Global macro overview for 23/12/2016

Global macro overview for 23/12/2016:

At the end of this trading week a bunch of economic data from the US was released. US Final GDP posted an excellent gain of 3.5%, exceeding the forecast of 3.3%. On the other hand, durable goods orders reports were mixed. While core durable goods orders gained 0.5% versus the forecast of 0.2%, durable goods orders posted a sharp decline of 4.6%. Still it was better than the forecast of -4.9%. The job market data were sligthly worse than anticipated. Initial unemployment claims jumped to 275k while economists expected a rise of 255k. Still, the four-week average of jobless claims remains at low levels.

Let's now take a look at the US dollar index technical picture on the daily time frame. The bulls are still in control over this market as the price is trading near the recent swing highs around 103.00 level. Nevertheless, a corrective cycle is a must for this market, so when the techncial support at the level of 102.58 is clearly violated, the next support is expected to be seen at the level of 102.08. In case of a further breakout, the 38%Fibo at the level of 100.69 is the most probable target level.

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Analysis of gold for December 23, 2016

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Recently, gold has been trading sideways at the price of $1,131.60. Using the market profile, I found today's point of control at the price of $1,131.20 on the 30M time frame. On this chart I found that price is trading above the 21SMA and that there is sluggish supply in the background, which is a sign of strength. Anyway, I found trading range between the price of $1,133.90 (resistance) and $1,127.60 (support). Watch for buying opportunities with the first target at $1,133.00 or for a break of trading range to confirm further direction. If the price breaches support, gold may test the level of $1,125.65.

Resistance levels:

R1: 1,131.70

R2: 1,132.75

R3: 1,134.50

Support levels:

S1: 1,128.25

S2: 1,127.20

S3: 1,125.50

Trading recommendations for today: watch for buying opportunities on the dips or for a break of trading range to confirm further direction.

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Global macro overview for 23/12/2016

Global macro overview for 23/12/2016:

The German Gfk Consumer Climate data was released today and it was just slightly better than market participants expected. The Gfk index was at the level of 9.9 points, while the expectations were 9.8 points, unchanged from last month number. Importantly, this data was collected before the recent terrosrist attack in Berlin, so the next survey might be more pessimistic than this one is.

Let's now take a look at the EUR/USD techncial picture on the 4H time frame. The market is traidng quietly in pre-Christmas mood, so the Gfk data release did not really make any substantial change. The technical support is seen at the level of 1.0352 and the next techncial resistnace lies at 1.0500.

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Technical analysis of USD/CAD for December 23, 2016

General overview for 23/12/2016:

The market is trading around the weekly pivot resistace at the level of 1.3505. The level of 1.3433 will act as an intraday support now as the market approaches the resistance level. Pay attention to the growing bearish divergence between the price and momentum oscillator.

Support/Resistance:

1.3503 - WR1

1.3479 - 78%Fibo

1.3433 - Intraday Support

1.3322 - Intraday Support

1.3292 - Weekly Pivot

1.3269 - Intraday Support

1.3167 - WS1

Trading recommendations:

The buy orders should be closed with profit at the level of 1.3479. Currently, traders should wait for another trading setup to occur shortly.

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Technical analysis of EUR/JPY for December 23, 2016

General overview for 23/12/2016:

The top for the wave d (green) might be in place and now the market is trying to develop the wave e (green) of a triangle pattern. Break below the intraday support at the level of 122.79 will lead to the immediate test of the wave (a) low at the level of 122.20.

Support/Resistance:

124.43 - WR1

124.07 - Technical Resistance

123.20 - Intraday Resistance

123.01 - Weekly Pivot

122.79 - Intraday Resistance

121.93 - WS1

120.52 - WS2

Trading recommendations:

Daytraders should consider opening sell positions only if the intraday support at the level of 122.79 is clearly violated. TP should be set at the level of 122.20.

