USD/CAD Fundamental Analysis for February 9, 2017

Today is one of the most important day for both USD and CAD as two major announcements on both currency will be published at the same time. On the USD side, Unemployment claims report will be published which was previously 246k and it is forecasted that it will increase up to 249k as the unemployment rate in US has been increased. On the CAD side, NHPI (New Home Price Index) report will be published which was previously 0.2% and forecasted that it will increase to 0.3%. As of the overall fundamental context US is found to be weaker among all other major currencies rather than CAD as the negative trade balance report of CAD which was -0.1B which was forecasted to increase by 0.2B. Overall market is expected to show a good amount of volatility today after the news report publishes.

Now let us look at the technical point of view, market is currently inside intraday corrective structure and showing some bearish activities inside the Tuesday's bullish bar. Intraday market is bearish but as two important news to be published on the both currencies of the pair a good amount of volatility is expected to be in the market. In the currency scenario, we will be looking to sell if we see any daily close below 1.3050 with a target toward 1.30 as nearest support and 1.2830 as the next support but if the market closes above 1.32 we will be shifting our bias to bullish but with a shorter target in comparison which would be at 1.3280-1.33.

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NZD/USD Fundamental Analysis for February 9, 2017

NZD had a great fall against USD after the spike toward 0.7375 area. As USD is weaker among the other majors but it is quite dominating in this pair. Today, NZD official rate was announced which was found to be unchanged at 1.75% but after the press conference and RBNZ governor wheeler speaks about the monetary policy in Wellington today NZD is already losing more ground against the USD. A good amount of volatility is also expected after the Unemployment claims of USD is going to publish today and if the news comes positive toward USD we might see more downward move in this pair soon.

Now let us look at the technical view, currently market is volatile and already showing some counter trend move against the NZD. The price has broken below 0.7230 level and if the price daily close below the 0.7230 level then we will be looking forward for a downward target at 0.6950 and on the other hand if we see bearish rejection off the level 0.7230 then we will be looking forward to buy with a target toward 0.7450.

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Technical analysis of USD/JPY for Feburary 09, 2017

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USD/JPY is expected to trade with bullish bias. The pair is supported by the rising trend line, which confirms a positive view. The relative strength index stands firmly above its neutrality level at 50. In addition, 111.95 is playing a key support role, which should limit the downside potential.

As long as this key level is not broken, look for further advance to 112.80 and even to 113.25.

Recommendation:

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 112.80 and the second one is at 113.25. In the alternative scenario, short positions are recommended with the first target at 111.65 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 111.30. The pivot point is at 111.95.

Resistance levels: 112.80, 113.25, and 113.60. Support levels: 111.65, 111.30, and 111.00.

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Technical analysis of USD/CHF for Feburary 09, 2017

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USD/CHF is expected to trade with Bullish bias above 1.000. The pair managed to break above its bearish trend line and the 50-period moving average, which confirmed a positive outlook. Besides, a bullish cross between the 20-period and 50-period moving averages has been identified. The relative strength index is above its neutrality level at 50, and lacks downward momentum.

Therefore, as long as 0.9930 is holding on the downside, look for a further rebound to 1.000.

Resistance levels: 1.000, 1.0025, and 1.0050

Support levels: 0.99, 0.9885, and 0.9860

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Technical analysis of NZD/USD for Feburary 09, 2017

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NZD/USD is expected to stick to its downside movement. The pair broke below its 20-period and 50-period moving averages and is consolidating on the downside. In addition, the 20-period moving average crossed below the 50-period one, which is negative. The relative strength index is bearish below the level of 30 and lacks upward momentum. In conclusion, as long as 0.7240 is resistance, look for a further drop towards 0.7175 and even 0.7150 in extension.

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 0.7175. A break below this target will move the pair further downwards to 0.7150. The pivot point stands at 0.7240. If the price moves in the opposite direction and bounces back from the support level, it will move above its pivot point. It is likely to move further to the upside. According to that scenario, long positions are recommended with the first target at 0.7280 and the second one at 0.7310.

Resistance levels: 00.7280, 0.7310, and 0.7375

Support levels: 0.7175, 0.7150, and 0.7100

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Technical analysis of GBP/JPY for Feburary 09, 2017

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GBP/JPY is expected to trade with bullish bias above 119.30. The pair is posting a rebound on its horizontal support at 140.35, and is expected to post further bounces. The 20-period moving average is currently turning up, and a cross above the 50-period moving average will be a bullish signal and will open the room for further upside. Meanwhile, the relative strength index is around its neutrality area at 50 and lacks downward momentum. As long as the level of 140.35 is not broken down, further bounce is preferred with 141.45 and 142.00 as targets.

