NZD/USD intraday technical levels and trading recommendations for May 2, 2016

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On January 28, the depicted support at 0.6400 acted as a prominent key level offering a valid buy entry. The 0.6550 level was broken above a few weeks ago.

Bullish persistence above 0.6550 (depicted recent support) was necessary to keep the price moving towards higher bullish targets.

The price zone of 0.6750-0.6840 constituted a significant resistance zone where signs of a bearish rejection were seen during the previous few weeks (triple-top reversal pattern).

On February 9, the NZD/USD pair failed to consolidate below the depicted support level at 0.6550.

Moreover, an obvious bullish recovery was expressed around the depicted temporary support level. Hence, the recent bullish swing towards 0.6750 and 0.6860 was initiated.

In March, an obvious bullish breakout above 0.6750 and 0.6860 was executed. Hence, these price levels now constitute recent support levels to be watched for valid buy entries.

Conservative traders should use a valid buy entry around the 0.6760 mark. It is already running in profits. S/L should be raised to 0.6880 to offset the risk and secure more profits.

This week, bullish persistence above 0.6850 (recent support) is mandatory to maintain enough bullish momentum in the market.

The recent bearish pullback towards 0.6850 was considered as a valid signal to BUY the pair.

It's already running in profits now. Bullish targets are located at 0.6960, 0.7050, and 0.7150 where the upper limit of the depicted channel is located.

On the other hand, a daily closure below the 0.6850 level enhances a quick bearish movement towards 0.6750 ( Low probability).

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USD/CAD intraday technical levels and trading recommendations for May 2, 2016

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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 significant bearish rejection was observed around 1.3450. Hence another consolidation range was established from 1.3450 down to 1.2800.

On December 7, a bullish breakout above 1.3450 (upper limit of the recent consolidation range) enhanced the bullish side of the market. Hence a bullish visit to the resistance at 1.4120 (Fibonacci Expansion 100%) occurred.

Bullish persistence above 1.4150 enhanced the bullish side of the market towards 1.4650 (141.4% Fibonacci expansion) where an evident bearish rejection was expected (bearish engulfing weekly candlestick).

The 1.4120 level (Fibonacci Expansion 100%) stood as a significant resistance level where a significant bearish rejection was applied.

Although the area of 1.3050-1.3250 was expected to offer bullish support for the USD/CAD pair, the same price zone was broken below as depicted on the daily chart.

The 1.3300 level stands as a significant resistance as it corresponds to the 50% Fibonacci level and the backside of the broken weekly uptrend where a valid sell entry was suggested on March 24.

Since March 18, the USD/CAD pair had been trapped within the consolidation range between 1.3300 and 1.2970 until a bearish breakout took place on April 11.

Traders were instructed to consider the recent pullback towards 1.2970 (61.8% Fibonacci level) as a valid signal to sell the USD/CAD pair. This trade is currently running in profits.

The USD/CAD pair should keep trading below 1.2800 and 1.2650 (recent support levels) in order to reach the next support level located at 1.2400 where price action should be watched for a possible bullish pullback.

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Technical analysis of EUR/GBP for May 02, 2016

EUR/GBP continues moving higher producing higher highs and higher lows. Pair formed a strong support area near 0.7700 and now it has very hard time getting anywhere lower.

On the 2nd of March, EUR/GBP rejected the same support level (0.7700) where at the same time it rejected the 200 Moving Average. Clearly this level acts as a key support and while it is holding, an uptrend is very likely to continue.

Consider buying EUR/GBP at the current rate (0.7830) targeting the 361.8% Fibonacci level (0.8210) applied to the first corrective wave down after breaking prior resistance at 0.7700. The stop loss should be just below S1 (0.7710)

Support: 0.7710

Resistance: 0.7850, 0.7940, 0.8070, 0.8210

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Technical analysis of GBP/CHF for May 02, 2016

GBP/CHF is still trending down without being able to produce new higher high. Pair formed a strong resistance area between 1.4200 and 1.4300. Last week, this resistance was tested once again and rejected forming a bearish divergence on the RSI oscillator.

