Technical Analysis by Alpari

[Alpari]

Euro/dollar: today’s situation is 50/50​

Previous:

What was expected to be seen on the euro on Wednesday was done on Tuesday. The US stats continue to stand on the side of the dollar bulls. The US housing market exceeded expectations. The number of construction permits and foundations lain in June rose.

The euro/dollar dropped 80 points to 1.0999. Meanwhile the GBP lost around two figures. The euro weakened to a lesser extent due to it strengthening in the euro/pound cross.

Market Expectations:

The current situation on the hourly is contradictory. On the one hand an inverted pattern is forming for a revival of the euro to 1.1050. On the other hand, the weakening of the euro could hasten to 1.0980 and below. The fall stopped at 8th July minimum (1.0996). If the euro/dollar exceeds 1.1022 over the course of two hours after trade opening in Europe, we could see a forecast for a strengthening to 1.1050.

Day’s News (EET):

• 09:00, German June producer price data;
• 11:00, Eurozone May balance of payment;
• 11:30, UK average salary changes index, unemployment benefit applications and unemployment level in May;
• 12:00, Swiss index for economic expectations in June from ZEW;
• 17:00, Eurozone July consumer confidence;
• 17:30, US changes in oil reserves for week ending 17th July.

Technical Analysis:

Intraday forecast: minimum: n/a, maximum: n/a, close: n/a.

Euro/dollar rate on the hourly. Source: TradingView

Since the last 4-hour candle isn’t closed, we need to make two scenarios. On the 4H a pinbar has formed. More precisely: a double bottom from two pinbars. You can see it better on the hourly.

If the euro/dollar exceeds 1.1022 within the two hours after trade opening in Europe, the forecast for a rise to 1.1050 will be activated. I don’t see how it could go higher since tomorrow will see the ECB convene and Draghi speak.

If the bulls don’t manage to pass the level indicated, the risks of a slide along the red scenario to 1.0980 will persist.

 

[Alpari]

Euro strengthening before ECB meeting​

Previous:

The euro’s Wednesday trading closed slightly down. The euro bulls quickly won back losses which were incurred after UK labour market data came out.

High intraday volatility continued ‘til trade close in the States. As a result a daily pinbar formed. Although the dark shade of the candle was small, it was a bullish signal. If Draghi doesn’t quash the euro, it will come off today.

Market Expectations:

The euro was up to 1.1043 against the dollar in Asia. Since yesterday’s 1.1030 maximum was exceeded, a bull signal was activated in accordance with the pinbar. The target on it is 1.1080.

I didn’t bother with a forecast due to the ECB convening and taking a decision on interest rates. In addition, at 15:30 EET, Mario Draghi will hold a press conference. He is unpredictable, so I don’t see the point in making a forecast.

Day’s News (EET):

• 11:30, UK retail sales and net state borrowing in June;
• 14:15, ECB interest rate;
• 15:30, Draghi’s press conference, US Philadelphia Fed manufacturing index for June and US initial unemployment benefit applications for the week ending 17th July;
• 17:00, US secondary housing market sales in June and US June index for leading indicators from the Conference Board.

Technical Analysis:

Intraday forecast: minimum: n/a, maximum: n/a, close: n/a.

Euro/dollar rate on the hourly. Source: TradingView

The trend line which took its beginning from a 1.1148 peak has been broken in Asia on the hourly. The LB and the 45th Gann degree have also been passed. Taking into account that a daily pinbar formed yesterday, it would be logical to think that the euro will strengthen to around 1.1080 today.

The graph is without a forecast. I don’t want to guess where the euro will be during Draghi’s speech. The market expects that the monetary policy of the ECB will be left unchanged. If There are no surprises at the press conference, the euro will strengthen against the dollar.

 

[Alpari]

Euro reviving after Friday’s weakening​

Previous:

The euro/dollar on Friday closed down. The USD strengthened on strong US labour market data. The amplitude of the price fluctuations was a full figure because of the news.

Job creation outside the agricultural sector in July increased 255k against a 180k forecast. The numbers for the two previous months were reassessed upwards. May rose from 11k to 24k and June rose from 287 to 292. This is a total reassessment rise of 18k.

The level of people in the working population rose by 0.1% to 62.8% and the unemployment level remained unchanged at 4.9% (forecasted: 4.8%). The US hourly wage index in June was up 0.3% (forecasted: 0.2%, previous: 0.1%).

June’s data turned out significantly better than that of March (200k higher). The stats published increased the likelihood of a US interest rate rise this year. According to data from the futures market on interest rates, the likelihood of a September interest rate rise has increased from 9% to 15% and in December from 29.4% to 38.4%.

Over the course of two hours the euro/dollar dropped to 1.1046. By trade close the price had returned to 1.1105.

