EUR/JPY analysis for August 08, 2017

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Recently, the EUR/JPY has been trading sideways at the price of 130.40. According to the 4H time frame, I found a fake breakout of the sideways base, which is a sign that buying looks risky. There is also a hidden bearish divergence on the moving average oscillator, which is another sign of weakness. My advice is to watch for potential selling opportunities. The downward target is set at the price of 128.60.

Resistance levels:

R1: 131.00

R2: 131.40

R3: 131.80

Support levels:

S1: 130.20

S2: 129.75

S3: 129.50

Trading recommendations for today: watch for potential selling opportunities.

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NZD/USD Intraday technical levels and trading recommendations for August 8, 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 (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 (Key-Zone) where price action should be watched for further decisions.

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Intraday technical levels and trading recommendations for EUR/USD for August 8, 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 bullish advance towards 1.1850 and 1.2000-1.2100 where 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, evident bullish momentum has been expressed on the chart.

As anticipated, the ongoing bullish momentum allowed the EUR/USD pair to pursue further bullish 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 (Level of previous multiple bottoms) where 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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GBP/USD analysis for August 08, 2017

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Recently, the GBP/USD has been trading sideways at the price of 1.3017. The analysis from yesterday is still active. According to the 1H time frame, I found that price has broken the rising wedge formation in the background and that sellers are in control. My advice is to watch for potential selling opportunities. The downward targets are set at the price of 1.2950 and 1.2815.

Resistance levels:

R1: 1.3060

R2: 1.3090

R3: 1.3115

Support levels:

S1: 1.3010

S2: 1.2985

S3: 1.2960

Trading recommendations for today: watch for potential selling opportunities.

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Technical analysis of USD/JPY for August 08, 2017

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USD/JPY is expected to trade with bullish bias above 110.15. The pair is consolidating above the key support at 110.15, which should limit the downside potential. The relative strength index is above its neutrality level at 50 and lacks downward momentum.

Therefore, as long as 110.15 is not broken, look for a further rise to 110.80 and even to 111.05 in extension.

Alternatively, if the price moves in the opposite direction, a short position is recommended below 110.15 with a target at 109.15.

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

Strategy: BUY, Stop Loss: 110.15, Take Profit: 110.80

Resistance levels: 110.80, 111.05, and 111.40 Support Levels: 109.90, 109.65, 109.35

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Technical analysis of USD/CHF for August 08, 2017

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USD/CHF is expected to trade with a bullish outlook. The pair posted a rebound and broke above both 20-period and 50-period moving averages. The relative strength index has landed on its neutrality level at 50 and is turning up. The downside potential should be limited by the key support at 0.9700.

Therefore, as long as this key level holds on the downside, look for a further upside to 0.9745 and even to 0.9765 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: 0.9745

Resistance levels: 0.9745, 0.9765, and 0.9780

Support levels: 0.9670, 0.9630, and 0.9600

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Technical analysis of GBP/JPY for August 08, 2017

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GBP/JPY is expected to trade with a bullish outlook. The pair recorded lower tops and lower bottoms, which confirmed a negative outlook. The declining 50-period moving average is playing a resistance role. The relative strength index is capped by a declining trend line.

To sum up, as long as 144.85 is resistance, expect another decline to 143.35 and even to 142.45 in extension.

Alternatively, if the price moves in the opposite direction as predicted, a long position is recommended above 144.85 with the target at 145.40.

Strategy: SELL, Stop Loss: 144.85, Take Profit: 143.35.

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: 145.40, 145.95, and 146.60

Support levels: 143.35, 142.45, and 141.75.

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Global macro overview for 08/08/2017

Global macro overview for 08/08/2017:

The German Trade Balance data disappointed the market participants. The last month surplus of 20.3 Bln Euro was beaten by this month figure of 21.2Bln, but it was worse than expected number of 22.3Bln. The export dropped by 2.8% in June, from 1.5% in May. At the same time, imports dropped by 4.5% from 1.3% in May. As a result, the seasonally-adjusted trade balance still widened to the highest level since February.

