USD/JPY analysis for December 29, 2017

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Recently, the USD/JPY pair has been trading downwards. The price tested the level of 112.48. According to the 4H time – frame, I found a breakout of upward trendline, which is a sign that buyers lost power and sellers took control. My advice is to watch for potential selling opportunities. The downward targets are set at the price of 112.05 and at the price of 111.88.

Resistance levels:

R1: 113.25

R2: 113.62

R3: 113.95

Support levels:

S1: 112.57

S2: 112.27

S3: 111.88

Trading recommendations for today: watch for potential selling opportunities.

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Trading plan 12/29/2017

Trade plan 12/29/2017

Overall picture: Trend against the dollar.

In the last days of the outgoing year, there is a general trend against the dollar wherein the euro broke the level of 1.1900. It seems that the pound is ready to go up to 1.3470 while, both the Swiss franc and the Japanese yen have turned against the dollar.

These are good points to enter against the dollar, but the statistics of past New Year holidays taught us that in the first week of the new year, it is better to stay out of the market or to reduce risks at least.

GBP / USD pair

Buy the pair at the level of 1.3470, with the target of 1.3650.

We congratulate all of you on the New Year! Wishing you happiness, health and good luck!

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Global macro overview for 29/12/2017

The last trading session this year brings a continuation of the US Dollar weakness observed in recent days. The good data from the US economy in form of Chicago PMI index published yesterday, which reached its 7-year peaks, did not stop the US Dollar bears The market is pessimistic towards the US currency, as it has not yet seen any chances for positive changes in expectations related to the FED monetary policy. Additionally, from a historical perspective, the first quarter was more often weaker for the US Dollar, which was explained by the weakness of macroeconomic data due to weather conditions (severe winter).

Trading in the period between Christmas is, however, characterized by the continuation of the observed dominant trends, so the US Dollar should continue to weaken across the board. The seasonals factors might play an important role in January and trigger highly anticipated January effect.

Let's now take a look at the US Dollar Index technical picture at the H4 time frame. The price has broken below the important technical support at the level of 92.49 and currently is heading towards the next important support at 91.50.The market conditions are now oversold, but there is still no bullish divergence between the price and momentum present yet. The zone between the levels of 92.49 - 92.67 will now act as a resistance to the price as long as the lower lows will be made.

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Technical analysis of USD/JPY for December 29, 2017

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All our downside target which we predicted in yesterday's analysis have been hit. Despite of recent rebound from 112.65 (the low of December 28), the pair is still capped by a declining 50-period moving average. The relative strength index is below its neutrality level at 50. Even though a continuation of the technical rebound cannot be ruled out, its extent should be limited. To conclude, below 113.00, look for a further decline with targets at 112.20 and 112.00 in extension.

Alternatively, if the price moves in the opposite direction, a long position is recommended above 113.00 with a target of 113.15.

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: SELL, Stop Loss: 113.00, Take Profit: 112.20

Resistance levels: 113.15, 113.35 and 113.85 Support Levels: 112.20, 112.00, 111.70

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Global macro overview for 29/12/2017

Dow Jones Industrial at the close increased 0.26% up to 24837,51 points, S&P500 increased by 0.18% up to 2687,54 points and Nasdaq went up by 0.16% up to 650,50.16 points. Technological companies, telecoms and development companies contributed the most to DJI increases as the global investors hope that at the end of the year the stock exchanges may rise to record levels. From large technology companies, Apple and Facebook shares grew , biotech companies such as Gilead and Amgen were declining. Information technology sector is the best-performing sector on the New York Stock Exchange in 2017, it gained 38% from January.

The US economic data were positive as well. The manufacturing sector activity index in the Chicago region strongly increased in December, up to 67.6 points (in November, the index was 63.9 points). Analysts expected in the 12th drop of the index to 62.0 points. Up 0.7% (on monthly basis), the stocks of American wholesalers also went in November - the Trade Department said in the preliminary reading. Meanwhile, analysts expected a 0.3% increase in the inventory ratio. The number of unemployed people continuing to receive benefits amounted to 1.943 million a week, which ended on December 16th. Here, the analysts expected 1,900 million people. On the commodity market, crude oil price increases slightly slowed down, however, the cost of raw material is still high, given the prices for the last 2.5 years.

In conclusion, the sentiment among the US investors is still high and remains on elevated levels. This is why the market participants might expect another gain in 2018, which possibly start with so-called January effect.

Let's now take a look at the SPX (SP500 ETF) technical picture at the H1 time frame. The sequence of higher highs and higher lows continues. The market is trading above all of the moving averages, but the momentum remains neutral. The nearest technical support is seen at the level of 266.60 and the nearest technical resistance is seen at the level of 268.61.