Market Expectations:

I always look at a movement against that of Friday after the payrolls. The fall of the euro/dollar was partially reversed. The 1.1120 and 1.1140 levels will be today’s resistances. By trade close I expect a revival of the pair to the hourly trend line at 1.1123. After the release of US GDP, one single good NFP will not be enough for the Fed to put up rates in September. The news today is little.

Day’s News (EET):

• 9:00, German industrial Manufacturing in June;
• 10:15, Swiss July CPI;
• 11:30, Eurozone investor confidence index for August from Sentix;
• 15:30, Canadian June construction permits.

Technical Analysis:

Intraday forecast: minimum: 1.1073, maximum: 1.1125, close: 1.1123.

Euro/dollar rate on the hourly. Source: TradingView

The euro was reaching for the support around the 157th degree on Friday. From the 1.1046 minimum, the price restored to 1.1105 (45 degrees). 1.1120 and 1.1140 are today’s resistances. The first level is formed at the LB and the second is from the trend line.

The price could head up without a rebound, or it could first return to 1.1073. I reckon the euro will rise without rebounding. I’m not looking at the economic calendar. By the close of the day I expect a rise in the EUR/USD to the hourly trend line at 1.1123.

 

[Alpari]

EURUSD in sideways​

Previous:

Investor activity during the American session was low. Due to the lack of catalysers for movement, the EURUSD dropped to 1.1072 and then restored to 1.1088 by trade opening in Asia. The euro spent the day in a 33 point corridor range.

Market Expectations:

On Tuesday I am sticking with a bullish mood for the pair and reckon that, with support from the euro/pound, the euro/dollar will rise to 1.1128. The news is little, too little for it to rock the market. Due to this, the euro’s strengthening has a ceiling of 1.1150.

Day’s News (EET):

• 08:45, Swiss July unemployment level;
• 09:00, German June balance of trade;
• 11:30, UK production in manufacturing industries and industrial production in June. UK balance of trade for June;
• 15:15, Canadian foundations lain for new homes in June;
• 15:30, US productivity in the non-farm sector and labour force expenses in Q2 of 2016;
• 17:00, UK Q2 GDP assessment from NIESR and US index for economic optimism amongst consumers in August from IBD/TIPP.

Technical Analysis:

Intraday forecast: minimum: 1.1071 (current Asian), maximum: 1.1128, close: 1.1101.

Euro/dollar rate on the hourly. Source: TradingView

The euro dollar is still trading below the 45th degree and LB. Whilst traders within the price are banking on a rate drop from the BoE, the euro/pound will offer support to the euro/dollar.

When a cross rises with a weakening dollar, the euro/dollar rate sees a sharp rise. When a cross rises with a rising dollar, the euro/dollar consolidates in a sideways. The stronger the EUR/USD growth from its current level, the higher the likeliness of us seeing a test of 1.12.

 

[Alpari]

Euro ready to strengthen further against the dollar​

Previous:

My expectations for yesterday rang true. The euro dollar consolidated in a 1.1070-1.1105 range and then headed upwards. The trend line was broken at 1.1105. The road to 1.1215 is now open.

Strong US labour market data is enough to increase the interest rate in September. A correction has started on the dollar.

Market expectations:

The euro is up 35 points – to 1.1152 – in Asia. I don’t see anything which could hinder the euro/dollar’s growth; the news on Wednesday isn’t anything attention grabbing. We could see a rise for the third session in a row. I forecast a rebound to 1.1140/30 with subsequent growth to 1.1180.

Day’s News (EET):

• 17:00, US non-farm vacancies in June;
• 17:30, US oil reserve changes for first week of August;
• 21:00, US July federal budget balance.

Technical Analysis:

Intraday forecast: minimum: 1.1140, maximum: 1.1180, close: 1.1165.

Euro/dollar rate on the hourly. Source: TradingView

The bulls managed to win back all of the losses they incurred on Friday after the strong labour market data. I reckon that there will be another rise up to 1.1200. Today my euro target is 1.1180, along the 112 Gann degree. Now the bulls really need to stand firm in the 1.1130-1.1140 zone.

 

[Alpari]

Correction for euro​

Previous:

The euro/dollar on Wednesday reached 1.1190 thanks to purchases of the euro for the British pound after a failed BoE auction. The central bank didn’t manage to acquire enough long-term state bonds as part of its program.

Market expectations:

Today I wanted to consider a rise for the euro to 1.1220, but the weak nature of the pound and commodity currencies forced me to go for a fall to 1.1137. The upward movement from 1.1046 to 1.1190 wasn’t complete. Keep an eye on whether the buyers will be able to pass the 1.1155 support or not. The euro/pound cross is on the side of the buyers, so to sell euro against the dollar is a bit risky. The economic calendar in Europe is empty.

Day’s News (EET):

• 15:30, Canadian primary market housing sales index for June;
• 15:30, US initial unemployment benefit applications for the week ending 7th August and import price index for July.

Technical Analysis:

Intraday forecast: minimum: 1.1137, maximum: 1.1191 (current Asian), close: 1.1159.

