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Brent: general analysis Current trend Since the beginning of this week Brent has been traded in the range of 107.00-108.00. Tension around Ukraine continues to provide support to the crude oil Brent. Today, market participant are waiting for the release of report on oil inventory in the US warehouses from US Energy Information Administration. Analysts expect that index will drop. The data on number of initial applications for unemployment benefit will be also known today (15:30 GMT+3). Support and resistance Support levels: 107.00, 106.25 and 105.50. Resistance levels: 108.00, 108.80, 109.30 and 109.60. Trading tips On the four-hour chart Bollinger bands demonstrate slight convergence, indicating uncertainty in the market. MACD histogram is in the negative zone and its volumes are slowly increasing. It is likely that the instrument will continue to trade in the channel of 107.00-108.00. As soon as correction starts, sell positions can be opened at the level of 108.00 with the target of 107.00 Buy positions can be opened from support level of107.00 with the target of 108.00.
Vadim Smarzh Analyst of LiteForex Investments Limited
GBP/USD: general analysis Current trend The British Pound continues to trade below resistance level of 3/8 Murray (1.6968), although at yesterday’s meeting the Bank of England decided not to change in monetary policy. Interest rate was left at the level of 0.5%, while volume of bond purchase remained at the level of 375 billion. Experts do not see the point to lower interest rate in the current situation, as it may cause the rise of risks in the real estate market and lead to the formation of another “bubble” Today, the data on British industrial production and trade balance will become known. It is expected that both indices will slightly go down, which may trigger a new wave of sales of the British currency. Support and resistance The nearest resistance level is Murray level of 3/8 (1.6968). Support level is 1.6841 (2/8 Murray level). Trading tips It is recommended to open short positions after breakdown of the level of 1.6900 with stop-loss at 1.6925 and a target of 1.6850
Dmitry Agurbash Analyst of LiteForex Investments Limited
Forex: Ichimoku Clouds. Review of AUD/USD AUD/USD, H4 Let’s look at the four-hour chart. Tenkan-sen line is above Kijun-sen, they are both horizontal. Chinkou Span line is above the price chart; current cloud is ascending. The pair has been corrected to the red line, which is still a support level (0.9356). One of the previous maximums of Chinkou Span line is expected to be a resistance level at 0.9386.
AUD/USD, D1 On the daily chart Tenkan-sen line has crossed Kijun-sen from above, forming trend reversal pattern. However, downward impetus wasn’t enough and the price returned above Kijun-sen line (0.9332). Chinkou Span line is above the price chart; current cloud is ascending. One of the previous maximums of Chinkou Span line is expected to be a resistance level at 0.9423.
Key levels Support levels: 0.9356, 0.9332. Resistance levels: 0.9386, 0.9423. Trading tips On the four-hour chart we can see a correction of the upward movement. Daily chart confirms Bullish trend. Targets for the long positions are 0.9386 and 0.9423. Anastasiya Glushkova Analyst of LiteForex Investments Limited
EUR/USD: the pair fell to the lower limit of the ascending channel Current trend At the beginning of the previous week the pair continued to strengthen; demand for Euro continued to increase and favourable EU economic data provided additional support to the pair, pushing it up to the highs since 2011. However, the level of 1.4000 has become a psychological obstacle for the pair. As soon as the pair had reached this level, investors started to sell overbought European currency and buy the USD. First of all this change in investors’ behavior was caused by the speech of Mario Draghi, who said that forecast for June may force ECB to take measures in order to raise inflation rate. Additional support to the USD was provided by positive statement of the US Fed head, Janet Yellen. As a result, the pair fell from the local highs of 1.3995 to the level of 1.3745. Europe and US important macro-economic news is not expected today. Support and resistance After ambiguous speech by Mario Draghi the pair has lost over 200 points reaching the lower limit of the ascending channel of 1.3745. However, it is worth noting that the fall of the pair was based on the emotions. The American dollar remains under pressure of weak macro-economic statistics and optimistic speech of the head of US Fed cannot strengthen national currency for a long time. Key economics of Eurozone, on the contrary, show accelerated growth rates. Economic statistics show growth in the key economic areas. In the medium-term new surge of upward movement is expected with the target of 1.4000 (1.4050). Support level: 1.3745, 1.3700, 1.3650 and 1.3600. Resistance levels: 1.3810, 1.3850, 1.3900, 13950 and 1.4000. Trading tips In the current situation it makes sense to place long positions with take profit at the level of 1.3950 (1.4000) and stop-loss at the level of 1.3720.
Dmitry Likhachev Analyst of LiteForex Investments Limited
AUD/USD: the pair will continue upward movement Current trend Last Thursday the currency pair AUD/USD had significantly strengthened after release of Australian labour market data. It became known that both employment and unemployment rates were above market’s expectations. Unemployment remained at the previous level of 5.8% against expectation of growth up to 5.9%, while the number of jobs rose by 14.2 thousand against the forecast of 8 thousand. Following the release of this statistic the price of the pair had reached the four-week highs at the level of 0.9394, but later the price underwent correction to the level of 0.9355 (moving average of Bollinger bands). It is likely that movement in the pair will be volatile today. Investors will wait for the draft budget of Australia for 2014-2015, which will be released on Tuesday. It is expected that in the next fiscal year tightening of monetary policy will be introduced, and number of benefits for the taxpayers will be cancelled. Support and resistance Currently, the price has pushed off from the level of 0.9355, which suggests the rise up to the level of 0.9380 and 0.9395 (upper moving average of Bollinger bands). In case of breakdown of the level of 0.9395, the price can go further up to 0.9425. Technical indicators give mixed signals. MACD histogram is in the positive zone, its volumes are decreasing. Stochastic lines intersect, turning upward. Trading tips In the current situation it makes sense to open long positions from the current level of price with take profit at 0.9395. Short positions with the target of 0.9320 can be opened if the price falls to the level of 0.9355.
