EURUSD Technical Analysis 2014, 02.11 - 09.11: Bearish With W1 Psy Level Crossing
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newdigital, 2014.10.31 17:02
Forex Weekly Outlook November 3-7US ISM Manufacturing PMI, rate decision in Australia, the UK and the Eurozone, Employment figures from New Zealand, Australia, Canada as well as important jobs data from the US with the all-important NFP report. These are the major market movers planned for this week. Check out these events on our weekly outlook.
Last week, The Federal Reserve ended its QE3 program with a vote of confidence in the US economic recovery. The ongoing improvement in the labor market, the economic expansion and the satisfactory inflation rate has made the decision to end the bond-buying program as almost foregone. Furthermore the advance GDP data released a day later showed the economy grew 3.5% in Q3 slightly better than forecasted, suggesting the US economy is marching forward. Will this trend continue in Q4?
- US ISM Manufacturing PMI: Monday, 14:00. The Manufacturing PMI declined to 56.6 in September after posting 59 points in August. The reading reached the lowest level since June and analysts expected a higher figure of 58.6.The New Orders Index fell short by 6.7 from the 66.7 release in August, still indicating growth in new orders. The Production Index reached 64.6, rising 0.1 above the August reading. The Employment Index expanded for the 15th consecutive month, registering 54.6, declining 3.5 points below the August reading. Overall the general trend remained positive. Another mild drop to 56.5 is expected this time.
- Australian rate decision: Tuesday, 2:30. The Reserve Bank of Australia kept the cash rate unchanged at 2.5%, in line with market forecast, but warned against weakening in the housing sector driven by the overpriced housing market. Global growth continued in a moderate pace, despite a recent slowdown in China’s growth. The Bank also cautioned against the strength of the Australian dollar, offering less assistance than would normally be expected in achieving balanced growth in the economy. However the general trend pointed to moderate growth in the coming quarters. No change in rates is anticipated.
- US Trade Balance: Tuesday, 12:30. The U.S. trade balance narrowed unexpectedly in August to $40.1 billion, reaching its smallest level in seven months. Economists expected a higher deficit of $41 billion. Exports rose by 0.2% to $198.5 billion in August, and imports gained 0.1% to $238.6 billion. Petroleum imports were weak but imports of capital goods soared to their highest on record. The U.S. trade balance is expected to reach $40.1 billion this time.
- NZ employment data: Tuesday, 20:45. Unemployment in New Zealand declined to its lowest level in more than five years, reaching 5.6% in the second quarter from 5.9% in the first three months of 2014. The reading was better than the 5.8% forecasted by analysts, however the participation rate declined to 68.9% from 69.3% in the first quarter. Nevertheless, the job market continues to grow rising 0.4% in the second quarter after expanding 0.9% in the previous quarter. The figures suggest that New Zealand’s job market is no longer a key concern for the country. New Zealand job market is expected to increase by 0.6% while the unemployment rate is expected to narrow again to 5.5%
- BOJ Governor Haruhiko Kuroda: Wednesday, 1:30. BOJ Governor Haruhiko Kuroda will speak in Tokyo. Japan’s inflation reached to its lowest pace in half a year, drifting further away from the Central Bank’s 2% target. Kuroda may give further explanations on the reasons behind the new stimulus measures issued at the end of October, earlier than expected.
- US ADP Non-Farm Employment Change: Wednesday, 12:15. U.S. Private-sector employers increased hiring in September, adding 213,000 jobs, according to ADP payrolls processor. The 11,000 climb was better than the 207,000 rise predicted by economists. 88,000 jobs were created from small businesses, 48,000 jobs were created from medium sized businesses and 77,000 jobs were created from large businesses. The slowdown in August proved to be temporary after the NFP release posted strong gains. Us private sector is expected to add 214,000 jobs in October.
