Daily Market Analysis By FXOpen

[Resolve]

Market Analysis: AUD/USD Remains At Risk While NZD/USD Attempts Recovery

AUD/USD declined heavily from well above 0.6650. NZD/USD also tumbled and is now attempting a recovery from 0.5850.

Important Takeaways for AUD USD and NZD USD Analysis Today

• The Aussie Dollar started a major decline below the 0.6610 level against the US Dollar.
• There is a connecting bearish trend line forming with resistance near 0.6530 on the hourly chart of AUD/USD at FXOpen.
• NZD/USD is attempting a recovery wave from the 0.5850 zone.
• There was a break above a key bearish trend line with resistance at 0.5880 on the hourly chart of NZD/USD at FXOpen.

AUD/USD Technical Analysis

On the hourly chart of AUD/USD at FXOpen, the pair struggled to stay above the 0.6650 pivot zone. The Aussie Dollar started a fresh decline below the 0.6620 and 0.6600 levels against the US Dollar.

The pair even settled below the 0.6550 level and the 50-hour simple moving average. Finally, it tested the 0.6480 support zone. The recent low was formed near 0.6482 and the pair is now consolidating losses near the 23.6% Fib retracement level of the downward move from the 0.6562 swing high to the 0.6482 low.

TO VIEW THE FULL ANALYSIS, VISIT FXOPEN BLOG

Disclaimer: This article represents the opinion of the Companies operating under the FXOpen brand only (excluding FXOpen EU). It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

 

[Resolve]

MSFT Share Price Plummets After Earnings Report, But It’s Not All Bad

Yesterday, after the main trading session on the Nasdaq, Microsoft released its second-quarter report:
→ Earnings per share: actual = $2.95, forecast = $2.93;
→ Gross revenue: actual = $64.72 billion, forecast = $64.38 billion.

Despite key figures exceeding analyst expectations, MSFT's share price plummeted, falling below the psychological threshold of $400 in after-hours trading.

Investor disappointment may have been caused by the slowdown in growth of its cloud business and significant financial investments in AI infrastructure—a long-term investment with delayed payback.

Could the decline continue?

TO VIEW THE FULL ANALYSIS, VISIT FXOPEN BLOG

Disclaimer: This article represents the opinion of the Companies operating under the FXOpen brand only (excluding FXOpen EU). It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

 

[Resolve]

Smart Money Concept and How To Use It in Trading

In the world of forex trading, understanding the movements and strategies of the market's most influential players like banks and hedge funds—termed "smart money"—can provide retail traders with a significant advantage. This FXOpen article offers a deep dive into the Smart Money Concept, discussing how institutional investors influence market trends and how retail traders can align their strategies with these market movers for potentially better outcomes.

Understanding the Smart Money Concept

The Smart Money Concept (SMC) centres on the principle that the movements of large institutional investors in financial markets can offer valuable clues to retail traders about future market trends.

These institutional investors, often referred to as “smart money,” include banks, hedge funds, and investment firms, wielding significant capital power to influence market directions. The core of SMC lies in the belief that by observing and understanding the trading behaviours and patterns of these entities, retail traders can align their trading strategies to potentially tap into more favourable results.

TO VIEW THE FULL ARTICLE, VISIT THE FXOPEN BLOG

Disclaimer: This article represents the opinion of the Companies operating under the FXOpen brand only (excluding FXOpen EU). It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

RISK WARNING: Trading on the Forex market involves substantial risks, including complete possible loss of funds and other losses and is not suitable for all members. Clients should make an independent judgement as to whether trading is appropriate for them in the light of their financial condition, investment experience, risk tolerance and other factors.

 

[Resolve]

EURUSD Technical Analysis – 31st JULY, 2024

EURUSD – Moving Average Bullish Crossovers

EURUSD was unable to sustain its bearish momentum and after touching a low of 1.0807 the prices started to bounce upwards against the United States dollar.
We can see the formation of Moving Average Bullish Crossovers: AMA20 & AMA50 in the 1-hourly timeframe.
The resistance of the channel is broken in the 1-hourly timeframe.