Fibonacci applied to the descending channel breakout point shows that rate failed to test 23.6% after breaking below the 38.2% level. Consider selling GBP/CHF at the current rate (1.4040) targeting the 23.6% support - S5 (1.3360). The stop loss should be just above the R1 (1.4285).

Support: 1.4000, 1.3820, 1.3680, 1.3535, 1.3360

Resistance: 1.4285

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Gold analysis for May 02 , 2016

Since our previous analysis, gold has been moving upwards. As I expected, the price tested the level of $1,301.93 in a high volume. My take profit level at the price of $1,284.50 has been reached. According to the 15M time frame, I found successful testing of supply today (a narrow spread of the bar in a low volume), which is a sign that we may see an upward continuation. The intraday trend is upward, so watch for buying opportunities on the dips. The level of $1,300.00 seems like a solid area to build buying positions. The first take profit level is set at the price of $1,304.00.The second take profit level is set around the price of $1,307.00 and the third take profit level is set at the price of $1,313.00.

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Daily Fibonacci pivot points:

Resistance levels:

R1: 1,298.00

R2: 1,299.00

R3: 1,301.35

Support levels:

S1: 1,293.75

S2: 1,292.40

S3: 1,290.00

Trading recommendations for today: Be careful when selling gold at this stage and watch for potential buying opportunities.

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EUR/NZD analysis for May 02, 2016

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Recently, EUR/NZD has been moving sideways at the price of 1.6360. According to the 1H time frame, I found a rounding bottom pattern (reversal pattern) in the background, which is a sign that intraday selling looks risky. I placed the Fibonacci expansion to find the potential end of the bearish correction and I got the Fibonacci expansion of 61.8% at the price of 1.6350. The short-term trend is bullish. So, watch for buying opportunities on the dips. The first take profit level is set at the price of 1.6425 and the second take profit level is set at the price of 1.6590.

Fibonacci Pivot Points:

Resistance levels:

R1: 1.6425

R2: 1.6465

R3: 1.6530

Support levels:

S1: 1.6295

S2: 1.6255

S3: 1.6190

Trading recommendation for today: Be careful when selling EUR/NZD and watch for buying opportunities on the dips.

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Technical analysis of GBP/USD for May 2, 2016

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Overview:

  • The GBP/USD pair faced strong resistances at the levels of 1.4670 and 1.4717. So, the strong resistance has been already formed at the levels of 1.4670 - 1.4717.and the pair is likely to try to approach it in order to test it again. However, if the pair fails to pass through the level of 1.4717 (major resistance), the market will indicate a bearish opportunity below the new strong resistance level of 1.4670 (the level of 1.4670 coincides with the double top). Moreover, the RSI starts signaling a downward trend because it is seen below 50, but also it should be noted that the trend is still showing strength above the moving average (100). Thus, the market is indicating a bearish opportunity below 1.4670 so it will be good to sell at 1.4670 with the first target of 1.4550. It will also call for a downtrend in order to continue towards 1.4449. The daily strong support is seen at 1.4449. However, the stop loss should always be taken into account, for that it will be reasonable to set your stop loss at the level of 1.1760.
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Technical analysis of EUR/USD for May 2, 2016

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Overview:

  • The EUR/USD pair opened above the support at 1.1458. The EUR/USD pair continues moving upwards from the level of 1.1458. Yesterday, the pair rose from the level of 1.1458 to the top around 1.1485. This week, the first resistance level is seen at 1.1534 followed by 1.1617, while daily support 1 is seen at 1.1376. According to the previous events, the EUR/USD pair is still moving between the levels of 1.1376 and 1.1534. For that we expect a range of 158 pips (1.1376 - 1.1534)in coming two days. If the EUR/USD pair fails to break through the resistance level of 1.1534, the market will decline further to 1.1376. This would suggest a bearish market because the RSI indicator is still in a positive area and does not show any trend-reversal signs. The pair is expected to drop lower towards at least 1.1376 with a view to test the pivot point. On the contrary, if a breakout takes place at the resistance level of 1.1534, then the market will continue towards the next objective around the spot of 1.1617.

