Market analysis and trade recommendations by FBS

[riki143]

USD/JPY: yen is running in the corridors
1/30/2017

On the USD / JPY daily chart, bulls fulfilled the target on the previously formed longs but failed to overcome the important resistance at 115.35. As a result, the descending trading channel has been formed. If quotes don't go out from its boundaries, the upwards trading channel will unlikely be restored. The nearest support is located at 112.5.

On the USD/JPY hourly chart, bears are trying to go back to the descending trading channel. The key moment will be the test of the support at 113,95-114. Its breakout can lead to the restoration of the medium-term downward trend. If the aforementioned support is not tested, the bulls may start their attack in the direction of the target 161.8% in the AB = CD pattern.

More:
https://new.fxbazooka.com/analytics/12244

 

[riki143]

Morning brief for January 30
1/30/2017

USD/JPY dropped to 114.50 on a slightly softer than expected US Q4 GDP, downside miss on durable goods orders and Trump’s immigration policy. On Friday, the US president signed an executive order necessitating suspension of the US refugee program for 120 days and banning all immigrants from 7 Muslim countries for 90 days. So far, we have another protectionist executive order in our piggy bank and there is as yet little flesh on the bones for the FOMC to raise interest rates. This’s non-farm payroll week; who knows, maybe the US data will bring us good news.

EUR/USD jumped to 1.0730 on the dipping US bond yields and on the same reasoning that we’ve presented in the first paragraph. Today’s focus will on the US data package: core PCE, personal spending and pending home sales all coming after 15:30 MT time.

AUD/USD slid down to 0.7550 in the course of the Asia session. Chinese Lunar New Year holidays kept trading in the Asian session on the subdued side.

Kiwi moved downwards having touched 0.7260. The trade balance data was ahead of market’s expectation (the deficit shrank to -41M), but it didn’t put new heart into NZD.

USD/CAD advanced to 1.3133 due to the broad weakening of the Canadian dollar. There was a shooting in a Quebec mosque overnight. Five Muslims were killed according to Reuters report. Brent oil futures slowed down their pace and went lower to $55.45 on the Asian session.

More:
https://new.fxbazooka.com/analytics/12245

 

[riki143]

EUR/USD: "V-Top" pushing price lower
1/30/2017

We’ve got a new “Breakaway Gap”, so the price faced a resistance at 1.0745. Also, there’s a “V-Top” pattern, so bears are likely going to test the 34 Moving Average in the short term. If a pullback from this line happens, there’ll be an opportunity to have an upward price movement towards the next resistance at 1.0774.

Bulls found a resistance at 1.0745, which led to form a “V-Top” pattern, so the price is declining. The main intraday target is a support at 1.0678, which could be a departure point for another bullish rally in the direction of the last high.

More:
https://new.fxbazooka.com/analytics/12246

 

[riki143]

GBP/USD: bears going to test uptrend
1/30/2017

The price faced a support at 1.2509, so the pair is consolidating. Nevertheless, bears are likely going to test the next support at 1.2490 near the uptrend. If we see a pullback from this level, there’ll be a chance to have a new local high.

There’s a “V-Top” pattern, which has been confirmed. Therefore, the market is likely going to decline towards a support at 1.2509 – 1.2490 during the day. Considering a possible pullback from this area, bulls will probably try to test the nearest resistance at 1.2619 – 1.2672.

More:
https://new.fxbazooka.com/analytics/12247

 

[riki143]

AUD/USD: aussie going into the Cloud
1/30/2017

Technical levels: support – 0.7530, 0.7480; resistance – 0.7570, 0.7610.

Trade recommendations:

1. Buy — 0.7560; SL — 0.7540; TP1 — 0.7610; TP2 — 0.7660.

2. Buy — 0.7530; SL — 0.7550; TP1 — 0.7480; TP2 — 0.7400.

Reason: bullish Ichimoku Cloud, but falling Senkou Span A; a dead cross of Tenkan-sen and Kijun-sen and falling lines; the prices are in the Cloud.

More:
https://new.fxbazooka.com/analytics/12248

 

[riki143]

USD/JPY: bulls are intercepted initiative
1/30/2017

Technical levels: support – 114.60; resistance – 115.60.

Trade recommendations:

1. Buy — 114.60; SL — 114.40; TP1 — 115.60; TP2 — 116.10.

Reason: bearish Ichimoku Cloud, but rising Senkou Span A; a golden cross of Tenkan-sen and Kijun-sen and rising Tenkan-sen; the prices are supported by Tenkan-sen.

More:
https://new.fxbazooka.com/analytics/12249

 

[riki143]

Commerzbank warns of potential drop in oil prices
1/30/2017

Brent futures slid to $55.52 from $58.35 (January high) as investors got signals of growing production in the United States that can potentially offset the output cuts implemented by several OPEC members. Baker Hughes rig count climbed by 15 to 566 last week. Donald Trump in his first days as the US President positions himself as protectionist and advocate for the resurgence of the US energy industry.