Euro/dollar rate on the hourly. Source: TradingView

On Wednesday the euro/dollar restored to 1.1190. The zone between the 112 and 135 degrees is an inverted one, so the risks of a correction to the 45th degree are up for the pair. If the 1.1150-1.1160 support zone holds back any rush from the sellers, I don’t exclude a renewal of the maximum on the American session.

On Thursday I went for a fall in the euro to 1.1137, with a subsequent bounce to 1.1170. Whilst the euro is weakening, the LB will be nearing the 45th degree by 14:00 EET and will offer support to the euro bulls.

 

[Alpari]

Expected euro rise to 1.1242​

Previous:

Euro trades on Friday closed down. The euro crumbled from its 1.1341 maximum by 1.5 figures. The fall was by 135 degrees. Demand for the dollar rose after Janet Yellen announced that there had been an improvement in US economic conditions; lifting expectations of an increase in the US interest rate. Nothing was said about when this may happen. The rise in the rate will be gradual, taking new labour market and inflation data into account.

Market expectations:

As you already know, on Mondays I look at movement against that of Friday. Whilst the experts are mulling over what Yellen said, today I expect the euro/dollar to rise to 1.1242. A spurt to 1.1255 is currently possible. The economic calendar for Europe today is bare, so the bulls don’t have anything to stop them reversing Friday’s weakening against the euro.

Day’s News (EET):

• 15:30, US base index for personal consumption expenditure in July and incomes for the month.

Technical Analysis:

Intraday forecast: minimum: 1.1176 (current Asian), maximum: 1.1242, close: 1.1230.

Euro/dollar rate on the hourly. Source: TradingView

The 112-135 degree zone is a correction inversion zone for the euro. The fall of the euro/dollar resumed at the 135th degree via 1.1182. Since today is Monday, I expect the price to rise to 1.1242. In the evening this level will drift towards the balance line and will become a resistance for the euro bulls. After trade close in Europe, a correction against this movement will look to take place.

 

[Alpari]

Euro bulls trying to win back morning’s losses​

Previous:

The euro/dollar closed slightly up on Monday. During trades in the States the pair dropped to 1.1158 on data regarding personal consumption expenditure. In shifting the minimum, the price returned to 1.1193. The reaction to the stats was weak since the UK was having a bank holiday. Trader activity was low.

Market expectations:

There’s no important macro data planned to be released today. All traders will be focussed on the US labour market data from Friday. The euro is trading down in Asia by 0.14% against Monday’s closing price. Going off the hourly indicators, the pair is ready to restore itself to 1.1210. Graphical analysis is indicating a weakening of the euro. Since my yesterday’s expectations of movement against that of Friday did not ring true, today I am again looking at the pair heading to the LB at 1.1210.

Day’s News (EET):

• 9:00, German June import price index;
• 10:00, German preliminary August CPI and Swiss economic barometer from KOF for August;
• 11:30, UK net private sector financing, M4 money supply and mortgages approved in July;
• 15:30, Canadian Q2 of 2016 balance of payments, raw material price index for July and PMI for July;
• 16:00, US housing price index from S&P/CS for June;
• 17:00, consumer confidence index from CB for August.

Technical Analysis:

Intraday forecast: minimum: 1.1168 (current Asian), maximum: 1.1210, close: 1.1193.

Euro/dollar rate on the hourly. Source: TradingView

Without the Brits, the sellers managed to shift the euro to the 157th degree. On Tuesday I expect to see a rise of the euro to 1.1211. The bull divergence on the AO indicator and the buy signal forming on the oscillator stochastic are in favour of a euro strengthening.

Since the MA line is on its way down, the oscillator’s signal could be a false one. We need to wait for a break in the 1.1185- 1.1195 zone. As soon as this zone is passed, we can look at a strengthening of the euro as part of a W-shaped pattern.

I’ve also considered the forming of a double bottom since the current movements do not suit a saw-like fall. If a double bottom forms, the price should return to 1.1158 and bounce sharply to 1.1180. Without any risk of a rebound, the euro/dollar will fall to 1.1129.

 

[Alpari]

Euro dollar reaches upper limit of downward channel​

Previous:

The euro/dollar updated its weekly maximum due to a general strengthening of the dollar after the publication of strong consumer confidence data. The report’s figures increased the chances of there being an interest rate hike from the Fed in September from 21% to 24%, thereby offering support to the US currency.

The Conference Board’s index for consumer confidence in August hit figures unseen since September of last year: 101.1 points. The data is significantly higher than expected (97.0) and that of July (96.7, reassessed from 97.3).

Market expectations:

On Tuesday the euro/dollar closed down. In Asia the GBP has fully recovered all of yesterday’s losses against the USD. Now it is trying to do the same with the euro.

The rate lifted from a minimum of 1.1132 to 1.1160. Going off the technical aspect and the cycles, I’d still say there’ll be a rise in the quotes. Only the US stats are knocking it down. As a result, a saw-like pattern with a double bull divergence has appeared on the hourly.