Intraday technical levels:

  • R3: 1.1775
  • R2: 1.1617
  • R1: 1.1534
  • PP: 1.1376
  • S1: 1.1293
  • S2: 1.1135
  • S3: 1.1052
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Global macro overview for 02/05/2016

Global macro overview for 02/05/2016:

According to the National Bureau of Statistics of China, the Purchasing Managers' Index climbed to 50.1 points in April, marginally lower than March's 50.2 points, but still above the fifty-point mark that separates expansion from contraction. Moreover, data on two more sub-indices was released as well.The new factory orders decreased to 51.0 points from 51.4 points in March, and the production sub-index dropped slightly to 52.2 points from 52.3 points in March. This means that the activity in China's manufacturing sector increased for the second consecutive month, but the advance was not that impressive, so the sustainability of this pick-up might be short-lived.

The biggest trading partner of China is Australia and that is why we should take a look at the technical picture of the AUD/USD pair inthe daily time frame after the data release. The growing bearish divergence indicates a lack of strength in the bulls camp, so the recent support levels might be tested again. The first of this supports is at the level of 0.7546, the second is at 0.7489, and the third formed at the level of 0.7386. Please notice that the golden trend line might be broken if the second support level is violated and that is what bears camp needs to take back the control over the market.

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Global macro overview for 02/05/2016

Global macro overview for 02/05/2016:

The PMI Manufacturing data for the eurozone was released earlier this morning. It had been excepted that the French PMI was still above the fifty-point level (Germany 51.8, Italy 53.9, Spain 53.5). The total PMI for the eurozone was at the level of 51.7 points, a little better than last month's reading of 51.5 points. As we know that the manufacturing sector represents nearly a quarter of total eurozone GDP, this set of data looks solid and promising. In conclusion, the business conditions in the manufacturing sector does not signal any significant deterioration in the eurozone manufacturing sector. Moreover, according to the current data, a further increase of business conditions is expected.

Let's now take a look at the EUR/USD technical picture in the daily time frame after the data was released. Bulls broke above the golden trend line, but the growing bearish divergence should now prevent further advance. Moreover, the supply zone might put a lid at any further bullish rally as well. Nevertheless, if bears want to take the control over the market, they must break back below the level of 1.1215.

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Technical analysis of USD/CAD for May 2, 2016

General overview for 02/05/2016:

There is a possibility that the ending diagonal pattern is forming right now in this market. It will act as a final wave of the whole corrective structure in the wave Z. To confirm this scenario, the market must make one more sub-wave to the downside and then strongly rebound to the upside, targeting the first the intraday resistance at the level of 1.2587 and then the level of 1.2756. Otherwise the corrective wave progression will evolve into a more complex and time consuming pattern.

Support/Resistance:

1.2434 - WS1

1.2498 - Intraday Support

1.2574 - Weekly Pivot

1.2587 - Intraday Resistance

1.2651 - WR1

1.2694 - Intraday Resistance

1.2756 - Wave XX High

1.2792 - WR2

1.2873 - WR3

Trading recommendations:

Day traders should consider opening buy orders only if the level of 1.2587 is clearly violated (H1 candle close above this level), with SL below the level of 1.2498 and TP at the level of 1.2694.

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Technical analysis of EUR/JPY for May 2, 2016

General overview for 02/05/2016:

There are two possible Elliott wave counts for the current situation and both of them are pointing out more gains. The main count indicates an (a)(b)(c) irregular flat corrective cycle with the (c) leg yet to unfold. The (b) leg of this cycle is currently completed with the bottom at the level of 121.68. The alternative count however indicates that the top for the big wave B is already in place at the level of 126.45 and since then the impulsive structure in big wave C started to develop to the downside. Wave 1 of this cycle is completed and now the market should develop an internal corrective cycle to the upside, targeting the levels of 122.97 and if broken, 124.30. Please notice, that the growing bullish divergence between the price and momentum oscillator supports both views at the time of writing.