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Analysis of EUR/NZD for December 23, 2016

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Recently, EUR/NZD has been moving sideways at the price of 1.5130. Using the market profile, I found today's point of control at 1.5115 on the 30M time frame. The price is trading above the 21SMA and there is a successful test of supply, which is a sign of strength. My advice is to watch for buying opportunities on dips. I placed Fibonacci expansion to find potential upward targets. I got Fibonacci expansion 61.8% at the price of 1.5225. Anyway, the first upward target is set at the price of 1.5170 (most recent swing high)

Fibonacci Pivot Points:

Resistance levels

R1: 1.5160

R2: 1.5185

R3: 1.5225

Support levels:

S1: 1.5080

S2: 1.5050

S3: 1.5010

Trading recommendations for today: watch for buying opportunities.

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Intraday technical levels and trading recommendations for NZD/USD for December 23, 2016

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During August and September, a consolidation range was established from the price level of 0.7250 up to 0.7350.

Later on October 20, the lower limit of the consolidation range (0.7250) stood as a temporary resistance which initiated a bearish movement toward 0.7100 (lower limit of the depicted channel).

Bullish recovery was expressed around the price level of 0.7100 on October 28. Hence, a double-bottom pattern was seen on the chart.

Bullish fixation above 0.7250 and 0.7350 was needed to allow further advance toward the projected target of the reversal pattern around 0.7450.

However, significant signs of a bearish reversal were expressed around the upper limit of the price range (0.7350).

The bearish breakdown of 0.7250 (lower limit of the depicted range) enhanced the bearish side of the market toward the price level of 0.7100 (recent bottom of October 28), which was broken as well.

Bearish persistence below 0.7100 allowed a quick decline toward 0.6960 (BUY zone) where bullish rejection and a valid BUY entry were expected. All T/P levels were successfully achieved.

Once again, bearish persistence below the price level of 0.7100 was needed to head toward lower target levels around 0.7060 and 0.6990 (upper limit of the depicted BUY zone).

This week, the price level of 0.6990 failed to apply enough bullish pressure. Instead, bearish continuation was achieved toward the lower limit of the depicted BUY zone (0.6860).

The NZD/USD pair remains trapped within the depicted price range (0.6860-0.6990) until a breakout occurs in either direction.

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Intraday technical levels and trading recommendations for USD/CAD for December 23, 2016

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On August 18, signs of a bullish recovery were manifested around the price level of 1.2830, which led to the current bullish breakout above 1.3000.

The USD/CAD pair was trapped between the price levels of 1.3000 (61.8% Fibonacci level) and 1.3360 (50% Fibonacci level) until a bullish breakout took place one month ago.

Note that the USD/CAD pair challenged the upper limit of the depicted channel around 1.3360-1.3400, which succeeded to apply enough bearish pressure on the pair.

Shortly after, a bearish engulfing weekly candlestick was expressed by the end of the week indicating strong resistance around 1.3550.

Bearish persistence below the price level of 1.3300 (50% Fibonacci Level) was achieved.

This allowed a further decline toward 1.3200 and 1.3080 (lower limit of the depicted channel) where bullish rejection was expressed as anticipated.

The current bullish breakout above 1.3360 (50% Fibonacci level) will probably lead to a quick bullish movement toward 1.3700-1.3750 (upper limit of the depicted channel) where bearish rejection should be expected.

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Intraday technical levels and trading recommendations for GBP/USD for December 23, 2016

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The price zone between 1.3845 and 1.3550 (historical bottoms set in January 2009) was considered a significant demand zone to be watched for bullish recovery.

However, by the end of June a significant bearish break below 1.3550 was expressed as seen on the depicted charts (fundamental reasons). Bearish persistence below the demand level at 1.3550 enhanced the bearish scenario towards the price levels around 1.2700 (bearish projection target).

Since then, the GBP/USD pair has been trapped inside the depicted consolidation range above 1.2700 until a bearish breakout took place on October 6.

Daily persistence below 1.2700 confirmed the bearish Flag pattern. That is why, a bearish projection target would be located around 1.2020.

Recently, bullish recovery was manifested around 1.2080. That is why, a bullish pullback was executed towards 1.2700-1.2750.

Risky traders could consider the recent bullish pullback towards the price zone of 1.2700-1.2750 for a valid SELL entry. S/L should be set as a daily candlestick closure above 1.2750. T/P levels should be located at 1.2300 and 1.2100.

