ThirdBrainFx Market Commentary

[ThirdBrainFx]

Hi All,

We would like to offer a daily technical analysis based market commentary to the EarnForex community on this thread. You are most welcome to share your views and participate in a constructive manner.

Thanks.

 

[ThirdBrainFx]

ThirdBrainFx Market Commentary - January 29, 2014

Beside the official interest rate decision from the Reserve Bank of New Zealand, there were not many important economic data was released today. The RBNZ kept its key lending rate at 2.5%, same as last month.

Silver Outlook

Silver once again closed in negative territory on Tuesday around $19.51 despite poor durable goods orders report in the US session. Investors are seen cautious ahead of FOMC decision on the pace of monthly asset purchase program.

At the moment of writing in Asian session white metal is being traded at $19.55 where immediate resistance can be noted at $19.61 which is 50% fib level of recent move. A break above would target $19.84 and then $20.12.

On downside support is around $19.38 ahead of $19.08 that are two important fib levels. Commodity Channel Index (CCI) is in extreme oversold territory. Positive divergence may also be noted with MACD. Relative Strength Index (RSI) is also in bearish zone but well above oversold territory.

Federal Open Market Committee decision on monthly bond purchase program and interest rate is due today. Analysts are unanimous that no change in interest rate is expected this time around however tapering in bond purchases by $10 billion is likely which shall trigger bullish momentum in greenback and consequently Silver may come under selling pressure.

A break below $18.62 would turn our bias into bearish about white metal because a Higher Low (HL) is needed for Silver to be in bullish momentum. Similarly a dip below $18.62 will also scrap the double bottom price pattern. Broader outlook of silver however looks positive because the current price of silver is well below its mining cost. Miners might not be able to bear losses for a longer time period and ultimately they will wind up production thus price shall increase due to lesser supply.


GBPUSD Outlook

Yesterday, the UK GDP figures were released, which came in line with the expectations. After the release, the GBPUSD pair dropped initially to test the 1.6550 support level. However, the pair found buyers around the same area, and traded higher again. The pair is currently consolidating in a range of 30-40 pips.

Looking at the 4 hour chart of GBPUSD, there was an up-move trend line, which was breached earlier. Now, that broken trend line is acting as a resistance for the pair, as can be seen in the chart below. After the break, the pair formed a base at around the 50% Fibonacci retracement level of the last major move up from 1.6305 to 1.6667 levels.

The base formed around the 1.6480 level looks very similar to another low, as highlighted with rectangles in the chart below. The fractal also looks very similar to the last move. If this is true, then the pair might attempt for another low below 1.6480 level before rallying higher.

On the downside, the support lies at around the 1.6530 level followed by the 1.6480 level. On the upside, the resistance can be seen at around the 1.6620 level followed by the previous high. The RSI on the 4 hour chart looks constructive, and holding the 50 level, which is a positive sign as of now. We have a major risk event scheduled later during the day. The Fed will announce interest rates and policies. It would be interesting to see whether they opt for another reduction in bond purchases. This event can act as a major catalyst for the pair.

 

[ajpipsmaker]

The GBPUSD dived towards the 1.6450 level today.
However, the pair is now finding some bids from the same area.
Now, the previous support area at around 1.6520 level as mentioned in your analysis may now act as a resistance for the pair.
On the other hand, the Aussie is doing well in the risk off mood.
I never though Aussie may find bids against the GBP in the current situation.
The price action always has a surprise for you.
I am still learning how to deal with it

Cheers!

 

[usman7290]

Just look at silver.... today it hit as low as $18.98, so called "Safe Heavens" are being punished badly by the stronger dollar

 

[ThirdBrainFx]

ThirdBrainFx Market Commentary - January 30, 2014

Among the major economic data release today, the quarterly US advance GDP figure and the unemployment claims number were the most important. Unfortunately for the US economy, both indicators came out short of what analysts were expecting. The forecast for the advance GDP (q/q) was set at 3.3%, which came out at 3.2%. On the other hand, the unemployment claims figure was forecasted to come out at 331,000, which came out at 348,000.

