Technical analysis of USD/CHF for August 07, 2017

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The target which we predicted in yesterday's analysis has been hit. The pair is still expected to trade in higher range. The pair posted a pullback from 0.9765 (the high of August 4), and is still trading above its rising 50-period moving average. The relative strength index is mixed with bullish bias. Even though a continuation of the consolidation cannot be ruled out, its extent should be limited.

The US Labor Department reported an addition of 209,000 nonfarm payrolls in July, more than +180,000 expected. Average hourly earnings for private-sector workers increased 9 cents in July to $26.36 an hour, the largest monthly increase since October. For the fourth straight month, the wages increased 2.5% on a year-on-year basis. Besides, the jobless rate declined to 4.3% from 4.4% in June.

To sum up, while the price holds above 0.9700, look a further advance to 0.9765 and 0.9785 in extension.

Chart Explanation: The black line shows the pivot point. The present price above the pivot point indicates the bullish position and below the pivot points indicates the short position. The red lines show the support levels and the green line indicates the resistance levels. These levels can be used to enter and exit trades.

Strategy: BUY, Stop Loss: 0.9700, Take Profit: 0.9765

Resistance levels: 0.9765, 0.9785, and 0.9820

Support levels: 0.9665, 0.9630, and 0.9600

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Technical analysis of GBP/JPY for August 07, 2017

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GBP/USD is under pressure. The pair recorded lower tops and lower bottoms, which confirmed a negative outlook. The downward momentum is further reinforced by the declining 50-period moving average. The relative strength index is capped by a descending trend line.

Hence, as long as 144.90 holds on the upside, a new drop to 143.90 and even to 143.35 seems more likely to occur.

Alternatively, if the price moves in the opposite direction as predicted, a long position is recommended above 144.90 with the target at 145.45.

Strategy: SELL, Stop Loss: 144.90, Take Profit: 143.90.

Chart Explanation: the black line shows the pivot point. The price above the pivot point indicates the bullish position and when it is below the pivot points, it indicates a short position. The red lines show the support levels and the green line indicates the resistance levels. These levels can be used to enter and exit trades.

Resistance levels: 145.45, 145.95, and 146.60

Support levels: 143.90, 143.35, and 142.75.

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Technical analysis of NZD/USD for August 07, 2017

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NZD/USD is expected to trade in lower range. The pair is under pressure below its key resistance at 0.7420, which should limit the upside potential. The downward momentum is further reinforced by the 50-period moving average. The relative strength index is below its neutrality level at 50. Therefore, as long as 0.7420 is not surpassed, look for a further decline to 0.7330 and even to 0.7305 in extension.

Strategy: SELL Stop Loss: 0.7420 Take Profit: 0.7330

Chart Explanation:

The black line shows the pivot point. Currently, the price is above the pivot point which indicates the bullish position. If it remains below the pivot point, it will indicate the short position. The red lines show the support levels and the green line indicates the resistance levels. These levels can be used to enter and exit trades.

Resistance levels: 0.7455, 0.7495, and 0.7525

Support levels: 0.7330, 0.7305, and 0.7300

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

Analysis of gold for August 07, 2017

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Recently, gold has been trading downwards. The price tested the level of $1,254.00. On the daily time frame, I found a broken upward channel, which is a sign that buying looks risky. Also, there is a bearish flip on RSI oscilator, which is another sign of weakness. My advice is to watch for potential selling opportunties. The first downward target is set at the price of $1,245.00.

Resistance levels:

R1: $1,263.00

R2: $1,265.00

R3: $1,266.00

Support levels:

S1: $1,261.00

S2: $1,260.00

S3: $1,259.00

Trading recommendations for today: watch for potential selling opportunities.

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Intraday technical levels and trading recommendations for NZD/USD for August 7, 2017

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Daily Outlook

The NZD/USD pair has been trending up within the depicted bullish channel since January 2016.

In November 2016, early signs of bullish weakness were expressed on the chart when the pair failed to record a new high above 0.7400.

A bearish breakout of the lower limit of the channel took place in December 2016.