- US ISM Non-Manufacturing PMI: Wednesday. 14:00. Non-manufacturing Purchasing Managers Index declined to 58.6 in September, following 59.6 registered in August. The reading was broadly in line with market forecast, indicating that he service sector is advancing more rapidly than the manufacturing sector. Respondents commented that business activity cooled mildly in the past few months after posting strong growth, but they remain positive about the general trend of the economy. Non-Manufacturing PMI is predicted to reach 58.2 this time.
- Australian employment data: Thursday, 23:30. Australia’s Unemployment rate increased mildly in September amid an unexpected decline in. Australian job market contracted 29,700 jobs mainly in part-time work, lifting unemployment to 6.1% from 6.0% in August. The slowdown in employment coincides with the sharp drop in mining investment. The Reserve Bank of Australia faces a tough challenge whether to raise interest rates from a record low of 2.5% to help reduce rising house prices. However, such a move may increase interest rates could undermine growth and cause unemployment to rise. Australian job market is expected to gain 10,300 positions while the unemployment rate is expected to remain unchanged at 6.1%.
- UK rate decision: Thursday, 11:00. The Bank of England nine-member Monetary Policy Committee voted to maintain rates at 0.5%, despite rising calls for a rate hike. The BOE’s next move will be strongly dependent on the Eurozone central bank call. The current slowdown in Europe postposes all rate hike plans. Economists expect soft demand from Europe will keep the central bank on hold until 2015. Rates are expected to remain at 0.5% this time.
- Eurozone rate decision: Thursday, 11:45. The European Central Bank kept its benchmark interest rate at 0.05% at its October meeting, following a 10 bps cut in the previous month. Furthermore, the Bank Policymakers decided to reveal their plan to buy asset-backed securities and covered bonds. These new moves are intended to stimulate financing bodies to expand loans to all sectors of the economy. The ECB also decided to increase its monetary policy accommodation to spur growth.
- US Unemployment claims: Thursday, 12:30. The number of new claims for unemployment benefits declined again last week, reaffirming the growth trend in the US job market. The 1,000 decline from the previous week was better than forecasted and the four-week moving average, fell again to 287,750, the lowest level since February 2006. Analysts have noted that claims have rarely remained low for such a long period. If the pace of firings will remain low, and hiring will continue, wage is expected to grow in the fourth quarter. The number of new jobless claims is expected to reach 285,000 this week.
- Canadian employment data: Friday, 12:30. Canadian private sector surged in September amid a job gain of 74,000 positions, the majority in full-time employment. The unexpected increase pushed the unemployment rate down two 6.8% from 7.0%, the lowest level in nearly six years. Economists expected a job addition of 18,700 with an unchanged unemployment rate. The rebound in full time positions indicates a positive trend in the Canadian job market. Canadian private labor market is expected to increase by 400 positions while the unemployment rate is predicted to remain at 6.8%.
- US Non-Farm Employment Change and Unemployment rate: Friday, 12:30. U.S. employers increased hiring in September with a job gain of 248,000, pushing the jobless rate to a six-year low of 5.9%. The strong figures suggest the US economy is advancing with a steady job growth and fewer layoffs. Economists expected a smaller gain of 216,000 and no changes in the unemployment rate. The employment was broad based but the participation rate dropped to 62.7, the lowest level since 1978 and weak wage growth is another concern the Fed has to address. US job market is expected to gain 229,000 in October with no change in the unemployment rate.
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newdigital, 2014.11.03 05:33
EUR/USD Technical Analysis: Half of Profit Booked on Short (based on dailyfx article)
- EUR/USD Technical Strategy: Short at 1.2710
- Support: 1.2500, 1.2316, 1.2140
- Resistance:1.2737, 1.2886, 1.3000
The Euro continues to press downward against the US Dollar, with prices probing the lowest levels in over two years. Near-term support is in the 1.2500-34 area, marked by the October 3 low and the 23.6% Fibonacci expansion, with a daily close below that exposing the 38.2% level at 1.2316. Alternatively, a reversal above trend line resistance at 1.2737 opens the door for a test of the October 15 high at 1.2886.
