USD/CAD intraday technical levels and trading recommendations for January 4, 2016

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Overview:

A bullish breakout above the previous consolidation zone between 1.2400 and 1.2800 was performed on July 15 (shown on the weekly chart). A long-term bullish target was projected towards the level of 1.3270.

A significant bearish rejection was observed around 1.3450. Since then, another consolidation range was established between 1.2800 and 1.3400.

Few weeks ago, a bearish breakout below the support level of 1.3075 was needed to enable a further bearish decline towards 1.2900. However, an evident bullish rejection was expressed around this level.

A bullish breakout above 1.3400 (the upper limit of the recent consolidation range) was performed on December 7.

Daily fixation above 1.3400 enhanced the bullish side of the market.

A bullish visit towards the next resistance level of 1.4100 (Fibonacci Expansion 100%) should be expected. Hence, a valid sell entry should be expected around this level.

On the other hand, the price zone of 1.3370-1.3400 remains a significant support zone to be watched for a valid buy entries if a bullish pullback occurs.

Trading recommendations:

Risky traders can have a counter-trend sell position cans around 1.4100 (Fibonacci Expansion 100%) if enough bearish rejection is expressed when retesting takes place.

On the other hand, conservative traders should wait for the USD/CAD pair to retrace towards the zone of 1.3380-1.3400 looking for a low-risk buy entry. S/L should be placed below 1.3300.

The initial T/P levels should be placed at 1.3500 and 1.3600. The long-term bullish target is projected towards 1.4100.

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Intraday technical levels and trading recommendations for GBP/USD for January 4, 2016

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Few months ago, the market was pushed above the weekly key zone around 1.5550 in an attempt to reach the area of 1.5900, which provided significant bearish resistance.

Recent weekly candlesticks came as bearish engulfing candles, closing below the level of 1.5220 (the neckline of the Head and Shoulders pattern). This supported the bearish side of the market in the long term.

A quick bearish decline towards the weekly demand level of 1.4950 was expected as a result of the bearish breakdown below 1.5200.

Weekly persistence below 1.4950 exposed the way towards 1.4800 while the price levels of 1.4650 and 1.4600 (the depicted demand levels) wait for a bearish visit as long as the market keeps trading below 1.4800 (the lower limit of the depicted bearish channel).

On the other hand, re-closure above 1.4950 allows another bullish pullback to occur towards 1.5350 especially after the previous weekly bullish rejection at 1.4800 (the lower limit of the current bearish channel).

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During 2015, significant bearish rejection was expressed around 1.5770 and 1.5230 where a bearish Head and Shoulders reversal pattern was established. Since then, the market has been trending down within the depicted bearish channel.

The price level of 1.4950 was broken to the downside few weeks ago, constituting a significant supply level. As anticipated, it offered a valid sell entry on December 24.

Daily persistence below 1.4800 (the lower limit of the current bearish channel) was needed to allow further bearish decline towards 1.4680 and 1.4610 where previous prominent bottoms are located on the GBP/USD daily chart.

This week, the GBP/USD pair looks oversold as it's being pushed further below the lower limit of the depicted bearish channel. That's why, early signs of bullish reversal should be considered around price zone of 1.4660-1.4610.

Trading Recommendation:

Risky traders can have a valid BUY entry anywhere around price zone of 1.4660-1.4610 if enough bullish rejection is expressed.

S/L should be located below 1.4550 to limit our risk. Initial T/P levels should be located at 1.4800 and 1.4950.

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Intraday technical levels and trading recommendations for EUR/USD for January 4, 2016

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Previously, the EUR/USD pair moved lower after breaking below the major demand levels around 1.2100 and 1.2000 where historical bottoms were previously established back in July 2012 and June 2010.

EUR/USD bears pushed the price slightly below the monthly demand level of 1.0550 (established in January 1997). Bullish recovery was observed shortly after.

April's candlestick came as bullish engulfing one. However, next monthly candlesticks (August, September, October, and November) reflected strong bearish pressure, which existed around the level of 1.1450.

