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GBP/USD: the rise in the pair will continue Current trend On Tuesday, quotes in the pair GBP/USD rose again after minor correction on Monday. The USD was under pressure from ZEW business activity index in Eurozone, which was above expectations. In April, this index amounted to 64.8 points. Today, the price will continue to rise up to 1.5050, despite the release of the minutes of the last meeting of the Bank of England, which was not favourable for the GBP. Bank officials believe that British economy will face deflation in the nearest months and inflation growth rate will be slow until the end of this year. They are also concerned about low rise in salaries, as although its growth is ahead of inflation, it is yet not sufficient. There will not be any important news today, which can affect movement in the pair. However, on Thursday, attention shall be paid to the British retail sales for March and preliminary business activity index in the manufacturing sector of the USA from Markit. Support and resistance The pair has broken down the upper line of Bollinger bands indicator, which can provoke correction to 1.4990 and 1.4945. On the other hand, the bands are diverging, which indicates upward trend. Other technical indicators show the rise in quotes. MACD histogram is in the positive zone, crossing the signal line from top to bottom. Stochastic lines have crossed and turned upwards. Support levels: 1.4990, 1.4945 and 1.4855. Resistance levels: 1.5050, 1.5100 and 1.5160. Trading tips In the current situation it makes sense to open long positions after breakdown of the level of 1.5050 with the targets of 1.5100 and 1.5160. If the price consolidates below the level of 1.4990, it is advisable to open short-term short positions with the target of 1.4945.
Dmitriy Zolotov Analyst of LiteForex Investments Limited
EUR/USD: Greece discourages investments in Euro Current trend This week, the pair continues to move in the narrow range of 1.0800-1.0680. On Monday, the pair went down amid negative data on German producer price index. On Tuesday, European currency managed to win back some losses, going up to 1.0770. Yesterday morning the pair continued to rise and tested the level of 1.0800, however, amid today’s poor data on the key indices of France, Germany and Europe as a whole, the pair fell to support level of 1.0680. Today, attention will be focused on the American labor market. It is unlikely that the pair will go beyond the range of 1.0800-1.0680. It is possible that amid favourable data on the US labor market Euro can reach key support level of 1.0680 against the USD and will continue to trade at this level. At the meeting of Eurogroup, which will be held tomorrow, decision on the Greek problem will be made. The price of Euro will depend on this decision. Uncertainty in Eurozone deters investors and puts pressure on the pair, making change in trend impossible. Support and resistance In the medium-term trend downtrend will continue. Changes in the trend can take place only in case of breakdown of the local highs of 1.0840. Уровни поддержки: 1.0680, 1.0635, 1.0575, 1.0530, 1.0500, 1.0415. Уровни сопротивления: 1.0740, 1.0800, 1.0840, 1.0880, 1.0940, 1.1030. Trading tips It is recommended to open short positions from the key resistance level and take profit at the levels of 1.0680, 1.0635 and 1.0530.
Dmitry Likhachev Analyst of LiteForex Investments Limited
AUD/USD: аnalysis and forecast Current trend Yesterday, quotes in the pair AUD/USD went up due to weakening in the USD. The American currency is still under pressure. Poor data on labor market, business activity index in the manufacturing sector and sales in the construction sector brings uncertainty. Market participants begin to doubt that the American economy has recovered sufficiently in order tighten monetary policy. Sales of new homes in March amounted to 481 thousands, which was below the forecast. Initial applications for unemployment benefits increased by 5 thousand, up to 295 thousands, although it was expected that their level would remain unchanged. According to preliminary data business activity index in the manufacturing sector from Markit fell to 54.2. On the other hand, the Australian dollar was supported by inflation data, released on Wednesday. According to the Australian Bureau of Statistics, consumer price index rose to 0.2% in Q1. Support and resistance Resistance levels: 0.7820 (Upper line of Bollinger bands), 0.7900 (important psychological level), 0.7938 (highs of 24 March), 0.8000 (important psychological level). Support levels: 0.7763 (lows of the Asian session), 0.7710 (lows of Thursday), 0.7675 (bottom line of Bollinger bands), 0.7600 (important psychological level). Trading tips Short positions can be opened after breakdown of the level of 0.7760 with the targets of 0.7710 and 0.7675. Buy positions are advisable from the level of 0.7830 with the targets of 0.7900 and 0.7938.