All market participant attention is on Friday’s US labour market report. Before it comes out the market will be in full swing. Today the monthly candle closes. For the buyers not to disappear before they need to, they have to close the month above 1.1197 (July’s maximum).

Day’s News (EET):

• 09:00, Swiss consumer indicator for June from UBS, German retail sales in July;
• 10:55, German unemployment changes in July;
• 12:00, Eurozone’s preliminary CPI for August and unemployment level for July;
• 15:15, US NFP from ADP in July;
• 15:30, Canadian GDP for June;
• 16:45, US Chicago PMI in August;
• 17:00, US incomplete housing sales in July;
• 17:30, US oil reserves for the week ending 27th August.

Technical Analysis:

Intraday forecast: minimum: n/a, maximum: n/a, close: n/a.

Euro/dollar rate on the hourly. Source: TradingView

My yesterday’s expectations didn’t come off. The double bottom was not realized. After the publication of consumer confidence data in the US, the euro/dollar dropped to 1.1132. The price remains in a downward-facing channel. At the moment the price is up at the top limit of this channel; trading at 1.1158.

A double bull divergence has formed according to the AO indicator. An upward break in the channel puts the minimum target at 1.1208. Since the US stats are breaking all the patterns and tonight the ADP index is out, I haven’t bothered making a forecast. I am inclined to go for a strengthening of the euro as part of a correction after Yellen’s speech.

So could the euro go down, I hear you ask? It could. Anything could happen before the 1.1030-1.1050 zone.

 

[Alpari]

Hammer forms on daily​

Previous:

The euro finished Wednesday’s trading up. The monthly candle closed doji at 1.1157 against 1.1167 in July. The body of the candle was 10 points. The euro spent the day under pressure whilst the euro/pound hadn’t started correcting. By trade close in Europe, the euro/dollar had restored to 1.1165.

Job creation in the US private sector for August was 177k against a forecasted 175k. The previous value was reassessed up by 15k to 194k. As I said earlier, there isn’t a positive correlation between the ADP and NFP, so any time the values coincide, the market ignores the data.

Market expectations:

At the time this analysis was written, the euro/dollar was trading at around 1.1153. The euro is pushing off from 1.1123 after a triple bear divergence. The minimum target after the saw-like pattern is 1.1207. Since the price on the hourly period is balanced, before the payrolls, I expect to see a growth to 1.1176. Higher than this is unlikely, since traders stray away from opening new positions before important events.

Day’s News (GMT+3):

• 10:15, Swiss July retail sales data;
• 10:30, Swiss index for business activity in the manufacturing sector for August.
• 10:55, German definitive business activity index for manufacturing in August,
• 11:00, Eurozone definitive business activity index for manufacturing in August,
• 11:30, UK definitive business activity index for manufacturing in August,
• 14:30, US redundancies in August from Challenger,
• 15:30, US unemployment benefit requests for week ending 27th August, reassessment of manufacturing in the non-farm sector during Q2 of 2016, reassessed labour force price for Q2 of 2016,
• 16:30, Canadian index for business activity in manufacturing for August from RBC,
• 16:45, US definitive index for business activity in manufacturing for August.
• 17:00, US index for business activity in manufacturing from the ISM for August, expenditure on construction for July and PMI from the ISM for August.

Technical Analysis:

Intraday forecast: minimum: 1.1145, maximum: 1.1176, close: 1.1165.

Euro/dollar rate on the hourly. Source: TradingView

The euro has updated its minimum for three days in a row under pressure from the falling euro/pound. As a result, a saw-like pattern and triple bear divergence between the price and the AO indicator has formed.

The euro bulls broke the upper limit of the channel and the price is now at the LB. Taking the formation of a hammer on the daily into account, I expect to see the euro to restore to 1.1176 (45 degrees) today. If the cross will be on the buyers’ side, then it will reach 1.12.

 

[Alpari]

Flat expected for the euro until NFP release​

Previous:

The euro closed up on Thursday. The US stats helped the euro bulls win back losses all the way to 1.1202. A hammer candle formation came off. The growth in the rate stopped exactly at the 67th degree, where the pair traded for 10 hours.

The USD lost after the publication of the ISM index for the manufacturing sector. The index stood at 49.4 in August (forecasted: 52.0). With an index below 50, the Fed is unlikely to raise rates in September. Due to this, today’s NFP will carry weight.

Market expectations:

The Non-farm Payrolls (NFP) is the key event for Friday. In Asia the euro/dollar has updated its maximum and is trading at 1.1201. I expect a fall in the rate to 1.1194 before the US stats come out. Where the price will be after the stats is anyone’s guess. That’s why I’ve not bothered with a forecast. The NFP is an unforecastable indicator, so we could see some surprises.