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 141.45 and the second one at 142.00. In the alternative scenario, short positions are recommended with the first target at 139.90, 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 139.45. The pivot point is at 140.35.

Resistance levels: 141.45, 142.00, 142.75

Support levels: 139.90,139.45, 139.00

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EUR/NZD analysis for February 09, 2017

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Recently, the EUR/NZD pair has been upwards. The price tested the level of 1.4854. According to the 30M time frame, I found strong upward movement in the background due to Wheeler speech today. Anyway, my advice is to wait potential end of the bearish correction before buying. The price should at least test Fibonacci retracement 38.2% at the price of 1.4740.

Fibonacci pivot points:

Resistance levels:

R1: 1.4750

R2: 1.4790

R3: 1.4860

Support levels:

S1: 1.4620

S2: 1.4570

S3: 1.4500

Trading recommendations for today: watch for potential end of bearish correction before buying.

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Trading plan for 09/02/2017

Trading plan for 09/02/2017:

Today there will be a few economic releases, but still two important news releases are scheduled for today that will catch the attention of the global investors, i.e. the Unemployment Claims data from the US and the Governor Mark Carney from Bank of England speech.

01:30 pm GMT - Unemployment Claims from the USA

The labour market's strong rebound in January is expected to receive support in today's weekly report on new filings for unemployment benefits. The market analysts see a slight increase in initial claims from 246k to 249k. The lowest initial claims figure was issued in November last year at the level of 233k. After strong NFP number from last Friday, the US job market looks very solid and today's release of initial claims will likely support this view as any number below 300k will be considered positive for the labour market.

Let's now see how we can trade this news release. The pair that will be affected the most is EUR/USD. Currently it is trading around the intraday resistance at the level of 1.0704. In a case of a better than expected data (less than 249k), the market should spike lower towards the next intraday support at the level of 1.0640. In a case of worse than expected data (more than 249k), the market should break out above the intraday resistance and head towards the level of weekly pivot at the level of 1.0756.

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06:30 pm GMT - Governor Mark Carney from Bank of England speech.

Market snapshot: Gold prices at 3-month high

Gold prices rose as US rate hike bets cooled. The projection for the year-end level of the Fed Funds rate fell to the lowest in two months, which caused the US Treasury bond yields and the US Dollar to move down in together. This bolstered the overall risk sentiment and made the yellow metal to climb at the highs this month.

Currently, the gold is trading at the daily technical resistance at the level of $1,240. There is still a potential for higher prices, but the bearish divergence between the price and the momentum oscillator and the overbought market conditions are indicating a temporary correction to come soon. The next support is seen at the level of $1,220 and from this level, the price should bounce towards the $1,276 level.

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Market snapshot: GBP/USD is breaking higher from the lows.

Yesterday's comments from the UK Prime Minister Theresa May ("We believe we can, within the 2-year time frame, get the agreement for the withdrawal from the EU and the trade arrangements to ensure we have a strong strategic partnership with the EU in the future") has made the Pound to rally across the board and it looks like the trend will continue today.

The downside risk for GBP/USD looks limited as the Brexit-triggered decline may have run out of momentum. The price is trading within a safe distance from the important technical support at the level of 1.1985 and now the bulls are trying to continue the rally towards the next intraday resistance at the level of 1.2729. Only a sustained violation of the level of 1.2347 would invalidate this scenario.

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Gold analysis for February 09, 2017

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Recently, gold has been trading upwards. As I expcted, the price tested the level of $1,244.77. According to the 4H time frame, I found successful rejection from lower diagonal of upward channel. The trend is still bullish. Based on 1H time frame, I have found broken symmetrical triangle, which sign that gold may continue with upward movement. Target is set at the price of $1,252.00 (Fibonacci expansion 161.8%).

Fibonacci pivot points:

Resistance levels:

R1: 1,242.40

R2: 1,245.50

R3: 1,250.40

Support levels:

S1: 1,232.50

S2: 1,229.50

S3: 1,224.60

Trading recommendations for today: watch for potential buying opportunities.