Support/Resistance:

119.54 - WS1

121.68 - Intraday Support

122.32 - Intraday Resistance

122.97 - Weekly Pivot

123.37 - Intraday Resistance

124.30 - WR1

126.45 - Swing High

Trading recommendations:

Day traders should consider openig buy orders only if the level of 122.32 is clearly violated (H1 candle close above this level), with SL below the level of 121.68 and TP at the level of 123.67.

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Technical analysis of USD/JPY for May 02, 2016

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USD/JPY is expected to trade with bearish bias with 106.20 in sight. Last Friday, the U.S. stock indices extended their losses weighed down by continued weakness in technology stocks, and also by profit-taking by investors who viewed stock valuation as stretched. The Dow Jones Industrial Average declined 0.3% to 17,773, the S&P 500 dropped 0.5% to 2,065, and the Nasdaq Composite was down 0.6% to 4,775.

Nymex crude oil declined 0.2% to $45.92 a barrel, gold surged another 2.2% to $1,293 an ounce, silver jumped 1.7% to $17.82 an ounce, and the benchmark 10-year Treasury yield eased to 1.821% from 1.838% on Thursday.

On the forex front, the U.S. dollar weakened broadly against other major currencies, with the Wall Street Journal Dollar Index dropped 0.6% to 84.98, its lowest level since May 2015. Following a 3.0% plunge on Thursday, USD/JPY slid another 1.6% to 106.35 after chalking an 18-month low of 106.27. EUR/USD rose 0.9% further to 1.1454, and GBP/USD added 3 pips to 1.4611. The pair keeps trading on the downside while being capped by the descending 20-period (30-minute chart) moving average. The intraday bearish bias is also maintained by the descending 50-period moving average. Meanwhile the intraday relative strength index remains below the neutrality level at 50 lacking upward momentum. The intraday outlook continues to be very bearish, and the pair is expected to break below the immediate support at 106.20 before sinking further towards 105.50.

Trading Recommendation:

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 106.20. A break of this target will move the pair further downwards to 105.50. The pivot point stands at 107.85. 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 108.75 and the second target, at 109.90.

Resistance levels: 108.75, 109.90, 110.65

Support levels: 106.20, 105.50, 105

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Technical analysis of USD/CHF for May 02, 2016

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USD/CHF is expected to trade in a lower range. The pair is heading downward within its intraday declining channel in place since April 27, 2016. The falling 20-period and 50-period moving averages also act as resistance levels, which should continue pushing the prices lower. Furthermore, the relative strength index lacks upward momentum. In these perspectives, as long as 0.9655 holds on the upside, look for further downsides to 0.9560 and 0.9530 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 0.9560. A break of this target will move the pair further downwards to 0.9530. The pivot point stands at 0.9655. 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 this scenario, long positions are recommended with the first target at 0.9730 and the second one, at 0.9765.

Resistance levels: 0.9700, 0.9730, 0.9765

Support levels: 0.9560, 0.9530, 0.95

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Technical analysis of NZD/USD for May 02, 2016

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NZD/USD is expected to post further advance. The pair remains on the upside within a bullish channel, and it is more likely to challenge its nearest resistance at 0.7025 in the coming trading hours. The horizontal support at 0.6930 should limit any downward attempts. In addition, the relative strength index is still bullish above its neutrality area at 50. To sum up, as long as 0.6930 is not broken, pair is likely to advance to 0.7025 and 0.7055 in extension.

Trading recommendations:

The pair is trading above its pivot point. It is likely to trade in a wider range as long as it remains above its pivot point. Therefore, long positions are recommended with the first target at 0.7025 and the second one, at 0.7055. In the alternative scenario, short positions are recommended with the first target at 0.6890 if the price moves below its pivot points. A break of this target is likely to push the pair further downwards, and one may expect the second target at 0.6865. The pivot point is at 0.6930.