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Technical analysis of USD/CHF for December 29, 2017

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All our targets which we predicted in yesterday's analysis have been hit. The pair is heading downward now, and is expected to test its next support at 0.9770. The risk of a slide below this threshold remains high, as both the 20-period and 50-period moving averages are heading downward, and call for further decline. The relative strength index is below its neutrality area at 50. In these perspectives, as long as 0.9810 is not surpassed, likely decline to 0.9730 and 0.9750 in extension.

Chart Explanation: The black line shows the pivot point. The present price above the pivot point indicates a bullish position, and the price below the pivot points 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.

Strategy: SELL, Stop Loss: 0.9810, Take Profit: 0.9730

Resistance levels: 0.9840, 0.9860, and 0.9900

Support levels: 0.9730, 0.9700, and 0.9650

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Technical analysis of GBP/JPY for December 29, 2017

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All out targets which we predicted in yesterday's analysis have been hit. The pair resumed its upward momentum, and is now challenging its resistance at 0.8895. A bullish breakout of this threshold seems more likely to occur, as the 50-period moving average is turning up, and plays well a support. Last but not least, the relative strength index calls for a new rise.

To sum up, above 151.45, look for further advance to 152.35 and 152.60 in extension.

Alternatively, if the price moves in the direction opposite to the forecast, a short position is recommended below 151.45 with the target at 151.20

Strategy: BUY, Stop Loss: 151.45, Take Profit: 152.35

Chart Explanation: the black line shows the pivot point. The price above the pivot point indicates long positions; and when it is below the pivot points, it indicates short positions. 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: 152.35, 152.60, and 153.00

Support levels: 151.20, 151.00, and 150.55

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Intraday technical levels and trading recommendations for EUR/USD for December 29, 2017

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Monthly Outlook

In January 2015, the EUR/USD pair moved below the major demand levels near 1.2050-1.2100 (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 has been 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 allowed a quick bullish advance towards 1.2100 where recent evidence of bearish rejection was expressed (Note the previous Monthly candlestick of September).

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Daily Outlook

In January 2017, the previous downtrend was reversed when the Inverted 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 (Previous Daily Supply-Zone).

The daily supply zone failed to pause the ongoing bullish momentum. Instead, evident bullish breakout was expressed towards the price level of 1.2100 where the depicted Head and Shoulders reversal pattern was expressed.

If the recent bearish breakout persists below 1.1700 (Neckline of the reversal pattern), a quick bearish decline should be expected towards the price zone of 1.1415-1.1520 (Initial targets for the depicted H&S pattern).

Bearish target for the depicted Head and Shoulders pattern extends towards 1.1350. However, to pursue towards the mentioned target level, significant bearish pressure is needed to be applied against the mentioned zone (1.1415-1.1520).

However, In November, recent price action around the price zone of 1.1520-1.1415 indicated evident bullish recovery.

This hindered further bearish decline which allowed the current bullish pullback to occur towards the price level of 1.2000 where price action should be watched for a possible SELL entry.

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Technical analysis of NZD/USD for December 29, 2017

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All our upside targets which we predicted in yesterday's analysis have been hit. NZD/USD is still expected to trade with a bullish outlook.

The pair remains on the upside, and is also supported by its rising 50-period moving average. The relative strength index is bullish above its ascending trend line support. In addition, a strong support base at 0.7070 should limit any downward attempts.

To sum up, as long as 0.7070 is not broken, likely advance to 0.7135 and 0.7150 in extension.

The black line shows the pivot point. Currently, the price is above the pivot point, which is a signal for long positions. If it remains below the pivot point, it will indicate short positions. The red lines are showing the support levels and the green line is indicating the resistance levels. These levels can be used to enter and exit trades.

Resistance levels: 0.7135, 0.7150, and 0.7185

Support levels: 0.7050, 0.7025, and 0.700

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NZD/USD Intraday technical levels and trading recommendations for December 29, 2017

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Daily Outlook

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.

This resulted in a quick bullish advance towards next price zones around 0.7150-0.7230 (Key-Zone) and 0.7310-0.7380 which was temporarily breached to the upside.

Recent bearish pullback was executed towards the price zone of 0.7310-0.7380 (newly-established demand-zone) which failed to offer enough bullish support for the NZD/USD pair.

Re-consolidation below the price level of 0.7300 enhanced the bearish side of the market. This brought the NZD/USD pair again towards 0.7230-0.7150 (Key-Zone) which failed to pause the ongoing bearish momentum.

An atypical Head and Shoulders pattern was expressed on the depicted chart which initiated bearish reversal.

As expected, the price level of 0.7050 failed to offer enough bullish support for the NZD/USD pair. That's why, further bearish decline was expected towards 0.6800 (Reversal pattern bearish target).

Evident signs of bullish recovery was expressed around the recent low (0.6780). That's why, a bullish pullback is expected towards 0.7050.

Moreover, further bullish advance should be expected towards 0.7150 if enough bullish momentum is expressed above the price level of 0.7050.