Analyst of LiteForex Investments Limited
GBPUSD: trend reversal is possible this week Current trend Last week, the British currency significantly strengthened against the USD. The Pound rose despite the lack of positive macro-economic statistics. British retail sales data, released on Thursday, was worse than expected; however the pair continued to go up. The main growth factor for the pair GBP/USD was weakening in the USD amid negative key indices on labor market and construction sector. Strong data on orders for durable goods released on Friday could not provide strong support for the USD. Although today’s economic calendar does not contain important UK and US news, the Pound has been strengthening since morning, reaching the level of 1.5180. On Tuesday, the British preliminary GDP for Q1 will become known. It is expected that the index will grow; however it is not clear if the price will be able to break down the key level of 1.5190. GDP of the USA will also be known this week, as well as the decision of the US Fed on interest rates. Negative data on the American statistics can put additional pressure on the USD and in such case the level of 1.5550 will become unattainable. Support and resistance Despite sharp rise in the pair GBP/USD downtrend continues. Nevertheless, breakdown of the local highs and key resistance level of 1.5190, trend can reverse and in this case the “bulls” will have new targets of the levels of 1.5360, 1.5550 and 1.5610. Support levels: 1.5110, 1.5035, 1.4950, 1.4880, 1.4750, 1.4640 and 1.4570. Resistance levels: 1.5190, 1.5220, 1.5275, 1.5360, 1.5475, 1.5550 and 1.5610. Trading tips In the current situation it makes sense to open short positions on the trend from the key resistance level and upper limit of the ascending channel with take profit at .4750 and 1.4570. Short stop-loss can be placed above the level of 1.5190. Alternative scenario can take place in case of breakdown of the current local highs of 1.5190, and movement of the price to the new peaks. In this case it is advisable to place pending buy orders above the level of 1.5200 and take profit at the level of 1.5550.
Analyst of LiteForex Investments Limited
EUR/USD: review and forecast of the movement direction Current trend This week the pair EUR/USD continues to trade in the narrow upward channel. The USD has been slowly losing positions, which was caused by the poor U.S. macro-economic indices. In the near future the pair can continue upward movement up to 1.0970 and 1.1020. However, the price is unlikely to rise above these levels. Market participant will not take risk in advance of the U.S. FOMC meeting, which will be held on Wednesday. Introduction of monetary tightening policy is not expected; however, authorities of the U.S. Fed can specify the dates of changes in the interest rate at the meeting. On Wednesday, preliminary data on the US GDP for Q1 will become known. It is expected that the index will decline, which can put additional pressure on the USD. Support and resistance According to technical indicators upward movement is going to continue. Bollinger bands are directed upwards. MACD histogram is in the positive zone and its volumes are increasing. Stochastic lines are horizontal. Support levels: 1.0850, 1.0820 and 1.0750. Resistance levels: 1.0945, 1.0970 and 1.1020. Trading tips In the current situation short term long positions can be opened from the level of 1.0945 with the target of 1.1020. Short positions with the targets of 1.0850 and 1.0820 are advisable if the price breaks down the level of 1.0900.
Ilya Lashenko Analyst of LiteForex Investments Limited
USD/JPY: trading is recommended in the current range Current trend At the end of last week the pair USD/JPY had dropped to the level of 119.30 and went further down to the local lows of 118.80. On Monday, the USD won back some of the losses and returned to the level of 119.30. However by the evening, the price reached the local lows once again. Today, American currency got support from investors in advance of the release of the U.S. GDP for Q1 and the decision of the U.S. Fed on interest rates. It is worth noting that tomorrow the data on Japanese industrial output will be known, and the Bank of Japan will announce interest rate decision. Although market is favourable to the USD, it is unlikely that today’s statistics will be positive. GDP forecast is negative. In addition, it is also unlikely that the key interest rate will be raised in the near future. Currently, economic growth rate in the USD has slowed down, and the USD goes down versus the major currencies. In such situation it seems risky to invest into the USD. On the other hand, Japanese economy is in recession and its macro-economic statistics is not favourable either. Given the circumstances it is assumed that the pair will continue to move in the sideways channel in the wide range of 118.80-120.30. Support and resistance Support levels: 119.10, 118.80, 118.60, 118.00, 117.70, 117.10 and 116.00. Resistance levels: 119.35, 119.70, 120.00, 120.30, 120.70, 121.20 and 121.50. Trading tips In the current situation it is advisable to trade from the limits of the range. Sell positions can be opened at the upper limits of the channel, while buy orders can be placed at the bottom limits.