Trade Balance is the difference between the value of exports and imports in Germany and it is one of the biggest components of Germany 's Balance of Payment. Despite today's disappointing data, German exports have been weathering a series of potential risks relatively well. The ongoing political problems with Trump administration, Brexit uncertainty and a strengthening of the Euro are not harming the German exports much so far. Bilateral trade data over the first five months of the year show that only Brexit and the weaker pound sterling continue to leave their marks on German exports to the UK, but the strongest than anticipated exports to Netherlands, Italy and Eastern European countries has diminished the negative impact of Brexit. Nevertheless, if the current trend will continue, the German exports to the UK might be at the lowest level since 2010.

The biggest problem seems to be the ongoing appreciation of Euro, which currently is at the two-year high against the US Dollar and this might harm the German economy. Nevertheless, previous episodes have shown that there is no such thing like an explicit pain threshold for German exporters when it comes to the exchange rate, so the problem is likely exaggerated.

Let's now take a look at the German DAX30 index technical picture at the daily timeframe. The bears have managed to fill the gap between the levels of 12093 12302 and now the price is trying to rally back just as all the indices from the US are doing. The oversold market conditions support the bullish view. A breakout above the golden trend line is a confirmation that up trend is resumed.

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Global macro overview for 08/08/2017

Global macro overview for 08/08/2017:

The AIG Construction Index from Australia has hit a record high in July. The index is a survey of about 120 construction companies which asks respondents to rate the relative level of business conditions including employment, production, new orders, prices, supplier deliveries, and inventories. The recent level of 60.5 points ( the previous figure was 56.0 points) was the highest number since 2005, which was also at a record high on a quarterly basis (57.7 points) and six-month basis (54.9 points), suggesting that the construction companies are at their prime level of performance. The AIG notes that "the further upturn in industry conditions reflected expanding activity across all four major construction sectors" and "government infrastructure spending is starting to influence the data, pushing up the engineering construction sector (+6.9 to 57.5 points)". Other gains were noticed in non-residential approvals (up 27% in June), helping push up the commercial construction sector (+9.8 to 64.3 points)". The weakest sector in the last year has been apartments, with approvals peaking late last year, but the sector recovered in July to 52.6 points. Moreover, the AIG noted, that new orders, employment, and wages increased strongly, which might indicate, that the construction sector will help lift wage growth in coming quarters. This, in turn, will influence the Reserve Bank of Australia, as the inflationary pressures will increase as well. All in all, another interest rate hike by RBA seems to be investable this year and will strengthen AUD across the board.

Let's now take a look at the AUD/USD technical picture at the H4 timeframe. The market is still trading inside of a channel that looks like a bullish flag pattern, so as long as the level of 0.7874 is not clearly violated, the outlook remains bullish. The oversold market conditions support the view.

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Technical analysis of NZD/USD for August 08, 2017

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We are going to retain our yesterday's target downside target. NZD/USD is expected to trade with a bearish outlook.The pair broke below the key support at 0.7385 (lows of August 3 and 4), which becomes the key resistance now. The downward momentum is further reinforced by the declining 50-period moving averages. The relative strength index is mixed with a bearish bias.

Hence, as long as 0.7385 holds on the upside, look for a new decline to 0.7330 and even to 0.7305 in extension.

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: 0.7420, 0.7455, and 0.7475

Support levels: 0.7330, 0.7305, and 0.7300

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Fundamental analysis of EUR/JPY for August 8, 2017

EUR/JPY has been struggling to break the 130.60 resistance level recently which signals massive volatility and bullish counter pressure in the market as well. EUR has been much stronger recently which has led to a non-volatile bullish trend since April. Now it seems like getting a pause after JPY is on the way to its gains. Today, the Bank Lending report was published in Japan which was unchanged at 3.3% and the Current Account has shown a significant rise to 1.52T from the previous value of 1.40 which was expected to be at 1.51T. On the other hand, today Germany published the trade balance report with an increase to 21.2B from the previous value of 20.3B which was expected to be at 20.8B. Besides, the French Government unveiled the Budget Balance which showed less deficit to -62.3B versus the previous -66.4B. Furthermore, the French Trade Balance was published with better than expected value at -4.7B which was expected to be at -5.1B. Thus, both the Eurozone and Japan presented some positive economic reports today which is expected to lead to further correction in this pair. However, JPY is expected to have an upper hand over EUR by its progress signaled by the BOJ recently about the inflation and monetary policies to be taken in action.