We have also detected the formation of Bullish trend reversal with the Adaptive moving average AMA100 in the 1-hourly timeframe.
The SuperTrend indicator is also giving a bullish reversal signal in the 2-hourly timeframe.
The RSI indicator is back over 50 in the 4-hourly timeframe.

The prices of EURUSD are ranging near a new high record of 1-months.
EURUSD is now trading above its 100-hour SMA and below its 200-hour SMA simple moving averages.
• Euro Bullish correction seen above the 1.0807 mark.
• Short-term range appears to be Mild Bullish.
• EURUSD continues to remain above the 1.0840 levels.
• Average true range ATR is indicating high market volatility.

The next resistance is located at 1.0850 at which the Price Crosses 9 Day Moving Average.
EURUSD is now trading above its Pivot levels of 1.0832 and is moving into a Mild Bullish channel.

The price of EURUSD remains above its Classic support levels of 1.0811 and is moving towards its next target of 1.0863 at which the Price Crosses 18 Day Moving Average.

Disclaimer: This analysis represents my own opinion only. It is not to be construed as an opinion, offer, solicitation, recommendation, or financial advice of the Companies operating under the FXOpen brand.

For in-depth analysis, please check FXOpen Blog

Post automatically merged: Jul 31, 2024

GBPUSD Technical Analysis – 31st JULY, 2024

GBPUSD – Bullish Price Crossover

GBPUSD was unable to continue its bearish momentum and after touching a low of 1.2820 the prices started to bounce upwards against the United States dollar.
We can see the formation of Bullish price crossover with Moving Average 20 in both the 2-hourly and 4-hourly timeframes.
The price of GBPUSD is back over the pivot point in the 4-hourly timeframe.

The RSI indicator is back over 50 in the daily timeframe.
The Momentum indicator is back over Zero in the 2-hourly timeframe.
The prices of GBPPUSD are ranging near the support of channel in the daily timeframe.

GBPUSD is now trading below its 100-hour SMA and its 200-hour SMA simple moving average.
• Pound Bullish correction seen above the 1.2820 mark.
• Short-term range appears to be Mild Bullish.
• GBPUSD continues to remain above the 1.2840 levels.
• Average true range ATR is indicating high market volatility.

GBPUSD is now trading above its Pivot levels of 1.2844 and is moving into a Mild Bullish channel.
The price of GBPUSD is above its Classic support levels of 1.2820 and is now moving towards its next target of 1.2854 which is a 14-3 Day Raw Stochastic at 20%.

We are also looking for the breach of the levels of 1.2878 which is a 14-3 Day Raw Stochastic at 30%.

Disclaimer: This analysis represents my own opinion only. It is not to be construed as an opinion, offer, solicitation, recommendation, or financial advice of the Companies operating under the FXOpen brand.

For in-depth analysis, please check FXOpen Blog

 

[Resolve]

What Is a Darvas Box Theory and How Does It Work in Trading?

The Darvas Box Theory, pioneered by Nicolas Darvas in the 1950s, has transcended its stock market origins to become a valuable tool for forex traders. This method leverages specific price movements and patterns, known as the Darvas Box, to track market trends and make strategic trading decisions. In this article, we’ll break down Darvas’s theory, its rules, and how to apply it to the forex market.

Background of Darvas Box Theory
The Darvas Box Theory originated from the practices of Nicolas Darvas, a dancer turned investor, in the late 1950s. While touring, Darvas sought a method to grow his investment portfolio, leading to the development of his unique strategy. This approach, later known as the Darvas Box Theory, was primarily designed for the stock market but has since been adapted for various asset types, including forex.

The strategy’s effectiveness hinges on the identification of specific price movements and patterns—collectively referred to as the Darvas Box pattern. Nicolas Darvas’s strategy was meticulously detailed in his 1960 book, How I Made $2,000,000 in the Stock Market.

TO VIEW THE FULL ARTICLE, VISIT FXOPEN BLOG

Disclaimer: This article represents the opinion of the Companies operating under the FXOpen brand only (excluding FXOpen EU). It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

RISK WARNING: Trading on the Forex market involves substantial risks, including complete possible loss of funds and other losses and is not suitable for all members. Clients should make an independent judgement as to whether trading is appropriate for them in the light of their financial condition, investment experience, risk tolerance and other factors.