Later today, the trade balance figure, which is the difference in value between imported and exported goods during the reported month, of New Zealand is also due to be published by the Statistics New Zealand. This month, the forecast is set at 550 million against last month’s 183 million.

USDCHF Outlook

Yesterday, the Fed announced another QE cut.The central bank reducedbond purchases by another $10B. So, the market’s expectation was fulfilled. However, we have not noticed any major reaction from the US dollar. The reason for the same is that it was already priced in. The USDCHF after the release found support at around the 0.8930/40 level, which is one of the major swing levels for the pair.

However, the key thing to note here is that the pair was unable to overcome the 38.2% Fibonacci retracement level of the last down move from the 0.9155 peak to 0.8901 low.The pair also broke the flag, which was acting as a support to the pair. A breach of the flag now puts the pair again in the negative territory.

Now, the previous support at around the 0.8970/80 may act as a resistance for the pair. The pair might struggle to gain momentum above this level. The RSI has also dived below the 50 level, which is another negative sign. The pair needs to trade above the 0.8920 level to stay positive.

If the pair breaks the 0.8970/80 resistance level, then the next hurdle for the pair lies at around the 0.9000 figure, as can be seen in the 4 hour chart above. The 50% retracement level may also act as a resistance for the pair at around the 0.9030 level. On the downside, the pair needs to hold 0.8900/20 levels. A close below these levels may call for a test of previous swing level of 0.8850. We need to monitor CHF strength carefully, as the currency also seen gaining some ground against other currencies like the Euro and AUD as well.

AUDUSD Outlook

After repeated rejections from 0.8821 AUD/USD finally resume downside journey and closed yesterday in negative territory around 0.8743 amid Federal Reserve’s decision to reduce monthly asset purchase program by $10 billion.

At the moment of writing in Asian session pair is being traded at 0.8733 where immediate resistance is seen around 0.8758, confluence of different Mas, ahead of 0.8821 which is 38% fib retracement, a break above this resistance zone shall target 0.8871 that is 50% fib retracement as well as 200 MA and 100 MA on four hour chart.

On downside pair is headed towards 50% retracement of entire 2008/2011 move which is around 0.8536 as shown in above chart. Immediate support can be noted at 0.8658 that is low of previous wave. The pair once again printed Lower High (LH) and Lower Low (LL) in previous wave that confirmed our bearish bias about Aussie Dollar. Now a break below 0.8658 is required in order to print Lower Low (LL) once again, failing to which may push pair into bullish momentum which is however less likely.

Yesterday Federal Open Market Committee (FOMC) concluded two days meeting on hawkish note and announced more trimming in monthly bond purchase program by $10 billion thus Federal Reserve’s total asset purchase program (also known as QE in economic term) is now worth $65 billion per month and FOMC policy makers intend to wind up QE completely by the end of October this year through back to back tapering on every meeting. Dollar however didn’t rallied a lot after the announcement because it had already strengthened before decision due to optimism about tapering.

 

[sanjusharmaDHP]

The USDCHF pair has breached all important levels as pointed out in your analysis.
The pair is currently testing the 61.8% fib, as highlighted in the chart.
Does anyone think that the pair might continue higher from here?
What can be the next resistance for the pair?
I hope I am not hijacking this thread.
Thanks for sharing BTW

 

[ThirdBrainFx]

Market Commentary - January 31, 2014

Earlier today, the Australian Bureau of Statistics released the Producer Price Index, which came out way lower, at 0.2%, compared to the forecasted 0.7%. The AUDUSD immediately went down by around 66 points when this news was released at GMT 12:30 PM.

Later, at GMT 10:00 AM, the Eurozone CPI flash estimate was (year over year) released by the Eurostat. The CPI is used to measure the inflation level in the economy, and according to the CPI flash estimate, during last month, the Eurozone inflation went down by 0.2%, compared to last month's 0.9%. This means, the European Central Bank (ECB) will be further concerned about the depressed inflation in the economic union.

