Connect with us

Forex

Dollar Range Poised to Give Way with NFP, FOMC in Sight

Published

on


The U.S. Dollar continues to bounce in a relatively tight range, but with Non-Farm Payrolls on the docket for later this week along with a widely-expected FOMC rate hike for next Wednesday; this range is unlikely to last for long.

Talking Points:

– If you’re looking for trade ideas, please check out our Trading Guides. And if you’re looking for shorter-term trade ideas, please check out our IG Client Sentiment.

To receive James Stanley’s Analysis directly via email, please sign up here.

– In this webinar, we used price action to look at majors markets ahead of Friday’s release of Non-Farm Payrolls and next week’s widely expected hike out of the Federal Reserve. The U.S. Dollar has been rather directionless of recent, and current price action is testing last week’s high which syncs-in fairly well with a swing-low from two weeks before. We looked at a Fibonacci retracement drawn around the bullish move that started in September, and this offered a 38.2% level at 93.57. A bullish break above this level opens the door for top-side exposure while a break below the 61.8% retracement at 92.59 opens the door for short-side exposure.

EUR/USD appears to be trying to dig-out higher-low support after last week saw prices push up to 1.1950. The group of swing-highs from October was initially helping to set support but of recent, prices have started to slide below that prior zone. This exposes the prior swing-low around 1.1712, and if we do see support come-in above this price, this opens the door for bullish setups playing off of a higher-low for top-side continuation. As of now, support appears to be forming around a trend-line projection taken from a set of prior swing-highs.

EUR/USD Daily Chart

Chart prepared by James Stanley

– GBP/USD: We then moved over to Cable, which has continued to push-higher after last week’s news around the Brexit divorce bill. GBP/USD is falling below a key level right now that exists at 1.3478. This is the 50% retracement of the Brexit move in the pair, and this gave us a week’s worth of support after the bullish breakout in September. After this most recent bullish run, we saw some short-term support develop at that level, but selling pressure eventually punched prices back-below. Bullish continuation can wait for prices to move back-above 1.3500, after which 1.3478 could become an interesting area for higher-low support on bullish continuation.

AUD/USD remains as an attractive candidate for USD-strength continuation. Even with USD getting weak of recent, AUD/USD has remained near longer-term support. This will likely remain as on eof the more attractive venues to trade for USD-continuation, and if we do see the larger theme of U.S. Dollar strength return, we could be looking at a .7500-break.

EUR/JPY has been range-bound for much of the past three months, with a considerable amount of support building in the zone from 131.42-132.05. The resistance side of the coin has recently come into play, as the 61.8% retracement of the 2014-2016 run at 134.41 has helped to set a previous double-top in the pair. We saw another test near this zone on Friday and since then, sellers have started to take over. This exposes the zone around 131.42-132.05 for bullish support plays. We also looked at the possibility of a bullish mid-line play using the area around 133.10.

GBP/JPYPossibly a more attractive candidate for trading GBP-strength than what we saw in GBP/USD. GBP/JPY is digging out support around a Fibonacci level at 150.87. This is the 38.2% retracement of the 2015-2016 major move in the pair. This price has previously helped to set resistance, and we’re now seeing short-term support come-in around this area. Risk-reward with current technical could present a challenge, but a slightly deeper pullback opens the door for a re-test of the previous high around 152.75.

— Written by James Stanley, Strategist for DailyFX.com

To receive James Stanley’s analysis directly via email, please SIGN UP HERE

Contact and follow James on Twitter: @JStanleyFX



Source link

Continue Reading
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Forex

Traders Net-Short Are 63.3% Higher from Last Week

Published

on

By


US500,SP500

TRADERS REMAIN NET-SHORT

US 500: Retail trader data shows 24.6% of traders are net-long with the ratio of traders short to long at 3.07 to 1. In fact, traders have remained net-short since Jan 07 when US 500 traded near 2473.53; price has moved 11.9% higher since then. The number of traders net-long is 1.7% higher than yesterday and 1.6% lower from last week, while the number of traders net-short is 5.2% higher than yesterday and 63.3% higher from last week.

For more in-depth analysis, check out the Q1 2019 Forecast for Equities

S&P 500 SUGGESTS STRONG BULLISH BIAS

We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests US 500 prices may continue to rise. Traders are further net-short than yesterday and last week, and the combination of current sentiment and recent changes gives us a stronger US 500-bullish contrarian trading bias.

— Written by Nancy Pakbaz, CFA, DailyFX Research

Follow Nancy on Twitter @NancyPakbazFX



Source link

Continue Reading

Forex

On to the Next Big Levels of Resistance

Published

on

By


S&P 500/Dow Jones/Nasdaq 100 Technical Highlights:

  • S&P 500 nearing 2800-area, several swing-highs from last year
  • Dow Jones 26k-ish stands between it and record highs
  • Nasdaq 100 trading around resistance already

Check out the forecasts for Global Stock Indices and other markets on the Trading Guides page.