This SELL entry should be monitored cautiously as the ascending bottoms around the price levels of 1.2120 and 1.2320 may apply significant bullish pressure against the supply zone of 1.2700-1.2750 thus threatening the suggested trade.

On the other hand, price action should be watched around the current price levels (1.2300-1.2260) where a previous top was recently established on October 19. Hence, bullish rejection should be anticipated around the current price levels.

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Intraday technical levels and trading recommendations for EUR/USD for December 23, 2016

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In January 2015, the EUR/USD pair moved below the major demand levels near 1.2100 where historical bottoms were previously set in July 2012 and June 2010. Hence, a long-term bearish target was projected towards 0.9450.

In March 2015, EUR/USD bears challenged the monthly demand level around 1.0570, which had been previously reached in August 1997.

Later in April 2015, a strong bullish recovery was observed around the mentioned demand level.

However, next monthly candlesticks (September, October, and November) reflected a strong bearish rejection around the area of 1.1400-1.1500.

Again in February 2016, the depicted price levels around 1.1400-1.1500 acted as a significant supply zone during the bullish pullback.

That is why, recent bearish rejection was expected around the depicted supply levels (note the monthly candlesticks of May, August, and October 2016).

In the longer term, the level of 0.9450 remains a projected target if the current monthly candlestick maintains its bearish closure below the depicted monthly demand level of 1.0570.

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The long-term outlook for the EUR/USD pair remains bearish as the monthly chart illustrates. Bearish persistence below 1.0825 is needed to enhance this scenario.

In September 2016, temporary bullish breakout above 1.1250 was expressed again, but evident bearish pressure was applied to the EUR/USD pair on September 16.

Closure below 1.1250 (supply level 1) maintained enough bearish pressure and enhanced the downside momentum towards the price level of 1.1000 (key level 1).

On November 9, an obvious bearish break of the 1.1000 price level occurred (Shooting Star daily candlestick). Moreover, further decline below 1.0825 (Fibonacci Expansion 100%) was expressed.

Bearish persistence below 1.0825 allowed a further fall to occur at 1.0570 (demand level) where bullish rejection and a valid BUY entry were expressed on November 24.

The price level of 1.0825 (Fibonacci Expansion 100%) constituted a recent supply level which offered a valid SELL entry on December 8. Stop Loss should be lowered to 1.0600 to secure some profits.

Bearish persistence below the depicted demand level around 1.0570 allows further bearish decline. The first bearish target would be located around 1.0220.

On the other hand, the price level of 1.0570 constitutes a recent supply level to be watched for SELL entries if a bullish pullback occurs above 1.0500.

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Technical analysis of NZD/USD for December 23, 2016

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Overview:

  • The NZD/USD pair fell from the level of 0.6966 toward 0.6882. Right now, the price is seen at 0.6904. The resistance is seen at the level of 0.6966. Moreover, the price area of 0.6966 remains a significant resistance zone. Therefore, there is a possibility that the NZD/USD pair will move downside and the structure of a fall does not look corrective. The trend is still below the 100 EMA for that the bearish outlook remains the same as long as the 100 EMA is headed downwards. Hence, amid the previous events, the price is still moving between the levels of 0.6966 and 0.6882. If the NZD/USD pair succeed to break through the bottom level of 0.6882 (breakout), the market will decline further to 0.6838 as the first target. This would suggest a bearish market because the RSI indicator is still in a negative spot and does not show any trend-reversal signs. The pair is expected to drop lower toward at least 0.6800. On the contrary, if a breakout takes place at the resistance level of 0.6966, then this scenario may become invalidated.
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Technical analysis of USD/CHF for December 23, 2016

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Overview:

  • The USD/CHF pair continued to move upwards from the level of 1.0220. The pair has risen from the level of 1.0219 to the top around 1.0270. The USD/CHF pair did not make any significant movements yesterday. There are no changes in our technical outlook. The bias remains bullish in the nearest term testing 1.0342 or higher. In consequence, the USD/CHF pair broke resistance at 1.0220, which turned into strong support at the level of 1.0220. The level of 1.0220 is expected to act as major support today. Currently, the price is moving in a bullish channel. This is confirmed by the RSI indicator signaling that we are still in a bullish market. The price is still above the moving average (100). From this point, we expect the USD/CHF pair to continue moving in the bullish trend from the support level of 1.0220-1.0250 toward the targeted level of 1.0274. If the pair succeeds in passing through the level of 1.0274, the market will indicate an bullish opportunity above the level of 1.0274 so as to reach the second target at 1.0305. Also, it should be noted that the double top will set at the point of 1.0343. On the other hand, if the USD/CHF pair is able to break out the level of 1.0220, then you should place your stop loss at the level of 1.0180.
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Daily analysis of major pairs for December 23, 2016

EUR/USD: The EUR/USD went down on Monday and Tuesday, and then began to move upwards slowly from Wednesday. All these happened in the context of a downtrend. The major bias remains bearish, and so the current shallow bullish movement would turn out to be opportunities to go short.

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USD/CHF: The USD/CHF pair is still in a bullish mode, despite the current consolidation to the downside. The price is supposed to continue going upwards this week, reaching the resistance levels at 1.0300 and 1.0350. There is a Bullish Confirmation Pattern on the 4-hour chart. The bullish outlook would be valid as long as the price does not go below the support levels at 1.0050 and 1.0000.

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GBP/USD: This pair has come down 200 pips this week. Now it is below the distribution territory at 1.2300. There is a Bearish Confirmation Pattern on the chart and the accumulation territories at 1.2250, 1.2200, and 1.1150 before the end of this month. Long trades are not recommended in this market at this period.

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USD/JPY: This is a flat market and no directional movement has been carried out so far this week. Right now, it is OK to stay away from the market because there are mixed signals – the EMAs 11 and 56 are giving bullish signs, while the RSI period 14 is giving bearish signs.

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EUR/JPY: The EUR/JPY cross is a trendless market in the near time. The price has consolidated so far this week, but a rise in momentum will happen before the end of the year, which would be a surprise. A closer look at the market reveals some bullish attempts. The expected direction in the market is bullish when momentum does arise. Bearish corrections in this market should be taken as opportunities to go long.

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Technical analysis of USD/JPY for December 23, 2016

A triangle pattern is what we focus on in the short term in order to get a pullback towards an important trend support at 115-116. The short-term trend remains neutral as the price is moving sideways.

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Red line - resistance

Blue line - support

The price is about to break the blue trend-line support. As I said yesterday, I prefer to sell near resistance and buy close to support. Soon we will have a breakout below or above the triangle and the much-anticipated move towards 116 or 119.

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Red line - important trend line support

The trend remains bullish as long as the price is above the upward sloping red trend line. Oscillators are diverging at overbought levels. Bulls need to be very cautious. Resistance is at 118.30 and if it is broken, we should expect the USD/JPY pair to move towards 119-120.

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Technical analysis of GBP/USD for December 23, 2016

GBP/USD has broken support at 1.23 and is heading towards our next targeted support area of 1.22-1.2150. The trend remains bearish, but the downside move is very close to completion.

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Blue lines - bearish channel

The price is making lower lows and lower highs. The oscillators are not making new lows and this is a bullish divergence. The short-term target for GBP/USD is the 1.2250 level. The short-term resistance is at 1.23.

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Red lines - channel

Green line - horizontal support

The GBP/USD pair has broken out and below the red channel and is heading towards the green trend line. I am not sure if we are going to reach it, but the trend remains strongly bearish. Only a move back above 1.23 and a daily close above it will be a bullish short-term signal. For a larger bullish reversal to occur, the GBP/USD pair should move higher than 1.25 levels.

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Technical analysis of USDX for December 23, 2016

The US dollar index is trading sideways inside a trading range between 103.50 and 102.50. The medium- and long-term trend remains bullish. The continuation of the upside trend is more probable as long as the price is above 101.50.