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Global macro overview for 09/02/2017

Global macro overview for 09/02/2017:

The Reserve Bank of New Zealand had decided to leave the official interest rate unchanged at the level of 1.75%, as widely expected. In the statement issued after the decision, the RBNZ said: "Monetary policy will remain accommodative for a considerable period. Numerous uncertainties remain, particularly in respect of the international outlook, and policy may need to adjust accordingly", which is almost the same as the statement from November last year. The retention of the final sentence surprised markets with its dovish tone, which had expected that glimmer of an easing bias to be removed. In conclusion, the 2.0% interest rate expectation for the year 2017 just has been changed to more stable and sober anticipation of max. 1.8%.

Let's now take a look at the NZD/USD technical picture at the H1 time frame after the news was released. The market tanked significantly after the dovish statement and now it just bounced from the weekly pivot support at the level of 0.7191. It looks like the bulls want to test the technical resistance at the level of 0.7242 before the slide downwards will continue.

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Technical analysis of USD/CHF for February 09, 2017

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Overview:

  • The price of the USD/CHF pair is moving between the levels of 0.9960-0.9990 and 0.9860. The USD/CHF pair continued to move downwards from the level of 0.9960-0.9990. The pair has fallen from the level of 0.9960-0.9990 to the bottom around the spot of 0.9890. Consequently, the USD/CHF pair broke support at the level 0.9960-0.9990, which turned into strong resistance at the level of 0.9960-0.9990. In the H1 time frame, the level of 0.9960-0.9990 is expected to act as the major resistance 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 below the moving average (100). From this point, we expect the USD/CHF pair to continue moving in the bearish trend from the resistance levels of 0.9960-0.9990 and 0.9922 towards the target level of 0.9860. If the pair succeeds in passing through the level of 0.9860, the market will indicate the bearish opportunity below the level of 0.9860 so as to reach the second target at 0.9830.
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  • Moreover, if the USD/CHF pair is able to break out the level of 0.9830, the market will decline further to 0.9800. Briefly, the price spot of 0.9990-0.9960 remains a significant resistance zone. So, a possibility that the USD/CHF pair will have downside momentum is rather convincing and the structure of a fall does not look corrective. In order to indicate a bearish opportunity below 0.9990-0.9960. Sell below 0.9990-0.9960 with the first targets of 0.9890, 0.9860, and 0.9800. However, the stop loss should be located above the level of 1.0021.
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Global macro overview for 09/02/2017

Global macro overview for 09/02/2017:

The Crude Oil inventories data released yesterday had surprised the market participants. The expected number of 2.7m barrels had been easily beaten by huge 13.8m built up in stockpiles. Moreover, an EIA report upgrading the 2018 output forecast to 9.53m barrels from 9.3m barrels per day projected in January probably did not help matters either. Most of the analysts said the prices could be volatile as higher US crude supplies offset output cuts by the Organization of the Petroleum Exporting Countries (OPEC) and other producing nations.

Let's now take a look at the Crude Oil technical picture at the H1 time frame after the data was released. The market rallied towards the next intraday resistance at the level of 52.79 and the bull camp has managed to break out above it. Currently, the price is trading just below the intraday resistance at the level of 52.90, but the market conditions seem to be overbought. In the case of a further break out higher, the next resistance is seen at the level of 53.14.

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Technical analysis of NZD/USD for February 09, 2017

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Overview:

  • The NZD/USD pair continues to move downwards from the level of 0.7314. Yesterday, the pair dropped from the level of 0.7314 (but the level of 0.7375 is representing double top) to the bottom around 0.7190. Today, the first resistance level is seen at 0.7265 followed by 0.7314, while daily support 1 is seen at 0.7179. According to the previous events, the NZD/USD pair is still moving between the levels of 0.7265 and 0.7118; for that we expect a range of 145 pips in the coming hours. If the NZD/USD pair fails to break through the resistance level of 0.7265, the market will decline further to 0.6546. 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 0.7179 so as to test the first support. It will also call for a downtrend in order to continue towards 0.7118. The daily strong support is seen at 0.7118. On the contrary, if a breakout takes place at the resistance level of 0.7375 (the double top), then this scenario may become invalidated.
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Wave analysis of USDX for February 9, 2017

The Dollar index is testing important short-term resistance as we mentioned yesterday. The price is showing signs of rejection. The 100.80 level is a key resistance, while a break below 100 will be the confirmation I need for my bearish short-term view for a new low around 99.

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Black lines - bearish channel

Blue line - horizontal resistance

Red line - short-term trendline support

The Dollar index is trading above the Ichimoku cloud. The price has broken the short-term trendline support and now comes back to test it. The short-term support is at 100 and resistance is at 100.80. I continue to expect the price to make a new low towards 99 or lower.

