USD/JPY Fundamental Analysis for February 6, 2017

Recently JPY has been at the edge with good dominance over USD. Last week USD was influenced by negative fundamental reports, which provided some push to JPY to progress further since the market bounced off from the 118 level. Today Average Cash Earning report has been issued at the Asian Session which was forecasted to be 0.4% but the actual report was negative, down to 0.1%. The report pushed JPY a bit higher against USD but after hitting the nearest resistance at 112.50 the market bounced off and continued its way downward. As there was no high-impact news on USD today, so it is expected that JPY is going to dominate USD further.

Now let us look at technical view, the price is heading towards the support level of 112.00 and currently the market is showing some bullish move towards the 112.50 area. At 112.50 area if we see some bullish rejection in the intraday charts we will be looking forward to sell with a target towards 108.10 area.

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EUR/USD Fundamental Analysis for February 6, 2017

USD has been facing some negative effects in the economy since Donald Trump has started taking his steps towards changing some policies in the US Economy. Last week NFP showed a good increment of 227k in comparison to forecasted 170k which did boost the USD bias for sometimes but the 0.1% increase in Unemployment rate did hit USD down where EUR got ahead with a daily bullish close above 1.0750 level. This week it is expected that EUR will dominate the USD market and we can see some higher prices in this pair.

Now let us take a look at technical view, the market is currently residing inside the support area between 1.0715-50 and the bears are currently in control of the market. In this case, the market seems to be retracing towards the support area and consolidating inside the area for upcoming bullish price action to continue towards 1.0850. It is very much expected that the price will lead towards 1.0850 and if market breaks the resistance of 1.0850 it will progress up towards 1.1060 level. On the other hand, if the market breaks below 1.0700 with a daily close we will change our medium-term bias to bearish and shift our target down towards 1.0630 as the first support.

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EUR/USD Fundamental Analysis for February 6, 2017

USD has been facing some negative effects in the economy since Donald Trump has taken his steps towards changing some policies in the US Economy. Last week, NFP showed a good increment of 227k in comparison to forecasted 170k which did boost the USD bias for sometimes but the 0.1% increase in Unemployment rate did hit the USD down where EUR got ahead with a daily bullish close above 1.0750 level. This week it is expected that EUR will dominate the USD market and we can see some higher prices in this pair.

Now let us take a look at technical view, the market is currently residing inside the support area between 1.0715-50 and bears are currently in control of the market. In this case, the market seems to be retracing towards the support area and consolidating inside the area for upcoming bullish price action to continue towards 1.0850. It is very much expected that the price will lead towards 1.0850 and if market breaks the resistance of 1.0850 it will progress up towards 1.1060 level. On the other hand, if the market breaks below 1.0700 with a daily close we will change our medium-term bias to bearish and shift our target down towards 1.0630 as the first support.

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EUR/NZD analysis for February 06, 2017

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Recently, EUR/NZD has been trading downwards. The price tested the level of 1.4665. According to the 30M time frame, I found hidden bearish divergence on moving average oscilator and breakout of support, which is a sign that buying looks risky. The trend is still downward. My advice is to watch for selling opportunities. I have placed Fibonacci expansion to find potential downward target. I got Fibonacci expansion 161.8% at the price of 1.4620.

Fibonacci Pivot Points:

Resistance levels:

R1: 1.4750

R2: 1.4800

R3: 1.4840

Support levels:

S1: 1.4715

S2: 1.4695

S3: 1.4660

Trading recommendations for today: watch for potential selling opportunities.

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Gold analysis for February 06, 2017

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Recently, gold has been trading upwards. As I expeted, the price tested the level of $1,225.05. According to the 15M time frame, I found a hidden unconfirmed bearish divergence in the background, which is a sign of potential weakness. My advice is to watch for potential selling opportunities. Anyway, to confirm potential downward movement, I would wait that price breaks support at $1,221.50. If the price breaks the level of $1,221.50, Gold may test the level of $1,215.00. Anyway, if the price breaks the resitance at $1,225.05, gold may visit the level of $1,229.50 (Fibonacci expansion 100%). Trend is still bullish but there is bearish divergence in progres.

Fibonacci pivot points :

R1: 1,224.75

R2: 1,225.95

R3: 1,227.90

Support levels:

S1: 1,220.90

S2: 1,219.75

S3: 1,217.85

Trading recommendations for today: watch for potential selling opportunities.