In February 2017, the depicted short-term downtrend was initiated in the depicted supply zone (0.7310-0.7380).

However, a recent bullish breakout above the downtrend line took place on May 22. Since then, the market has been bullish as depicted on the chart.

The price zone of 0.7150-0.7230 (the key zone) stood as a temporary resistance zone until a bullish breakout was expressed above 0.7230.

This resulted in a quick bullish advance towards the next supply zone around 0.7310-0.7380 which is temporarily breached to the upside.

Now the price zone of 0.7310-0.7380 turns to be a newly-established demand-zone to be watched for possible bullish rejection and a possible BUY entry. S/L should be placed below 0.7300.

On the other hand, re-consolidation below the price level of 0.7300 brings the EUR/USD pair again towards 0.7230-0.7150 (the key zone) where price action should be watched for further decisions.

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GBP/USD analysis for August 07, 2017

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Recently, the GBP/USD pair has been trading downawrds. As I expected, the price tested the level of 1.3023. According to the 4H time frame, I found a breakout of the rising wedge formation in the background and my advice is to watch for potential selling opportuntiies. The first downward target is set at the price of 1.2950.

Resistance levels:

R1: 1.3050

R2: 1.3060

R3: 1.3070

Support levels:

S1: 1.3040

S2: 1.3030

S3: 1.3025

Trading recommendations for today: watch for potential selling opportunities.

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Intraday technical levels and trading recommendations for EUR/USD for August 7, 2017

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Monthly Outlook

In January 2015, the EUR/USD pair moved below the major demand levels near 1.2100 (multiple previous bottoms 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 1.0500, which had been previously reached in August 1997.

In the longer term, the level of 0.9450 remains a projected target if any monthly candlestick achieves bearish closure below the depicted monthly demand level of 1.0500.

However, the EUR/USD pair was trapped within the depicted consolidation range (1.0500-1.1450) until the current bullish breakout was executed above 1.1450.

The current bullish breakout above 1.1450 allows a quick advance towards 1.1850 and the price zone of 1.2000-1.2100 where the price action should be watched for evident bearish rejection and a valid SELL entry.

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Daily Outlook

In January 2017, the previous downtrend reversed when the Head and Shoulders pattern was established around 1.0500. Since then, the evident bullish momentum has been expressed on the chart.

As anticipated, the ongoing bullish momentum allowed the EUR/USD pair to pursue further advance towards 1.1415-1.1520 (Daily Supply Zone).

The daily supply zone failed to pause the ongoing bullish momentum. Instead, an evident bullish breakout is being witnessed on the chart. The nearest supply level to meet the pair is located around 1.2080 (a level of the previous multiple bottoms) where the price action should be watched for a bearish pullback and a possible SELL entry.

On the other hand, the price zone of 1.1415-1.1520 stands as a prominent DEMAND zone to be watched if a bearish pullback occurs.

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Global macro overview for 07/08/2017

Global macro overview for 07/08/2017:

A mixed set of data was released from Canada. The Statistics Canada reported that the labour market added 10.9k jobs in July, which was below the expected 13.1k gain. On the other hand, the unemployment rate fell to 6.3%, while market participants expected an unchanged reading of 6.5%.

Last month, the Bank of Canada decided to hike the interest rate from 0.5% to 0.75%, which was the first rate hike since 2010. More importantly, the BoC did not close the road for further tightening. In the current situation, the surprisingly lower unemployment rate is supporting the Bank of Canada's intention for one more rate hike in October. The other important factor is that the inflation expectations remained below the target, but the bank expects this to be due mostly to temporary factors such as competition in food prices and electricity rebates and still sees the inflation to hit 2.0% by the end of 2018. The next CPI data are scheduled for release on 18th of August, so global investors might start to price in the possible better than expected figures that would again justify the BoC interest rate hike.

Let's now take a look at the USD/CAD technical picture on the H4 timeframe. The market bounced from the technical support at the level of 1.2416 and currently is trading just below the technical resistance at the level of 1.2682. The market conditions are starting to become a little oversold at this timeframe, but there is still no divergence between the price and the momentum indicator. The overall trend remains bearish.

