Connect with us

Forex

Evening Star Prints as $60 Breakout Fails

Published

on


Crude Oil Price Forecast Talking Points:

– The 2019 rally in WTI Crude Oil continued this week as prices re-tested the $60 level on the chart around the Wednesday FOMC rate decision. Prices put in a day of indecision on Thursday followed by a sell-off on Friday, making for an evening star formation on the Daily chart, which will generally be approaches in a bearish manner.

– The bigger question is whether that evening star formation may be showing pullback potential or whether a larger reversal may be in the works. If risk aversion does continue to show, as was seen in early-Friday trade, the probability of a deeper reversal becomes stronger. But, at this early stage, there is little evidence to support that thesis as Oil prices remain well-elevated from potential areas of support around $57.25-$57.50 (which was resistance in early-March) and $54.50-$55.50. Until those supports are broken, the bullish 2019 trend can remain as workable.

Do you want to see how retail traders are currently positioned? Check out our IG Client Sentiment Indicator.

Technical Forecast for USOil: Bullish

The bullish 2019 trend in Oil ran into resistance this week, with prices temporarily pushing over the $60-level before sellers made a showing. And while 2019 trade has been considerably more upbeat and optimistic than the sell-off from Q4, prices failing to trade through a key area of resistance on the chart brings to question the near-term viability of bullish continuation in Oil prices as the final week of Q1 approaches.

Crude Oil Monthly Price Chart

WTI Crude Oil Monthly Price Chart

Chart prepared by James Stanley

Crude Oil Daily:

This week saw crude prices rally through the FOMC rate decision and into Thursday trade, at which point sellers showed-up to push prices back-below the $60 level. The sell-off continued through a key Fibonacci level on the chart at 59.64. The three-day candle formation has built into an evening star pattern, which involves an initial day of strength running into a day of indecision; followed by a sell-off that takes-out at least half of the gains from day one.

This keeps the door open for a short-term move of weakness down to the confluent Fibonacci zone that runs from 57.25-57.50, in which exists 38.2% retracements from both 2014-2016 and 2016-2018 major moves. This would be categorized as a pullback in the longer-term trend that’s held so far through 2019; and that theme can remain workable as long as prices trade above the March swing-low around $54.50.

Crude Oil Daily Price Chart

Crude Oil Daily Price Chart

Chart prepared by James Stanley

Timing Exposure in WTI Crude Oil

Given the culmination of the above factors: A strong bullish trend that’s held for the past few months running into a very obvious level of resistance at the psychological $60 handle, at which point a bearish formation had printed; and traders looking to onload bullish exposure may want to wait for a more optimal backdrop before looking to take on risk.

If the current retracement can push prices down to find support at the prior area of resistance, right around that confluent Fibonacci area discussed above, bullish trend strategies can become attractive. If that zone is unable to hold the lows, there’s another block of potential support around the $54.50-$55.50 area. If this zone comes into play, meaning there was a failure from buyers to hold support around $57.25, traders would likely want to utilize a bit of patience in waiting for support to actually build before looking to take on long exposure. Once that criteria is satisfied, the door can soon re-open for bullish strategies, targeting a resistance re-test of the $57.27 area on the chart.

Crude Oil Four-Hour Price Chart

Crude Oil Four Hour Price Chart

Chart prepared by James Stanley

To read more:

Are you looking for longer-term analysis on the U.S. Dollar? Our DailyFX Forecasts for Q4 have a section for each major currency, and we also offer a plethora of resources on USD-pairs such as EUR/USD, GBP/USD, USD/JPY, AUD/USD. Traders can also stay up with near-term positioning via our IG Client Sentiment Indicator.

Forex Trading Resources

DailyFX offers an abundance of tools, indicators and resources to help traders. For those looking for trading ideas, our IG Client Sentiment shows the positioning of retail traders with actual live trades and positions. Our trading guides bring our DailyFX Quarterly Forecasts and our Top Trading Opportunities; and our real-time news feed has intra-day interactions from the DailyFX team. And if you’re looking for real-time analysis, our DailyFX Webinars offer numerous sessions each week in which you can see how and why we’re looking at what we’re looking at.