Resistance levels: 0.7025, 0.7055, 0.71

Support levels: 0.6890, 0.6865, 0.6835

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Technical analysis of GBP/JPY for May 02, 2016

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GBP/JPY is expected to trade with bearish bias. The pair still remains under pressure below its key resistance at 157.15. Meanwhile the relative strength index lacks strong upward momentum. As long as 157.15 is not broken up, the first target to the downside is set at 154. A break below this level would open the way to further weakness towards 153.15.

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 154. A break of this target will move the pair further downwards to 153.15. The pivot point stands at 157.15. 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 158.40 and the second target at, 159.10.

Resistance levels: 158.40, 159.10, 159.95

Support levels: 154, 153.15, 152.20

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Technical analysis of USDX for May 2, 2016

The dollar index continues its downtrend as we expected towards 93. Longer-term support is found at 92.50 and as we have no reversal sign yet we could continue the move lower. Several indicators are oversold and this should raise our awareness and bears should be very cautious.

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Black lines - sideways channel

The dollar index remains in a bearish trend after breaking below the sideways channel. The price is below the Kumo confirming the bearish trend. The stochastic oscillator and the RSI are oversold and this is a warning for bears. Our 93 target has been reached so bears should be extra cautious. Resistance is at 93.30 and at 93.90.

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The weekly chart shows how the price is testing the weekly Kumo (cloud). The 38% Fibonacci retracement support is at 92.50 and with the stochastic oversold, dollar bears need to be very cautious. The risk reward for being bearish in the dollar at current levels is not worth taking. Being bearish now requires tight stops. The next target is 92.50.The material has been provided by InstaForex Company - www.instaforex.com

Technical analysis of Gold for May 2, 2016

Gold has broken above the important short-term resistance levels of $1,260-70 and has given new highs. A top around $1,300-$1,320 is still very probable as gold's bullish momentum is not as strong and oscillators enter overbought levels. I continue to believe upside potential is limited and I prefer to wait for a bigger pullback towards $1,150 to open long positions.

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Black lines - support levels

Yellow area - overbought stochastic diverging

Gold remains above the Ichimoku cloud on the 4-hour chart. The trend remains bullish. Short-term support is found at $1,281 and at $1,263. The stochastic and RSI oscillators are providing a warning for bulls as they are at overbought levels. No reversal signal yet.

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The weekly chart remains bullish as the price has broken above resistance. The trend is bullish as the weekly Kumo is below the price. Support is found now at $1,250 by the tenkan-sen and at $1,170 by the kijun-sen. The stochastic is diverging and this is another warning for bulls. No reversal sign on the weekly chart yet. $1,320 could be seen before any meaningful pullback.The material has been provided by InstaForex Company - www.instaforex.com

Technical analysis of Silver for May 02, 2016

Technical outlook and chart setups:

Silver is seen to be consolidating between $17.70 and $17.90 levels today, after hitting fresh highs at $17.95 levels last week. As seen on the daily chart view, the metal is producing a doji candlestick pattern as well, indicating a potential bearish reversal. On the flip side, a major resistance is seen at $18.40/50 levels and bulls might want to take that out before turning lower. In either case, a top and reversal should be on cards from here on. It is hence recommended to remain flat for now and look for further confirmation before taking a short decision. Immediate resistance is seen at $18.40/50 levels, while support is at $16.75 levels respectively.

Trading recommendations:

Remain flat for now, looking to go short on a bearish reversal.

Good luck!

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Technical analysis of Gold for May 02, 2016

Technical outlook and chart setups:

Gold is seen to be trading above $1,293.00 levels at this moment, consolidating its recent rally. As depicted here, the yellow metal should be heading towards $1,307.00/10.00 resistance levels before producing a meaningful correction. Please note that the fibonacci 0.382 support is seen at $1,200.00 levels, as depicted here. It is recommended to remain flat for now, and wait for the yellow metal to produce a bearish reversal at current or at $1,307.00/10.00 levels. Immediate resistance is seen at $1,307.00 levels, while support is at $1,275.00 levels respectively. The metal remains in control of bulls at the moment.

