullback from this level happens, there’ll be an opportunity to have another bullish price movement in the direction of a resistance at 1.0461 – 1.0506.

We’ve got a “Thorn” pattern, so the price is consolidating near the 34 Moving Average. In this case, the pair is likely going to test the nearest support at 1.0400 – 1.0381. However, if we have a pullback from these levels, bulls will probably try to achieve the 55 Moving Average.

More:
https://new.fxbazooka.com/analytics/11826

 

[riki143]

GBP/USD: bears going to move on
12/23/2016

The last “Pennant” pattern has been broken, so the price found a support at 1.2270, which led to the current consolidation. Under this circumstances, the market is likely going to decline in the direction of the nearest support at 1.2270 – 1.2205. If bears be stopped by this area, there’ll be an opportunity to have an upward movement towards a resistance at 1.2309.

The price has broken the lower side of the last “Flag”, so bears faced a support at 1.2270 afterwards. Meanwhile, the pair is likely going to reach the next support at 1.2239 – 1.2205 during the day. Considering a possible pullback from these levels, there’s a chance to have another bullish movement.

More:
https://new.fxbazooka.com/analytics/11827

 

[riki143]

Key option levels for Friday, December 23th
12/23/2016

EUR/USD

Main trend Short-term period Medium-term period
Neutral Neutral
Changes in the open interest + 17 620 ? + 24 681 ?
Closest resistance levels 1.0487; 1.0527; 1.0545; 1.0568
Closest support levels 1.0432; 1.0411; 1.0383; 1.0346
Trading recommendations
Baseline scenario Short EUR/USD below 1.0432, with target points at 1.0411 and 1.0383
Alternative scenario Moving above 1.0487 can be considered as a signal to Buy the pair, with target at 1.0527 and 1.0545

GBP/USD

Main trend Short-term period Medium-term period
Bearish Bearish
Changes in the open interest + 3 131 ? + 3 205 ?
Closest resistance levels 1.2347; 1.2376; 1.2397; 1.2422
Closest support levels 1.2288(76?); 1.2260; 1.2240; 1.2215
Trading recommendations
Baseline scenario Short GBP/USD below 1.2288, with target points at 1.2260 and 1.2240
Alternative scenario Moving above 1.2347 can be considered as a signal to Buy the pair, with target at 1.2376 and 1.2397

USD/CAD

Main trend Short-term period Medium-term period
Neutral Bullish
Changes in the open interest + 818 ? + 168 ?
Closest resistance levels 1.3484; 1.3506; 1.3535; 1.3581
Closest support levels 1.3457; 1.3410; 1.3365; 1.3330
Trading recommendations
Baseline scenario Long USD/CAD above 1.3484, with the target points at 1.3506 and 1.3535
Alternative scenario Moving below 1.3457 can be considered as a signal to Sell the pair, with target at 1.3410 and 1.3365

More:
https://new.fxbazooka.com/analytics/11828

 

[riki143]

Outlook for commodity currencies
12/23/2016

After brief recovery followed by Australia’s mid-year budget update, the AUD/USD resumed with its bearish trend and remained under selling pressure until Friday. Falling iron ore prices and subdued growth of Chinese economy are the key factors that weigh on the pair. The Reserve Bank of Australia does little to support the nation’s currency being in no haste to raise its benchmark.

Next week shouldn’t bring volatility to the chart. Focus your attention on the US CB consumer confidence index, pending home sales and unemployment claims

The technical outlook for AUD/USD is tilted to the downside. The nearest supports on the Aussie’s way lie at 0.72000 and 0.7140 levels. If commodity prices manage to retrieve their losses we may look for rebounds from the current levels to 0.7250, 0.7325 marks.

More:
https://new.fxbazooka.com/analytics/11829

 

[riki143]

USD/JPY outlook for December 26 - 30
12/23/2016

USD/JPY has settled into a narrow range of 116.50 – 118.20 in the course of the past week. The Bank of Japan left its loosening monetary policy unchanged on Tuesday. The Fed raised its benchmark at its December meeting and projected a triple hike in 2017. So, the interest rate differentials between the US and Japan widened significantly pushing the US dollar higher.

Next week traders will focus on Japan’s annual household spending and core inflation data both coming on Tuesday. The US statistical agencies will publish CB consumer confidence index, unemployment claims, monthly pending home sales and Chicago PMI.

It is most likely that USD/JPY will continue to surge towards the resistances located at 118.70, 120.00 levels given the prospect for the higher US rates in 2017 and far-reaching yield curve targeting strategy of the BoJ. Alternative scenario suggests a continuation of the current corrective movement or small retracement of the quotes towards the nearest supports located at 116.00, 115.55 (61.8% Fibo retracement level formed from the May 2015 peak) and 114.75 (100 MA on the weekly timeframe).