At GMT 1:30 PM, the Canadian monthly GDP figure came out at 0.2%, just a bit lower compared to last month's 0.3%. Since the GDP is the inflation adjusted value of all goods and services produced in the Canadian economy, Forex traders follow the GDP figure more closely than other fundamental data.

EURUSD Outlook

EUR/USD on Thursday closed at 1.3542 with a large bearish engulfing daily candle after Germany’s consumer price index missed expectations and the US Dollar rose after Fed tapering decision.At the moment of writing in Asian session, EUR/USD is being traded around 1.3549 with immediate support seen around 1.3521 that is 38.2% fib retracement level, a break below this level shall target 1.3506, swing low of previous wave, a fall below 1.3506 will turn our short term bias into negative and in that case the pair may threaten 1.3431 which is another important fib support.

On upside, resistance can be noted around 1.3589 that is 50% fib level, a break above shall target 1.3660 and then 1.3737 which is high of the previous wave. Both Relative Strength Index (RSI) and Commodity Channel Index (CCI) are above oversold territory which means there is still a room for more downside movement. Slight positive divergence may be noted with CCI.

Previously Germany’s unemployment rate slumped more than expectations to 6.8%. However, the country’s Consumer Price Index (CPI) remained below estimates with 1.3% read, both were preliminary reports for the month of January.

Elsewhere the US economy grew at 1.3% in the fourth quarter, annualized growth remained 3.2%, a government report said yesterday. Both the figures were in line with median projections from analysts. During the same period consumer spending surged to the highest level since 2010, the report added. Dollar was seen gaining momentum after Fed tapering decision and impressive economic figures and this trend is likely to continue today.

EURAUD Outlook

EURAUD has been climbing very rapidly for the last several weeks now. However, in the last few days, the pair has failed to gain any momentum to the upside. The Euro was under pressure, and since the AUDUSD is trading at very low levels, the EURAUD pair managed to find some sellers around the 1.5830/40 levels. The pair dived after forming an intraday high around this level.

The pair also broke an important up-move trend line, as can be seen in the 4 hour chart below. The pair dropped below the 50% Fibonacci retracement level, and managed to find support just above the 61.8% retracement level of the last move up from the 1.5029 to 1.5830 level. As can be seen below the 1.5350/40 region is very critical for the pair. This region acted as a resistance in the past, and may now act as support for the pair.

The pair has formed a down-move channel, as plotted in the chart below. The pair might dip again to test the 61.8% fib level, which also represents the last major swing level. So, a confluence of support lies around the same area.

The RSI has dipped below the 50 level, which is a negative sign. The pair is currently testing the broken trend line, which is acting as a resistance as of now. A break above this may call for a test of 1.5550 level. Above this, the pair might target the previous high. On the downside, a breach of the 1.5330 level may call for a test of 1.5240 level. Furthermore, in the medium term, the 1.5000 figure may act as a strong support for the pair.

 

[ajpipsmaker]

The EURAUD pair did test the 61.8% retracement level.
However, the pair is bouncing sharply from the 1.5320 level.
The pair also managed to hold the support of the channel.
I think this is a typical move in the EURAUD pair.
EURUSD has also managed to find some buyers from the 1.3480 level.
Let us see how the pair can hold the support.

Thanks for sharing mate

 

[ThirdBrainFx]

Market Commentary - February 3, 2014

Although it was a bank holiday in the second largest economy in the world, China, there was plenty of action in the Forex market during the early Asian session. The Australian building approvals (m/m) figures came out way below the expected -0.3%, at -2.9%.

At 9:30 AM, the UK’s manufacturing PMI was published by the Markit, which measures the Level of a diffusion index based on surveyed purchasing managers in the manufacturing industry. The forecast for the Market’s PMI on UK was set at 57.1 but it came out slightly lower, at 56.7.

One of the important economic indicators for the US Economy is considered to be the Manufacturing PMI from the Institute for Supply Management. The ISM Manufacturing PMI was expected to come out at 56.2, but actual figure came out 51.3.