Day’s News (GMT+3):

• 11:30, UK index for business activeness in the construction sector throughout August;
• 12:00 Eurozone PMI for July;
• 15:30, Canadian July balance of trade and labour output in Q2 of 2016. US average hourly wage for August, unemployment level for August and balance of trade for July;
• 17:00, US factory orders in July.

Technical Analysis:

Intraday forecast: minimum: n/a, maximum: n/a, close: n/a.

Euro/dollar rate on the hourly. Source: TradingView​

The euro/dollar has restored to the 67th degree on weak ISM manufacturing data. I expect a flat before the American session. If the euro/pound cross continues its upwards correction, the flat on the euro/dollar will be an upward one, and not as I have it on the graph.

The 112th degree heads through 1.1255. This is the target for the buyers if the NFP is lower than 180k and if previous values are reassessed downwards. The target is in the region of 1.1280 if we go off the U3.

 

[Alpari]

Market waiting for Draghi to speak​

Previous:

On Wednesday the euro closed slightly down. The price during the American session updated its maximum from where it returned to 1.1238. The jump upwards was caused by a growth in the euro/pound cross as a response to Carney speaking. The BoE governor announced that the Bank is ready to implement further stimulus if required.

Market expectations:

The euro/dollar is trading up 0.1% or 12 points in Asia in comparison with Wednesday. The pressure on the dollar continues due to the falling likelihood that the Fed will raise rates this September. This likelihood has now dropped to 15%.

The ECB is to convene this Thursday and Draghi is to hold a press conference afterwards. My forecast is for up to 15:30 EET. It’s unclear what Draghi will come out with. It is this man who will set the pace for any euro movements before trade close in Europe.

Day’s News (GMT+3):

• 14:45, ECB interest rate decision;
• 15:30, Canadian July construction permits, manufacturing capacity usage in Q2 of 2016 and housing price index on the primary market in July. ECB press conference. US initial unemployment benefit applications for the week ending 4th September;
• 18:00, US oil reserves for the week ending 4th September;
• 19:20, BoC’s Timothy Lane to speak;
• 22:00, US consumer financing in July.

Technical Analysis:

Intraday forecast: minimum: n/a, maximum: n/a, close: n/a.

Euro/dollar rate on the hourly. Source: TradingView​

My expectations for a sideways and daily pinbar rang true. The euro/dollar shifted the maximum to 1.1271 and then returned to 1.1239. As a result, a pinbar formed at the close of the day.

In accordance with the pinbar, we should sell euro when there’s a break in 1.1229. However, today will see Draghi speak and he can cancel all technical signals. Due to this my forecast only runs up to 15:30 GMT+3.

Draghi could have the euro/dollar wobbling in a range of 100 or more points, so trading whilst he speaks is risky. Let the emotions of other traders run wild whilst he speaks and then get involved afterwards.

 

[Alpari]

EUR/USD: lost its steam on the hourly​

Previous:

The euro closed Tuesday down. My idea of buying from the trend line at 1.1225 ended up a loss making one. My stop loss took effect when the trend line – which took its beginnings from the 1.1123 minimum – broke. Due to a fall in the euro/pound to 0.8608 (-0.98%), the euro/dollar crumbled to 1.1191.

The dollar received support from falling oil prices and data from the US. Oil fell due to the announcement from the Saudi and Iranian oil ministers that the OPEC negotiations in Algeria are just consultative. One could say that no one intends to conclude an agreement on a freeze in output.

The US index for consumer confidence rose to a 9-year maximum of 104.1 against a forecasted 99.8 (previous: 101.8). Markit’s PMI in the service sector rose to 51.9 (forecasted: 51.1, previous: 51.0).

Market expectations:

The picture is rather contradictory. I want to go for a rise of the euro to 1.1230 on the hourly and a fall to 1.1130 on the daily. I’ve ended up going for the fall since the daily is more important than the hourly.

Tonight the Fed’s Yellen and the ECB’s Draghi are to speak. Due to this I’ve set my euro forecast at a weakened 1.1173. It’s unlikely they’ll have anything new to say, so I don’t expect to see any real price swings on the market. Any fall will be cancelled with a close of the hourly candle above 1.1230.

Day’s News (GMT+3):

• 9:00, Swiss consumer indicator from UBS for August and Eurozone consumer climate from Gfk for September;
• 10:00, Swiss economic barometer from KOF for September;
• 11:05, BoE Shafik to speak;
• 15:30, US durable goods’ orders in August;
• 17:00, Fed’s Yellen to speak;
• 17:10, FOMC’s Bullard to speak;
• 17:30, ECB’s Draghi to speak, US oil reserves for week ending 24th September.

Technical Analysis:

Intraday forecast: minimum: 1.1173, maximum: 1.1220, close: 1.1190.