Now let us look at the technical view. The price is currently struggling at the edge of 130.60 which signals that the recent bullish break was false. As the price is currently showing some bullish rejection and impulsive bearish momentum, it signals that bears are quite stronger in pulling the price down towards the 128.50 support level. As the price remains below 131.00, the bearish bias is expected to continue further in this pair.

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Trading plan for 08/08/2017

Trading plan for 08/08/2017:

Slight losses of the US Dollar can be noticed across the board and it was caused yesterday by Fed officials Bullard and Kashkari who said they were in no hurry to raise interest rates. On the Asian stock market the mixed sentiment prevails. The Hang Seng is up nearly 0.4%, the Nikkei 225 drops 0.3%, and the Shanghai Composite is near yesterday's closing price.

On Tuesday 8th of August, the event calendar is light, but market participants will pay attention to the German and French Trade Balance data, the JOLTs Job Openings data and the NFIB Small Business Optimism data from the US. Besides, Canada will unveil the Housing Starts data.

Analysis of EUR/USD for 08/08/2017:

The NFIB Small Business Optimism data is scheduled for release at 10:00 am GMT and market participants expect the sentiment to stay unchanged at the level of 103.6 points. Last Friday the NFP data beat the expectations, but small companies are in a slightly different situation, despite the fact that the ADP estimate of small-business employment posted a modest rebound last month. Companies with fewer than 50 employees created 50,000 new positions, up from 29,000 in the previous month, but the trend still looks weak. After accelerating in the first quarter of 2017, the employment growth in small companies decreased sharply in recent months. The stumble is conspicuous in the year-over-year trend, which slumped to a weak 1.3% gain in July – a six-year low. Nevertheless, the sentiment among small-company executives remains relatively high and stable, with the biggest score at 117 points in March. The current levels of optimism are visibly lower but are still expected at the levels above 100. The main reason for a slide in sentiment might be attributed to Trump administration's reforms of the taxes and health system - none of the promised reforms have been done, so the owners and small companies executives are losing faith that those reforms will ever be implemented. Less hiring by the small business executives means lower wages and consumer spending levels, which is an important part of the US economy and the overall GDP.

Let's now take a look at the EUR/USD technical picture at the H1 timeframe. Bulls have managed to retrace 50% of the previous slide and now are consolidating under the technical resistance at the level of 1.1829. The next technical support is seen at the level of 1.1775 and 1.1721. The overall trend in the higher time frames is still bullish.

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Market Snapshot: S&P500 made another all time high

The US S&P500 index made a new all-time high yesterday, but the S&P500 ETF called SPY is still under the recent swing high at the level of 247.98. Nevertheless, the series of higher highs and higher lows is indicating that a new high will be made soon. The momentum indicator supports the bullish bias.

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Market Snapshot: USD/CHF testing the trend line

USD/CHF has bounced from the technical support at the level of 0.9442 and currently is testing the golden trend line from below. Bulls have managed to break out a little bit higher and made a local high at the level of 0.9770, just below the technical resistance at 0.9773. Nevertheless, the most important resistance at the level of 0.9811 hasn't been violated yet and as long as the price is trading below this level, bears are in control over this market.

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Euro: Analysts promise 1.3000

Euro: Analysts promise 1.3000

Morning review.

On the market - a minimum of news. This August in Russia, the usual time of catastrophes, we look how everything drowned beyond the Urals and admire the miracle-pike.

And in the West, August is a month of total calm. Now the future of the currency market will be determined at the end of August and in September. At the end of August, the famous banking gatherings in Jackson-Hole, Wyoming, will take place and they say that a general decision will be made to reduce world liquidity (exit from QE).

Then in September, there will be meetings of the Fed and the ECB, and for a snack, the elections in Germany. (However, in the elections in Germany, no surprises are expected, again, Merkel).

But this is the end of August and September, before this another two weeks.

A correction is expected but all write that they are ready to buy euro. Bloomberg writes confidently about the euro's goal at 1.3000 (by the end of the year or earlier). If the ECB announces the completion of the infusion program so easily.

At the moment - correction.

Down - the entrance to the breakdown is 1.1725.