AUDUSD Outlook

AUDUSD performed well in the last week compared to some other pairs like EURUSD, GBPUSD and NZDUSD. The pair is already trading just above monthly lows, and it needs some catalyst for further losses. The pair held the 0.8650/60 support level, and managed to climb back above the 0.8710 resistance level.

The pair is trading in a triangle, as can be seen in the 4 hour chart shown below. There is a clear resistance for the pair around the 0.8820 level. There are about three rejections from the same level, as the pair was unable to gain momentum above the said level. This level is crucial, as it represents the 38.2% Fibonacci retracement level of the last down move from 0.9085 to 0.8659 levels.

If the pair manages to break the triangle and resistance level, then the next hurdle for the pair lies at around the 0.8880 level. This is a key swing level for the pair. It acted as a support several times, and may now act as a resistance for the pair. This level also coincides with the 50.0% retracement level. So, there is a confluence of resistances around the same region for the pair.

The RSI is trying to climb back above the 50 level. If it succeeds, then the pair might target the next resistance zone, in my opinion. On the downside, the support lies around the triangle trend line followed by the previous low of 0.8659 level. A breach of this level may trigger further losses for the pair, as it may target the 0.8550 level in the medium term. We have the RBA interest rate decision during the week, which may act a strong catalyst for the pair in the short term.

EURUSD Outlook

EUR/USD nosedived on Friday for a second consecutive day hence leaving another bearish engulfing candle on daily chart which shows that bears are in complete control after Eurozone experienced another inflation slowdown in January.

The pair is being traded around 1.3483 at 5:23 GMT in Asia. A strong support can be noted near 1.3435-40 where both 76% fib level and 200 Daily Moving Average (DMA) are currently sitting in. A break and daily close below this support zone may threaten 1.3294, swing low of Novermber 7 and another crucial support for EUR/USD.

On upside, resistance is seen around 1.3521, 61.8% fib level, ahead of 1.3589 which is 50% fib level. A break above 1.3589 resistance area may push EUR/USD into short term bullish trend thus targeting 1.3662 and 1.3738 in coming days. The pair however will remain vulnerable as far as it is being traded below 1.3738 i.e. swing high of previous wave.

Inflation in Eurozone slid down to 0.7% in January, a preliminary gauge by EuroStat revealed on Friday. Economists had predicted 0.9% spike for January against previous month’s 0.8% gain. Thus inflation continued to remain below 1% for a fourth straight month. European Central Bank (ECB) has set 2% target for inflation which is well above current level.

Elsewhere, the US Consumer Sentiment Index (CSI), released by Reuters and University of Michigan,droppedto 81.2 inJanuary;however it remained above the median projection of analysts which was 81.0. Earlier commerce department reports had shown that consumer spending hit the highest level in more than three years that consequently helped the US grow at 3.2% in fourth quarter.

 

[Shooting_Star]

What you guys think about eur/usd now? is it a good buying opportunity right now?

 

[ThirdBrainFx]

Market Commentary - February 4, 2014

The Reserve Bank of Australia published its cash rate for the month, which it kept at 2.5%, same as last month. The key interest was actually the rate statement from Governor of RBA, Glenn Stevens. He mentioned that “Beyond the short term, growth is expected to strengthen, helped by continued low interest rates and the lower exchange rate. Inflation is expected to be somewhat higher than forecast three months ago, but still consistent with the 2–3 per cent target over the next two years.” As a result of this bullish tone, the AUD appreciated across the board just after the rate statement was released. Specifically, the AUDUSD moved up almost 90 points within an hour.

At GMT 9:30 AM, the Markit released the UK’s construction PMI. This economic indicator measures the level of a diffusion index based on surveyed purchasing managers in the construction industry. This month, the construction PMI came out at 64.6 against the forecasted 61.6.

At 10:30 PM, the Statistics New Zealand will publish the unemployment rate which is forecasted to come out at 6.0%, slightly better than last month’s 6.2%.