Euro/dollar rate on the hourly. Source: TradingView


On Tuesday the euro/dollar broke through the balance and trend lines. After a fall to the 67th degree, the euro corrected to 1.1226. The pair sat in a sideways for 11 hours, trading at 1.1211. I reckon that as soon as the oscillator stochastic returns to the sell zone, the euro will renew its downward movement. If the euro/pound cross breaks the 0.86 level, the fall of the EUR/USD will hasten. Due to a general strengthening of the dollar, the sellers could reach the 112th degree at 1.1147 in just 4 hours. Any fall will cancel with a close of the hourly above 1.1230.

 

[Alpari]

EURUSD back to balance line​

Previous:

The euro/dollar closed slightly up in comparison with Tuesday. The day was volatile due to the news. The daily candle has long shades and a W-shaped intra-day pattern.

The euro/dollar fell to 1.1182 from trade opening in Europe due to a fall in the euro/pound cross. When information came out about how the Germans could offer state support to Deutsche Bank, the euro shot up to 1.1237.

The Fed chief also spoke yesterday, bringing the euro down to 1.1187. Yellen announced before congress that the majority of FOMC members think rates must be lifted before the end of 2016; i.e. the likelihood is high that there will be a rate hike in December this year.

When the OPEC states agreed on a reduction in oil output of by 740k barrels per day to 32.5 million barrels, oil jumped 7% to $49 per barrel. As such, the USD lost value on the Forex market, with the euro restoring to 1.1220.

Market expectations:

In my forecast I’ve gone for a rise to 1.1252 in the first half of the day. On the hourly period, the euro has a complex wave structure, so my forecast may not come off. When formed on the basis of a W-shaped pattern, the right side tries to be similar to the left. This is the ideal situation. The maximum on the left side is at 1.1279. But the market could start forming a down-sized triangle. Then with every renewal of the maximum the risks of a sharp fall to 1.1190 will be up.

Day’s News (GMT+3):

• 10:55, German employment changes for August;
• 11:00, UK net borrowing in August;
• 11:30, UK M4 money supply and number of mortgage approvals in August;
• 15:30, US definitive GDP in Q2 of 2016, unemployment benefit applications for the week ending 24th September;
• 16:00, BoE’s Forbes to speak;
• 17:00, US incomplete housing sales in August, FOMC’s Powell to speak;
• 23:00, Fed chief Yellen to speak.

Technical Analysis:

Intraday forecast: minimum: 1.1214 (current Asian), maximum: 1.1252, close: 1.1230.

Euro/dollar rate on the hourly. Source: TradingView​

The euro has found a support at 1.1180/90. As I said above, the high volatility on the currency market is due to the fundamental factors. These are always more weighty than the technical signals. Keep this in mind and take it into account when opening trades.

Due to a rise in the price of oil to $49, the euro/dollar rose to 1.1236. The stochastic is in the sell zone. However, I reckon that the buyers will renew the maximum from trade opening on the European session.

I’ve made a line across the 1.1226 and 1.1237 peaks. On the European session the line runs through 1.1252. This is where the target is for Thursday. From here I’m waiting for a bounce to 1.1233. Basically we’re talking about a close at the LB. If the price goes according to my forecast, Friday for me will be a day of growth for the euro: all the way to 1.1280.

 

[Alpari]

EUR/USD: the flat could continue into Friday​

Previous:

On Wednesday the euro/dollar closed three points higher than the closing price of Tuesday. The euro was bobbing around near the LB throughout the day. The US stats held back any revival for GBP/USD and EUR/USD.

The data from ISM showed that business activity in the service sector for September had risen to 57.1 (forecasted: 53.0, previous: 51.4). August’s manufacturing orders rose 0.2% (forecasted: -0.1%, previous: 1.4%).

Market expectations:

On Thursday, trader attention is set to switch to Friday’s NFP. The data from the ADP on Wednesday did not match market expectations. Employment rose only 154k in September (forecasted: 166k previous: 175k). Despite the strong data from the ISM and manufacturing orders, the weak ADP report should have held the dollar back.

The ECB is publishing minutes from its monetary policy meeting today. We could see a spike of volatility for the euro during this time. My intraday target is 1.1234.

Day’s News (GMT+3):

• 09:00, German industrial order changes in August;
• 10:15, Swiss CPI for September;
• 11:10, Eurozone business activeness in retail for September;
• 11:30, UK mortgage lending without those for acquiring or renovating houses in Q2 of 2016;
• 14:30, ECB monetary policy minutes;
• 15:30, Canadian planned dismissals in September from Challenger;
• 15:30, Canadian construction permits in August and US initial unemployment benefit applications;
• 17:30, natural gas reserve changes for week ending 2nd October;
• 18:50, BoC’s Wilkins to speak.

Technical Analysis:

Intraday forecast: minimum: 1.1189, maximum: 1.1234, close: 1.1221.

Euro/dollar rate on the hourly. Source: TradingView

As I reckoned, the euro/dollar spent the day in a sideways. The target was hovering around the balance line between the 90th and 45th degrees. In my forecast I’ve gone for the price remaining in a 1.1185-1.1240 range until Friday.