Upward - aggressively and at the breakdown of 1.1830, more conservatively at the breakdown of 1.1910.

We are still on sale, but from 1.1830 upsides down.

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The pound plays poker

Forex analysis review
The pound plays poker

Fundamental Analysis of GBP/USD for August 8, 2017

GBP/USD has been quite bearish recently due to positive high impact economic reports of USD. As of the Brexit effect and political unrest in the economy recently GBP has gained over USD with a steady manner which came to a pause after USD had some positive economic reports published on Friday. Moreover, BOE has failed to provide hopes on Rate Hike, Inflation, and Economic growth which resulted to further weakness of the currency which is expected to continue for coming days as well. Today GBP BRC Retail Sales Monitor report was also published with a decreased figure at 0.9% which previously was at 1.2%. On the other hand, today USD have NFIB Small Business Index report which is expected to remain unchanged at 103.6, JOLTS Job Opening report is expected to show a growth to 5.74M from the previous figure of 5.67M and IBD/TIPP Economic Optimism is also expected to show a bit of a rise to 50.6 from the previous figure of 50.2. To sum up, USD is currently quite hawkish in nature with positive economic reports which is expected to add to the gains of the currency against GBP in the coming days. Though the gain is expected to be shorter in duration as GBP is overall quite stronger in long term basis.

Now let us look at the technical view, the price is currently residing below the resistance level of 1.3050 which is expected to reach 1.2850 in the coming days which is also a trendline support. After the bearish impulsive price action of NFP, USD is currently quite strong in nature and expected to gain more over GBP in the coming days as the price remains below the resistance area of 1.3050 to 1.3130.

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The pound plays poker

The British pound could not hold onto its levels of 10-month highs against the US dollar and the sterling tumbled down due to the decline in the forecasts for the growth of the UK economy by the Bank of England, the moderately "dovish" rhetoric of Mark Carney and strong data on the US labor market. The futures market does not believe in hiking the repo rate in May 2019, while the increase in the likelihood of tightening the Fed's monetary policy in December from 44% to 47% has become the basis for a GBP/USD bearish attack.

Impressed with better-than-expected data on business activity in the service sector, the sterling super-thursday for its health: the index accelerated from 53.4 to 53.8, which was a pleasant surprise after the purchasing managers index dropped to an 11-month low and revived hopes for a gradual recovery in the UK economy.

Dynamics of business activity in Britain

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Source: Financial Times

Nevertheless, the Bank of England did not make the best out of the situation and reduced GDP growth forecasts from 1.9% to 1.7% in 2017 and from 1.7% to 1.6% in 2018. What more needs to be done if the path of the indicator has significant discrepancies with earlier estimates?

Forecasts for GDP growth

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Source: Financial Times.

The Monetary Policy Committee left the REPO rate at 0.25% with six votes to two. Mark Carney said that the Central Bank needs to work closely when dealing with extreme conditions, inflation remains a priority, and rates can be raised earlier than the market expects. If you add to this speech the following comments by Ben Broadbent on the possibility of a monetary tightening, you might think that the BoE acted as a "hawk". In fact, investors are well aware of the benefits of a strong pound, which blocks the growth of inflation. In this regard, they start to ignore the comments on hiking rates, comparing them with the player's poker bluff.

Furthermore, US employment data added pressure on the position for "bulls" of the GBP/USD. In June, non-farm payrolls increased by 209,000, unemployment dropped to 4.3%, and the average salary accelerated at the fastest pace since autumn 2016. The US dollar recorded modest gains. According to Nordea Markets, even amid further improvements in macroeconomic data, it would be unlikely that they will be able to develop them in the United States. Blame the "American" Damocles sword factor of the public debt ceiling for everything. Until the end of September to the middle of October, it is unlikely that the yield of treasury bonds will increase substantially.

As for the pound, the gradual process of brexit negotiations, risks of slowing down industrial production as well as concerns with attracting investments in financial markets and in the UK economy, will paint the future with shades of grey.

Technically, after implementing the "Bat" and "Three Movements" patterns, the GBP/USD pair fell to support at 1.303. Here is the lower limit of the ascending trading channel. A successful attack will allow the "bears" to rely on the development of correction in the direction of 1,285-1,29. On the contrary, the exit will lay a foundation for consolidation.