GBPUSD Outlook

GBP/USD continued free-fall move on Monday as Britain’s market manufacturing PMI for the month of January remained below median projection of analysts.The pair is being traded around 1.6293 at 05:39 GMT in Asia. Immediate support can be noted at 1.6265 which is 50% fib level. 100 Daily Moving Average (DMA) and double bottom resistance-turned-support are also sitting in nearby 1.6265, making this support a considerable hurdle for beers. A break and close below 1.6265 may threaten 1.6170 i.e. 61.8% fib level.

On upside, resistance is noted around 1.6359, 38% fib level ahead of 1.6417 which is 55 DMA and then 1.6476, 23% fib level. It is pertinent that cable has already broken a critical support zone around 1.6308 that consequently changed bias into bearish, now the pair is likely to be vulnerable as far as it is being traded below 1.6624, swing high of current wave. A Higher High (HH) will again turn bias into bullish.

Commodity Channel Index (CCI) is showing -140 reading at daily chart, a read below -100 signals oversold sentiment. Relative Strength Index (RSI) is also in oversold territory at four-hour timeframe. Ironically, we do not see significant weakness with MACD despite 300 pips slump in as many days.

On Thursday, Bank of England (BoE) is due to announce its decision about benchmark interest rate and pace of asset purchase program. Analysts are unanimous that no change in monetary policy stance is expected this time around. Later on Friday, the US labor department is to release non-farm payrolls and jobless rate figures for the month of January that will be of great interest as usual.

AUDNZD Outlook

The Australian dollar likely bottomed in the short term at around the 1.0490 level. The pair aggressively declined against the New Zealand dollar in the late 2013. However, the pair now seems to be holding the 1.0500 area pretty well. The pair has recently climbed back above the 1.0800 level, which was the first hurdle for the pair.

The pair is now facing its second hurdle to the upside. The 38.2% Fibonacci retracement level of the last major down-move from the 1.1579 to 1.0490 level sits at around the 1.0900 level. The pair is trying to overcome it as of writing. About an hour ago, the RBA announced the interest rates. They kept the interest rates unchanged, which is pushing the pair higher. The pair has also breached the down-move trend line, as can be seen in the daily chart shown below.

If the pair manages to close above the 38.2% fib level, then I think the pair might target the 50.0% fib level at around the 1.1035 level. However, the physiological level 1.1000 may also act as a resistance for the pair in the short to medium term.

The RSI is coming closer to the extreme level on the daily chart, which is an early sign that the pair might retrace some of the recent gains. On the downside, I think the broken resistance at around the 1.0800 level may now act as a support for the pair. A break below could open the doors for another leg lower. On the upside, the 1.1000 level followed by 1.1030/40 level remains the key for the pair. So, watch all these levels carefully while trading.

 

[sanjusharmaDHP]

The EURAUD pair did test the 61.8% retracement level.
However, the pair is bouncing sharply from the 1.5320 level.
The pair also managed to hold the support of the channel.
Let us see how the pair can hold the support.

The EURAUD dived today my friend.
The pair is now approaching the 1.5100 handle.
This is an important zone for the pair.
The RBA had no choice, but to leave the cash rates at 2.5%.
This is pushing the Australian dollar higher.
The pair has retraced a lot of losses against the Euro and NZD.
I am looking for a test of the 1.5020 level in the coming days now
I may be wrong though

 

[ThirdBrainFx]

Market Commentary - February 5, 2014

Bank holiday in China will continue till February 6 due to the Chinese New Year. However, there were plenty of economic data that were released during the day. First, the UK's service PMI came out at 58.3 against forecasted 59.1. Then, during the afternoon, at GMT 1:15 PM, the Automatic Data Processing, Inc released the non-farm employment change figure which came out way short of the expected 191,000. The actual employment change during the last month was only 175,000.

At 1:30 PM, the Statistics Canada released the month-over-month building permits figure, which measures the change in the total value of new building permits issued during the last month. The forecast for the new building permits were set at 2.3%. However, the actual figure came out 4.1% lower than last month.