Analyst of LiteForex Investments Limited
EUR/USD: general analysis Current trend European currency continues to strengthen against the USD despite negative news from Greece. The USD is under pressure caused by the outcome of the Fed FOMC meeting. Interest rates have been left at the previous level, as expected. Market participants were disappointed as Fed officials did not give any indications of timing of the increase in interest rates. Amid these facts Euro broke out important resistance level of 1.1000 and reached the level of 1.1230. However, today’s decision of the rating agency Moody's to downgrade rating Greek state bonds to the level of Саа2, has reduced trading activity of the buyers of European currency. At the moment, EUR is traded in the range of 11169-1.1189. According to the rating agency the balance between economic and financial risks in Greece is deteriorating, which can put pressure on Euro. Support and resistance The nearest resistance level: 1.1230 – 8/8 Murray level. Support level: 1.1169 – 7/8 Murray level. Trading tips It is recommended to open short positions after breakdown of the level of 1.1150 with protective orders at 1.1180 and the target of 1.1024.
Ilya Lashenko Analyst of LiteForex Investments Limited
GBP/USD: review and movement forecast Current trend At the last trading session the Pound has slightly dropped against the USD. Due to lack of important macro-economic statistics and prolonged rise in the pair, investors decided to take profit and close long positions. Therefore, yesterday’s decline was of technical nature. Additional pressure on the pair was caused by positive data on applications for unemployment benefits in the USA. Their number amounted to 262 thousand, which was significantly less than expectations of 290 thousand. Today’s economic calendar is not very eventful. Nevertheless, in the afternoon, business activity index in the U.S. manufacturing sector ISM for April will become known. Support and resistance On the four-hour chart Bollinger bands demonstrate convergence, confirming that the existing downtrend will continue. MACD histogram is in the positive zone; its volumes are rapidly decreasing, which suggests that sellers’ influence is increasing. Resistance levels: 1.5360, 1.5400, 1.5440 and 1.5490. Support levels: 1.5300, 1.5270, 1.5215 and 1.5170. Trading tips If the existing trend continues, it is recommended to open sell positions from the current levels with the nearest target of 1.5270. Breakdown of the level of 1.5270 will enable movement in price up to the level of 1.5215. Upward movement can continue only after consolidation of the price above the level of 1.5400. In such circumstances the “bulls” will try to bring the pair back to the highs of the past week at the level of 1.5500.
analytics of LiteForex Investments Limited
USD/JPY: analysis and forecast Current trend At the trading session last Friday, the pair USD/JPY reached two-week highs at the level of 120.28. The American currency went up, despite some negative US statistics, which demonstrated that PMI remained at the previous level of 51.5 points last month, while experts expected the rise in the index to 52.0 points. According to Reuters/Michiga, consumer sentiment index also remained at the previous level of 95.9 points, which was lower than the forecast of 96.0 points. Today’s attention of the market participants will be focused on the U.S. news on the dynamics of production orders. It is expected that this index will increase and reach the level of 2.0%, which will provide support to the USD. A speech of the member of the Fed Open Market Committee, Mr. Evans, will be also of interest. He will probably give his opinion about the timing of the interest rate increase. Support and resistance Resistance levels: 120.28 (Last Friday’s highs), 120.84 (highs of 13 April), 121.52 (highs of 17 March), 122.02 (highs of 10 March). Support levels: 119.55 (middle line of Bollinger bands), 119.00 (important resistance level), 119.55 (bottom line of Bollinger bands, lows of 30 April). Trading tips It makes sense to open buy positions after breakdown of the level of 120.28 with the first target of 120.84 and the next one at the level of 121.50. Sell positions are advisable after breakdown of the level of 119.55 with the targets of 199.00 and 118.49.
Analytics of LiteForex Investments Limited
AUD/USD: analysis and forecast Current trend Last week, volatility in the pair AUD/USD was high. At the beginning of the week the pair had grown and reached the level of 0.8075. However, the pair failed to break through the resistance level, and it gave the “bears” a chance to quickly win back lost positions. After that the USD has been growing and by the end of the week the price reached the level of 0.7875. It became known today that the Bank of Australia has decreased interest rate to 2.0%. Market’s reaction to this news was ambiguous. At first the price went down to the level of 0.779; however, later it rose up to 0.7910. Following the minor correction the pair has consolidated above the level of 0.7875, which coincides with Fibonacci retracement of 61.8%. It is also a strong support level. The “bulls” will try to maintain existing pace and will make an attempt to push the price higher up to the level of 0.7910. The “bears” will aim at breaking down and consolidation above the level of 0.7875. Support and resistance Resistance levels: 0.7910, 0.7950 and 0.8000. Support levels: 0.7875, 0.7850, 0.7840 and 0.7825. The level of 0.7875 is the key level of the “bears”. Trading tips Short positions can be opened below the level of 0.7865 and from the level of 0.7950. Buy positions are recommended if the price breaks down the level of 0.7960.
Dmitriy Zolotov Analyst of LiteForex Investments Limited