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Global macro overview for 06/02/2017

Global macro overview for 06/02/2017:

In the last month of 2016, the Australian retail sales posted a surprise fall. The official figures released today reported that retail sales dropped 0.1% to $A25.61 billion on a seasonally adjusted basis in December, following the preceding month's downwardly revised gain of 0.1% and missing analysts' expectations for a rise of 0.3% in the reported month. Moreover, it was the first contraction in retail sales since July 2016. The biggest decrease of 2.3% was noted in household goods retailing. The Australian Bureau of Statistics reported that the fall was mainly driven by a sharp 6.6% decrease in sales of hardware, building and garden supplies (the biggest monthly decrease in this category since July 2000). In conclusion, this set of worse than expected data reveals a worrying lack of momentum retails sales heading into 2017. The Reserve Bank of Australia will announce its interest rate decision tomorrow at 03:30 am GMT and this is the next macroeconomic event for Australia worth to keep an eye on.

Let's now take a look at AUD/USD technical picture at the daily time frame. The worse than expected data did not spark any panic selling as the bullish uptrend is still intact and there is still not divergence between the price and the momentum oscillator. The market still trades above all of the moving averages and it looks like the bulls will try to break out above the recent important high at the level of 0.7777 and then they might even challenge the swing high at the level of 0.7835. The next support is seen at the level of 0.7609.

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Global macro overview for 06/02/2017

Global macro overview for 06/02/2017:

The Bureau of Labor Statistics revealed on Friday that Non-Farm Payrolls rose 227,000 in January, which beat the market expectations of 170,000 jobs and the last month figure of 154,000. The unemployment rate increased slightly to 4.8% from 4.7% a month ago. The average hourly earnings grew 0.1% in January, following the prior month's downwardly revised 0.2% and falling behind the 0.3% rise market forecast. The data suggest the job market is the US is still growing, but not that rapidly as a year ago. Nevertheless, the Federal Reserve policy makers are still in favor of at least three interest rate hikes in 2017 and the first hike can come as soon as in March. In conclusion, the data-dependent FED officials will now wait-and-see whether the US job market is still slowly growing and if the conditions will not deteriorate significantly, they will keep their promises regarding the interest rate hike.

Let's now take a look at the US Dollar index technical picture at the 4H time frame. The recent low had been made at the level of 99.22, just below the important technical support, but so far no follow through occurred. Nevertheless, the market is still trading below the golden trend line, so any break out higher will be considered as the end of the corrective cycle. The next resistance is seen at the level of 100.26 and 101.02 and the next support at the mentioned levels of 99.43 and 99.26.

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Technical analysis of USD/CAD for Febuary 6, 2017

General overview for 06/02/2017:

The bottom at the level of 1.2967 is the most important level for the whole bullish, impulsive scenario now. Any violation of this level would indicate that the old top at the level of 1.3598 is the big cycle wave B top. Now the market is developing impulsive wave structure to the downside, with a long-term target projection at the parity level. Nevertheless, to confirm the intraday bullish scenario, the price must break out above the intraday resistance at the level of 1.3076 and then head higher towards the weekly pivot resistance at the level of 1.3125 to create the overbalance. Please notice that the growing bullish divergence between the price and the momentum oscillator supports the view.

Support/Resistance:

1.2925 - WS1

1.2967 - Technical Support

1.2981 - Intraday Support

1.3050 - Weekly Pivot

1.3076 - Intraday Resistance

1.3125 - WR1

1.3246 - WR2

Trading recommendations:

Day traders should consider opening buy order from current levels with SL below the level of 1.2967 and TP at the level of 1.3125 (with a possible extension higher).

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Technical analysis of EUR/JPY for Febuary 6, 2017

General overview for 06/02/2017:

The corrective cycle continues after a failed impulsive wave development that ended only in three waves. The current wave structure looks like a complex WXYXXZ pattern and it is about to complete. The first projected level for wave c of wave Z (brown) is at the level of 120.52. If the wave Z (brown) is completed there, then the whole correction in wave (4) (blue) will be completed as well, so the last wave to the upside, wave 5 (blue) might start to unfold at last.

Support/Resistance:

123.84. - WR2

123.30 - Wave XX Top

122.51 - Intraday Resistance

122.41 - WR1

121.70 - Weekly Pivot

121.01 - Intraday Support

120.52 - Technical Support

Trading recommendations:

Day traders should consider opening sell order from current levels with SL above the level of 121.01 and TP at the level of 120.52.

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Elliott wave analysis of EUR/NZD for February 6 - 2017

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Wave summary:

The correction from 1.9114 has extended and seen a new low at 1.4650. As long as minor resistance at 1.4945 is able to cap the upside, we need to allow for slightly lower to 1.4560 to complete this extremely complex ending diagonal, which has been unfolding since June 2016. Only a break above minor resistance at 1.4945 will ease the downside pressure, while a break above resistance at 1.5282 will be needed to confirm that wave 2 finally has completed and wave 3 has taken over for a new long-term impulsive rally that ultimately should take this cross above 1.9114.