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Green line - trendline support

Blue line - projection forward

My preferred scenario so far has been that we are making wave 4 down and we should soon see a reversal as a part of wave 5. The short-term trend remains bearish and if the price overlaps the wave 1 high, this scenario will be canceled and a more bearish view will be adopted. Either way a bounce is justified for USD from current or lower levels. Critical support for the longer-term bullish view remains the green upward sloping trendline.

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Technical analysis of gold for February 9, 2017

Gold price made a new higher high yesterday at $1,244.50 and is now trading around $1,240. Trend remains bullish. The price is approaching our short-term target of $1,250 where we could see some kind of a deeper pullback maybe towards $1,230.

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Blue line - trendline support

Gold price is holding above the tenkan-sen (red line indicator) and is making higher highs and higher lows. Once this change is observed we should expect a pullback towards $1,230 and why not even $1,220-15. Oscillators are diverging. The short-term trend is in danger of turning bearish.

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Long-term trend remains bullish as the price has made an important trend reversal at $1,122 and started its next upward move that is expected to be similar if not bigger to the previous leg up from $1,045 to $1,375. The price is testing weekly kijun-sen (yellow line indicator) and this confirms my longer-term bullish view that eventually we are going towards the upper cloud boundary. Oscillators have a lot of room to the upside on a weekly basis.

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Daily analysis of major pairs for February 9, 2017

EUR/USD: The EUR/USD has gone down in the short-term, generating a short-term bearish signal. Price has gone down by more than 100 pips this week, now below the resistance line at 1.0700. The next target for bears is support line at 1.0650, which might even be breached to the downside.

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USD/CHF: This currency trading instrument has not done anything significantly this week, save some kind of volatility, which is also not significant in itself. There are mixed signals in the market, but there would soon be a serious breakout this week or next. That is what would determine the next direction in the market.

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GBP/USD: The GBP/USD has not done anything significant this week, save the brief pullback on February 7, which was quickly recovered. It may be OK to stay away from the market until there is a clean directional movement, which would most probably favor the bears. There could be temporary rallies here, but the market should drop seriously soon.

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USD/JPY: This is a bear market, which has been unfolding within the last several weeks. The EMA 11 is below the EMA 56 and the RSI period 14 is below the level 50. Further decline is possible, but it is expected that JPY pairs would rally soon: the USD/JPY also included.

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EUR/JPY: The EUR/JPY is in a strong bearish mode. Price has come down by 340 pips since January 30, 2017, and there is currently an attempt to breach the demand zone at 119.50, which would eventually be breached this week or next, as price targets another demand zones at 119.00 and 118.50.

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Daily analysis of GBP/USD for February 09, 2017

GBP/USD is challenging the resistance level of 1.2561 and it's looking to break above that zone that strengthens the bias towards 1.2645. The bollinger band is getting a contraction around the 1.2550 level and that should be a sign for a possible strong move to come further. If the pair pullbacks and break the 1.2475 level, then it can plunge toward 1.2414.

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H1 chart's resistance levels: 1.2561 / 1.2645

H1 chart's support levels: 1.2475 / 1.2414

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 1.2561, take profit is at 1.2645 and stop loss is at 1.2480.

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Daily analysis of USDX for February 09, 2017

USDX continues to move around the 100.00 handle and it remains steady above the 200 SMA at H1 chart. Next key resistance is located at the 101.43 level, where a breakout should open the doors to test the 102.39, while a break below the 100.00 zone should strengthen the bearish bias for the mid-term and eventually, the index could test the 98.98 level.

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H1 chart's resistance levels: 101.43 / 102.38

H1 chart's support levels: 100.01 / 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 100.01, take profit is at 98.98 and stop loss is at 101.03.

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Daily Video Analysis on GBP/USD - 8th February 2017

We take an in-depth look on GBP/USD to see if there are any trading opportunities available for us to trade off and generate potential profits from. We explain clearly how we use a range of analytical approaches from Fibonacci retracements to Fibonacci extensions, price action and oscillators to determine such trading opportunities.

Join us and learn how to find good trading opportunities through technical analysis!

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Daily analysis of USD/JPY for February 08, 2017

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Overview

The USD/JPY pair settled near 112.00, while the EMA50 still puts the price under pressure. Moreover, the stochastic moves near the overbought levels. Therefore, we wait for the price to resume a decline in the upcoming sessions within the bearish channel that appears on the chart. Thus, the bearish trend scenario will remain valid and active in the upcoming sessions, and its next target located at 110.00. To achieve it, the pair should stay below 113.97. The expected trading range for today is between 110.50 support and 113.00 resistance.

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