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EUR/USD: Technical analysis of 23.05
1. Current trend
Look at the four-hour chart of the pair EUR/USD. Since the beginning of the month the pair has moved in the downward channel. Yesterday the “bulls” tried to leave the channel and change the trend; however they failed, as resistance levels, which coincided with Fibonacci 50.1 and 61.8 blocked the way. Most indicators show further decline in rate. All three moving average lines are lined up in the downward order. The signal line and histogram are in the negative zone. Stochastic is in the oversold zone; both lines of the indicator are directed downward, indicating the decline.
2. Levels of support and resistance
The nearest support level is 1.2825. Next after it will be 1.2760 – it is the key level and if it is broken down, the price will go further down. Resistance levels are 1.2940 and 1.2990, which have recently prevented the rise in price.
3. Trading tips
The most feasible scenario is the decline of rate up to the level of 1.2760. It is also possible that the price will move in the channel of 1.2940 -1.2825; therefore it makes sense to set sell limits at the upper boundary.
Ilya Lashenko
Analyst of LiteForex Group of Companies
XAU/USD: Gold continues to consolidate
1. Current trend
The week before last gold was in the downtrend, reaching the lows of 1340 USD per troy ounce. Investors actively sold gold amid recovery of the US economy and rumours that government might curtail asset purchase program.
Last week gold was trading in the range of 1360-1400.
This Monday trades were quiet, as markets in the US were closed due to Memorial Day and some banks in the UK and EU had a day off.
Technical indicators do not give clear signals. Stochastic shows further decline: both of its lines are directed downward. Histogram and the signal line of MACD indicator are near the zero line, indicating sideways movement.
2. Levels of support and resistance
At the moment the pair is near 61.8 Fibonacci line - this is a support level, which is being tested. Next support levels are 1373.50 and 1362; main target for the “bears” is the level of 1321.00.
The nearest resistance level is 1400, which coincides with the level of 50.0 Fibonacci.
Next levels for the “bulls” will be 1430.00 and 1445.00.
3. Trading tips
It is recommended to place short positions below the level of 1375.00. Buy positions are recommended above the level of 1410. It also makes sense to place pending buy orders near the figure 1340.
Ilya Lashenko
Analyst of LiteForex Group of Companies
AUD/USD: The level of 0.9600 remains impregnable
1. Current trend of the currency pair AUD/USD
At the beginning of this week the currency pair AUD/USD has traded not far from the strong support level of 0.9600. On Tuesday “bears” tried to break down this key level, however they failed, as the pair did not have strong drivers to trigger decline. Pushing off from the level of 0.9600 the pair started to correct and at the moment traded near resistance level of 0.9670.
2. Important levels (support and resistance)
At the moment situation in the market is ambiguous. On the one hand the pair lacks sufficient drivers to decline and break down the level of 0.9600; on the other hand economic situation in Australia impedes the rise in the pair. It is likely that downward trend will continue and after breakdown of the level of 0.9600 the pair may drop to 0.9530. At the same time we cannot rule out a chance of long-term upward correction to the levels of 0.9750, 0.9830, 0.9900 and 1.0000. In the current situation it is recommended to hold short positions opened earlier. Short-term long positions can be opened from the level of 0.9700.
3. Technical indicators
On the daily chart “Bollinger bands” indicator is directed downward; the price chart is in the bottom band. Histogram of MACD indicator is in the oversold zone, volumes continue to increase. Stochastic lines are directed downward and may soon enter the oversold zone (20), forming a sell signal.
Dmitriy Zolotov
Analyst of LiteForex Group of Companies
USD/JPY: Technical analysis of 31.05
1. Current trend
The currency pair USD/JPY still traded in the sideways channel. This week “bears” made repeated attempts to go down below the level of 100.55, as this would have opened them the way to the lower levels below the 100 figure. However, this level was strong and they could not break it down without additional support. At the end of this week USD/JPY traded in the channel of 100.70-100.60. The main target of the “bulls” is to go back to the previous highs and consolidate above the level of 102.5.
Technical indicators do not give clear signals. Stochastic is below the moving average line and both of the lines are ready to cross, giving a buy signal. MACD shows growth: the signal line is directed upward, histogram is tending to the positive zone.
2. Trading tips
It is likely that the pair will move in the narrow channel. It does not seem feasible that bears will go further down; therefore it makes sense to open long positions with profit taking near 102.00-102.50.