If you’re looking for educational information, our New to FX guide is there to help new(er) traders while our Traits of Successful Traders research is built to help sharpen the skill set by focusing on risk and trade management.

— Written by James Stanley, Strategist for DailyFX.com

Contact and follow James on Twitter: @JStanleyFX

Other Weekly Technical Forecasts:

Australian Dollar Forecast – AUD/USD Rebound Stalls Post-Fed



Source link

Continue Reading
Click to comment

Leave a Reply

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

Forex

Weekly Trade Levels for US Dollar, Euro, Sterling, Loonie, Gold & Oil

Published

on

By


New to Forex Trading? Get started with this Free Beginners Guide

DXY, Euro, Loonie Monthly Opening-Ranges Intact

The US Dollar Index is trading into the monthly opening-range highs into the start of the week and the focus is a reaction around the 98.05/10 resistance zone- note that the monthly ranges in Euro and Loonie also remain intact. In this webinar we review updated technical setups on DXY, EUR/USD, USD/CAD, GBP/USD, Crude Oil (WTI), Gold, USD/JPY, AUD/USD, EUR/AUD & SPX.

Why does the average trader lose? Avoid these Mistakes in your trading

Key Trade Levels in Focus

DXY – Immediate focus is on topside resistance at 98.05/10. Initial support at 97.87 with near-term bullish invalidation raised to 97.71.

EUR/USD – Euro is coiling into the monthly opening-range just above slope support. Immediate focus is on support at 1.1140. Initial resistance at 1.1187 with near-term bearish invalidation at monthly-open resistance at 1.1215– look for a bigger reaction there IF reached. A break lower would expose 1.1110.

GBP/USD – Sterling broke below multi-month slope support last week with price responding to near-term pitchfork support into the open. Initial resistance at 1.2798 with bearish invalidation at 1.2859. Downside support objectives at the August low-day close at 1.2697 and the 100% extension at 1.2662.

Gold – Risk for near-term recovery while above the yearly / monthly low-day close at 1270. Initial resistance at 1280 with near-term bearish invalidation with the monthly open a 1283.

For a complete breakdown of Michael’s trading strategy, review his Foundations of Technical Analysis series on Building a Trading Strategy

Key Event Risk This Week

Economic Calendar- Key Data Realeses

Economic Calendar – latest economic developments and upcoming event risk

Active Trade Setups:

Learn how to Trade with Confidence in our Free Trading Guide

—Written by Michael Boutros, Currency Strategist with DailyFX

Follow Michael on Twitter @MBForex



Source link

Continue Reading

Forex

AUDUSD Soars on Shock Election, Apple Shares Slump, Risk of S&P 500 Drop

Published

on

By


MARKET DEVELOPMENT – AUD Soars on Shock Election, Apple Shares Slump, Risk to S&P 500

DailyFX Q2 2019 FX Trading Forecasts

AUD: The Aussie outperforms following a shock election outcome, in which Prime Minister Scott Morrison secured re-election (full story). In reaction, the Aussie gapped higher at the Asia open, reclaiming the 0.69 handle against the greenback. However, as equity markets have headed lower throughout the European morning, risks are for gains to be faded. Alongside this, key headwinds in the form of trade war tensions and a potential RBA June rate cut are likely to limit upside. Reminder, RBA Governor Lowe due to speak tonight after RBA meeting minutes (calendar)

Crude Oil: Oil prices surged at the Asia open as Saudi Arabia signalled that cuts could be extended throughout the remainder of 2019 at the JMMC meeting, while President Trump had also stepped up his critical rhetoric towards Iran. Although, with equity prices beginning to push lower, oil prices have pared the majority of its initial gains.