 

[Resolve]

USD/JPY Falls Below 150 Yen per Dollar

The yen was last this strong in mid-March this year. News from central banks contributed to the decline in USD/JPY.

Yesterday, the Bank of Japan raised interest rates to levels not seen in the past 15 years. Conversely, the Fed kept rates unchanged as expected but "opened the door" for a possible cut in September, according to Reuters. This news weakened the USD and provided a bullish boost to U.S. stock markets.

This shift highlights the collapse of the "carry trade" strategy, where high U.S. rates and low Japanese rates supported the rise of USD/JPY. From early 2023 to the July peak in 2024, USD/JPY rose by about 23%, but it started declining amid news of Bank of Japan's currency interventions.

On July 25, analysing the USD/JPY chart, we:
→ Constructed a descending channel (shown in red);
→ Predicted a scenario with a technical rebound from the lower boundary of the red channel.

Since then, USD/JPY climbed to the psychological mark of 155 yen per dollar on July 30, where the downtrend resumed after a false breakout.

How might the USD/JPY situation develop?

TO VIEW THE FULL ANALYSIS, VISIT FXOPEN BLOG

Disclaimer: This article represents the opinion of the Companies operating under the FXOpen brand only (excluding FXOpen EU). It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

 

[Resolve]

Market Reacts Mildly to Fed Decision, Focus Shifts to NonFarm Payrolls

Late July and early August are packed with significant macroeconomic events. This week has already seen rate decisions from the Bank of Japan and the Federal Reserve, with the Bank of England meeting today and the U.S. monthly labour market report due tomorrow. As the U.S. regulator left the rate unchanged at 5.50% yesterday, market participants will now focus on incoming macroeconomic data for further clues on the Fed's future policy.

GBP/USD

Ahead of today's Bank of England meeting, the GBP/USD pair remains firmly above the significant support level of 1.2820. The price has tested the 1.2820-1.2800 range three times in recent sessions, so far without breaking through.

Technical analysis of the GBP/USD pair indicates potential for continued growth towards June highs if it holds above 1.2900. A break below 1.2800 could lead to a downward correction towards the crucial range of 1.2700-1.2600.

TO VIEW THE FULL ANALYSIS, VISIT FXOPEN BLOG

Disclaimer: This article represents the opinion of the Companies operating under the FXOpen brand only (excluding FXOpen EU). It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

 

[Resolve]

META Shares Rise Above $500

Yesterday, after the close of the main trading session, social media giant META reported its second-quarter results, significantly exceeding analysts' expectations:

→ Earnings per share: actual = $5.16, forecast = $4.72;
→ Revenue: actual = $39.07 billion, forecast = $38.26 billion;
→ Daily active users increased by 7% year-on-year to 3.3 billion;
→ Ad impressions grew by 10%, and ad prices increased by an average of 10%.

CEO Mark Zuckerberg stated that the integration of AI across all platforms, including Instagram, WhatsApp, and Facebook, is driving engagement growth.

Investors were undeterred by the fact that Reality Labs, the division focused on metaverse development, reported a loss of around $4.5 billion for the second quarter, bringing its total loss since its inception in 2020 to $50 billion.

As a result, during after-hours trading, META’s share price rose by 7%, surpassing the psychological $500 level.

What Could Happen Next?

On 19 July, our analysis of META’s chart identified an ascending channel (shown in blue) and highlighted the importance of support at the $455 level.

Since then, the share price attempted to break this level on 25 July, but this led to a surge in demand, with META’s price rising sharply and forming a candle with a long lower wick.

In pre-market trading today, META's price is above $505, and the main session is likely to open around these levels.

TO VIEW THE FULL ANALYSIS, VISIT FXOPEN BLOG

Disclaimer: This article represents the opinion of the Companies operating under the FXOpen brand only (excluding FXOpen EU). It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

 

[Resolve]

EURUSD Technical Analysis – 01st AUG, 2024

EURUSD – Bearish Price Crossover Pattern

EURUSD was unable to sustain its bullish momentum and after touching a high of 1.0834 the prices started to decline against the United States dollar.
We can see the formation of Bearish Price Crossover Pattern with the Moving Average MA50 and MA100 and Adaptive Moving Average AMA50 in the daily timeframe.
The Williams percent range indicator is back under -50 in the weekly timeframe.