Ilya Lashenko
Analyst of LiteForex Group of Companies
1.Current trend of the currency pair GBP/USD
At the beginning of this week quotes of the currency pair GBP/USD went up. The rise was driven by weak data on business activity index in the U.S. manufacturing industry, released on Monday. The index did not meet expectations, declining to the level of 49.0 points. This fact triggered the rise in the price up to the highs at the level of 1.5370. Today, after minor correction, the pair resumed growth. This time investors’ optimism is associated with publication of the data on business activity index in the service sector of Great Britain, which amounted to 54.9 points in May. The price reached resistance level of 1.5370; however did not break down this level yet.
2.Important levels (support and resistance); best entry/exit points
At the moment the pair traded near the level of 1.5350. In the near future temporary downward correction to the level of 1.5330 may take place, which will be followed by ascending movement in price to the target levels of 1.5370 and 1.5410 and probably up to 1.5440. In the current situation it is advisable to open long positions from the level of 1.5330 with profit taking at the level of 1.5410.
3.Technical indicators
On the four-hour chart “Bollinger bands” are directed upward; the price chart is in the upper band. MACD histogram is in the overbought zone; in the near future it may cross the signal line from bottom to top, which will be the signal for ascending movement in price. The lines of Stochastic are crossing the overbought level (80), forming a buy signal.
Dmitriy Zolotov
Analyst of LiteForex Group of Companies
USD/JPY: The pair continues to decline (12.06.2013)
1. Current trend of the currency pair USD/JPY
On Tuesday, quotes of the currency pair USD/JPY went down; the price reached support level of 95.80-95.60, but failed to exceed it. The decline in price was a result of market reaction to the meeting of the Bank of Japan, where it was decided to keep monetary policy unchanged and refrain from its further development. Strengthening in Yen was also triggered by the rise in business sentiment index in large industrial companies of Japan. The index rose up to 5.0 points in Q2, which is the best result since 2011. The rise in business sentiment index in industrial sector along with significant GDP growth in Q1 gives hope for the recovery of Japanese economy and continuation of descending movement in the pair.
2. Important levels (support and resistance)
At the moment the pair has slightly corrected and traded near 96.30-96.60. During the day upward correction may reach the level of 97.30, however it is more likely that that pair will resume downtrend and the price will go down to 93.70 or probably up to 91.30. In the current situation it is advisable to open short positions from the level of 95.60 with profit taking around 93.70.
3. Technical indicators
On the daily chart “Bollinger bands” indicator demonstrates divergence of the lines, confirming downtrend. The price chart has recently broken down the bottom line, giving a chance of temporary ascending correction to the level of 97.30. Histogram of MACD indicator is in the oversold zone, its volumes are increasing. Stochastic lines are crossing, forming a weak signal of downward movement in price.
Dmitriy Zolotov
Analyst of LiteForex Group of Companies
EUR/USD: Statistics on retail sales may provoke the rise in USD
1. Current trend of the currency pair EUR/USD
The currency pair EUR/USD continues trading in the ascending channel; On Thursday the price has reached four-month highs at the level of 1.3390. The rise in Euro was triggered by positive data on the volume of industrial output in Eurozone. In April this index amounted to 0.4%, which was far above expectations of expert who believed that index would show the decline to -0.2%. Nevertheless, today the pair may shift to downward correction, which could be driven by the data on the US retail sales for May, as the index is expected to be positive.
2. Important levels (support and resistance)
At the moment the pair traded at the level of 1.3320-1.3340. In the near future the price may go down to the level of 1.3170. However, from this level the price may reverse and resume ascending movement with a chance of reaching the level of 1.3650. In the current situation it is advisable to open short-term sell orders from the level of 1.3300 with profit taking near 1.3170.
3. Technical indicators
On the four-hour chart “Bollinger bands” indicator does not demonstrate divergence of the lines; all lines are directed upward. The price chart is tending towards the moving average line, giving a chance of downward movement to the levels of 1.3280 and 1.3170. MACD histogram is in the overbought zone, its volumes are decreasing. Stochastic lines are directed downward, also suggesting that downward movement in price is possible.