Trading recommendations:

Remain flat for now, look to go short at higher levels ($1,307.00/10.00).

Good luck!

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Technical analysis of EUR/JPY for May 02, 2016

Technical outlook and chart setups:

The EUR/JPY pair is seen to be trading higher at 122.24 levels, after hitting lows at 121.45/50 levels last week. The drop from 126.40 levels looks to be an impulse (5 waves). A rally above 123.00 levels would confirm that a meaningful low has been formed at 121.45 levels and that the countertrend might push the price higher into 124.50 levels. It is hence recommended to remain flat for now and wait for the pair to break above 123.00/30 levels at least, to go long again. Immediate support is seen at 122.47 levels, while resistance is seen at 123.00 levels. Bulls might be poised to push the pair higher, till EUR/JPY remains above 121.50 levels.

Trading recommendations:

Remain flat for now, looking to buy at lower levels.

Good luck!

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Technical analysis of GBP/CHF for May 02, 2016

Technical outlook and chart setups:

The GBP/CHF pair dropped to 1.3917 levels today in early hours trade before pulling back sharply. The pair is trading above 1.4000 levels at the moment, looking to rally towards higher levels. Please note that the pair broke below its trend line support but has found support close to fibonacci 0.50 levels of the rally between 1.3400 through 1.4200 levels, as depicted here. It seems that the pair has terminated its wave 4 and resumed the rally towards 1.4290 levels. It is still recommended to remain long with risk at 1.3900 levels. Immediate support is seen at 1.3900 levels, while resistance is at 1.4290 levels respectively.

Trading recommendations:

Remain long now, stop at 1.3900, target 1.4300.

Good luck!

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Elliott wave analysis of EUR/NZD for May 2 - 2016

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Wave summary:

The very slow start of what we expect is a new major rally to above 1.6833 and much higher is still developing in a slow motion way. That said, we are currently looking for minor support at 1.6231 to protect the downside for a break above minor resistance at 1.6433 and, more importantly, resistance at 1.6592 to confirm the next rally to resistance at 1.6833 and above.

Only a break below minor support at 1.6231 will yet again delay the expected recovery.

Trading recommendation:

We are long in EUR from 1.6365 and lift our stop to 1.6225. If you are not long in EUR yet, then buy a break above 1.6433 and use the same stop at 1.6225.

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Elliott wave analysis of EUR/JPY for May 2 - 2016

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Wave summary:

EUR/JPY has broken below the important support at 121.69 (a low has been seen at 121.66). The break below 121.69 does open a window for a decline all the way to the 117.37 - 117.99 area before the corrective low is finally in place. That said, we are seeing a clear loss of momentum which could mean that at least a reaction will be seen soon for a rally to 123.32 and maybe even higher to 124.60 before the final decline.

It will take a break above 126.47 to confirm that an important low is in place.

Trading recommendation:

We are long in EUR from 122.85 with stop placed at 121.65.

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Technical analysis of EUR/USD for May 02, 2016

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When the European market opens, some economic news will be released such as the Final Manufacturing PMI, German Final Manufacturing PMI, French Final Manufacturing PMI, Italian Manufacturing PMI, and Spanish Manufacturing PMI. The US will release economic data too such as the Loan Officer Survey, ISM Manufacturing Prices, Construction Spending m/m, ISM Manufacturing PMI, and Final Manufacturing PMI. So amid the reports, EUR/USD will move with low to medium volatility during this day.

TODAY'S TECHNICAL LEVELS:

Breakout BUY Level: 1.1515.

Strong Resistance: 1.1508.

Original Resistance: 1.1497.

Inner Sell Area: 1.1483.