Hence, a long-term projected target is still seen at 0.9450 if a bearish breakout below the monthly demand level of 1.0555 occurs before the end of this month (January).

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On August 24, the EUR/USD pair looked overbought as the market spiked above the level of 1.1500 (daily supply level).

Shortly after, the intraday supply zone of 1.1360-1.1400 provided significant bearish pressure. An intraday sell entry was suggested. All T/P levels are located at 1.1150 and 1.1050 were already reached.

A bearish breakout of the depicted uptrend was performed on October 23. This enhanced a long-term bearish scenario with targets at 1.0800 and 1.0600.

One month ago, daily persistence below the level of 1.0800 and 1.0700 (key levels) ensured enough bearish momentum towards 1.0550 (prominent monthly level) where the recent bullish pullback was initiated.

Last week, the level of 1.1000 was considered a significant supply level to offer a valid sell entry.

A Head and Shoulders reversal pattern was established around the mentioned supply level. S/L should be lowered to 1.0950 and Initial T/P levels should be located at 1.0820.

An obvious bearish closure below 1.0800 (the neckline of the depicted reversal pattern) is needed to enable a further bearish decline towards 1.0730 and 1.0550 again.

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EUR/NZD analysis for January 04, 2016

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Overview:

Recently, EUR/NZD has been moving upwards. As I expected, the price has reached and rejected strongly from our take-profit zone at the level of 1.5835. In the daily time frame, I found a supply bar and confirmed formation of a strong head-and-shoulders pattern (a broken neckline). In the H4 time frame, the price rejected strongly our 200 SMA (1.6180) and created bearish outside bar from 200 SMA. According to the daily time frame, I found testing of the 200 SMA. I expect further downward movement and retesting of 1.5850 and even potential breakout to the downside.

Fibonacci Pivot Points:

Resistance levels:

R1: 1.5960

R2: 1.6000

R3: 1.6060

Support levels:

S1: 1.5845

S2: 1.5810

S3: 1.5750

Trading recommendations : Buying EUR/NZD looks very risky at this stage since the price rejected strongly our 200 SMA in the H4 and daily time frames. Watch for potential selling opportunities.

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Gold analysis for January 04, 2016

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Overview:

Since our last analysis, gold has been trading upwards. The price tested the level of $1,078.30 in an average volume. In the daily time frame, I found potential testing of 50 SMA. Be careful when buying gold at this stage. An intraday trend is neutral. Short- and mid-term trends are downward. In the H4 time frame, the price is well above SMA 50 and 100, but moving averages are flat. According to the M30 time frame, I found a volume spike and very wide spread of the bar (buying looks very risky). I found symmetrical triangle (trend continuation pattern) and the price is trying to break upside, but in my opinion, we may see a potential fake breakout to the upside so be careful when buying. I expect testing of $1,050.00. I would like to see a breakout in a high volume at $1,046.00 confirming the trend-continuation pattern.

Daily Fibonacci pivot points:

Resistance levels:

R1: 1,064.60

R2: 1,065.65

R3: 1,067.30

Support levels:

S1: 1,061.20

S2: 1,060.20

S3: 1,058.50

Trading recommendations: Watch for potential selling opportunities, buying looks risky.

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Technical analysis of EUR/JPY for January 04, 2016

Technical outlook and chart setups:

The EUR/JPY pair is seen to be trading around the 129.75/80 levels for now and it might be looking to test December lows around 129.50 before deciding on a next big move. But indicators are pointing to a potential bottom formation and probability remains high for a rally from here. It is hence recommended to initiate 50% long positions for now with risk at the 129.50 levels. Immediate support is seen at the 127.50 levels, followed by 126.10 and lower while resistance is seen at the 132.50 levels, followed by 133.70 and higher. A break above the 132.50 levels would confirm that a meaningful low is in place.

Trading recommendations:

Initiate 50% longs now, stop is at 128.50, target is open.

Good luck!

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Technical analysis of AUD/JPY for January 04, 2016

After a strong downtrend, the AUD/JPY pair started to move higher and currently a correctional upward move could be still taking place. The breakout of the downtrend trend line as well as breakout of the 50% Fibonacci retracement level (applied to the high of May 14 and low of August 24, 2015) supports the idea of an ongoing correctional wave up.