R3: 1.5282

R2: 1.4953

R1: 1.4867

Pivot: 1.4675

S1: 1.4654

S2: 1.4560

S2: 1.4449

Trading recommendation:

Our top at 1.4650 has been hit for a loss. We will only buy a break above 1.4945.

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Elliott wave analysis of EUR/JPY for February 6 - 2017

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Wave summary:

As long as support at 120.50 continue to protect the downside, we will be looking for a break above minor resistance at 122.03 and more importantly a break above resistance at 122.99 that confirms more upside towards 126.54 to complete wave 3.

However, if support at 120.50 gives away, it will extend the correction in wave (iv) lower towards 119.14 before wave (v). We should expected the rally higher towards 126.54.

R3: 122.52

R2: 122.03

R1: 121.76

Pivot: 121.05

S1: 120.99

S2: 120.50

S3: 120.20

Trading recommendation:

Our stop at 121.90 was hit for a small profit. We are looking to buy a break above 121.76.

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Technical analysis of GBP/USD for February 06, 2017

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Overview:

  • The GBP/USD pair has been moving in a bullish trend from the support levels of 1.2473, 1.2380 and 1.2287 since last week. There are no changes in our technical outlook. The bias remains bullish in the nearest term testing 1.2681 or higher. Currently, the price is in a bullish channel. This is confirmed by the RSI indicator signaling that we are still in a bullish trending market. As the price is still above the moving average (100), immediate support is seen at 1.2380 and 1.2473, while the weekly strong support is found at 1.2287. Consequently, the first support is set at the level of 1.2380. The market is likely to show signs of a bullish trend around the spot of 1.2380 - 1.2450. In other words, buy orders are recommended above the 1.2450 level with the first target at the level of 1.2605.
  • Furthermore, if the trend is able to break through the first resistance level of 1.2605, we will see the pair climbing towards the double top (1.2774) to test it in coming days. Thus, the market is indicating a bullish opportunity above the support levels of 1.2380 - 1.2450, for that the bullish outlook remains the same as long as the 100 EMA is headed to the upside. It would also be wise to consider where to place a stop loss; this should be set below the second support of 1.2287.
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Technical analysis of EUR/USD for February 06, 2017

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Overview:

  • The EUR/USD pair is trying to break a minor support at the level of 1.0744 which acts as a key level this week. According to the previous events, the EUR/USD pair is still moving between the levels of 1.0744 and 1.0659. Therefore, we expect a range of 85 pips in coming hours. The trend is still below the 100 EMA, for that the bearish outlook remains the same as long as the 100 EMA is headed to the downside. For this reason, the price spot of 1.0828 remains a significant resistance zone. Consequently, there is a possibility that the EUR/USD pair will move downside. The structure of a fall does not look corrective. In order to take a bearish opportunity below 1.0828 or/and 1.0744, sell below 1.0744 with the first target at 1.0659. Besides, the weekly support 1 is seen at the level of 1.0659. However, traders should watch for any sign of a bullish rejection that occurs around 1.0828 (the double top). Moreover, the level of 1.0868 is expected to act as a major resistance this week. Since the trend is below the 1.0868 level, the market is still in a downtrend. Overall, we still prefer the bearish scenario.

Daily key levels:

  • Major resistance:1.0953
  • Minor resistance:1.0868
  • Intraday pivot point:1.0744
  • Minor support:1.0659
  • Major support:1.0535
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Technical analysis of USDX for February 6, 2017

The Dollar index continues to trade inside the downward sloping wedge pattern in a tightening range. The price is expected to make new lows below 99 before reversing to the upside. The wave 4 scenario correction is still my preferred one.

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Red lines - downward sloping wedge

Blue lines - expected price movement

Short-term support is at 99.50. If broken expect a test of 99 or even lower. Resistance is found at 100 and 100.70. If resistance it is broken we should expect a back test of the broken wedge and continuation to the upside towards 105.

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Green line - long-term trend line support

The Dollar index is near completion of its wave 4, a pullback is expected before resuming its uptrend towards 105. I believe the current pullback is just a pause to the larger bullish trend. Only the rejection at 101.50-102 could cancel my bullish view of 105. On a weekly basis I would expect the price to test below 99 but closes above it or even above 100. I believe this can be a reversal week.