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Global macro overview for 07/08/2017

Global macro overview for 07/08/2017:

The Friday's NFP Payrolls report from the US was the first in a long time that did not disappoint investors. The headline NFP number was released at the level of 209k while market participants expected 183k jobs. The unemployment rate decreased to 4.3% from 4.4% and the average wages rose by 0.3% as expected.

The strong payrolls growth, falling unemployment, and firmer wages growth is good news and with the PPI and CPI scheduled for reease this week, we could see growing support within the Fed officials for additional rate hikes. The market is currently looking for the headline PPI to rise to 2.3% from 2% (core PPI to rise to 2.1% from 1.9%) while Friday's CPI report is predicted to rise to 1.8% from 1.6%. If the data is beaten, then global investors might realize, that only one potential interest rate hike in December 2017 is a too cautious estimate and might start to price in another two hikes next year. That would give the US Dollar another lift up across the board.

Let's now take a look at the US Dollar Index technical picture at the H4 timeframe. A strong upwards reaction after the NFP data release can not be equated with an automatic trend change. The sentiment against the US Dollar was recently extremely negative. Positive surprise by the labor market report for July is just the first step to reversing the depreciation trend - the market based on one 180 degree data will not change its extremely pessimistic attitude. So far, the process of correction of extreme positioning has started. The more extreme it is, the stronger the reaction would be. The nearest technical resistance is seen at the level of 94.47.

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Trading plan for 07/08/2017

Trading plan for 07/08/2017:

At the beginning of the week, there are major changes in the major currencies despite a slight weakening of the US Dollar. The strongest currencies are AUD (+0.2%), EUR (+0.17%) and SEK (+0.15%). The exception is NZD which loses 0.15%. WTI crude oil starts the week with a slight decline and is at $49.40 (-0.3%) and Brent is at $52.25 (-0.35%). The ounce of gold costs 1,257.80 USD (-0.1%). On the Asian stock market sentiment was positive: the Hang Seng added 0.45%, the Nikkei 225 advanced by 0.55%, and the Shanghai Composite rose by +0.23%.

On Monday 7th of August, the event calendar is light but global investors should keep an eye on the CPI data from Switzerland, the Halifax House Price Index data from the UK and the Sentix Investor Confidence data from the Eurozone. Later, during the US session, FOMC member Neel Kashkari will give a speech.

EUR/IUSD analysis for 07/08/2017:

The Sentix Investor Confidence Index data is scheduled for release at 08:30 am GMT and market participants expect a slight deterioration in confidence from 28.3 points to 27.8 points. The dip in the confidence might be related to the current situation in the EUR/USD rate exchange as it recently got very strong. This strengthening of the euro is the result of a stronger run of economic growth this year, but it's a complicating factor for the European Central Bank's monetary policy. The outlook for softer inflation is more visible as the ECB target of 2.0% hasn't been reached yet. Moreover, the euro's climb since June might decrease inflation by 0.2 percentage points this year and 0.4 percentage points next year, which is a significant impact. In this situation, the ECB has a tough nut to crack as it can not withdraw from the stimulus and can not hike the interest rates immediately. The most likely move from the ECB is to wait-and-see approach to consider the future data from the Eurozone economy.

Let's now take a look at the EUR/USD technical picture at the H4 timeframe. The market had bounced from the technical support at the level of 1.1728 and currently is trading in the middle of the range. The recent swing high is seen at the level of 1.1908, but hasn't been tested yet. The market is sliding down from the overbought conditions and the momentum indicator is pointing to the downside. In a case of a further pullback towards the support at the level of 1.1728, the next technical support is seen at the level of 1.11612.

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Market Snapshot: Crude oil tests the 78%Fibo again

Crude oil has been trading sideways since hitting the golden channel resistance at the level of $50.29. The nearest technical support is seen at the level of $48.38 and if broken, then another support is seen at the level of $47.54. The momentum indicator that points to the downside supports the bearish bias.