You probably thought that maybe the price will leave this range today. Maybe after the ECB’s minutes come out. For this, though, there is another range: 1.1160-1.1270.

 

[Trader Dale]

thare has been a strong buying activity on eur/usd caused by the ECB news that were demented later on. I think that the markets will go down again to test this activity. I think that logical levels for intraday long trades would be 1.1159 and 1.1147. What do you think?

 

[Alpari]

EUR/USD trading near the day’s trend line

Previous:

On Thursday the euro/dollar closed down due to a strengthening of the USD. In Asia, euro sales gathered pace. The euro/pound cross with the fall of the pound couldn’t help the buyers. The euro is being sold in other cross pairs.

The GBP cheapened against the dollar by 4.8% to 1.1995 overnight. In points this is 6 figures or 600 points. Traders and analysts are still scratching their heads as to what was the reason for the colossal slide of the pound since there was no news from the UK out last night.

Judging by the informational feeds this morning: all fingers are being pointed at French president Francois Hollande who did speak last night. He announced that the UK should pay a high price for leaving the EU. He declared that a strong position should be taken with regards to the UK, so as not to encourage other member states from leaving.

And since trading volumes are low at night, trading of the pound could have messed with the algorithmic systems which were set to break price levels.


An additional negative for the euro has come from Italy. The Italian prime minister Renzi has decided to hold a referendum on proposed constitutional reforms. If the Italians vote against them, he will probably have to resign. In his place could appear the leader of the 5 Star Movement, a party which believes that the euro is harming the Italian economy. If a referendum is then announced for Italy to leave the EU, the euro will reach parity with the dollar.

Market expectations:

Today’s key event is the US labour market report: the NFP. The pound has already set itself for decent figures. Due to the release of the NFP, I haven’t done a forecast. The most important indicator in the report is the data for wage growth. If it ends up higher than forecasted, then even with an overall low NFP, the Fed could drop rates. I suggest you take a look at the daily picture.

Day’s News (GMT+3):

• 09:00, German industrial production in August;
• 10:00, Swiss September currency reserves;
• 10:30, UK September housing price index from Halifax;
• 11:30, UK output in the manufacturing industry, balance of trade and industrial output for August;
• 15:30, Canadian employment changes, unemployment level in September, US changes in average hourly wages and NFP for September;
• 17:00, Canadian index for business activity in September from Ivey, UK Q3 GDP from NIESR, US wholesale reserves in August;
• 17:30, BoC report on economic conditions and business development, US Fed’s Fischer to speak;
• 19:45, US Cleveland Fed’s Mester to speak;
• 22:00, Kansas city Fed’s George to speak and net consumer financing in August;
• 23:00, BoC’s Wilkins to speak and US Fed’s Brainard to speak.

Technical Analysis:

Intraday forecast: minimum: n/a, maximum: n/a, close: n/a.

Euro/dollar rate on the hourly. Source: TradingView

Instead of looking at the hourly, I suggest you take a look at the daily. See the pinbar for 4th October? I first reckoned that a triangle would be set on it from the 1.1366 peak and that’s why I was looking to buy euro. The euro/pound was also in a union with the euro bulls. Nothing gave a hint of a fall before the payrolls. However the external factors and the pound’s problems have broken the triangle.

Take a look at how the lower limit of the supposed triangle has been broken. Below runs the trend line through 1.1088 from 1.0516 (03/12/15). We could say that this is a key support for the euro bulls. Its loss will lead to a sharp decline of the euro to 1.1035 (100%) and then will open the road to 1.0886 (161.8%). Now to what the targets are. I got these levels using the expansive fibo in the trend. I built it across three points: 1.1366-1.1223-1.1279. A break in the support could be a false one if the euro closes above 1.1130 after the payrolls.

 

[Alpari]

Pressure on euro increases​

Previous:

On Wednesday the euro/dollar closed down. The price fell to 1.1020. The FOMC minutes didn’t aid the euro bulls. The USD continues to strengthen on expectations that the US Fed will increase rates. According to the minutes, three members of the committee voted for a hike in September. This means that it won’t be worth sacking off your accounts during the November meeting. Maybe there will a surprise if the stats meet the expectations. Here I’m talking about the labour market and CPI data.

Market expectations:

With each day that the euro falls, the number of those wishing to purchase euro rises. According to data from myfxbook, 80% of traders are in long positions with a total volume of 15,371 lots. With a 20/80 split, the market will look for another balance point and throw all of the unneeded buyers straight off the boat. Due to this, I expect a renewal of the minimum to 1.0989. If the euro/pound cross hastens downwards, we could see an approach to 1.0964.

Day’s News (GMT+3):

• 09:00, German definitive September CPI;
• 15:30, Canadian first-time housing sales in August; US initial unemployment benefit claims for week ending 8th October and September import prices;
• 18:00, US oil reserves for week ending 8th October.

Technical Analysis:

Intraday forecast: minimum: 1.0988, maximum: 1.1038, close: 1.1013.