We have also detected the formation of Bearish Trend reversal with the Moving average MA20 in the weekly timeframe.
The Support of the channel is broken in the 1-hourly timeframe.
We can also see that the prices are near the resistance of the channel in the monthly timeframe.
The prices of EURUSD are ranging near a new low record of 1-year.

EURUSD is now trading below its 100-hour SMA and its 200-hour SMA simple moving averages.
• Euro Bearish correction seen below the 1.0834 mark.
• Short-term range appears to be Mild Bearish.
• EURUSD continues to remain above the 1.0790 levels.
• Average true range ATR is indicating high market volatility.

The next support is located at 1.0784 which is a Price 3 Standard Deviations Support.
EURUSD is now trading just above its Pivot levels of 1.0791 and is moving into a Mild Bearish channel.

The price of EURUSD remains above its Classic support levels of 1.0787 and is moving towards its next target of 1.0773 which is a 38.2% Retracement From 13 Week Low.

Disclaimer: This analysis represents my own opinion only. It is not to be construed as an opinion, offer, solicitation, recommendation, or financial advice of the Companies operating under the FXOpen brand.

For in-depth analysis, please check FXOpen Blog

 

[Resolve]

GBPUSD Technical Analysis – 01st AUG, 2024

GBPUSD – Support of Channel Is Broken

GBPUSD was unable to continue its bullish momentum and after touching a high of 1.2862 the prices started to decline against the United States dollar.
We can see that the Support of Channel Is Broken in the 1-hourly timeframe which is indicative of the bearish trend.
The price of GBPUSD is ranging near the resistance of the channel in the 15-minutes timeframe.

The RSI indicator is back under 50 in the daily timeframe.
Some of the technical indicators are also giving a neutral stance in the markets which indicates the presence of the consolidation wave in the market.
The prices of GBPPUSD are ranging near a new low record of 1-months.

GBPUSD is now trading below its 100-hour SMA and its 200-hour SMA simple moving average.
• Pound Bearish correction seen below the 1.2862 mark.
• Short-term range appears to be Mild Bearish.
• GBPUSD continues to remain above the 1.2800 levels.
• Average true range ATR is indicating high market volatility.

GBPUSD is now trading just above its Pivot levels of 1.2807 and is moving into a Mild Bearish channel.
The price of GBPUSD is above its Classic support levels of 1.2790 and is now moving towards its next target of 1.2806 which is a Price 3 Standard Deviations Support.

We are also looking for the breach of the levels of 1.2779 which is a 38.2% Retracement From 4 Week Low.

Disclaimer: This analysis represents my own opinion only. It is not to be construed as an opinion, offer, solicitation, recommendation, or financial advice of the Companies operating under the FXOpen brand.

For in-depth analysis, please check FXOpen Blog

 

[Resolve]

Market Analysis: Gold Price Regains Strength While Oil Price Takes Hit

Gold price started another increase and surpassed the $2,440 resistance. Crude oil is showing bearish signs and might decline below $75.00.

Important Takeaways for Gold and Oil Prices Analysis Today

• Gold price started a steady increase from the $2,420 zone against the US Dollar.
• A key bullish trend line is forming with support near $2,440 on the hourly chart of gold at FXOpen.
• Crude oil prices failed to clear the $78.20 region and started a fresh decline.
• There was a break below a connecting bullish trend line with support at $77.50 on the hourly chart of XTI/USD at FXOpen.

Gold Price Technical Analysis

On the hourly chart of Gold at FXOpen, the price found support near the $2,320 zone. The price remained in a bullish zone and started a strong increase above $2,400.

There was a decent move above the 50-hour simple moving average and $2,420. The bulls pushed the price above the $2,435 and $2,440 resistance levels. Finally, the price tested the $2,455 zone and the price is now consolidating losses.