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Blue lines - trading range

The short-term support is at 102.50 where we find the Ichimoku cloud support and the lower trading range boundary. The short-term resistance is at recent highs at 103.55. The holiday season is ahead, so volatility is expected to be low.

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Red lines - bullish channel

Green line - long-term trend line support

The long-term trend remains bullish as long as the price is inside the upward sloping red channel. The price remains above the Kumo (cloud) and this confirms the long-term bullish trend. The weekly support is at 100 and next at 97. Stochastic oscillator is diverging at overbought levels. This is a warning for bulls.

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Technical analysis of gold for December 23, 2016

The gold price remains inside its sideways trading range in what it seems a triangle pattern. The short-term trend is neutral. Gold is very close to important long-term support. A bounce is expected. There has been no reversal confirmation yet.

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Blue line - short-term resistance

Green line - short-term support

The gold price is trading sideways between $1,143-$1,127. These two levels are important short-term support and resistance levels that, if broken, will at least provide a 10-20$ move.

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Red lines - downward sloping wedge

The weekly price continues to trade inside the downward sloping wedge and below the weekly cloud. Oscillators are diverging at oversold levels, but unless the price breaks above $1,150, there is no confirmation of a short-term trend change. Above $1,280-$1,300, the bullish scenario will once again become dominant.

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Technical analysis of EUR/USD for Dec 23, 2016

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When the European market opens, some economic data will be released such as French Consumer Spending m/m and GfK German Consumer Climate. The United States will release some macroeconomic statistics as well: such as Revised UoM Inflation Expectations, Revised UoM Consumer Sentiment, and New Home Sales. Amid the reports, the EUR/USD pair will move with a low to medium volatility throughout the day.

TODAY'S TECHNICAL LEVEL:

Breakout BUY Level: 1.0489.

Strong Resistance:1.0482.

Original Resistance: 1.0472.

Inner Sell Area: 1.0462.

Target Inner Area: 1.0437.

Inner Buy Area: 1.0412.

Original Support: 1.0402.

Strong Support: 1.0392.

Breakout SELL Level: 1.0385.

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 Dec 23, 2016

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Today Japan will not release any significant economic data, but the United States will release some macroeconomic reports such as Revised UoM Inflation Expectations, Revised UoM Consumer Sentiment, and New Home Sales. So there is a probability that the USD/JPY pair will move with low to medium volatility throughout the day.

TODAY'S TECHNICAL LEVEL:

Resistance. 3: 118.07.

Resistance. 2: 117.84.

Resistance. 1: 117.61.

Support. 1: 117.35.

Support. 2: 117.12.

Support. 3: 116.89

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 AUD/NZD for December 23, 2016

The price has finally dropped strongly and reached our profit target yesterday. We now turn bullish above 1.0436 support (Fibonacci retracement, horizontal swing low support, Fibonacci projection) for a bounce to at least 1.0500 resistance (swing high resistance, Fibonacci projection, Fibonacci retracement).

The RSI (34) is supported by our ascending support line.

Buy above 1.0436. Stop loss at 1.0406. Take profit at 1.0500.

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USD/CHF dropping nicely towards profit target, remain bearish

The price continues to drop towards our profit target. We remain bearish below 1.0268 resistance (Fibonacci retracement, horizontal overlap resistance) for a further push down to 1.0200 resistance (Fibonacci projection, Fibonacci retracement, horizontal overlap support).

Stochastic (21,5,3) is seeing descending resistance pushing the price down.

Sell below 1.0268. Stop loss at 1.0296. Take profit at 1.0200.

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Elliott wave analysis of EUR/NZD for December 23 - 2016

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Wave summary:

The rally from 1.4654 likely completed the first impulsive rally in wave [i] at 1.5176 and we should now look for a minor correction towards at least 1.4976 and possibly a slightly deeper correction towards 1.4853 in wave [ii] before an extended rally in wave [iii] takes over for a rally towards 1.5837.

In the short term, a break below minor support at 1.5039 confirms that wave [ii] is unfolding.

Trading recommendation:

Our take profit target at 1.5165 was hit for a nice 335 pips profit. We will buy EUR again at 149.25 and start by place our stop at 1.4650.