Dmitriy Zolotov
Analyst of LiteForex Group of Companies
GBP/USD: High demand for the Pound is gradually weakening
1. Current trend of GBP/USD
On Wednesday the British currency continued to go up slowly against the USD, which was triggered by the positive data on British labour market. Number of applications for unemployment benefits fell by 8.6 thousand in May. The pair had reached the level of 1.5700 and shifted to sideways correction. However it is obvious that the pair slowed down its upward movement and investors do not rush to invest into overbought Pound and some investors prefer to close their long positions. Today the pair slightly declined due to poor European data. British economic news is not expected today, while US economic data will be worth of attention. Experts believe that number of initial applications for unemployment benefits will slightly increase, which may have a negative impact on the YSD rate and support the pair GBP/USD. However the data on US retail sales is expected to be positive.
2. Important levels (support and resistance)
In the current situation growth may continue; however the pair is unlikely to go above the level of 1.5750. In future the decline by 200-300 points is possible. US macro-economic statistics suggest that American economy is stabilizing, which can indicate strengthening in the USD soon. The demand for the Pound is gradually decreasing and in this situation the pair is likely to move to support level of 1.5490 (1.5400).
3. Best entry/exit points
It is advisable to place short positions with profit taking at the level of 1.5490 (1.5400). It makes even more sense to place pending short positions from the level of 1.5750 with profit taking at the level of 1.5400.
4. Supporting facts
On the four-hour chart MACD histogram shows the decrease in volumes of long positions; histogram is still in the positive zone and is directed downward, indicating the beginning of the downward wave in the near future.
Dmitriy Likhachev
Analyst of LiteForex Group of Companies
EUR/USD. Downward movement can be replaced by ascending correction
1.Current trend of the currency pair EUR/USD
The currency pair EUR/USD continues downward movement, caused on Tuesday by the news about the rise in the number of unemployed in Spain by 127.2 thousand people in June. The number significantly exceeded experts’ expectations. As a result, by Wednesday the pair has lost about 100 points and continues to decline to support level of 1.2920. It is likely that the price will continue to fall in advance of statistics from American labour market on Friday, which is expected to be positive.
2.Important levels (support and resistance)
At the moment the price continues to decline, trying to reach the level of 1.2920. So far the price has failed to break down this level. If this level is exceeded, downward movement may reach the level of 1.2840 or even the level of 1.2750. However, there is a high chance that the price will reverse from the level of 1.2840 and shift to the ascending movement. If the price breaks down the level of 1.2920, it is advisable to place short positions with profit taking at the level of 1.2840.
3.Technical indicators
On the four-hour chart indicator “Bollinger bands” demonstrates divergence of the lines, confirming downtrend; the price chart traded in the lower band. Histogram of MACD indicator is in the oversold zone and its volumes are increasing. However it should be noted that histogram has all signs that it may merge with the price chart, indicating possibility of ascending correction. The lines of Stochastic are directed upward and also suggest that temporary ascending correction is possible.
Dmitriy Zolotov
Analyst of LiteForex Group of Companies
GBPUSD: expected rebound up to 1.5000
1. Current trend of GBPUSD
Last Friday the pair was still declining because of the positive statistics of the Nonfarm Payrolls. In spite of the estimated 162 000 the figures had reached the level of 195 000. Favorable figures consolidated American dollar and GBPUSD fell to the new local minimum 1.4855. After an abrupt descent investors are apprehensive about depositing to the oversold pound. However if we consider future macroeconomic data, the pound will have an opportunity to restore its position. Leaders of Bank of England are going to broach an issue of changing of monetary policy. The majority makes a stand against increasing the volume of asset purchase program, referring to positive macroeconomic statistics and British economic recovery.
2. Important levels: support and resistance
In the near future it is probable for the pair to go down and to reach key support level. The fall will be followed by a considerable rebound up to 1.5000, 1.5050. Many analytics and investors assume the consolidation up to 1.5200 to the begging of August. We also can not ignore the possibility of resistance level of 1.4840 breakdown. This scenario is highly probable if The Bank of England decides to enlarge the asset purchase program or if the third round of Quantitative easing of FRS curtails.
3. Best entry/exit points
It is suggested to open long positions with Take Profits at 1.5000-1.5050.
4. Supporting facts
MACD histogram on the four-hour chart is in the negative zone under the zero lineand is directed downwards. It means the “bearish” trend will continue.
Dmitry Likhachev
Analyst of LiteForex Group of Companies