Currently, the price is testing the S1 support for the second time as well as lower trend line of the ascending channel. This could be the price area where bears will start fixing profits giving a way to bulls.

Consider buying AUD/JPY while the price is near S1, targeting R3 resistance, that is 61.8% Fibonacci retracement level. The stop loss should be well below the S1 support.

Support: 85.60

Resistance: 87.80, 89.60, 91.40

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Technical analysis of EUR/AUD for January 04, 2016

The EUR/AUD downtrend started on August 24, 2015 and it still seems to be valid. The price has been moving downwards for over 3 months now within the descending channel.

Currently, the price is trading near the upper trend line of the channel which has been rejected several times. The Fibonacci applied to the corrective wave up after a major support breakout shows that both S1 and S2 support levels were also broken and it should open the way for another extension down towards the S3 support, that is 361.8% Fibonacci.

Consider selling EUR/AUD while the price is near R1 (1.5165) targeting the S3 (1.4150) support level. The stop loss should be above the previous level of support at 1.5555.

Support: 1.4925, 1.4540, 1.4150

Resistance: 1.5165, 1.5555

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Technical analysis of GBP/CHF for January 04, 2016

Technical outlook and chart setups:

The GBP/CHF pair is trading around the 1.4750 levels for now, well above its lows at the 1.4600 levels last week. The pair is consolidating for now and a high-possible move from here should be on the upside, and a break above 1.4800 would be required to confirm it. It is recommended to initiate 50% long positions now with risk at the 1.4600 levels. Immediate support is seen at the 1.4600 levels, followed by 1.4550 and lower, while resistance is seen at the 1.4900 levels, followed by 1.5050 and higher. The pair could potentially rally through the 1.5200 levels from here before reversing.

Trading recommendations:

Initiate long positions now, stop is at 1.4600, target is open.

Good luck!

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Technical analysis of Gold for January 04, 2016

Technical outlook and chart setups:

Gold is trading higher today and has taken out interim resistance at $1,072.00 levels already. The metal has made intraday highs at the $1,074.50 levels and still looking to go further. Bulls seem to be poised to remain in control until prices stay broadly above the $1,057.00 levels from here on. It is hence recommended to remain long in the metal with risk at $1,050.00. Immediate support is seen at the $1,057.00 levels (interim), followed by $1,047.00 and lower, while resistance is seen at the $1,077.00 levels, followed by $1,081.00 and higher.

Trading recommendations:

Remain long for now, stop is at the $1,050.00 levels, target is open.

Good luck!

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Technical analysis of Silver for January 04, 2016

Technical outlook and chart setups:

Silver is seen to be trading around the $14.00 levels for now looking to break above $14.10 before producing a meaningful retracement. The metal is still controlled by bulls until prices stay above the $13.65 levels from here on. It is hence recommended to remain long for now with risk at the $13.45/55 levels. Immediate resistance is seen at the $14.10 levels, followed by $14.40, $14.60 and higher while support is seen at the $13.75 levels, followed by $13.65 and lower. Bulls are expected to push prices higher above at least $14.60 and subsequently $15.00.

Trading recommendations:

Remain long, stop is at $13.45, target is open.

Good luck!

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Global macro overview for 04.01.2016

Global macro overview for 04/01/2016:

The UK economy might face a number of headwinds in 2016, some of which have the potential to slow down what has so far been a robust recovery. The most important macro-political event of the year 2016 might be the UK public referendum on leaving the European Union called Brexit. In an attempt to increase the growing popularity of the right wing anti-EU UK Independence Party, Conservative leader David Cameron vowed to hold a referendum on the EU membership by the end of 2017 if he was re-elected. The Conservatives won an overall majority at the election in May this year, so it is possible that a deal may be reached by February 2016. This kind of events would enable Cameron to hold the referendum in summer, well before the deadline he set in the lead up to the election. The consequences of such a move will cause a high volatility in financial markets and this is why the outcome of the possible referendum will be monitored closely by market participants.