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EUR/USD profit target reached, remain bullish

Price has surpassed our descending resistance-turn-support line triggering a bullish move from here. EUR/USD made a push up to our profit target before reversing back to our buying level. We remain bullish above 1.0418 support (Fibonacci retracement, horizontal overlap support) for a push up to at least 1.0510 once again (Fibonacci retracement, horizontal overlap support).

RSI (34) has made a bullish exit signalling a change in the momentum.

Buy above 1.0418. Set stop loss at 1.0347 and take profit at 1.0510.

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AUD/JPY profit target reached, time to turn bullish

Price has dropped perfectly to our profit target. We now turn bullish above major support at 84.64 (Fibonacci retracement, horizontal support, Fibonacci projection) for a push up to 85.70 resistance (Fibonacci retracement, horizontal swing high resistance).

Stochastic (34,5,3) shows major support at 14%.

Buy above 84.64. Set stop loss at 84.14 and take profit at 85.70.

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Elliott wave analysis of EUR/JPY for December 23 - 2016

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Wave summary:

The break above minor resistance at 123.01 has weakened the case for a decline to 119.70, but it has not invalidated the possibility entirely. The failure to follow through on the break above 123.01 indicates a more complex correction is unfolding in wave c of (iv).

In the short term, we expect yesterdays high at 123.20 to be able to cap the upside for a break below minor support at 122.41 and more importantly below support at 122.01 that confirms a new test of 121.64 and lower towards 120.95 and possibly closer to 119.70 before wave (iv) is complete. Only a direct break above the yesterday high at 123.20 and more importantly above resistance at 123.64 will confirm that wave (iv) is complete and wave (v) of 3 higher to 126.54 is unfolding.

Trading recommendation: Our stop at 123.05 was hit for a small profit. We will sell EUR upon a break below 122.41 and place stop at 123.00. Take profit will be placed at 120.25.

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USD/JPY at major resistance, remain bearish

Price is testing our descending resistance line and we remain bearish below resistance at 118.16 (Fibonacci retracement, Fibonacci projection) for a drop to at least 116.14 support (Fibonacci projection, Fibonacci retracement, horizontal pullback support).

Stochastic (34,5,3) remains bearish below 94% resistance.

Sell below 118.26. Set stop loss at 118.71 and take profit at 116.14.

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Daily analysis of USDX for December 23, 2016

The index remained supported by the 102.56 level across the board, as we are seeing that the bullish tone is still present on the overall price action. The resistance zone of 103.98 is still the closest target to the upside, but we expect to see very slow moves in upcoming sessions, as the New Year's holidays are coming. The MACD indicator is in positive territory, favoring the bullish scenario.

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H1 chart's resistance levels: 103.98 / 104.69

H1 chart's support levels: 102.56 / 101.40

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 103.98, take profit is at 104.69 and stop loss is at 103.26.

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Daily analysis of GBP/USD for December 23, 2016

The pair did not stay calm during Thursday and it managed to consolidate below the 1.2318 level. That move is opening the door to test the demand zone of 1.2249 and GBP/USD is moving around the lower band of Bollinger. If we see a breakout below 1.2249, it can plunge to test the support zone of 1.2185. The MACD indicator is entering negative territory.

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H1 chart's resistance levels: 1.2318 / 1.2390

H1 chart's support levels: 1.2249 / 1.2185

Trading recommendations for today: Based on the H1 chart, sell (short) orders only if the GBP/USD pair breaks a bearish candlestick; the support level is at 1.2249, take profit is at 1.2185 and stop loss is at 1.2312.

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Daily analysis of Silver for December 22, 2016

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Overview

The silver price is fluctuating near 16.00 levels. We took a deeper look on the chart and found out that the price is forming a bullish pattern explained in the minor image. Its confirmation line is located at 16.15, which means that given the breach of this level, the pattern will have a positive impact on the price and make it head towards our positive targets that start at 16.56 and extend to 17.43. Therefore, we still expect bullish trend for today unless breaking and holding below 15.49 levels. The expected trading range for today is between the 15.80 support and the 16.56 resistance.

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