Oil prices were steady in January hovering above $50 as OPEC members and allies fulfilled their promises under the collective agreement. Saudi Arabia, Kuwait, and Algeria said that they had cut output this month by even more that it was required. Russia convinced the market that it’s curbing production faster than it was suggested. The oil market was showing resilience having refused to react to such bearish news as the buildup in the US oil inventories and rigs number. So, at the present time, many investors buy are buying oil futures with expectations that prices will continue their rally in the near-term future.

Analysts from Commerzbank call on investors not to be too joyful beforehand and warn them of an imminent decline in oil prices as soon as countries start refusing to adhere to output cuts. Another drag on oil prices – any indication of the growth of the US oil industry (rise in drilling activity, the restoration of pipelines). An additional factor that may contribute to the oil prices’ downfall is Iran’s intentions to increase oil production after international sanctions eased last year. Now, the country persistently seeks funding and technology from abroad to open about 70 oil and natural gas field as soon as possible.

More:
https://new.fxbazooka.com/analytics/12250

 

[riki143]

USD/JPY: bears going to test "Window" again
1/30/2017

The last “Window” acted as a support twice, but we’ve got a bearish “Hammer” and a “Shooting Star”, which both have been confirmed. Therefore, the market is likely going to test 13 & 21 Moving Averages, which could be a departure point for another bullish price movement.

We’ve got a new “Window”, which is acting as a resistance. Also, there’s a local “Engulfing”, so bears are likely going to test the lower “Window” in the short term. If a pullback from this level be on the table, there’ll be an opportunity to have a new local high.

More:
https://new.fxbazooka.com/analytics/12252

 

[riki143]

Your helpers for technical chart analysis
1/30/2017

In this article, you will find some useful technical indicators that will facilitate your trade and save your time for chart analysis.

Chart pattern recognition indicator

Candlestick patterns are really quirky. Even when we think that we’ve remembered all the patterns we need accurately, there are good chances that things will get twisted. Where exactly the wick of the candle should start/end; how one bar should be positioned against another one for the right signal. These and many other questions must have been arising in your head when you were struggling to identify the future movement of the prices. There are many indicators that can do the same job for you. So, you won’t need to google shooting, morning stars, haramis every time you want to open a trade. One of such indicators is called the chart pattern recognition indicator. You can easily download it on the Internet and never confound bearish engulfing pattern with its bullish homologs and ext.

That’s how it looks in Metatrader 4.

Market Profile MetaTrader indicator

Another indicator that might grab your attention is Market Profile MetaTrader indicator. It will enable you to monitor the price density over a given period of time. With the help of this indicator, you will quickly identify the most important price levels, value areas. The indicator should be plotted to M5 – D1 timeframes.

Example from MT4

Pin-bar indicator

The next indicator will help you to find pin-bars – the most effective reversal patterns. Just to remind you, pin-bar is a single candlestick that identifies potential reversals in the market. You might find it easy to identify these patterns at the technical charts. But sometimes we just don’t notice them being focused on other important things. So, the pin-bar indicator will be our reminder of all these needlelike patterns.

Example from MT4

More:
https://new.fxbazooka.com/analytics/12253

 

[riki143]

EUR/CHF broke strong support area
1/30/2017

EUR/CHF broke strong support area
Next sell targets – 1.0650 and 1.0620
EUR/CHF continues to fall strongly – following the earlier breakout of the powerful support area lying between the support levels 1.0700 and 1.0680 (this support zone has been steadily reversing this currency pair from last June). The breakout of this support area should accelerate the active minor impulse wave 3, which belongs to the intermediate impulse wave (3) from August.

EUR/CHF is expected to fall further toward the next sell target at the support level 1.0650 – the breakout of which can lead to further losses toward the next support level 1.0620 (target price for the completion of the active minor impulse wave (iii)).

More:
https://new.fxbazooka.com/analytics/12254

 

[riki143]

USD/CHF reversed from support zone
1/30/2017

USD/CHF reversed from support zone
Next buy target - 1.0080
USD/CHF recently reversed up from the support zone lying between the pivotal support level 1.0000 (former top of impulse 1 from October, which was set as the sell target in our earlier forecast for this currency pair), lower daily Bollinger Band and the 50% Fibonacci correction level of the previous upward impulse from November. The upward reversal from this support zone stopped the earlier C-wave of the intermediate ABC correction (4) from December.

USD/CHF is likely to rise further toward the next buy target at the resistance level 1.0080 (earlier support level, which stopped the previous minor impulse wave (i)).