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Technical analysis of gold for February 6, 2017

Gold price continues to make higher highs and higher lows. The price has broken and closed above $1,212 on a weekly basis opening the road for a move towards $1,300. The trend remains bullish. As long as the price is above $1,200 bulls are in control.

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Blue line is short-term support trend line

Gold is trading above the 4-hour Ichimoku cloud. Support by the cloud is at $1,200. Trend line support is found at $1,210. Resistance is found at $1,230 and the next is at $1,250 for the short-term. As long as the price is above the cloud and above $1,200 short-term trend is bullish. Critical support is at $1,180.

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On a weekly basis the price closed inside the weekly cloud. This implies that soon we should expect a test of the kijun-sen resistance (yellow line indicator) and after that a move towards the upper cloud boundary towards $1,280-$1,300. In the long term I remain bullish.

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USD/CAD intraday technical levels and trading recommendations for February 6, 2017

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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 (the lower limit of the depicted channel) where bullish rejection was expressed as anticipated.

A bullish breakout above 1.3360 (50% Fibonacci level) was expected to allow a further advance toward 1.3700-1.3750 (the upper limit of the depicted channel). However, significant bearish rejection was expressed around 1.3580 (recent established top).

The price level of 1.3300 (50% Fibonacci Level) failed to provide enough support for the recent bearish pullback.

That is why, the recent bearish pullback toward 1.2970 (61.8% Fibonacci level) offered a valid BUY entry as expected in previous articles.

This week, a bullish breakout above 1.3300 (50% Fibonacci Level) is needed to enhance bullish advance towards 1.3440 and 1.3550. Otherwise, the USD/CAD pair remains trapped within the current consolidation range (1.2970-1.3300).

On the other hand, DAILY closure below 1.2970 (61.8% Fibonacci level) will confirm a double top pattern with projected bearish targets at 1.2860, 1.2730, and 1.2600.

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NZD/USD Intraday technical levels and trading recommendations for February 6, 2017

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On November 8, significant signs of a bearish reversal were expressed around the upper limit of the depicted consolidation range (0.7350).

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 enabled the NZD/USD pair to pursue toward lower target levels around 0.6990 (the upper limit of the depicted BUY zone).

The price level of 0.6990 failed to apply enough bullish pressure. Instead of that, bearish movement continued toward the lower limit of the depicted BUY zone (0.6860) which provided significant bullish rejection on December 23.

The NZD/USD pair was trapped within the depicted price range (0.6860-0.6990) until a bullish breakout occurred.

A bullish breakout above 0.7000 allowed the pair to head toward the price level of 0.7100 (Key-Level) which failed to provide sufficient bearish pressure on the pair.

Bullish persistence above 0.7100 allowed further bullish advance toward 0.7250-0.7350 (Sell-Zone) where a valid SELL entry can be offered if enough bearish pressure is maintained (note the bearish daily candlesticks within the SELL-zone).

On the other hand, bullish closure above 0.7350 will probably liberate a quick bullish movement towards 0.7450.

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Intraday technical levels and trading recommendations for GBP/USD for February 6, 2017

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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 toward the price levels around 1.2700 (Bearish projection target).

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 was expected near 1.2020.

On October 25, bullish recovery was initiated around the price level of 1.2080. That is why, a bullish pullback was executed toward 1.2700-1.2750.

Risky traders considered this bullish pullback toward the price zone of 1.2700-1.2750 to be a valid SELL entry. All T/P levels were successfully reached.

On January 16, a bullish engulfing candlestick was expressed around the demand level of 1.2000. That is why, another bullish breakout above 1.2430 was initiated.

The next bullish target is located around 1.2750 where bearish rejection should be expected.

On the other hand, the next bearish destination would be located around 1.1200 when bearish momentum is resumed.

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Intraday technical levels and trading recommendations for EUR/USD for February 6, 2017

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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 toward 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.

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

Otherwise, the EUR/USD pair remains trapped within the depicted consolidation range (1.0570-1.1400).

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The long-term outlook for the EUR/USD pair remains bearish as the monthly chart illustrates. Bearish persistence below 1.0575 is needed to pursue this bearish scenario.

On November 14, bearish persistence below 1.0825 (Key-Level 2) allowed further decline toward 1.0570 (demand level) where evident bullish rejection was expressed on November 24.

Shortly after, the Fibonacci Level 50% (1.0825) constituted a recent supply level which offered a valid SELL entry on December 8.

Bearish persistence below the depicted demand level (1.0570) was expected to allow further decline toward 1.0220. However, significant bullish recovery was expressed around the price level of 1.0340 on January 3.