In the meantime, the GBP/USD pair bounced form the technical support at the level of 1.693, but did not manage yet to close above the critical resistance at the level of 1.4848.

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Technical analysis of USD/JPY for January 04, 2016

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USD/JPY is expected to trade in a lower range as the key resistance is at 119.95. Last Thursday, US stock indices settled lower in the last session of 2015, weighed on by shares in semiconductor, technology hardware and software sectors. The Dow Jones Industrial Average fell 1.0% to 17,425, the S&P 500 dropped 0.9%, to 2,043, while the Nasdaq Composite was down 1.2% to 5,007.

Nymex crude oil rebounded 1.2% to $37.04 a barrel, gold was flat at $1,060 an ounce, and the benchmark 10-year Treasury yield closed at 2.173%, down from 2.305% in the previous session.

Meanwhile, the US dollar bounced with EUR/USD falling 0.6% to 1.0860, GBP/USD dropping 0.5% to 1.4743, and USD/CHF surging 1.4% to 1.0018. On the other hand, USD/JPY declined 0.2% to 120.30. The pair fell to as low as 119.95 at the end of 2015 before posting a rebound. Currently, it is trading above the 20- and 50-period (30-minute chart) moving average and the intraday relative strength index has reached the over-bought level of 70. As long as the key resistance at 119.95 is not surpassed, the pair is expected to return to the first downside target at 118.60.

Trading recommendations:

The pair is trading below its pivot point. It is likely to trade in a lower range as long as it remains below the pivot point. Short positions are recommended with the first target at 118.60. A break of that target will move the pair further downwards to 118. The pivot point stands at 119.95. In case the price moves in the opposite direction and bounces back from the support level, it will move above its pivot point. It is likely to move further to the upside. According to that scenario, long positions are recommended with the first target at 120.40 and the second target at 120.75.

Resistance levels: 120.40, 120.75, 121

Support levels: 118.60, 118, 117.65

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Technical analysis of USD/CHF for January 04, 2016

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USD/CAD is under pressure. The pair is reversing down against its key resistance at 0.9990 and remains under pressure. The descending 50-period moving average maintains a bearish bias. The first target to the downside is therefore set at 0.9910. A break below this level would open the way to further weakness towards 0.9875.

Trading recommendations:

The pair is trading below its pivot point. It is likely to trade in a lower range as long as it remains below the pivot point. Short positions are recommended with the first target at 0.9910. A break of that target will move the pair further downwards to 0.9875. The pivot point stands at 0.9990. In case the price moves in the opposite direction and bounces back from the support level, it will move above its pivot point. It is likely to move further to the upside. According to that scenario, long positions are recommended with the first target at 1.0030 and the second target at 1.0085.

Resistance levels: 1.0030, 1.0085, 1.0125

Support levels: 0.9910, 0.9875, 0.9825

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Technical analysis of NZD/USD for January 04, 2016

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NZD/USD is under pressure. The pair failed to break above its nearest key resistance at 0.6820 after the recent tests, and remains under pressure below its falling 50-period moving average. At the current stage, the pair seems more likely to test its support at 0.6735 in the coming trading hours. The relative strength index is negative without showing any reversal signs. To sum up, as long as 0.6820 holds on the upside, look for a new pullback to 0.6735 and 0.6715 in extension.

Trading recommendations:

The pair is trading below its pivot point. It is likely to trade in a lower range as long as it remains below the pivot point. Short positions are recommended with the first target at 0.6735. A break of that target will move the pair further downwards to 0.6715. The pivot point stands at 0.6820. In case the price moves in the opposite direction and bounces back from the support level, it will move above its pivot point. It is likely to move further to the upside. According to that scenario, long positions are recommended with the first target at 0.6845 and the second target at 0.6885.

Support levels: 0.67305, 0.6715, 0.6665

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Technical analysis of GBP/JPY forJanuary 04, 2016

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GBP/JPY is under pressure. The pair has accelerated to the downside after breaking down its previous support at 176.85, which should now play a key resistance role. The first target to the downside is set at the horizontal support and overlap at 175. A break below this level would open the way to further weakness towards 174.50.