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Market Snapshot: AUD/USD retreats from highs

The price of AUD/USD is still moving inside of the navy channel, but lower highs and lower lows are being made inside it. The most important technical support is seen at the level of 0.7874 and any breakout below this level will directly expose the next technical support at 0.7838 to be tested.

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Euro can resume growth

Eurozone

The strong report on the US labor market for July led to a reassessment of the euro's outlook for the development of rising dynamics.

The European economy grew for 17 consecutive quarters, the annual growth rate has reached 2.1%, which is the strongest indicator since 2011. The inflation rate has declined to a minimum since June 2009, core inflation remains at a high level, despite some downfall.

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Prior to the next meeting of the ECB, which will be held on September 7, and exactly one month from now.

In favor of a deeper correction, the technical signals but fundamentally a reversal in the mood of investors has not yet been observed.

Today, the data on German industrial production in June and Sentix investor in the euro zone for August will be published today, despite a slight decrease in the last month, it is at the highest levels since 2007. Business activity is at high-level .

United Kingdom

The pound was declined in large part.

At the same time, expecting a reversal in the pound is too soon.

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Oil and ruble

Brent attempts to gain a foothold above $52/bbl, using a successfully developing conjuncture, but there is no assurance for continuous growth. Commercial oil reserves in the United States had slightly declined but was able to remain at a high level. Production has increased to 9.43 million barrels, and with this, the bulls can not expect support.

The OPEC countries are desperately trying to regain control of the situation. As the problems in Venezuela could possibly lead to a reduction in production, OPEC + is forced to look for a solution to outstrip production growth in Libya and Nigeria, which in the end does not give hints about the potential reduction in global reserves.

Baker Hughes issued a report regarding the stabilization of a number of active drilling rigs at 765 units while the growth had stopped, this is a positive factor for the bulls. The positive CFTC report on Friday indicates an increase in the aggregate speculative position. Given the renewed demand for commodity currencies, it is assumed that oil will still make an attempt to increase to $55/bbl.

The ruble continues to trade in the range with no reactions either to the dynamics of oil prices or to the expansion of sanctions by the United States. According to the Federal Customs Service, the Russian Federation's revenues from oil exports in the first half of 2017 gained 38.7% which is higher than the results during the first half of 2016, revenues from gas exports increased by 19.5%. The confident growth of industrial production for four consecutive months enable the ruble to feel confident, even despite a decrease in purchases by the Ministry of Finance of foreign currency.

This week, the ruble may resume strengthening.

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Daily analysis of major pairs for August 7, 2017

EUR/USD: This pair went upwards, testing the resistance line at 1.1900 and then dropping below the resistance line at 1.1800. The drop in the context of an uptrend may end up giving a nice opportunity to buy long at better prices. The outlook on EUR pairs is bullish for this week, and the price could go upwards from here, testing the resistance line at 1.1800, 1.1850 and 1.1900.

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USD/CHF: There remains a bullish signal on the USD/CHF, although price consolidated last week. The resistance level at 0.9750 has been tested and it could be tested again this week, but it is unlikely that it would be breached to the upside. The USD/CHF was able to remain bullish as a result of the weakness in CHF, which may be reversed this week. The outlook on the CHF is bullish for the week, and the USD/CHF may experience a downward movement in case CHF becomes strong.

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GBP/USD: The GBP/USD was able to go upwards because of its positive correlation with the EUR/USD, which is strong in its own right. Price made some bullish attempt, which was rendered invalid as it tested the distribution territory at 1.3250 and then got rejected as price became weak on Thursday and Friday. Further weakness is a possibility because the outlook on GBP pair is bearish for this week. The accumulation territories at 1.3000 and 1.2950 could be tested.

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USD/JPY: There is a huge Bearish Confirmation Pattern on the USD/JPY. Since July 11, the price has dropped by 420 pips; plus the shallow bullish attempt that was seen at the end of last week pales into insignificance when compared to the overall bearish bias. The outlook on certain JPY pairs is bearish this week, and this could cause the demand level at 110.50 and 110.00 to be tested. The demand level at 110.00 was tested last week.