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newdigital, 2014.11.02 08:21
EUR/USD forecast for the week of November 3, 2014, Technical AnalysisThe EUR/USD pair initially tried to rally during the course of the week, but found enough trouble at the 1.28 level in order to turn things back around and fall very harshly. We tested the 1.25 level, but found it to be somewhat supportive towards the end of the session on Friday. Ultimately, if we break down below the lows of the week, we could go much lower at that point in time. We believe that the market should continue to go lower given enough time, and that the 1.25 level will eventually break down.
Ultimately, we believe that the market could very well head back down to the 1.2050 level, as it would then be a “round-trip” of the entire uptrend that we have obviously broken down below now. The fact that the 1.28 level, which of course was the 61.8% Fibonacci retracement level of the longer move, was broken down significantly, it appears that the market should make that round-trip previously mentioned.
Ultimately, we believe that anytime that this market will continue to be sold off every time it rallies, as the sellers are most certainly in control at this point time. And we think about it, it makes him presents as the European Central Bank almost certainly has to keep a very loose monetary policy in order to bring down the value of the Euro in order to try to stimulate the economy.
Given enough time, we believe that the real way to make profits over the longer term will be to continue to hang onto trades, perhaps adding to a position in order to increase its size every time we rally. The 1.20 level below should be rather supportive though, so we don’t know whether or not the market will actually go below there. At that point in time, it is possible that the trend will turned back to the upside, but assuredly at this point in time it appears of the market is ready to break down significantly. We have no interest in buying this market until we break above the 1.30 handle, something that does not look very likely.
Triangle pattern is going to be broken for H4 timeframe:
If yes so we may see good market rally. But some resistance levels for the price in the way to uptrend: 1.2509 and 1.2536.
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newdigital, 2014.11.04 09:23
EUR/USD Technical Analysis: Euro Aiming Below 1.24 Figure (based on dailyfx article)
The Euro sank to the lowest level in over two years against the US
Dollar, with sellers claiming a foothold below the 1.25 figure. A daily
close below the 38.2% Fibonacci expansion at 1.2316 exposes the 50%
level at 1.2140. Alternatively, a turn above the 1.2500-34 area (October
3 low, 23.6% Fib) clears the way for a challenge of trend line
resistance at 1.2723.
We entered short EURUSD at 1.2710 in line with our long-term fundamental outlook subsequently booked profit on half of the position. The rest of the trade remains open to capture any further downside momentum with a stop-loss at breakeven (1.2710).
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newdigital, 2014.11.05 05:04
EURUSD Scalps Target 1.26 Ahead of ECB / NFPs (based on dailyfx article)
- EURUSD responds to long-dated trendline- immediate focus is higher
- Scalps target topside correction / short entries higher up
- EURUSD responds to 2011 trendline- Recovery shifts immediate focus is higher
- Broader downtrend remains intact sub-October trendline resistance
- Resistance (possible short entries) at 1.26, 1.2640 & 1.27
- Support objectives at 1.2466, 1.2414 & 1.2315
- Daily RSI divergence / former resistance-trigger now support- constructive
- Numerous resistance/support triggers pending
- Event Risk Ahead: Eurozone Retail Sales and US ADP Employment & ISM on Wednesday, ECB on Thursday, NFP on Friday
H4 price
is on primary bearish for trying to break 1.2466 support level for the bearish to be continuing.
- Chinkou Span line is located below the price
- Ichimoku cloud/kumo (Sinkou Span A and Sinkou Span B) is above the price - this is indicating the bearish market condition.
- The nearest support level for H4 price is 1.2466
| Resistance | Support |
|---|---|
| 1.2566 | 1.2466 |
| 1.2577 | N/A |
If
H4 price will break 1.2466 support level on close H4 bar so the primary bearish will be continuing.
If not so we may see the ranging market condition within primary bearish.