Trading recommendations:

The pair is trading below its pivot point. It is likely to trade in a lower range as long as it remains below the pivot point. Short positions are recommended with the first target at 175. A break of that target will move the pair further downwards to 174.50. The pivot point stands at 176.85. In case the price moves in the opposite direction and bounces back from the support level, it will move above its pivot point. It is likely to move further to the upside. According to that scenario, long positions are recommended with the first target at 177.50 and the second target at 178.30.

Resistance levels: 177.50, 178.30, 179

Support levels: 175, 174.50, 174

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Global macro overview for 04/01/2016

Global macro overview for 04/01/2016:

The Chinese PMI manufacturing index data has been released overnight and it has disappointed market participants. The index was at the level of 48.2 in December versus 48.6 points in November. The reading is clearly worse than economists has expected (49 points) and it is still, 10th time in a row, lower than the key level of 50 points. He Fan, head economist of Caixin Insight Group said: '' The newest PMI reading shows that forces responsible for creating the economic prosperity have met some headwinds, and the economy is in the risk of further slowdown''.

The gold prices have bounced from the support at the level of 1058 and now are trading just above the short-term trend line around the level of 1077. The next resistance is seen at the level of 1081.50.

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Technical analysis of EUR/JPY for January 4, 2016

General overview for 04/01/2016 09:30 CET

An anticipated wave c purple to the downside has developed correctly, but the whole structure might be close to invalidation if the level of 129.65 is violated. In H4 time frame, the bigger cycle wave B blue bottom is exactly at the level of 129.65 and then the bullish impulsive cycle starts in form of a wave 1. The main count is still valid, but to confirm a bullish breakout and trend reversal, the price must violate the technical resistance at the level of 131.02.

Support/Resistance:

129.65 - Bigger Time Frame Impulsive Count Invalidation Level

129.80 - WS1

130.14 - Intraday Resistance

131.02 - Technical Resistance

131.14 - Weekly Pivot

131.62 - WR1

Trading recommendations:

Daytraders should consider buying on the dips in this market with SL below the level of 129.64 and TP open for now.

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USDX technical analysis for January 4, 2016

The US dollar index has started the year in a very defensive position as sellers push it lower towards important short-term support at 98. The short-term picture is mixed and traders should be very cautious as if sellers find no resistance from buyers, then we should not cancel out a move back towards 96.

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Blue line - trend-line support

The US dollar index is testing the blue trend-line support and the Ichimoku cloud support at 98. A break below this support will push the index towards 97, which is the next important horizontal support. Breaking below it will open the way for 96.

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The weekly chart shows us that if this week continues as bad as it started, we should be expecting the US dollar index to move towards the weekly kijun-sen (yellow indicator) support at 96.60 and maybe lower towards 96 at the upper weekly cloud boundary. Resistance is at 99 and it must be broken in order to have a confirmed bullish reversal with eyes on new highs next.The material has been provided by InstaForex Company - www.instaforex.com

Technical analysis of USD/CAD for January 4, 2016

General overview for 04/01/2016 09:00 CET

The corrective cycle in wave 4 might be completed as the triangle pattern on this pair is clearly visible. There is still one more wave up needed to complete the impulsive wave progression, but confirmation for this wave come with the violation of the round number of 1.4000. The last wave 5 will have a new high above this level.

Support/Resistance:

1.4058 - WR3

1.4000 - Round Number Resistance|WR2|

1.3923 - WR1

1.3872 - Weekly Pivot

1.3814 - Intraday Support

1.3807 - WS1

Trading recommendations:

Daytraders should consider buying on the dips in this market with SL below the level of 1.3814 and TP open for now.

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Gold technical analysis for January 4, 2016

The gold price continues trading sideways between $1,090-$1,040. With weekly stochastic still at oversold levels, despite the new lows and overall dollar strength, gold has not collapsed and, as expected, the downside is very limited. On the other hand the upside potential remains good.