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EUR/JPY: The EUR/JPY is a neutral market, and the neutrality continued last week. Bull made an effort to push the price above the supply zone at 131.00, but the effort proved abortive as price experienced some weakness in the last few days of last week (emphasizing the neutrality in the market). On factor preventing a serious pullback in this market is the stamina in EUR. Should EUR loses strength, there would be a pullback on the EUR/JPY.

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Daily analysis of USDX for August 07, 2017

Forex analysis review
Daily analysis of USDX for August 07, 2017

Trading Plan for EUR/USD and GBP/USD for August 07, 2017

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Technical outlook:

Initially weekly, then daily and now we are presenting the 4H chart view for intermediary trade setups in EUR/USD. The pair has produced a much awaited bearish reversal now and is still looking to continue dropping lower. As seen here, the short term story reveals a break below trend line support and that prices could further drift towards the intermediary trend line support which is passing through 1.1400/1500 levels for now. Please note that immediate Fibonacci extensions are pointing towards 1.1700 levels at least. First major support is seen through 1.1600 levels, while resistance should be strong at 1.1910 levels respectively. In line with the long term picture, the short term story remains bearish and selling on rallies remains a favorable trading strategy.

Trading plan:

Please remain short from last week, stop at 1.1940, targeting at least 1.1800 and 1.1600. Please book partial profits at 1.1700 levels.

GBP/USD chart setups:

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Technical outlook:

In line with the long term story discussed last week, the medium term story remains intact for now. The pair has pushed 3 waves lower and is still looking to push through 1.2900 and 1.2800 levels respectively before producing a meaningful retracement higher. Furthermore, an intermediary trend line has been broken which supports bearish view going forward. The wave trajectory is expected to push through 1.2900 levels before producing a counter trend rally. Please note that it remains high probability that GBPUSD has resumed its larger term bearish trend and hence a series of lower lows and lower highs is possible going forward. The pair is expected to produce 5 waves lower at a higher degree, which could drag prices lower through 1.1900 levels at least. Immediate Fibonacci support is seen at 1.2900 levels for now while price resistance should be strong at 1.3267 levels respectively.

Trading plan:

Continue holding short positions from last week, stop at 1,3280 targeting 1.2900, 1.2800 levels at least. Please book partial profits around 1.2900 levels.

Fundamental outlook:

Today's event book remains almost empty, with no major market movers as those on Friday last.

Good luck!

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Elliott wave analysis of EUR/NZD for August 7, 2017

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Wave summary:

As support at 1.5980 gave away the backup support at 1.5830 had to step up to the plate and it did as the low has been seen at 1.5832 and the next rally higher towards 1.6236 now should be seen. A break above minor resistance at 1.5996 will confirm the next rally higher towards 1.6236.

R3: 1.6154

R2: 1.6028

R1: 1.5996

Pivot: 1.5950

S1: 1.5885

S2: 1.5830

S3: 1.5779

Trading recommendation:

We are long EUR from 1.5510 with stop placed at 1.5770. If you are not long EUR yet, then buy near 1.5885 or upon a break above 1.5996 and place your stop at 1.5825.

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Elliott wave analysis of EUR/JPY for August 7, 2017

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Wave summary:

The correction from 131.40 has been deeper than expected, but as long as short-term important support at 129.83 is able to protect the downside, we will be looking for more upside closer to the ideal target near 133.46.

Short-term a break above minor resistance at 131.12 will confirm the next rally higher to above 131.40 for a move closer to 133.46. Only a break below 129.83 will confirm that wave C and Y already completed with the test of 131.40.

Trading recommendation:

Our stop at 130.30 was hit for a small profit. We will re-buy EUR here at 130.55 with stop placed at 129.75 and take profit at 133.20.

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Technical analysis of EUR/USD for Aug 07, 2017

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When the European market opens, some Economic Data will be released, such as Sentix Investor Confidence and German Industrial Production m/m. The US will release the Economic Data, too, such as Consumer Credit m/m and Labor Market Conditions Index m/m, so, amid the reports, EUR/USD will move in a low to medium volatility during this day.

TODAY'S TECHNICAL LEVEL:

Breakout BUY Level: 1.1834.

Strong Resistance:1.1827.