More:
https://new.fxbazooka.com/analytics/11830

 

[riki143]

EUR/USD: consolidation going to move on
12/23/2016

There’s a “Shooting Star”, but this pattern hasn’t been confirmed yet. So, the price is likely going to decline in the short term. However, bulls will probably try to test the last high afterwards. As we can see on the Daily chart, a “High Wave” has been formed, so there’s an upward correction on the way. Considering that there isn’t any bearish pattern so far, the market is likely going to rise in the coming days.

We’ve got a “Shooting Star” and an “Engulfing” at the last highs. At the same time, both patterns don’t have enough confirmation. Also, the 89 Moving Average acted as a resistance. So, there’s an option to have a new low, but bulls are likely going to test the nearest resistance soon.

More;
https://new.fxbazooka.com/analytics/11831

 

[riki143]

USD/JPY: bears going to test the nearest support
12/23/2016

There’s an “Engulfing”, which has been confirmed enough, so the market is likely going to get a support on the 21 Moving Average. If a pullback from this line happens, there’ll be an opportunity to have an upward movement towards the upper “Window”. As we can see on the Daily chart, there isn’t any reversal pattern so far. In this case, bulls are likely going to move on.

The price is still consolidating on the one-hour chart. At the same time, there’re bearish patterns such a “Tweezers”, a “High Wave” and a “Harami”, which all have been confirmed. So, the current correction is likely going to test the nearest support area. However, if we see a pullback from this zone, there’ll be a chance to have another bullish rally.

More:
https://new.fxbazooka.com/analytics/11832

 

[riki143]

GBP/USD: outlook for December 26-30
12/23/2016

GBP/USD dropped to 1.2245 level in the course of past week. The UK data set released on Friday did little to support the pound. The uncertainty over the Brexit process will continue pressuring the pound. The Supreme Court is expected to make a ruling in the middle of January. There may be other legal challenges that could cause future delays of the EU-UK separation. Next week shouldn’t bring lots of moves to the chart.

The pair needs to recover above 1.2330 to reverse this bearish tone and be able to correct higher, towards the 1.2450/60 area.The pound should continue its downward movement remaining the momentum of the past week. On the downside, there are several supports located at 1.2200, 1.2178 and 1.2073 levels.

More:
https://new.fxbazooka.com/analytics/11833

 

[riki143]

EUR/USD: wave [ii] going to be continued
12/23/2016

The price has been rising since a pullback from 1/8 MM Level happens, so there’s an opportunity to have wave [ii] in the short term. If a pullback from 2/8 MM Level be on the table, bears are likely going to deliver wave [iii].

As we can see on the one-hour chart, wave [ii] is taking form of a zigzag. Therefore, wave (b) is likely going to be continued. However, there’s a chance to have bullish wave (c) of [ii] afterwards. In this case, 6/8 MM Level could be tested once again.

More:
https://new.fxbazooka.com/analytics/11834

 

[riki143]

EUR/AUD reached buy target 1.4470
12/23/2016

EUR/AUD reached buy target 1.4470
Next buy target - 1.4700
EUR/AUD continues to rise strongly – following the earlier breakout of the strong resistance level 1.4470 (which was set as the buy target in our previous forecast for this currency pair). The resistance level 1.4470 is also the former upper boundary of the tight sideways price channel inside which the pair has been trading from the middle of November (as can be seen below).

The breakout of the resistance level 1.4470 accelerated the c-wave of the active minor ABC correction (ii) - which started earlier from the lower boundary of the aforementioned sideways price channel. EUR/AUD is expected to rise to the next buy target 1.4700.

More:
https://new.fxbazooka.com/analytics/11835

 

[riki143]

USD/CAD reached buy target 1.3500
12/23/2016

USD/CAD reached buy target 1.3500
Next buy target - 1.3590
USD/CAD continues to rise after the price earlier broke through the resistance level 1.3500, which was set as the buy target in our previous forecast for this currency pair. The breakout of this resistance level continues the active intermediate impulse wave (3) from the middle of December.

With the accelerating daily Momentum - USD/CAD can be expected to rise further in the direction of the next buy target at the pivotal resistance level 1.3590 (which stopped the previous intermediate impulse wave (1) in the middle of November, as can be seen below).