GBP/USD, daily chart

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Technical analysis of EUR/USD for Aug 08, 2017

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When the European market opens, some Economic Data will be released, such as French Trade Balance, French Gov Budget Balance, and German Trade Balance. The US will release the Economic Data, too, such as IBD/TIPP Economic Optimism, Mortgage Delinquencies, JOLTS Job Openings, and NFIB Small Business Index, so, amid the reports, EUR/USD will move in a low to medium volatility during this day.

TODAY'S TECHNICAL LEVEL:

Breakout BUY Level: 1.1855.

Strong Resistance:1.1848.

Original Resistance: 1.1837.

Inner Sell Area: 1.1826.

Target Inner Area: 1.1798.

Inner Buy Area: 1.1770.

Original Support: 1.1759.

Strong Support: 1.1748.

Breakout SELL Level: 1.1741.

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 08, 2017

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In Asia, Japan will release the Economy Watchers Sentiment, 30-y Bond Auction, Current Account, and Bank Lending y/y data, and the US will release some Economic Data, such as IBD/TIPP Economic Optimism, Mortgage Delinquencies, JOLTS Job Openings, and NFIB Small Business Index. So, there is a probability the USD/JPY will move with low to medium volatility during this day.

TODAY'S TECHNICAL LEVEL:

Resistance. 3: 111.23.

Resistance. 2: 111.01.

Resistance. 1: 110.79.

Support. 1: 110.54.

Support. 2: 110.32.

Support. 3: 110.10.

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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GBP/USD remain bullish above major support

The price continues to drop towards our buying area. We prepare to buy on major support at 1.3006 (Fibonacci retracement, Fibonacci extension, horizontal overlap support, bullish divergence) 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 can see bullish divergence being formed vs price signaling that a bounce is impending.

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

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

The price has dropped perfectly form our selling area yesterday. We remain bearish looking to sell on strength below 0.7931 resistance (Fibonacci retracement, horizontal overlap resistance) for a further push down to 0.7875 support (Fibonacci extension, horizontal swing low support). We also shift our stop loss to 0.7950 to protect our running profits.

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

Sell below 0.7931. Stop loss is at 0.7950. Take profit is at 0.7875.

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NZD/USD profit target reached, prepare to buy

The price has dropped perfectly from our selling area and is fast approaching our profit target. We prepare to buy above major support at 0.7333 (Fibonacci retracement, horizontal swing low support, Fibonacci extension) for a push up to at least 0.7389 resistance (Fibonacci retracement, horizontal pullback resistance).

RSI (34) sees intermediate resistance at 49% which continues to hold it down, as long as RSI remains below this level, our long term view on NZDUSD would be bearish.

Stochastic is seeing major support at 8% signaling that a short term correction is fast approaching.

Buy above 0.7333. Stop loss is at 0.7305. Take profit is at 0.7389.

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EUR/JPY bouncing perfectly towards profit target, remain bullish for a further rise

The price has bounced up perfectly from our buying level yesterday. We remain bullish today looking to protect our profits by shifting stop loss to breakeven at 130.17. The plan is to continue to buy on dips above 130.46 support (Fibonacci retracement, horizontal overlap support) for a further push up to 131.03 resistance (Fibonacci retracement, Fibonacci extension, horizontal swing high resistance).

Stochastic (34,5,3) is seeing intermediate support at 42% signaling that a further rise is expected.

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

Buy above 130.46. Stop loss is at 130.17. Take profit is at 131.03.

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AUD/JPY remain bullish with price testing pullback support

We remain bullish looking to buy above major support at 87.53 (Fibonacci retracement, horizontal swing low support, pullback support) for a push up to at least 88.02 resistance (Fibonacci retracement, 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 87.53. Stop loss is at 87.32. Take profit is at 88.02.

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USD/JPY remain bullish for a further rise

The price made a bullish exit from a previous descending resistance-turned-support line signaling that we're seeing a change in momentum. 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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Daily analysis of major pairs for August 8, 2017

EUR/USD: The EUR/USD did not do anything significant on Monday – price merely went sideways. Last Friday, a drop in price was witnessed. 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: This currency trading instrument consolidated last week, and it also went sideways on August 7. 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 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: A clean bearish signal has been generated on the Cable, following the weakness that started last week. From the weekly high of 1.3268, the price has lost about 220 pips, now below the distribution territory at 1.3050. The next target is the accumulation territory at 1.3000, which would most likely be breached to the downside.