Equities: US equity futures have headed lower amid the continued crackdown by the US on China’s Huawei, which in turn has chipmakers come under pressure, while Google also stated that they are to restrict the company’s use on android services. Elsewhere, Apple’s price target had been cut by HSBC to $174 (median street price target = $220), citing concerns over China, while tariff led price increases on Apple products could also have dire consequences on demand. Apple shares currently lower by 2.4% in pre-market.

AUDUSD Soars on Shock Election, Apple Shares Slump, Risk of S&P 500 Drop - US Market Open

Source: DailyFX, Thomson Reuters

DailyFX Economic Calendar: – North American Releases

AUDUSD Soars on Shock Election, Apple Shares Slump, Risk of S&P 500 Drop - US Market Open

IG Client Sentiment

AUDUSD Soars on Shock Election, Apple Shares Slump, Risk of S&P 500 Drop - US Market Open

How to use IG Client Sentiment to Improve Your Trading

WHAT’S DRIVING MARKETS TODAY

  1. Gold Price Sell-Off Continues, Silver Price Hits a Six-Month Low” by Nick Cawley, Market Analyst
  2. COT Report: Japanese Yen and Euro Shorts Collapse, USD Longs Reduced” by Justin McQueen, Market Analyst
  3. Crude Oil Price May Be Carving Out a Top” by Paul Robinson, Currency Strategist
  4. Using FX To Effectively Trade Global Market Themes at IG” by Tyler Yell, CMT , Forex Trading Instructor

— Written by Justin McQueen, Market Analyst

To contact Justin, email him at Justin.mcqueen@ig.com

Follow Justin on Twitter @JMcQueenFX



Source link

Continue Reading

Forex

Gold Price Sell-Off Continues, Silver Price Hits a Six-Month Low

Published

on

By


Gold (XAU) and Silver (XAG) Price Analysis and Charts.

  • Gold (XAU) eyes a cluster of support.
  • Silver (XAG) makes afresh 2019 low as buyers disappear.

DailyFX Q2 Forecasts and Top 2019 Trading Opportunities.

Gold (XAU) Needs to Support to Hold

The sell-off on gold continues with the precious metal down around $30 in less than a week. Gold is under pressure from a resurgent US dollar, buoyed by last Friday’s Uni of Michigan data which smashed expectations and hit a multi-year high. The important 61.8% Fibonacci retracement level at $1,287/oz. failed to provide any support when broken last week, while the $1,287 – $1,281/oz. zone made up of old horizontal support is being tested now. A clear break and close below opens the way to the recent double bottom around $1,266/oz. which is currently being guarded by the 200-day moving average at $1,268.6/oz. Below here the 50% Fibonacci retracement level at $1,262/oz heaves into view.

How to Trade Gold: Top Gold Trading Strategies and Tips

Gold (XAU) Daily Price Chart (August 2018 – May 20, 2019)

Gold Price Sell-Off Continues, Silver Price Hits a Six-Month Low

Silver (XAG) Nears a Fresh Six-Month Low

Another precious metal under heavy selling pressure. Silver is now at levels last seen in early December last year and is over 11% lower since making its recent high of $16.21/oz. in late February. The downtrend since the late-February high continues to be respected and it is possible that silver completely retraces all the way back down to the November 14 low at $13.89/oz. Psychological support at $14.00/oz. may slow the decline, while the CCI indicator shows that the market is extremely oversold.

Silver (XAG) Daily Price Chart (August 2018 – May 20, 2019)

Gold Price Sell-Off Continues, Silver Price Hits a Six-Month Low

Trading the Gold-Silver Ratio: Strategies and Tips.

IG Client Sentiment data show that retail traders are 79.1% net-long gold, a bearish contrarian indicator. Recent daily and weekly sentiment shifts give us a stronger bearish contrarian bias.

— Written by Nick Cawley, Market Analyst

To contact Nick, email him at nicholas.cawley@ig.com

Follow Nick on Twitter @nickcawley1



Source link

Continue Reading

Trending

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