Bullish persistence above 1.0600 allowed further bullish advance toward 1.0825-1.0850 (Fibonacci Level 50%) where bearish rejection and a valid SELL entry can be anticipated.

Bullish breakout above 1.0570-1.0600 was executed on January 12.

That is why, the price level of 1.0570 at the moment constitutes a recent demand level to be watched for the bullish rejection if any bearish pullback occurs.

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Technical analysis of EUR/USD for Feb 07, 2017

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When the European market opens, some Economic Data will be released, such as Sentix Investor Confidence, Retail PMI, and German Factory Orders m/m. The US will release the economic data, too, such as Loan Officer Survey, Labor Market Conditions Index m/m, and Mortgage Delinquencies, so, amid the reports, EUR/USD will move in a low to medium volatility during this day.

TODAY'S TECHNICAL LEVEL:

Breakout BUY Level: 1.0835.

Strong Resistance:1.0828.

Original Resistance: 1.0818.

Inner Sell Area: 1.0808.

Target Inner Area: 1.0783.

Inner Buy Area: 1.0758.

Original Support: 1.0748.

Strong Support: 1.0738.

Breakout SELL Level: 1.0731.

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 Feb 07, 2017

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In Asia, Japan will release the Average Cash Earnings y/y data, and the US will release some Economic Data, such as Loan Officer Survey, Labor Market Conditions Index m/m, and Mortgage Delinquencies. So, there is a probability the USD/JPY will move with low to medium volatility during this day.

TODAY'S TECHNICAL LEVEL:

Resistance. 3: 112.99.

Resistance. 2: 112.77.

Resistance. 1: 112.55.

Support. 1: 112.27.

Support. 2: 112.05.

Support. 3: 111.83.

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 February 6, 2017

EUR/USD: The EUR/USD went upwards last week, but also not significantly. Price tested the resistance line at 1.0800 many times, but it was unable to breach it to the upside. The resistance line at 1.0800 must be breached to the upside this week, so that the bullish movement can continue, and so that risk of a serious pullback can be averted.

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USD/CHF: The USD/CHF went downwards last week, but significantly. Price is below the resistance levels at 1.0000 and 0.9950, now moving toward the support level at 0.9900, which is one of the targets for this week. There is a Bearish Confirmation Pattern in the market, and further bearish movement is expected.

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GBP/USD: The Cable has been characterized by upwards and downwards swings. Last week, price generally moved between the distribution territory at 1.2700 and the accumulation territory at 1.2400. A break above the distribution territory would emphasize a bullish outlook; while a break below the accumulation territory would emphasize a bearish outlook.

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USD/JPY: Here, the bias has turned bearish on 4-hour and daily charts. There is a Bearish Confirmation Pattern in the market, and further bearish journey is a possibility. There would be occasional rallies along the way, but the overall movement should be bearish this week, as bears target the demand levels at 112.00, 111.50 and 111.00 this week.

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EUR/JPY: This currency trading instrument is neutral in the long-term and bearish in the short-term. There is a short-term "sell" signal in the market, and price is supposed to continue going further downwards. Further bearish movement would also result in a bearish outlook in the long-term. The first target for this week is at the demand zone at 120.50: followed by the demand zones at 120.00, and 119.50.

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Daily analysis of GBP/USD for February 06, 2017

GBP/USD didn't have major changes in its structure after the US NFP's release, as the pair stayed above the support level of 1.2420. We're still seeing some sideways move around the 200 SMA at H1 chart and if the pair manages to break above 1.2591, then we can expect further gains toward the 1.2718 level and that's a likely scenario, due to the fact that the 1.2420 zone is still intact.

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H1 chart's resistance levels: 1.2591 / 1.2718

H1 chart's support levels: 1.2420 / 1.2274

Trading recommendations for today: Based on the H1 chart, buy (long) orders only if the GBP/USD pair breaks a bullish candlestick; the resistance level is at 1.2591, take profit is at 1.2718 and stop loss is at 1.2471.

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Daily analysis of USDX for February 06, 2017

USDX managed to stay below the 200 SMA, as the US NFP didn't bring enough bullish momentum in order to change the overall trend for the short term. To the downside, we're expecting to see a breakout below the 99.45 level that strengthens the bearish bias, but if the index doesn't make any new lower lows, then we should expect another rally attempt to test the 100.36 level.

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H1 chart's resistance levels: 99.80 / 100.36

H1 chart's support levels: 99.46 / 98.98

Trading recommendations for today: Based on the H1 chart, place sell (short) orders only if the USD Index breaks with a bearish candlestick; the support level is at 99.46, take profit is at 98.98 and stop loss is at 99.95.

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