TO VIEW THE FULL ANALYSIS, VISIT FXOPEN BLOG

Disclaimer: This article represents the opinion of the Companies operating under the FXOpen brand only (excluding FXOpen EU). It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

 

[Resolve]

S&P 500 Index Price Falls Amid Negative News

Yesterday, disappointing news about the US economy was released. According to ForexFactory:
→ The ISM Manufacturing PMI fell from 48.5 to 46.8 (analysts expected a rise to 48.8), indicating a decline in industrial production.
→ The number of unemployment benefit claims reached 249,000 – the highest in 12 months.

As a result, US stock indices declined, with bearish sentiment further driven by weak Q2 reports from several companies:
→ Intel decided to halt dividend payments (INTC shares plummeted by 19%).
→ Amazon reported a revenue decline (AMZN shares dropped by 6%).

The outperformance of sectors such as consumer staples, healthcare, and utilities compared to technology stocks suggests that investors fear a recession and are rotating into more stable assets.

Meanwhile, the daily S&P 500 chart (US SPX 500 mini on FXOpen) indicates a vulnerable position – since mid-April, the price has been moving within an upward channel (shown in blue), but today it is near the lower boundary, creating a risk of a bearish breakout.

TO VIEW THE FULL ANALYSIS, VISIT FXOPEN BLOG

Disclaimer: This article represents the opinion of the Companies operating under the FXOpen brand only (excluding FXOpen EU). It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

 

[Resolve]

USD/CHF Falls to Lowest Level in Nearly Six Months

As today's USD/CHF chart shows, the exchange rate has fallen below 0.872 – the Swiss franc hasn't been this strong against the US dollar since early February this year.

Bearish sentiment is driven by:
→ Expectations of a Fed rate cut, weakening the US dollar;
→ Low inflation in Switzerland – today's CPI data shows -0.2%;
→ Geopolitical tension, particularly the escalation in the Middle East following the killing of Hamas leader Ismail Haniyeh and the anticipated response from Iran.

Market participants appear to view the franc as a "safe haven."

TO VIEW THE FULL ANALYSIS, VISIT FXOPEN BLOG

Disclaimer: This article represents the opinion of the Companies operating under the FXOpen brand only (excluding FXOpen EU). It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

 

[Resolve]

Watch FXOpen's 29 July - 2 August Weekly Market Wrap Video

Weekly Market Wrap With Gary Thomson: GBP/USD, USD/JPY, MSFT and META Shares

Get the latest scoop on the week's hottest headlines, all in one convenient video. Join Gary Thomson, the COO of FXOpen UK, as he breaks down the most significant news reports and shares his expert insights.

• Market Reacts Mildly To Fed Decision, Focus Shifts To Nonfarm Payrolls
• USD/JPY Falls Below 150 Yen Per Dollar
• MSFT Share Price Plummets After Earnings Report, But It’s Not All Bad
• META Shares Rise Above $500

Stay in the know and empower yourself with our short, yet power-packed video.

Watch it now and stay updated with FXOpen.

Don't miss out on this invaluable opportunity to sharpen your trading skills and make informed decisions.



FXOpen YouTube


Disclaimer: This article represents the opinion of the Companies operating under the FXOpen brand only (excluding FXOpen EU). It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

RISK WARNING: Trading on the Forex market involves substantial risks, including complete possible loss of funds and other losses and is not suitable for all members. Clients should make an independent judgement as to whether trading is appropriate for them in the light of their financial condition, investment experience, risk tolerance and other factors.

#fxopen #fxopenyoutube #fxopenint #weeklyvideo

 

[Resolve]

GBPUSD Technical Analysis – 02nd AUG, 2024

GBPUSD – Bullish Price Crossover Pattern

GBPUSD was unable to continue its bearish momentum and after forming a low of 1.2707 the prices started to correct upwards against the United States dollar.
We can see that the formation of Bullish price crossover pattern with Moving Average MA20 and MA50 and the Adaptive Moving average AMA50 in the daily timeframe.
The price of GBPUSD is ranging near support of channel in the daily timeframe.