Original Resistance: 1.1816.

Inner Sell Area: 1.1805.

Target Inner Area: 1.1777.

Inner Buy Area: 1.1749.

Original Support: 1.1738.

Strong Support: 1.1727.

Breakout SELL Level: 1.1720.

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 Aug 07, 2017

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In Asia, Japan will release the Leading Indicators data, and the US will release some Economic Data, such as Consumer Credit m/m and Labor Market Conditions Index m/m. So, there is a probability the USD/JPY will move with low to medium volatility during this day.

TODAY'S TECHNICAL LEVEL:

Resistance. 3: 111.30.

Resistance. 2: 111.08.

Resistance. 1: 110.86.

Support. 1: 110.60.

Support. 2: 110.38.

Support. 3: 110.16.

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

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

GBP/USD profit target reached perfectly, prepare to buy

The price has dropped absolutely perfectly from our selling area and has reached our profit target. We prepare to buy on major support at 1.3006 (Fibonacci retracement, Fibonacci extension, horizontal overlap support) for a bounce up to at least 1.3109 resistance (Fibonacci retracement, horizontal pullback resistance).

Stochastic (34,5,3) is testing major support at 7.5% and we expect a bounce soon.

Buy above 1.3006. Stop loss is at 1.2954. Take profit is at 1.3109.

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AUD/USD dropping nicely towards profit target, remain bearish for a further drop

The price has dropped nicely from our previous call on Friday. We remain bearish looking to sell on strength below 0.7942 resistance (Fibonacci retracement, horizontal overlap resistance) for a further push down to 0.7875 support (Fibonacci extension, horizontal swing low support, bearish channel momentum).

RSI (34) sees a descending resistance line holding our bearish momentum really nicely.

Correlation analysis: We are expecting commodities weakness with AUD/USD and NZD/USD both expecting drops.

Sell below 0.7942. Stop loss is at 0.7981. Take profit is at 0.7875.

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NZD/USD testing major resistance, remain bearish for a further drop

The price continues to test our major resistance level. We remain bearish looking to sell below 0.7459 resistance (Fibonacci retracement, horizontal overlap resistance) for a further push down to at least 0.7333 support (Fibonacci extension, horizontal swing low support).

RSI (34) sees intermediate resistance at 49% which continues to hold it down.

Correlation analysis: We are expecting commodities weakness with AUD/USD and NZD/USD both expecting drops.

Sell below 0.7459. Stop loss is at 0.7500. Take profit is at 0.7333.

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EUR/JPY prepare to buy on major support

The price is now testing major support at 130.19 (Fibonacci retracement, Fibonacci extension, bullish divergence) and we expect to see a strong bounce above this level for a push up to 131.03 resistance (Fibonacci retracement, horizontal swing high resistance).

Stochastic (34,5,3) is seeing strong support above 7.8% and also sees bullish divergence signaling that a bounce is impending.

Correlation analysis: We are seeing JPY weakness across the board with bounces expected on EUR/JPY, AUD/JPY, and USD/JPY.

Buy above 130.19. Stop loss is at 129.76. Take profit is at 131.03.

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AUD/JPY profit target reached for the 5th time, prepare to buy

The price has bounced perfectly and reached our profit target for the 5th time in a row. We remain bullish looking to buy on the break of our 87.80 resistance (Fibonacci retracement, horizontal overlap resistance). Once the price has broken this level with strength, we look to play the rise to 88.25 resistance (Fibonacci retracement, Fibonacci extension, horizontal swing high resistance).

RSI (34) has broken out of a descending resistance-turned-support line signaling that a change in momentum is fast approaching.

Correlation analysis: We are seeing JPY weakness across the board with bounces expected on EUR/JPY, AUD/JPY, and USD/JPY.

Buy above 87.80. Stop loss is at 87.48. Take profit is at 88.25.

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USD/JPY bouncing up towards profit target, remain bullish

The price has bounced perfectly off our buying area and has started to shoot up nicely towards our profit target. We can also see that is has made a bullish exit from a previous descending resistance-turned-support line. We remain bullish looking to buy above 110.32 support (Fibonacci retracement, pullback support) for a further push up towards 111.59 resistance (Fibonacci retracement, horizontal overlap resistance).