More:
https://new.fxbazooka.com/analytics/11836

 

[riki143]

Key option levels for Monday, December 26th
12/25/2016

* Data about changes in the open interest will be available on Monday after 12:00 CT (Central Time)

EUR/USD

Main trend Short-term period Medium-term period
Bearish Neutral
Changes in the open interest + 13 411 ↑ + 43 770 ↑
Closest resistance levels 1.0499; 1.0537; 1.0554; 1.0576
Closest support levels 1.0440; 1.0419; 1.0390; 1.0372
Trading recommendations
Baseline scenario Short EUR/USD below 1.0440, with target points at 1.0419 and 1.0390
Alternative scenario Moving above 1.0499 can be considered as a signal to Buy the pair, with target at 1.0537 and 1.0554

GBP/USD

Main trend Short-term period Medium-term period
Bearish Bearish
Changes in the open interest - 3 ↓ - 4 ↓
Closest resistance levels 1.2336; 1.2366; 1.2387; 1.2413
Closest support levels 1.2278; 1.2254; 1.2236; 1.2212
Trading recommendations
Baseline scenario Short GBP/USD below 1.2278, with target points at 1.2254 and 1.2236
Alternative scenario Moving above 1.2336 can be considered as a signal to Buy the pair, with target at 1.2366 and 1.2387

USD/CAD

Main trend Short-term period Medium-term period
Neutral Bullish
Changes in the open interest + 730 ↑ + 45 ↑
Closest resistance levels 1.3543; 1.3563; 1.3600; 1.3654
Closest support levels 1.3501; 1.3477; 1.3439; 1.3385
Trading recommendations
Baseline scenario Long USD/CAD above 1.3543, with the target points at 1.3563 and 1.3600
Alternative scenario Moving below 1.3501 can be considered as a signal to Sell the pair, with target at 1.3477 and 1.3439

More:
https://new.fxbazooka.com/analytics/11837

 

[riki143]

GBP/USD: pound is led by the patterns
12/26/2016

On the GBP/USD daily chart, after quotes went beyond the descending trading channel the "bears" regained control over the market. The "Crab" pattern with its 113% and 127.2% intermediate targets is relevant at the present moment. We may expect the development of the correction wave from the December low located at the 1,215 level.

On the GBP/USD hourly chart, there is a formation of the CD wave of the "Shark" pattern. A breakout of the December low can lead to the downfall of quotes towards 1,215 (88.6%). Also, there might be a correction from the current levels towards 1.2357, 1.2441 and 1.2509.

More:
https://new.fxbazooka.com/analytics/11838

 

[riki143]

EUR/GBP: bulls launched a counterattack
12/26/2016

On the EUR/GBP daily chart, the "bears" failed to update the December minimum. "Bulls" launched a counterattack. If they manage to test the resistance at 0.8565, an activation of the "Bat" pattern will increase the risks of the continuation of the rally towards 0.9. The 0.873 and 0.8865 marks can serve as intermediate targets. Restoration of the downtrend is possible if quotes manage to return to 0.832.

On the EUR/GBP hourly chart, there is a rather steady uptrend. The further movement of the pair will depend on the test of the resistance at 0.8545.

More:
https://new.fxbazooka.com/analytics/11839

 

[riki143]

Morning brief report for December 26
12/26/2016

Markets are still half asleep as their participants celebrate Christmas.

EUR/USD is trading near the level of 1.0460. The euro managed to regain some of its losses on Friday mainly due to the weakening of the US dollar. USD slipped some points as investors took profits in the run-up to the Christmas holidays. US 10-year bond yields dipped following the Friday’s release of the US economic indicators (the household income data was not upbeat). The US dollar should not fall lower, as it remains to be well-supported thanks to the anticipation of a faster pace of the benchmark increases under Trump’s presidency.

USD/JPY fell to 116.95 on the weakening of the greenback. Today’s trading will be subdued as stock markets, precious/base metals options are shut for the Christmas holiday. European and American banks are closed as well. So, the yen may strengthen further in relation to the US currency snatching at a chance in the period of the US markets’ lull.

AUD/USD managed to recover on Monday after falling to 0.7160 following the news stating that Chinese President Xi Jinping was open to the deceleration in the economic growth of China. Aussie remains vulnerable to the price fluctuations in the commodity market and news flows from China.

GBP/USD edged down to 1.2265. The pound remains under pressure of uncertainty over the Brexit process.

More:
https://new.fxbazooka.com/analytics/11840

 

[riki143]

EUR/USD: bearish "Thorn"
12/26/2016

We’ve got a “Double Bottom”, which has been confirmed, so the price is consolidating. Considering the main downtrend, the market is likely going to test a support at 1.0419. If a pullback from this level happens, there’ll be an opportunity to have a bullish price movement towards a resistance at 1.0506.

There’s a “Thorn”, so bears are likely going to achieve a support at 1.0419. However, if we have a pullback from this level, bulls will probably try to reach the nearest resistance at 1.0478 – 1.0506.

More:
https://new.fxbazooka.com/analytics/11841