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Blue lines - triangle pattern

Red line - important support

The gold price continues trading sideways and has formed a triangle pattern with the $1,077 upper boundary and $1,050, the lower one. After a break above $1,077 we should expect the long-awaited bounce towards $1,120-30 to appear. A break of $1,050 can open the way for the sub-move of $1,000 in what I see the final leg of the decline from its all time highs.

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Red lines - downward sloping wedgeYellow line - long-term resistance

Blue lines - long-term Fibonacci retracements

With weekly stochastic still at oversold levels and near the lower wedge boundary, I still favor the bullish scenario with a bounce at least towards $1,120-30. The long-term trend remains bearish as the price is below the Ichimoku cloud, but I believe it is possible to see the cloud being tested.

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Elliott wave analysis of EUR/NZD for January 4, 2016

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Wave summary:

The wave ii tooled us all the way down to 1.5794 just above the start of the wave i at 1.5784. Second waves are allowed to correct 100% of the first wave, but they must never ever break below the start point of the first wave. In this case, the wave ii stopped just 10 pips before the starting point of the wave i and thereby sustained the count we have been working since early December.

In the short term, we will be looking for support at 1.5997 and a break above 1.6220 as the next important resistance to break is on the way higher to at least 1.6935.

Trading recommendation:

We bought EUR at 1.5810 and will move our stop higher to 1.5925. If you are not EUR long already, then buy near 1.5997 and use the same stop at 1.5925.

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Elliott wave analysis of EUR/JPY for January 4, 2016

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Wave summary:

A direct break below important support at 131.00 was the deciding factor. That break indicated that the wave (ii) ended at 134.59; and the wave (iii), lower to 126.05 and more likely even lower towards 116.13, which is now unfolding.

In the short term, we will ideally see resistance at 130.55 protecting the upside from a break below 129.62 confirming more downside pressure towards 126.05 and lower.

Trading recommendation:

Our stop + reverse at 130.95 was hit, meaning we are now short from 130.95 and we will place our new stop at 130.65.

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Technical analysis of EUR/USD for January 04, 2016

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When the European market opens, some economic reports will be released. For instance, data on Final Manufacturing PMI, German Final Manufacturing PMI, French Final Manufacturing PMI, Italian Manufacturing PMI, Spanish Manufacturing PMI, and German Prelim CPI m/m will be disclosed.The US will release its economic reports on the ISM Manufacturing Prices, Construction Spending m/m, ISM Manufacturing PMI, Final Manufacturing PMI. So amid the statistics, EUR/USD will move with low to medium volatility during this day.

TECHNICAL LEVELS FOR TODAY:

Breakout BUY Level: 1.0897.

Strong Resistance:1.0891.

Original Resistance: 1.0880.

Inner Sell Area: 1.0869.

Target Inner Area: 1.0844.

Inner Buy Area: 1.0819.

Original Support: 1.0808.

Strong Support: 1.0797.

Breakout SELL Level: 1.0791.

Disclaimer: Trading Forex (foreign exchange) on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.

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Technical analysis of USD/JPY for January 04, 2016

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In Asia, Japan will release its reports on Final Manufacturing PMI and the US will also unveil its economic data such as ISM Manufacturing Prices, Construction Spending m/m, ISM Manufacturing PMI, Final Manufacturing PMI. So there is a big probability that the USD/JPY will move with low to medium volatility during this day.

TECHNICAL LEVELS FOR TODAY :

Resistance. 3: 121.02.

Resistance. 2: 120.78.

Resistance. 1: 120.55.

Support. 1: 120.25.

Support. 2: 120.01.

Support. 3: 119.78.

Disclaimer: Trading Forex (foreign exchange) on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.

The material has been provided by InstaForex Company - www.instaforex.com

Daily analysis of major pairs for January 4, 2016

EUR/USD: The inability of EUR/USD to go further higher has resulted in a weak bearish movement. The price is now threatening to test the support line at 1.0850, which is most likely to occur. According to all indications, the bears would succeed in driving EUR/USD further down this week.