RSI (34) sees bullish divergence and also sees a bullish exit of a descending resistance-turned-support line.

Correlation analysis: We are seeing JPY weakness across the board with bounces expected on EUR/JPY, AUD/JPY, and USD/JPY.

Buy above 110.32. Stop loss is at 109.74. Take profit is at 111.59.

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Technical analysis of EUR/USD for August 07, 2017

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Overview:

  • The EUR/USD pair has faced strong support at the level of 1.1722 because resistance became support last week. So, the strong resistance has been already faced at the level of 1.1801 and the pair is likely to try to approach it in order to test it again. The level of 1.1801 represents a weekly pivot point for that it is acting as minor support this week. Furthermore, the EUR/USD pair is continuing to trade in a bullish trend from the new support level of 1.1722. Currently, the price is in a bullish channel. According to the previous events, we expect the EUR/USD pair to move between 1.1722 and 1.1801. Also, it should be noticed that the double top is set at 1.1901. Additionally, the RSI is still signaling that the trend is upward as it remains strong above the moving average (100). This suggests the pair will probably go up in coming hours. Accordingly, the market is likely to show signs of a bullish trend. In other words, buy orders are recommended above 1.1722 with the first target at the level of 1.1801. If the trend is being able to break the weekly pivot at the level of 1.1801, then the market will continue rising towards the weekly resistance 1 at 1.1880. However, the stop loss should be placed below the level of 1.1693.
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Technical analysis of GBP/USD for August 07, 2017

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Overview:

  • On the one-hour chart, the GBP/USD pair bullish trend from the support levels of 1.3012 and 1.3020. 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 1.3011, which coincides with a ratio of 23.6% Fibonacci. Consequently, the first support is set at the level of 1.3011. So, the market is likely to show signs of a bullish trend around the spot of 1.3011/1.3020. In other words, buy orders are recommended at the price of 1.3020 with the first target at the level of 1.3100. Furthermore, if the trend is able to breakout through the first resistance level of 1.3100. We should see the pair climbing towards the double top (1.3140) to test it. However, it would also be wise to consider where to place a stop loss; this should be set below the second support of 1.2972.
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Technical analysis of USDX for August 7, 2017

The Dollar index bounced strongly on Friday after the announcement of the jobs report and specifically of the better than expected NFP. Short-term trend has changed to bullish as the price is now testing important intermediate term trend.

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Magenda line - resistance

The Dollar index has broken above the resistance trend line and is making higher highs and higher lows. Price is now testing the important intermediate-term trend resistance level at 93.80. A pull back towards 93.20 is justified as this was the break out level. However, I believe that the time for a strong Dollar bounce has arrived. The weekly candle also could be confirming this view.

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We have been saying for the past few sessions that the Dollar index is oversold, diverging, and inside the long-term support area of 92-93. Last week's candle with the long tail and bullish close near the highs is a bullish reversal hammer pattern. If this week is positive and gives us a higher close, we will confirm the trend reversal that could push price towards even 98. I remain bullish the Dollar.The material has been provided by InstaForex Company - www.instaforex.com

Technical analysis of gold for August 7, 2017

The Gold price has broken the bullish channel downwards and has started a corrective phase. Price is expected to pull back at least towards $1,248. Short-term trend is bearish. I expect the corrective phase to last at least this week.

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Blue lines - bullish channel

The Gold price is trading inside the 4 hour Kumo. The trend has changed from bullish to neutral in cloud terms, but technically it is bearish for the short-term as we are now making lower lows and lower highs, having broken the bullish channel. Support is at $1,248 at the 38% Fibonacci retracement.

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On a daily basis, the price has broken out and above the Daily Kumo (cloud) and is now back testing it. I can see the kijun-sen (yellow line indicator) being tested. The price could reach $1,240 before the next upward move. Key resistance is at $1,270. I remain long-term bullish.The material has been provided by InstaForex Company - www.instaforex.com

Daily analysis of USDX for August 07, 2017

The index was favored by the US NFP numbers of July and the structure is now turning sideways, as USDX is hovering around the 200 SMA zone at H1 chart. To see further advances, the index needs to break above the 93.49 level in order to test the key psychological level of 94.00. To the downside, the nearest support is placed at 92.80.