Gold Outlook

Gold fell yesterday to $1247 after an upbeat factory orders report about the US that consequently lifted the greenback.
The precious metal is being traded around $1255 at 02:00 GMT in Asia. Immediate support can be seen around $1231 ahead of $1224 that is 23% fib level. A break and daily close below $1224 may threaten $1182 which is double bottom support zone.

On upside, first hurdle can be seen around $1270 that is 50% fib level, a break above shall target $1292 i.e. 61% fib level as well as 200 Daily Moving Average (DMA). Bias is bullish as white metal successfully printed Higher High (HH) and then Higher Low (HL) in previous wave.

Both Relative Strength Index (RSI) and Commodity Channel Index (CCI) are in neutral territory that means long moves might be in play very soon. Volumes are thin and no divergence is being noted with MACD.

Yesterday a report showed that the US factory orders for the month of December fell but less than expectations, analysts had expected -1.7% reading, however actual read remained-1.5%; since gold is negatively correlated to greenback, so we saw selling pressure in metal price.

Moreover, the precious metal is also missing a strong physical support from its biggest consumer China where this is a holiday season. Investors are also seen cautious ahead of the US labor department reports on Non-Farm Payrolls and Unemployment Ratethat are scheduled for release on Friday; more trimming in asset purchase program is linked to positive outcomes in labor sector.

EURUSD Outlook

The EURUSD has managed to hold on the previous major swing level at around the 1.3480 level. This level has acted as resistance and support several times, as can be seen in the daily chart shown below. So, the pair might struggle to take this level out. After the 1.3480 level, the 1.3460/40 level is also crucial. So, there are several supports for the pair on the way down.

The pair is currently forming an expanding wedge, as plotted in the chart shown below. The pair is fighting to hold the wedge support area. One important point to note here is that the pair has breached the 61.8% retracement level of the last major move up from 1.3294 to 1.3892 level. A breach of the key swing level may call for a full test of 1.3300 area.

On the upside, the 1.3550/60 may act as a strong resistance for the pair in the short term. A breach of this level may push the pair towards the 1.3600/10 area. The services PMI’s are scheduled to be released for the Euro zone, which might act as a catalyst for the pair. Any miss in the outcome may weigh on the Euro in the short term.

The RSI has breached the 50 level, and currently flat at around the 40 level. The pair is lacking momentum, which is a sign of consolidation.There is also a possible divergence forming on the MACD.We need to also monitor flows in other Euro pairs in order to judge the bearish pressure on the Euro. As of now, the sentiment is mixed, as the EURGBP was seen gaining some ground and the EURAUD was losing some ground. We need to wait for a couple of sessions in order to see how the pair reacts to the critical levels.

 

[Shooting_Star]

Gold showed huge rejection from 50% fib level, that really meaningful....

 

[ajpipsmaker]

What you guys think about eur/usd now? is it a good buying opportunity right now?

EURUSD is annoying me for now
The pair is trading in a range and desperately waiting for the ECB for the rescue.
Tomorrow is a big day for the EURUSD.
A break below the 1.3480 will put a lot of pressure on the buyers.
And, a break above 1.3550/60/80 level may put a lot of pressure on the sellers
I am sitting on sidelines as of now.
The pair is in the dying state according to me.
So, better stay away for some time, then jump accordingly.

Cheers!

 

[sanjusharmaDHP]

Gold showed huge rejection from 50% fib level, that really meaningful....

GOLD is in a dilemma whether to go up or down, he he
I am not trading GOLD from a long time.
The price action just does not make sense.
And, I hate trading something, which does not go anywhere.
The GOLD has to break 1320 to trade higher.
Until then, I am not touching it at all
Are you trading GOLD?
Long or short?

 

[ThirdBrainFx]

Market Commentary - February 6, 2014

There were plenty of economic data releases today to keep the Forex market alive. The day started with the Australian retail sales figure, which came out at 0.5%, as expected. Then the Australian trade balance figure came out way better, at 0.47 billion, against forecasted -0.27 billion.