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USD/JPY: This is a bear market – price has been going downwards since early July. There is a huge bearish Confirmation Pattern in the market, and the more bearish journey is anticipated this week as price goes for the demand level at 110.50 and 110.00 (both were tested last week). The demand levels may even be exceeded to the downside.

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EUR/JPY: The EUR/JPY is neutral, but the neutrality is gradually coming to an end as the price is being subtly pushed upwards. Price has moved above the demand zone at 130.50 and it may even move above the supply zone at 131.00. However, things would go seriously bearish when EUR becomes very week, and when JPY become strong it is its own right.

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Technical analysis of NZD/USD for August 08, 2017

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Overview:

  • The NZD/USD pair continues to move downwards from the level of 0.7421. Yesterday, the pair dropped from the level of 0.7421 (this level of 0.7421 coincides with the ratio of 61.8% Fibonacci retracement level) to the bottom around 0.7350. Today, the first resistance level is seen at 0.7421 followed by 0.7481, while daily support 1 is seen at 0.7337. According to the previous events, the NZD/USD pair is still moving between the levels of 0.7379 and 0.7285; for that, we expect a range of 94 pips (0.7379 - 0.7285). If the NZD/USD pair fails to break through the resistance level of 0.7421, the market will decline further to 0.7285. 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 0.7285 with a view to testing the weekly support 2. On the contrary, if a breakout takes place at the resistance level of 0.7421, then this scenario may become invalidated.
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Technical analysis of USD/CHF for August 08, 2017

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Overview:

  • Pivot point: 0.9693.
  • The USD/CHF pair continues to move upwards from the level of 0.9693. The market has been trading around the spot of 0.9693 since last week. The pair rose from the level of 0.9693 (the level of 0.9693 coincides with a ratio of 78.6% Fibonacci retracement) to a top around 0.9733. The first support level is seen at 0.9693 followed by 0.9639, while daily resistance 1 is seen at 0.9763. According to the previous events, the USD/CHF pair is still moving between the levels of 0.9693 and 0.9763; for that, we expect a large range in coming hours. On the 1-hour chart, immediate resistance is seen at 0.9763 which coincides with the double top. Currently, the price is moving in a bullish channel. This is confirmed by the RSI indicator signaling that we are still in a bullish trending market. The price is still above the moving average (100). Therefore, if the trend is able to break out through the first resistance level of 0.9763, we should see the pair climbing towards the second daily resistance at 0.9800 to test it. It would also be wise to consider where to place stop loss; this should be set below the second support 0.9639. Overall, the trend is still calling for a strong bullish market as long as the trend is still above the spot of 0.9693 and 0.9639.
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Daily analysis of GBP/USD for August 08, 2017

GBP/USD remains to consolidate losses around the support zone of 1.3012 and it's the last hurdle before to reach the other key zone at 1.2955. Currently, the pair is forming a lower low pattern below the 200 SMA and further weakness is expected. To the upside, the resistance zone of 1.3088 could act as a key barrier for any attempt of recovery.

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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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Daily analysis of USDX for August 08, 2017

USDX is still hovering at the 200 SMA zone in the H1 chart. It seems that bullish formations could start to happen soon in the index, as long as it remains above the moving average. However, the risk is still to the downside and if the US Dollar Index manages to do a pullback at the current stage, then it could test the support level of 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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Fundamental Analysis of USD/JPY for August 7, 2017

USD/JPY has been quite volatile recently at the edge of breaking below 110.00-60 support area. Recently after the positive Non-Farm Employment Change report published on Friday at 209k which was better than expectation of 182k, USD has surged higher by engulfing recent price action at the edge of the 110.60 support area making last bearish breakout to a false break whereas at the same day JPY Average Cash Earnings was published was published with negative value at -0.4% from previous positive value of 0.6% which was expected to be at 0.5%. Today JPY Leading Indicator report was published with an increased value at 106.3% from the previous value of 104.6% which was expected to be at 106.2% which did help JPY to stop the bullish momentum in the pair but it is expected to be quite shorter in duration. On the USD side, today there were no important economic events other than FOMC Member Kashkari's speech who is going to speak about nation's key interest rate and future monetary policy of the country which is expected to be hawkish in nature which might result in further gains on the USD side.