Euro/dollar rate on the hourly. Source: TradingView​

The 1.1035 level has been passed. The next interim level on the daily is 1.0978. In my forecast I’ve limited myself with the 202nd degree. Keep an eye on the euro/pound cross. A general strengthening of the dollar and a fall in the cross will mean the euro/dollar will fall below 1.0989 to 1.0964.

If we take the MA line D3 in our calculations, the path is free to 1.0931. Don’t be stood catching falling knives. On the rebound it would be better to sell euro. Since the euro has been falling for three days in a row, we could see an upward correction. Don’t get carried away with the volumes. Between the AO indicator and the price we can see a bull divergence has formed. i.e. now the sellers are already starting to partially close short positions.

 

[Alpari]

Short-term trading idea: FX EUR/AUD – bear speculation: exit from the triangle formation and a break of the trend line​

Trading opportunities for currency pair: the price has left the triangle formation downwards. The trend line was broken with this departure. The target for the downward movement is 1.3774. The time the target regions will be reached is from 11th to 28th November of this year. As our entry point we need to look from a bounce on the daily. A close of the daily candle above 1.4500 means we should hold off selling. Risk for the trade: 1-2% of deposit.

Previous

Due to the euro weakening, a week’s pinbar formed and the pinbar came off nicely in this cross.

Weekly graph​

In accordance with the pinbar, the price dropped to the TR1 trend line and S1 support which was holding the price above 1.4399 since August. The support zone ends at 1.4348 (minimum form November 2015). This means the sellers have nothing to sing and dance about until 1.4348 has been passed.

Since the price shot down out of the triangle formation, we could say that the triangle was in wave B (movement from the 1.4348 minimum to the 1.5097 maximum). If this was really a triangle, traders would be putting their target at least at around 1.3774. With my forecast line I’ve indicated the price movement after the break in the trend line. The time the target region is to be reached is between 11th and 28th November.

Since the graph is a weekly one it would we better to look for a market entry point on the daily graph. A close of the daily candle above 1.4500 means you should stave off selling. If you agree with my forecast, then before you open your trades you should calculate a lot based on the calculation of your stop and your risk at 1-2% of your deposit. i.e. the bigger the stop, the smaller the volume. With the current price pattern, stops are needed at 1.4794 or 1.5097. The smaller the stop, the larger the volume with the same amount of risk. Depending on the size of the stop, our working lot will change. If you start to have doubts about the trade, lessen the risk.

 

[Alpari]

EUR/USD: bounce from 1.0974 highly likely​

Previous:

Euro trading on Tuesday finished down. The euro/dollar fell during the American session to 1.0970. The euro lost against the dollar and pound. The pound strengthened after the publication of inflation data from the UK which exceeded expected levels and lowered the need for the country’s central bank to drop their interest rate. Speculators are also trying their hand on rumours that the UK parliament might vote against leaving the EU. As a result, the euro was under pressure from the cross.

Market expectations:

The euro/dollar on the hourly is in a correctional phase. 1.0974 is a good support. Taking into account that bullish signals are forming on the old time frames, in my forecast I’ve gone for a revival of the price to 1.1022. Since many traders have long positions, the fall of the pair could reach 1.0962. Here we need to keep an eye on all cross pairs. If the euro isn’t being sold in them, 1.0974 should hold out.

Day’s News (GMT+3):

• 11:30, UK average wage index for August, unemployment benefit applications for September and August unemployment level;
• 15:30, construction permits issued and foundations lain in September;
• 17:00, BoC monetary policy report and interest rate statement;
• 17:30, Australian index for leading indicators from Conference Board in August, US oil reserve changes for week ending 16th October;
• 18:15, BoC press conference;
• 20:00, BoE’s head economist to speak;
• 21:00, release of Us Fed’s Beige Book;
• 23:15, BoC’s governor to speak.

Technical Analysis:

Intraday forecast: minimum: 1.0975, maximum: 1.1022, close: 1.1010.

Euro/dollar rate on the hourly. Source: TradingView

The euro dropped to 1.0970 during the European session without updating the maximum. As I said above, the euro is under pressure from the euro/pound cross after the publication of UK inflation data. Market participants are also biting their nails before tomorrow’s ECB meeting and Mario Draghi speaking. They have no clue what decision the regulator will take with regards to QE.

I’m more inclined to use the 4-hour and daily graphs in the current situation. The indicators on these time frames are starting to signal a strengthening of the euro. Pay attention to the fact that I have two scenarios. I don’t know whether there will be a piercing of the lower limit of channel 2. Although the old time frames are indicating a turnaround for the euro, the hourly indicators are for a fall of the euro. Also don’t forget that long/short at the moment is 78/22. There are too many traders to lift it. As such, at the moment we’re likely to see a fall in the rate, maybe even an update of 17/10/16’s minimum and then we should rise. Draghi could fell correct the price pattern on Thursday to where we need it to be.