Target Inner Area: 1.1459.

Inner Buy Area: 1.1432.

Original Support: 1.1421.

Strong Support: 1.1410.

Breakout SELL Level: 1.1403.

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 May 02, 2016

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In Asia, Japan will release the Final Manufacturing PMI and the US will release some economic data such as the Loan Officer Survey, ISM Manufacturing Prices, Construction Spending m/m, ISM Manufacturing PMI, and Final Manufacturing PMI. So there is a probability the USD/JPY will move with low to medium volatility during this day.

TODAY'S TECHNICAL LEVELS:

Resistance. 3: 106.87.

Resistance. 2: 106.66.

Resistance. 1: 106.45.

Support. 1: 106.20.

Support. 2: 105.99.

Support. 3: 105.78.

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.

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Daily analysis of major pairs for May 2, 2016

EUR/USD: The EUR/USD went upwards by 230 pips last week. The movement lasted a week and has resulted in a bullish bias in the market. The resistance line at 1.1450 has already been tested, and the price is expected to go above it this week, testing other resistance lines at 1.1500 and 1.1550.

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USD/CHF: This pair also went down throughout last week, owing to the stamina in the EUR/USD and the CHF. The price closed below the resistance level at 0.9600 on Friday, April 29, 2016. The price had already fallen by 220 pips – leading to a Bearish Confirmation Pattern in the market. Further bearish movement is expected this week.

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GBP/USD: The Cable went upwards gradually last week, sustaining the bullish trend which started two weeks ago. The bulls fought a decisive battle at the distribution territory of 1.4600 (which is now an accumulation territory). They are now fighting another desperate battle at the distribution territory of 1.4650, which would be overcome because the outlook on the Cable is bright for the month of May (it is also bright for crosses like GBP/AUD, and GBP/NZD).

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USD/JPY: This pair moved sideways between Monday and Wednesday and dropped like a stone on Thursday. That drop was strong enough to bring about a new Bearish Confirmation Pattern on the 4-hour chart. The EMA 11 has gone below the EMA 56, while the RSI period 14 is below the level 50. The price is expected to go further south, reaching the demand levels at 106.00 and 105.50. This bearishness would also be visible on other JPY pairs this month.

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EUR/JPY: The EUR/JPY went upwards from Monday to Wednesday last week but broke down as a result of the fundamental figures released on Thursday, April 28, 2016. The price skydived by 450 pips, almost testing the demand zone at 121.50. This large pullback has resulted in a bearish signal in the market, for the price is supposed to go further south this week. Other JPY pairs are also bearish and as a result of this, long trades are not currently logical on JPY pairs until there are clear reversals on them. However, there could be a rally in JPY pairs at the end of May 2016.

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Daily analysis of USDX for May 02, 2016

We could be in front of a possible double bottom pattern on the H1 chart, where the USDX is finding strong support around the 93.72 level. However, this corrective move may be taken as a possible lower low pattern formation in order to extend the decline to reach new lows. If a breakout happens below the 93.72 zone, then the price can fall to the 93.26 level.

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H1 chart's resistance levels: 94.02 / 94.26

H1 chart's support levels: 93.72 / 93.26

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 at 93.72, take profit is at 93.26, and stop loss is at 94.20.

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Daily analysis of GBP/USD for May 02, 2016

GBP/USD has been dealing with the strong resistance around the 1.4633 level, in which a breakout could produce another rally to reach new lows, possibly toward the 1.4722 level, which is a key level for sellers, who are highly active. Another scenario could be telling us about a possible pullback to test the 200 SMA, before the pair performs further rebounds in favor of the bullish side.

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H1 chart's resistance levels: 1.4633 / 1.4722

H1 chart's support levels: 1.4549 / 1.4495

Trading recommendations for today: Based on the H1 chart, place buy (long) orders only if the GBP/USD pair breaks a bullish candlestick; the resistance level is at 1.4633, take profit is at 1.4722 and stop loss is at 1.4546.

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