- Recommendation for short: watch H4 price to break 1.2466 support for possible sell trade
- Recommendation
to go long: N/A
- Trading Summary: bearish
SUMMARY : bearish
Is a reversal around the corner?
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newdigital, 2014.11.06 05:54
EUR/USD Revisits Recent Lows After Hammer Formation Falls Flat (based on dailyfx article)
- EUR/USD Technical Strategy: Pending Short
- Hammer Formation Fails To Find Follow-Through
- H4 Lacking Bullish Reversal Signals Near Support
EUR/USD has slipped back below the 1.2500 handle after a bullish signal from a Hammer formation failed to find follow-through. As noted in recent reports the scope for the pair’s advance was likely limited given the nearby 1.2620 barrier overhead. With reversal signals now lacking a break below the recent lows near 1.2430 may set the scene for a descent on the late August ’12 lows near 1.2250.
EUR/USD: Hammer Candlestick Falls Flat
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D1 price is on primary bearish for crossing 1.2546 support level on open bar for now.
H4 price is on bearish ranging between 1.2485 support and 1.2631 resistance.
W1 price is on bearish with market rally finishing, the price is trying to break 1.2500 key psy support level for the bearish to be continuing.
MN price: bearish - Chinkou Span line is crossing the price on open bar, and the price is breaking 1.2571 support level. If Chinkou Span line will break MN price from above to below on close monthly bar so we may see the bearish market condition for this pair for the next months and next year too.
If D1 price will break 1.2546 support level so the primary bearish will be continuing (good to open sell trade for example)
If D1 price will break 1.2770 resistance - we may see the secondary market rally inside primary bearish with the good possibility to market reversal to primary bullish on D1 timeframe (good to counter-trend trading systems)
If not so we may see the ranging market condition within bearish.
UPCOMING EVENTS (high/medium impacted news events which may be affected on EURUSD price movement for this coming week)
2014-11-03 01:00 GMT (or 02:00 MQ MT5 time) | [CNY - Non-Manufacturing PMI]
2014-11-03 01:45 GMT (or 02:45 MQ MT5 time) | [CNY - HSBC Manufacturing PMI]
2014-11-03 08:15 GMT (or 09:15 MQ MT5 time) | [EUR - Spanish Manufacturing PMI]
2014-11-03 09:00 GMT (or 10:00 MQ MT5 time) | [EUR - Final Manufacturing PMI]
2014-11-03 15:00 GMT (or 16:00 MQ MT5 time) | [USD - ISM Manufacturing PMI]
2014-11-04 08:00 GMT (or 09:00 MQ MT5 time) | [EUR - Spanish Unemployment Change]
2014-11-04 13:30 GMT (or 14:30 MQ MT5 time) | [USD - Trade Balance]
2014-11-05 13:15 GMT (or 14:15 MQ MT5 time) | [USD - ADP Non-Farm Employment Change]
2014-11-05 14:15 GMT (or 15:15 MQ MT5 time) | [USD - FOMC Member Kocherlakota Speech]
2014-11-05 15:00 GMT (or 16:00 MQ MT5 time) | [USD - ISM Non-Manufacturing PMI]
2014-11-06 07:00 GMT (or 08:00 MQ MT5 time) | [EUR - German Factory Orders]
2014-11-06 12:45 GMT (or 13:45 MQ MT5 time) | [EUR - Minimum Bid Rate]
2014-11-06 13:30 GMT (or 14:30 MQ MT5 time) | [EUR - ECB Press Conference]
2014-11-06 13:30 GMT (or 14:30 MQ MT5 time) | [USD - Unemployment Claims]
2014-11-07 07:00 GMT (or 08:00 MQ MT5 time) | [EUR - German Trade Balance]
2014-11-07 13:30 GMT (or 14:30 MQ MT5 time) | [USD - Non-Farm Employment Change]
Please note : some US (and CNY) high/medium impacted news events (incl speeches) are also affected on EURUSD price movementSUMMARY : bearish
TREND : bearish
Intraday Chart