At GMT 12:00 PM, the Bank of England published the official bank rate, which it kept at 0.5%, same as last month. Within an hour, the European Central Bank released its minimum bid rate as well. This month, the ECB also kept its bid rate similar to last month, at 0.25%.

At GMT 1:30 PM, the Department of Labor in the United States published the weekly unemployment numbers, which came out slightly better, at 331K, compared to previously forecasted 337K.

EURAUD Outlook

The EURAUD pair is trading lower after the recent RBA rate decision. The Australian dollar has gained some bids against many major currencies. The EURAUD pair also managed to recover some of the lost ground. The pair after setting a high at around the 1.5830 level has dived towards the major support area. The pair is currently approaching the full 100% swing target of the last move up from the 1.5029 to 1.5830 level, as can be seen in the 4 hour chart shown below.

The 1.5000/20 support level may act as a strong support for the pair. It acted as a strong resistance earlier, and may now act as a strong support for the pair. There is a down-move trend line forming, as plotted in the chart shown below.This trend line may also act as a barrier for the pair. The trend line is coinciding with the 1.5220/40 level. So, this level may well act as a strong resistance zone for the pair. A break above this level may call for a test of the 1.5310 resistance level, as highlighted in the chart below.

The 1.5330 area is also a major swing zone for the pair. A close above this may trigger further gains for the pair, and the buyers might target the 1.5500 zone after the break. On the downside, after the 1.5000 support zone, the 1.4850 level may provide support to the pair.

The RSI has breached the 50 level, and currently testing the 30 level. It might dive towards the 20 level, and after that the pair might try to gain some momentum to the upside. The MACD is under divergence, which is a warning sign. So, watch out for a reaction from the pair at around the 1.5020/00 level.

USDJPY Outlook

USD/JPY once again closed above 101.00, a crucial 50% fib level, for a third straight day as the US services sector growth showed an upbeat reading on Wednesday.

The pair is being traded around 101.42 at 02:00 GMT in Asia. Immediate support can be noted around 101.00 which is 50% fib level of last major move, a break and daily close below this support zone may threaten another critical support which is sitting in around 100.00 i.e. 200 Daily Moving Average (DMA) and 61.8% fib level, this is also a medium term pivot zone for the pair.

On upside, resistance is being noted near 102.00-05 handle that is 38% fib level, 100 DMA is also close to this support zone. A break and close above 102.00 handle can open doors for 103.23 i.e. 23% fib level and 55 DMA.

It is pertinent that Commodity Channel Index (CCI) is dipping below -100 territory at daily chart which is considered an oversold zone. Relative Strength Index (RSI) is also very close to oversold area. The most important thing is that considerable positive divergence may be noted with MACD at four-hour time frame. All these signs show a potential reversal in near future.

Yesterday a report by a private firm showed that non-manufacturing or services sector in the US grew faster than expectations. Purchasing Managers Index (PMI) rose to 57.7 for the month of January compared to previous 55.7 read, a reading above 50 signals expansion. Later on Friday, the US labor department is scheduled to release non-farm payrolls and unemployment rate figures.

 

[Shooting_Star]

I opened a long position in UJ after having read your analysis, its going pretty well as for now, thanks keep sharing, from now I'm a regular visitor of this thread

 

[Shooting_Star]

EURUSD is annoying me for now
The pair is trading in a range and desperately waiting for the ECB for the rescue.

Cheers!

Euro shoot more than 130 pips, hopefully now you are satisfied LOL

 

[ajpipsmaker]

Euro shoot more than 130 pips, hopefully now you are satisfied LOL

He he
I am more than happy.
Draghi uncle did the trick for me.
I was not hoping that the pair can take out 1.3560 so easily.
However, it surged, and buyers pushed the pair higher.
It is not easy to trade such risky events.
Anything can happen.
Today, we have the US NFP.
Again, anything could happen. So, let's be prepared for it.
I am not entering into any risky trade.

Cheers!