More:
https://new.fxbazooka.com/analytics/12255

 

[riki143]

EUR/USD: bears going to deliver wave iii of (iii)
1/30/2017

4/8 MM Level acted as resistance several times, so wave 2 has been ended in a form of a zigzag. Therefore, bears are likely going to deliver a bearish impulse in wave . The main intraday target is 2/8 MM Level, which could be a departure point for an upward correction.

We’ve got a zigzag in wave (i), so the market delivered an impulse in wave i, which was stopped by 4/8 MM Level. So, it’s time for a local correction. Meanwhile, there’s an opportunity to have wave iii of (iii) afterwards.

More:
https://new.fxbazooka.com/analytics/12256

 

[riki143]

Key option levels for Tuesday, January 31st
1/31/2017

EUR/USD

Main trend Short-term period Medium-term period
Bearish Neutral
Changes in the open interest - 3 339 ? - 104 688 ?
Closest resistance levels 1.0711; 1.0734; 1.0751; 1.0777
Closest support levels 1.0692; 1.0673; 1.0642; 1.0620
Trading recommendations
Baseline scenario Short EUR/USD below 1.0692, with target points at 1.0673 and 1.0642
Alternative scenario Moving above 1.0711 can be considered as a signal to Buy the pair, with target at 1.0734 and 1.0751

USD/JPY

Main trend Short-term period Medium-term period
Bearish Neutral
Changes in the open interest + 452 ? + 839 ?
Closest resistance levels 113.66; 113.93; 114.16; 114.50
Closest support levels 113.46; 113.26; 112.89; 112.49
Trading recommendations
Baseline scenario Short USD/JPY below 113.46, with target points at 113.26 and 112.89
Alternative scenario Moving above 113.66 can be considered as a signal to Buy the pair, with target at 113.93 and 114.16

USD/CAD

Main trend Short-term period Medium-term period
Neutral Bullish
Changes in the open interest + 121 ? + 41 ?
Closest resistance levels 1.3125; 1.3153; 1.3200; 1.3222
Closest support levels 1.3089; 1.3065; 1.3026; 1.3002
Trading recommendations
Baseline scenario Long USD/CAD above 1.3125, with the target points at 1.3153 and 1.3200
Alternative scenario Moving below 1.3089 can be considered as a signal to Sell the pair, with target at 1.3065 and 1.3026

More:
https://new.fxbazooka.com/analytics/12262

 

[riki143]

USD/CAD: bears are testing the support
1/31/2017

On the USD/CAD daily chart, quotes came closer to the lower boundary of the ascending trading channel. If it is tested successfully, the prices can move lower towards 1.2977 (23.6% Fibo level of the last downward long-term wave), and towards 1,284 (88.6% target in the "Double top" pattern). In contrast, the rebound from the lower boundary of ascending trading channel can lead to the consolidation.

On the USD/CAD hourly chart, an activation of the AB = CD pattern followed by the breakout of the support located at 1.3035 can lead to the drop of the quotes to 224% target of the AB=CD pattern. The nearest resistance levels are located near 1,318 and 1,322 marks.

Recommendation: BUY 1,3035 SL 1,2980 TP1 1,318 TP2 1,322.

More:
https://new.fxbazooka.com/analytics/12263

 

[riki143]

Morning brief for January 31
1/31/2017

Price action in currencies has been a bit muted with JPY and GBP the two exceptions. It was the BOJ’s announcement day. The Bank of Japan stood pat and remain fairly committed to its yield curve control and other expansionary policies; extended deadline for loan program aimed at boosting lending, supporting industries. Inflation expectations are the same, not upbringing. USD/JPY slumped to 113.45.

EUR/USD edged up to 1.0700 on the broad weakening of the greenback. The US yields dipped on Monday. Later today, ECB president Draghi will be speaking in Frankfurt on Europe’s digital integrate market (the speech shouldn’t be market-moving). CPI figures and EU preliminary Q4 GDP are to produce a much greater effect. If CPI data indicates an uptick in inflation rates, it will increase calls for an early end to the ECB’s asset purchase program and push the euro higher.

USD/CAD slid to 1.3090 in the course of the past session mainly on the risk-averse investors’ sentiments. Market participants are becoming extremely worried as Mr. Trump seems to be serious about putting his controversial campaign pledges into action. This anxiety spread to the stock market and became a drag on the stock market. Other explanations hardly can be found. Brent oil futures are moving lower. Today’s focus will on the Canadian monthly GDP and raw material price index coming at 15:30 MT time.

GBP/USD spearheaded on Tuesday taking advantage of the US dollar’s weakness. There might be a bit of payback from the greenback if US consumer confidence release is strong.

Aussie and kiwi extended their gains against the US dollar. AUD/USD moved to 0.7560. NZD/USD rose above 0.7290 level. Later today we will receive the labor market data from New Zealand (employment change and unemployment rate).