S&P 500 nearing 2800-area, several swing-highs from last year

The S&P 500 is continuing to show impressive strength since its v-bottom began the day after Christmas, with it having a few points along the way where it could have been stopped in its tracks. But it wasn’t, and this has levels prior to the December swoon in view. The area surrounding 2800 is a big one.

From 2800 up to 2817 there were three peaks created from failed rallies, a logical area, with the rally having come this far, to look for stocks to weaken from. Watching price action will be key, as always, but especially around the levels just ahead.

While resistance looks likely to get tested soon, the upward channel structure over the past month will keep stocks pointed higher for as long as it holds. If the S&P is rejected off resistance, to further bolster the notion of a sizable retracement we’ll need to see the underside parallel undermined.

For now, the top-side must be respected, but the time for material weakness may be nearing…

Stocks are rallying, but will it last in the long-term? Find out where our analysts see stocks headed in the Global Equities Forecast.

S&P 500 Daily Chart (2800/817 big spot)

S&P 500 daily chart, 2800/817 big spot

Dow Jones 26k-ish stands between it and record highs

The Dow is nearing the 26k-area, a spot which is basically the equivalent of what 2800 is to the S&P 500. The zone runs up to near 26300. The focus is primarily on the S&P right now as it is the broader index, but depending on how price action plays out, the Dow may be the better index to short at some point if it shows relative weakness to the broader market.

Dow Daily Chart (26k-ish stands in the way)

Dow daily chart, 26k-ish stands in the way

Nasdaq 100 trading around resistance already

The Nasdaq 100 continues to lag behind, which is something to continue monitor given it was the bull-market leader with its leading group of stocks – FAANG – dominating price action and sentiment. The NDX is trading around the 200-day and near late-year swing highs equivalent to the ones discussed with regard to the S&P 500 and Dow. So far, relative weakness is making the 100 the preferred fade if the S&P finds material selling off resistance surrounding 2800/17.

Nasdaq 100 Daily Chart (trading around resistance)

Nasdaq 100 daily chart, trading around resistance

To learn more about U.S. indices, check out “The Difference between Dow, Nasdaq, and S&P 500: Major Facts & Opportunities.” You can join me every Wednesday at 10 GMT for live analysis on equity indices and commodities, and for the remaining roster of live events, check out the webinar calendar.

Tools for Forex & CFD Traders

Whether you are a beginning or experienced trader, DailyFX has several resources available to help you; indicator for tracking trader sentiment, quarterly trading forecasts, analytical and educational webinars held daily, trading guides to help you improve trading performance, and one specifically for those who are new to forex.

—Written by Paul Robinson, Market Analyst

You can follow Paul on Twitter at @PaulRobinsonFX



Source link

Continue Reading

Forex

Aussie Dollar Falls on RBA Minutes, US-China Trade Talks Eyed

Published

on

By


TALKING POINTS – AUSSIE DOLLAR, RBA MINUTES, ZEW, TRADE WARS, CHINA

  • Aussie Dollar, commodity bloc FX down on downbeat RBA meeting minutes
  • Germany’s ZEW survey may compound worries about slowing global growth
  • Trade wars in focus on US-China negotiations, fears of US auto tariff hike

The sentiment-linked Australian, Canadian and New Zealand Dollars weakened in otherwise quiet Asia Pacific trade. The move appeared to be inspired by an ominous tone in minutes from February’s RBA policy meeting. Meanwhile, the US Dollar corrected gently higher.

RBA officials cited “significant uncertainties”, noting that trade tensions and cooling domestic demand have increased negative knock-on risks from China. They added that consumption may fall if domestic house prices fall much further. They suffered the worst drop since 1983 in the three months through January.

TRADE WAR DEVELOPMENTS, GERMAN ZEW DATA MENACE MARKETS

Looking ahead, Germany’s ZEW survey of analyst sentiment may compound the downbeat mood, especially if it echoes the disappointing trend in regional data outcomes since September. A small improvement in the forward-looking Expectations index is nevertheless expected to keep it within a hair of six-year lows.

The tone of US-China trade negotiations may also be formative as a delegation from Beijing arrives in the US for continued talks. Both sides painted a rosy picture earlier in the week, but the Trump administration may be preparing a spoiler as the President ponders raising auto import tariffs.

What are we trading? See the DailyFX team’s top trade ideas for 2019 and find out!

ASIA PACIFIC TRADING SESSION

Asia Pacific Trade Economic Calendar

EUROPEAN TRADING SESSION

Europe Trade Economic Calendar

** All times listed in GMT. See the full economic calendar here.

FX TRADING RESOURCES

— Written by Ilya Spivak, Currency Strategist for DailyFX.com

To contact Ilya, use the comments section below or @IlyaSpivak on Twitter



Source link

Continue Reading

Trending

Copyright © 2017 Zox News Theme. Theme by MVP Themes, powered by WordPress.