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USD/CHF: The sudden weakness in the franc caused this pair to break out of its long-term base last week. Because of the bullish breakout, there is now a bullish signal in the market, and there is a tendency that the market could trend further higher from here. If it happens, the resistance levels at 1.0050 and 1.0100 could be reached soon.

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GBP/USD: The GBP/USD moved down by 170 pips last week, closing below the distribution territory at 1.4750. There is still a great probability that the market could continue going further down because the outlook on the GBP/USD (including other GBP pairs) is bearish. The price might test the accumulation territories at 1.4700 and 1.4650 this week.

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USD/JPY: This currency trading instrument simply consolidated last week. A closer look at the chart shows that the price consolidated to the downside at the close of trading activities last week, testifying to the ongoing weakness in the market. It is possible that the market would continue moving further downwards this week.

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EUR/JPY: The weakness in the euro caused the EUR/JPY to drop by 150 pips last week. This cross' movements would be determined by whatever happens to the euro. The price might attain the demand zones at 130.00 and 129.50 before the end of this week because there is a bearish confirmation pattern in the market.

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Technical analysis of GBP/USD for January 04, 2016

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Overview:

  • The market continues showing signs of weakness following the break at 1.4799 (support has become resistance). Therefore, the GBP/USD pair's support has been broken and it was turned into resistance last week. Moreover, the pair has already formed a strong resistance at the level of 1.4799 (the weekly pivot point). So, the market indicates a bearish opportunity at the level of 1.4799 with the first target of 1.4700 and continues towards 1.4665. On the other hand, if the trend fails to break this level and close below 1.4665, then upside momentum is rather convincing and the structure of the rise does not look corrective. Additionally, the market will indicate a bullish opportunity at 1.4665, thus it will be a good sign to buy at this level (1.4665) with targets at 1.4733 and 1.4790.

Weekly technical analysis of GBP/USD:

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Technical analysis of EUR/USD for January 04, 2016

The weekly technical analysis of the EUR/USD pair:

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Overview:

  • The support will be at the level of 1.0811, but the double bottom is going to set at 1.0852. According to previous events, the EUR/USD pair has called for the bearish market from the price of 1.0902 because the price of 1.0902 represents strong resistance (the weekly pivot point) this week. Moreover, the weekly pivot point at 1.0902 could hit the moving average (100). Our preference is to sell below the weekly pivot point at 1.0902 with the first target at 1.0852 in order to test the double bottom. Additionally, if the pair breaks the price of 1.0852, then it will continue towards 1.0811 with a view to test the weekly support 1 on January 04, 2015. However, the stop loss has always been taken into account, thus it will be useful to set it above the resistance at the level of 1.0965. Besides, stop loss should never exceed your maximum exposure amounts.
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Daily analysis of USDX for January 04, 2016

USDX starts the year and the week with a bullish tone above the support level of 98.66 and the 200 SMA on the H1 chart. There is still a structure that is favoring more bullish bias towards the 98.90 level on a short-term basis because the fractals are configured for it. A strong support is seen around the 98.14 level. The MACD indicator is at the positive territory.

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H1 chart's resistance levels: 98.90 / 99.07

H1 chart's support levels: 98.66 / 98.14

Trading recommendations for today: Based on the H1 chart, place buy (long) orders only if the USD index breaks with a bullish candlestick; the resistance level is 98.90, take profit is at 99.07, and stop loss is at 98.72.

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Daily analysis of GBP/USD for January 04, 2016

According to the H1 chart, GBP/USD is doing a strong bearish consolidation below the 1.4802 level, after a sideways range move before the New Year's eve. Currently, we can expect a decline below the 1.4702 level, which would open the doors to test the 1.4608 level on a short-term basis. The 200 SMA in this time frame is still pointing to the downside. The MACD indicator is at the negative territory.

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H1 chart's resistance levels: 1.4802 / 1.4918

H1 chart's support levels: 1.4702 / 1.4608

Trading recommendations for today: Based on the H1 chart, place sell (short) orders only if the GBP/USD pair breaks a bearish candlestick; the support level is 1.4702, take profit is at 1.4608, and stop loss is at 1.4793.

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