More:
https://new.fxbazooka.com/analytics/12264

 

[riki143]

EUR/USD: bulls going to test the nearest resistance
1/31/2017

The price faced a support on the 89 Moving Average, so we’ve got a “V-Bottom” here. Therefore, the market is likely going to reach the nearest support at 1.0719 – 1.0745 in the short term. If a pullback from this level happens, there’ll be an opportunity to have another decline towards a support between the 89 MA and the level 1.0624.

We’ve got a “V-Bottom”, so the price is consolidating. In this case, we should keep an eye on the nearest resistance at 1.0739 – 1.0745 as a possible intraday target. However, if we have a pullback from this area, bears will probably try to achieve a support at 1.0678 – 1.0669 afterwards.

More:
https://new.fxbazooka.com/analytics/12265

 

[riki143]

GBP/USD: "Pennant" led to another decline
1/31/2017

The pair found a support on the 34 Moving Average, so there’s a “V-Bottom” pattern. Under this circumstances, the market is likely going to test the nearest resistance between the levels 1.2548 – 1.2581. Considering the previously formed “V-Top” pattern, bears will probably try to achieve a support at 1.2432 later on.

There’s a “V-Bottom”, which has been formed under the 89 Moving Average. So, the price is consolidating. It’s likely that the pair is going to reach the nearest resistance at 1.2548 – 1.2581 during the day. If a pullback from these levels happens, there’ll be a chance to have another decline in the direction of the next support at 1.2465 – 1.2432.

More:
https://new.fxbazooka.com/analytics/12266

 

[riki143]

EUR/USD: euro returned to SSA
1/31/2017

Technical levels: support – 1.0690; resistance – 1.0715, 1.0770.

Trade recommendations:

1. Buy — 1.0700; SL — 1.0680; TP1 — 1.0770; TP2 – 1.0810.

2. Sell — 1.0670; SL — 1.0690; TP1 — 1.0605; TP2 – 1.0560.

Reason: bullish but narrowing Ichimoku Cloud; a dead cross of Tenkan-sen and Kijun-sen; all the lines of Ichimoku Indicator are horizontal; the prices are under resistance of Senkou Span A.

More:
https://new.fxbazooka.com/analytics/12267

 

[riki143]

GBP/USD: going to the Cloud
1/31/2017

Technical levels: support – 1.2420, 1.2490; resistance – 1.2530, 1.2570.

Trade recommendations:

1. Buy — 1.2490; SL — 1.2470; TP1 — 1.2530; TP2 — 1.2570.

Reason: bullish Ichimoku Cloud; a dead cross of Tenkan-sen and Kijun-sen; the prices are under Tenkan and Kijun, but supported by the Cloud.

More:
https://new.fxbazooka.com/analytics/12268

 

[riki143]

USD/TRY: short- and medium-term outlook
1/31/2017

The lira fell to the record minimum on January 11 becoming the worst performing emerging market currencies. The nation’s currency was hit by investors’ heightened risk sentiments that aroused as a result of insecurity, political uncertainty, and economic slowdown. A string of terror attacks in Turkey, worries about political instability followed by July coup d'état attempt have sent Turkish lira lower. S&P and Fitch had to downgrade Turkey’s credit rating in the aftermath of the listed events. No wonder, the lira slumped to historical lows under such pressure.

Turkey’s central bank decided to get things under control and recourse to monetary policy tightening to revive the lira’s exchange rate. On January 24, the Monetary Policy Committee raised its overnight lending interest rate by 75 basis points to 9.25 % and promised to tighten further if needed to offset the impact of the lira’s devaluation on inflation. But this measure didn’t help lira to pare its losses against the greenback, as market participants expected more from the Turkish central bank (traders were hoping for the sharp benchmark repo rate hike).

On January 30, Turkish lira managed to firm by more than 1% as investors partially shrugged off sovereign debt downgrades by credit rating agencies amid central bank’s attempts to tighten liquidity. The recent weakening of the US dollar following the inaction of Trump’s protectionist orders has also played into the hands of lira. Many believe that Turkish central bank will have to undertake even more tightening measures to push the lira higher. If they succeed the lira will hold its current positions against the greenback for a while. But in the longer term, as soon as Trump’s administration introduces its fiscal stimulus, the lira is poised to resume devaluation.

Short-term projections are neutral; USD/TRY will continue its consolidative movement in the narrow range of 3.7700 (Jan. 30 low)/3.7349 (Jan. 24 low) – 3.8245 (the border of Ichimoku cloud on the H4 timeframe). Next week can offer modest support for the lira, if the Fed takes a non-hawkish stance at its meeting (it could be the case, as there is still no signs of Trump’s expansionary fiscal policy on the horizon; weak NFP and labor market releases should cool the Fed’s eagerness to raise interest rates). Return below 3.7160 (Jan. 13 low) is needed to signal the uptrend reversal.

More:
https://new.fxbazooka.com/analytics/12270