The RSI indicator is back over 50 in the 4-hourly timeframe.
We can also see that the MACD crosses UP its Moving Average in the 4-hourly timeframe.
The Ichimoku: price is over the cloud in the 1-hourly timeframe.

The prices of GBPPUSD are ranging near a Near a new HIGH record of 1 month.
GBPUSD is now trading below its 100-hour SMA and its 200-hour SMA simple moving average.
• Pound Bullish reversal seen above the 1.2707 mark.
• Short-term range appears to be Strong Bullish.
• GBPUSD continues to remain above the 1.2800 levels.
• Average true range ATR is indicating high market volatility.

GBPUSD is now trading just above its Pivot levels of 1.2795 and is moving into a Strong Bullish channel.
The price of GBPUSD is above its Classic support levels of 1.2782 and is now moving towards its next target of 1.2816 which is a 38.2% Retracement From 13 Week High.
We are also looking for the breach of the levels of 1.2835 which is a 14 Day RSI at 50%.

Disclaimer: This analysis represents my own opinion only. It is not to be construed as an opinion, offer, solicitation, recommendation, or financial advice of the Companies operating under the FXOpen brand.

For in-depth analysis, please check FXOpen Blog

 

[Resolve]

EURUSD Technical Analysis – 02nd AUG, 2024

EURUSD – Bullish Trend Reversal Pattern

EURUSD was unable to sustain its bearish momentum and after forming a low of 1.0781 the prices started to correct upwards against the United States dollar.
We can see the formation of Bullish Trend Reversal Pattern with the Moving Average MA50 and MA100 and the Adaptive Moving Average AMA100 in the 4-hourly timeframe.
The Resistance of the channel is broken in the 1-hourly timeframe which indicates the bullish nature of the markets.

We have also detected the formation of Bullish price crossover pattern with the Adaptive Moving average AMA20, AMA50 and AMA100 in the daily timeframe.
The Ichimoku: price is over the cloud in the weekly timeframe.
The Parabolic SAR indicator is also giving bullish reversal signal in the daily timeframe.
The prices of EURUSD are ranging near a new HIGH record of 1 month.

EURUSD is now trading above its 100-hour SMA and its 200-hour SMA simple moving averages.
• Euro Bullish reversal seen above the 1.0781 mark.
• Short-term range appears to be Strong Bullish.
• EURUSD continues to remain above the 1.0900 levels.
• Average true range ATR is indicating high market volatility.

The next resistance is located at 1.0914 which is a 14-3 Day Raw Stochastic at 80%.
EURUSD is now trading just below its Pivot levels of 1.0916 and is moving into a Strongly Bullish channel.
The price of EURUSD remains above its Classic support levels of 1.0890 and is moving towards its next target of 1.0948 which is a 1-Month High.

Disclaimer: This analysis represents my own opinion only. It is not to be construed as an opinion, offer, solicitation, recommendation, or financial advice of the Companies operating under the FXOpen brand.

For in-depth analysis, please check FXOpen Blog

 

[Resolve]

What Is Market Capitulation, and How Can You Trade It?

Market capitulation occurs when investors collectively surrender to market fears, leading to a sharp decline in asset prices. This article delves into the mechanics of capitulation, how to identify it, and ways to trade effectively during these tumultuous times.

Understanding Market Capitulation

Market capitulation refers to a phenomenon where a large number of investors simultaneously give up on the market, leading to a rapid and substantial decline in asset prices. This mass surrender is driven primarily by panic and fear of further losses. Capitulation often marks the peak of a bearish trend and is typically characterised by a significant spike in trading volumes and sharp price declines.

Stock capitulation occurs when investors, overwhelmed by fear and uncertainty, rush to sell their assets to avoid further losses. This behaviour is often triggered by prolonged market downturns or significant economic events. For instance, during the COVID-19 pandemic in March 2020, the S&P 500 experienced a nearly 5% drop in a single day, a classic example of market capitulation. This event led to a subsequent 17% rebound in the index over the following week, highlighting how capitulation can precede a market turnaround.