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H1 chart's resistance levels: 93.49 / 94.00

H1 chart's support levels: 92.80 / 92.29

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 92.80, take profit is at 92.29 and stop loss is at 93.31.

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Daily analysis of GBP/USD for August 07, 2017

The pair has made another leg lower and it's close to testing the support zone of 1.3012, following positive US NFP numbers. Currently, a consolidation below the 200 SMA at the H1 chart is happening and as long as GBP/USD stays below that moving average, we can expect further weakness towards the 1.2955 level. MACD indicator is in the negative territory.

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H1 chart's resistance levels: 1.3088 / 1.3160

H1 chart's support levels: 1.3012 / 1.2955

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 1.3088, take profit is at 1.3160 and stop loss is at 1.3015.

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The emotions of the dollar will not help

Published on Friday, macroeconomic data provoked profit-taking and a noticeable strengthening in the dollar index.

The US trade balance deficit dropped significantly in June due to the growth in exports. The deficit reduction was 5.9% to the minimum since October 2016 which was at the value of $43.6 billion. The result was somewhat unexpected for the market because it is much better than the forecasts. The main reasons that led to positive dynamics are oil export growth and inflation decline against the background of the general weakening of the dollar in the first half of 2017. This had a positive effect on the position of exporters.

The labor market also showed a positive trend for the month of July. The number of new jobs increased by 209,000. This was unexpected for experts who expected weaker figures after the uncertain ADP report. Moreover, the estimates for May and June were also revised upwards. Unemployment fell from 4.4% to 4.3%, reaching a record low in 16 years.

At the same time, the broader calculation of unemployment, consisting of the total number of unemployed, drop-outs, and the composition of the workforce, is not so convincing. It indicated an unemployment rate of about 8%.

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Another positive point in the report was a higher than expected growth in the average wage which increased expectations for consumer activity and other things.

Thus, macroeconomic data played in favor of bulls in the dollar. Technical overselling and the completion of the week supplemented the picture and provoked locking in of profits. At the same time, the confidence that the dollar has reversed did not increase. In any case, the forecast on the rate of CME still gives a 52% chance that the Fed will not raise rates by the end of the year. They will limit themselves to the launch of the balance reduction program.

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Similarly, there is no outstripping growth in the yields of US Treasury bonds relative to other G10 securities. That it, there is no question of steady increase in the spread in favor of US securities. Investors are rather cautious about the prospects of the US economy since positive data on exports and the current conditions of the labor market are not strong enough drivers to change the mood of players. There are much more significant factors such as budget revenues and the result of the confrontation between the Congress and the Trump administration regarding the raising of the limit of public debt, medical reforms, and tax reforms.

The coming week, from the point of view of macroeconomic publications, can turn out to be rather calm. The main attention of the market will be turned to the publication on Friday of the report on consumer inflation in July. At the moment, cautious optimism is returning to the markets. Forecasts are generally favorable and it is expected that inflation will show a growth of 0.2%. On an annual basis, experts expect an increase from 1.7% to 1.8%. Positive data can serve as a trigger for the reversal of the dollar index.

On Monday, the Fed will present its assessment of the labor market. July employment indicators, published on Friday, were unexpectedly strong. However, the Fed may have its own view on the general dynamics of the employment market which is different from the market's views and therefore, the publication of the Labor Market Conditions Index on Monday can cause adjustments on the expectations for the rates.

On Wednesday, preliminary data on the labor productivity and labor costs in the second quarter will come out, This will complement the overall picture of the state of affairs in the US economy.

The dollar somewhat strengthened its positions. The probability of growth in corrective moods has increased. At the same time, the reasons for a new wave of strengthening the dollar are not enough. So, the most likely scenario for the coming week is the resumption of a decline in the dollar primarily against the euro and the commodity currencies.

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