Dmitriy Zolotov Analyst of LiteForex Investments Limited
USD/JPY: general analysis Current trend The Japanese Yen continues to decline against the American currency. On the daily chart the pair USD/JPY is trading near resistance level of 2/8 Murray (102.34). Breakdown of this level will open the way to 103.00. Decision by US Fed to reduce incentive programs has had a positive effect on the American dollar. In Japan current account surplus in 2013 was very low, despite stimulation of economy and lowering in the national currency rate. If this index reaches negative value, Japan, having huge external debt, will have to seek additional financing. Nevertheless, forecast is positive; it is assumed that surplus will grow along with the growth of the world economy. Support and resistance The nearest resistance level is 2/8 Murray (102.34). Support level is 101.95 (1/8 Murray). Trading tips It is recommended to open long positions after breakdown of the level of 102.34 with protective orders at 102.00 and a target of 103.00.
Dmitry Agurbash Analyst of LiteForex Investments Limited
GBP/USD: Mark Carney may trigger the rise of the pair Current trend On Monday the pair traded in the narrow range of 1.6900-1.6830. Following long-term decline last week, the pair managed to regain part of losses due to new wave of investors’ interest in the British currency. At the moment the pair is trading at the level of 1.6870 not far from the lower limit of the upward channel. Important British news is not scheduled for the release today. However, there will be some interesting US fundamental data, including retail sales, import price index, business inventories. On Wednesday, it is expected that the data on British labour market and inflation will be released and the head of the Bank of England Mark Carney will make a speech. According to forecast, retail sales index in the USA will significantly fall in April compared to the previous period. On the other hand, unemployment rate in the UK will decrease again, while average wages level will continue to increase. Thorough attention shall be paid to inflation report, which can influence on the regulator’s ideas about prospects of the British economy. In the current situation a lot will depend on the position of Mark Carney. If the head of the Bank of England will be optimistic about the pace of economic growth, it will become the first step towards changes in the monetary policy. In the medium-term the pair will continue to move in the upward channel to the target of 1.7050 (1.7100). Support and resistance Support levels: 1.6830, 1.6750, 1.6700 and 1.6600. Resistance levels: 1.6900, 1.7000, 1.7050 and 1.7100. Trading tips In the current situation it makes sense to place long positions with take profit at the level of 1.7050 (1.7100).
Dmitry Likhachev Analyst of LiteForex Investments Limited
Weekly Forex forecast 13-16 May 2014: EUR/USD, GBP/USD and USD/JPY
Weekly analytical video review for instruments EUR/USD, GBP/USD and USD/JPY based on fundamental analysis and technical indicators (MACD, Stochastic, Bollinger Bands). Daily reviews and forecast are available at LiteForex site Forex Trading : Top Forex Broker : LiteForex
EUR/USD: general analysis Current trend Yesterday, EUR/USD rate has slightly dropped. The pair was under pressure from European news. Management of the Central Bank of Germany said that they support new measures of easing monetary policy, introduced by the ECB. ZEW sentiment index in Germany fell to the level of 33.1 points in May against the previous level of 43 points, which has not been encouraging. Even negative US data was not able to provide support to the pair EUR/USD. Retail sales in the USA rose only by 0.1% in April, while a month earlier the rise amounted to 1.5%. Today investors wait for the data on industrial output in Europe. Experts predict that this index will decline, which can put pressure on the pair EUR/USD. Support and resistance Support levels: 1.3685, 1.3640 and 1.3590. Resistance levels: 1.3735, 1.3770, 1.3795 and 1.3835. Trading tips On the four-hour chart Bollinger bands are directed downwards, indicating further decline. MACD histogram is below the zero line; its volumes are decreasing; however it is too early to expect formation of the upward movement. The most feasible scenario is slow decline in price to the levels of 1.3685 and 1.3645. Sell positions are recommended at the current price with the targets of 1.3685-1.3645.
Vadim Smarzh Analyst of LiteForex Investments Limited
XAU/USD: analysis and forecast Current trend On Monday gold tried to regained lost positions, closely approaching to 1300.00, but could not maintain this level for long. In the afternoon the pair XAU/USD started to lose positions because of the rapid rise in the USD at the stock market. However, high demand for the precious metal remains due to tension in Ukraine, as gold has always been a tool to hedge risks, including political ones. Support and resistance Technical indicators show that the pair has entered the sideways channel and will trade in the range of 1291.00-1296.55. MACD histogram is at the zero level, not giving any signals, while Stochastic is in the overbought zone and can form a sell signal. Support levels: 1292.00, 1285.00 and 1280.00. Resistance levels: 1296.65, 1300.00 and 1314.00. Trading tips It makes sense to sell after consolidation of the price above the level of 1300.00. Short positions can be opened below the levels of 1285.00 with the target of 1275.00.
Ilya Lashenko Analyst of LiteForex Investments Limited