TO VIEW THE FULL ARTICLE, VISIT FXOPEN BLOG

Disclaimer: This article represents the opinion of the Companies operating under the FXOpen brand only (excluding FXOpen EU). It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

 

[Resolve]

The Nikkei 225 Index Has Plummeted to a Nine-Month Low

As shown by the Nikkei 225 (Japan 225 on FXOpen) chart:
→ In less than a month, the index price has dropped by more than 25%, providing grounds to suggest the start of a bear market;
→ The price has approached the psychological level of 30,000 points – the last time the price was this low was in autumn 2023.

Bearish sentiment is being driven by a combination of the following factors:
→ Negative news from the US labour market, published on Friday – this has significantly increased discussions about the likelihood of a recession;
→ The Bank of Japan’s interest rate hike last Wednesday to support the excessively weak yen.

As we wrote on 15 July, while analysing the Nikkei 225 index (Japan 225 on FXOpen):
→ Signs of bearish activity were observed around the 41,330 level;
→ The upward channel may break in the second half of the year.

It turned out that the bullish channel was broken much earlier and in an extremely aggressive manner – the bulls attempted to resume the trend from its lower boundary (shown by the black arrow), taking advantage of the 38,000 support, but were defeated.

What could happen next?

TO VIEW THE FULL ANALYSIS, VISIT FXOPEN BLOG

Disclaimer: This article represents the opinion of the Companies operating under the FXOpen brand only (excluding FXOpen EU). It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

 

[Resolve]

EUR/USD Analysis: The Rate Has Risen to a Nearly 5-Month High

As shown by today’s EUR/USD chart, the rate rose this morning to 1.096 – its highest level since mid-March.

On one hand, this was driven by the weakness of the dollar. The USD fell sharply against other currencies following the release of labour market news on Friday (data from ForexFactory hereafter):
→ The unemployment rate reached 4.3% – the highest since autumn 2021;
→ In July, employers created only 114,000 jobs (excluding the agricultural sector) compared to the forecast of 175,000. Last month’s figure was 179,000;
→ Wage growth is showing signs of slowing down.

The rapid deterioration of the labour market is an early sign of a recession. This is indicated by the rule of Claudia Sahm, who worked at the Federal Reserve for over 10 years.

On the other hand, the EUR/USD is rising due to the strength of the euro. Today, the Purchasing Managers' Index (PMI) figures were released in Europe – all are above the 50.0 level, indicating growth in the Eurozone economies.

TO VIEW THE FULL ANALYSIS, VISIT FXOPEN BLOG

Disclaimer: This article represents the opinion of the Companies operating under the FXOpen brand only (excluding FXOpen EU). It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

 

[Resolve]

EURUSD Technical Analysis – 05th AUG, 2024

EURUSD – Resistance of Channel Is Broken

EURUSD was unable to sustain its bearish momentum and after forming a low of 1.0892 the prices started to correct upwards against the United States dollar.
We can see the formation of Moving Average bullish crossovers: MA50 & MA100 in the 2-hourly timeframe.
The Resistance of the channel is broken in the 1-hourly timeframe which indicates the bullish nature of the markets.

We have also detected the formation of Bullish Trend reversal with the Moving Average MA50 and MA100 in the daily timeframe.
The MACD crosses UP its Moving Average in the daily timeframe.
The Aroon indicator is giving bullish trend in the daily timeframe.

The prices of EURUSD are ranging near a new HIGH record of 1 month.
EURUSD is now trading above its 100-hour SMA and its 200-hour SMA simple moving averages.
• Euro Bullish reversal seen above the 1.0892 mark.
• Short-term range appears to be Strong Bullish.
• EURUSD continues to remain above the 1.0970 levels.
• Average true range ATR is indicating high market volatility.

The next resistance is located at 1.0996 which is a Price 1 Standard Deviation Resistance.
EURUSD is now trading just below its Pivot levels of 1.0987 and is moving into a Strongly Bullish channel.
The price of EURUSD remains above its Classic support levels of 1.0965 and is moving towards its next target of 1.1008 which is a 1-Month High.

Disclaimer: This analysis represents my own opinion only. It is not to be construed as an opinion, offer, solicitation, recommendation, or financial advice of the Companies operating under the FXOpen brand.

For in-depth analysis, please check FXOpen Blog