Now let us look at the technical view, the price is currently residing above the support area of 110.00-60 which is expected to lead the price higher towards 112.30 resistance level before price continues its bearish trend. As the price has been correcting itself for a longer period and still residing inside the range of 110 to 115 area the corrective volatile structure is expected to continue further. If the price breaks below 110.00 with a daily close further bearish movement with a target towards 108.50 is expected in the coming days.

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Trading plan 07 - 08/11/2017

Trading plan 07 - 08/11/2017

General picture: The week is almost without news, the week of correction.

This week is almost without news and, probably, will be the week of "bulls" in the ranges.

Last week, Friday was an important day and the US labor market report. Prior to this, the EUR/USD course was going up, ignoring the positive data on the US and the Fed's willingness to gradually tighten monetary policy. However, on Friday, August 4, there was a breakdown. The report showed a strong increase in new jobs in the US +209 K - well above the forecast, and a decline in the unemployment rate to 4.3% (note that for 9 years after the crisis in 2008, thanks to a clear policy of the Fed, the US economy increased employment by +10 million workplaces).

The employment report was a signal for a noticeable fall in the EUR/USD exchange rate. The week was closed at the minimum, below 1.1800.

The trade on the EUR/USD pair will be in the range new week. The difficulty is that we do not yet see the lower end of the range. The drop may take place up to 1.1480. At the beginning of the week, a good point for sale is 1.1820, but it is better to postpone sales before approaching the highs above 1.1850. Purchases from 1.1730, but taking into account the possibility of continuing the fall.

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Fundamental Analysis of EURUSD for August 7, 2017

After a long impulsive bullish non-volatile trend, EURUSD has recently shown some bearish intervention after few high-impact positive reports were published on Friday. Recently, the US Average Hourly Earnings report was published at 0.3% in line with expectations, which previously was at 0.2%; Non-Farm Employment Change was published a bit lower at 209k from the previous figure at 231k, but it was better than the expected figure of 182k; and the Unemployment Rate was also published as expected at 4.3% which dropped a little from the previous value of 4.4%. After the high-impact reports came out mostly as expected, the USD was provided with strength to overcome the recent weakness amid bad economic reports. On the EUR side, today German Industrial Production report was published with a negative value at -1.1% from the previous positive value of 1.2%, which was expected to be positive at 0.2%; and Sentix Investor Confidence also showed a slight decrease to 27.7 from the previous figure of 28.3, which was expected to be at 27.8. On the other hand, today FOMC Member Kashkari is going to speak about nations key interest rates and future monetary policies, which is expected to be quite hawkish. As EUR has suffered from weak economic reports today after gaining some strength since the start of the day, so further gains on the USD is expected as of recent high-impact reports effect can be still sensed in the market which can lead to more bearish pressure on the pair for the coming days.

Now let us look at the technical view, the price has already broken below the dynamic support level of 20 EMA with a daily close on Friday, which signals further bearish pressure in this pair with a target towards the 1.1630 support area. As the price is currently seen to create a new higher low on the H4 chart, which is also below the dynamic level; the medium bearish bias is expected to continue further, which might go lower in future if the price rejects the bears at the support area between 1.1500 to 1.1630.

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Technical analysis of USD/JPY for August 07, 2017

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Our target which we predicted in previous analysis has been hit. Pair is expected to trade with bullish outlook as it is trading above its rising 20-period and 50-period moving averages, which play support roles and maintain the bullish bias. The relative strength index shows upside momentum.

Therefore, as long as 110.50 holds on the downside, look for a further rise to 111.30 and even to 111.60 in extension.

Alternatively, if the price moves in the opposite direction, a short position is recommended below 110.50 with a target at 110.25.

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

Strategy: BUY, Stop Loss: 110.50, Take Profit: 111.30

Resistance levels: 111.30, 111.60, and 11200 Support Levels: 110.25, 110, 109.55

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