Trade Recommendations:

An inverted Head and Shoulders pattern was established on the chart indicating high probability of bullish momentum.

That's why, the price zone of 0.6800-0.6830 was considered for a short-term BUY entry. Bullish persistence above 0.6950 and 0.7050 is mandatory to pursue towards next bullish targets.

S/L should be moved to 0.7040 to secure some profits. T/P level remains projected towards 0.7150 and 0.7240.

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Technical analysis of NZD/USD for December 29, 2017

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Overview:

  • Pivot point is seen at the price of 0.7062.
  • The NZD/USD pair is moving upwards from the level of 0.7062. Last two days, the pair rose from the level of 0.7062 to a top around 0.7090. Today, the first resistance level is seen at 0.7160 followed by 0.7227, while daily support 1 is seen at 0.7062. According to the previous events, the NZD/USD pair is still moving between the levels of 0.7050 and 0.7160. Furthermore, if the trend is able to break out through the first resistance level at 0.7160, we should see the pair climbing towards the double top (0.7227) to test it. Therefore, buy above the level of 0.7100 with the first target at 0.7160 in order to test the daily resistance 1 and further to 0.7227. Also, it might be noted that the level of 0.7227 is a good place to take profit because it will form a new double top on the H4 chart. On the other hand, in case a reversal takes place and the NZD/USD pair breaks through the support level of 0.7062, a further decline to 0.6978 can occur which would indicate a bearish market. On the whole, we still look for a strong bullish market as lon as the trend is still set above the spot of 0.7062.
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Technical analysis of USD/CHF for December 29, 2017

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Overview:

  • As expected, the USD/CHF pair continues to move downwards from the areas of 0.9800. Yesterday, the pair dropped from the level of 0.9800 to 0.9757, which coincides with a ratio of 23.6% Fibonacci on the H4 chart. Today, resistance is seen at the levels of 0.9800 and 0.9849. So, we expect the price to set below the strong resistance at the levels of 0.9800 and 0.984; because the price is in a bearish channel now. Amid the previous events, the price is still moving between the levels of 0.9800 and 0.9734 (double bottom). In overall, we still prefer the bearish scenario as long as the price is below the level of 0.9800. Furthermore, if the USD/CHF pair is able to break out the bottom at 0.9734, the market will decline further to 0.9700 (the level of 0.9734 will form a double bottom). On the other hand, if the price closes above the strong resistance of 0.9849, the best location for a stop loss order is seen above 0.9760; hence, the price will fall into a bearish trend in order to go further towards the strong support at 0.9700 to test it again.
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Bitcoin analysis for 29/12/2017

The South Korean government will announce that it will forbid domestic cryptocurrency exchanges to allow users to make transactions via anonymous accounts. As part of what appears to be a series of updates aimed at improving the supervision of industry practitioners, the government will also try to prohibit banks from issuing new virtual accounts on cryptocurrency exchanges. According to the South Korean news agency Yonhap, the statements were announced by Hong Namki, minister of the Office for Coordination of Government Policy, after discussions with vice-ministers from other government bodies after the recent increase in interest in crypto-valuables and their possession among the local community. Hong's announcement came just after an hour since the head of the Korean financial regulator warned against the Bitcoin bubble during a press meeting.Hong added that only accounts confirmed with identity could be allowed for deposits and withdrawals. A government ban on using anonymous accounts is seen in South Korea as the latest step towards curbing trade related to cryptocurrencies in the country. According to the report, the financial intelligence unit and the financial supervisory service will implement the regulation and supervise the stock exchanges in order to comply with the new rule.

Let's now take a look at the Bitcoin technical picture at the H4 time frame. The market is still in a corrective cycle as it hovers around the weekly pivot at the level of $14,371. The key level for bulls is the technical resistance at the level of $16,628, just above the 61% Fibo retracement. The key level for bears is the technical support at the level of $11,174. The corrective wave 4 might likely evolve into a triangle pattern before the uptrend will continue to the new highs.

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Trading plan for 29/12/2017

Just before the start of the last session in 2017 on the Old Continent, the leader is NZD/USD with 0.3% gains. Based on the upcoming data on inflationary pressure, it may partly count the Euro (0.1%), which is trying to stabilize the EUR/USD rate above 1.1950. The pound sterling (0.2%) and the Japanese yen (0.2%) record a slightly more bold move.

On Friday 29th of December, the event calendar is light in important economic releases, but the market participants will keep an eye on the Eurozone Money Supply data, German Preliminary Consumer Price Index data and Baker Hughes U.S. Rig Count.

EUR/USD analysis for 28/12/2017:

In the earlier economic calendar, investors' attention was drawn to the American economic data again. The amount of positive surprise was ensured by stocks of wholesalers, which from month to month recorded 0.7% jump to 0.3% expected by the market consensus. In the meantime, the newly filed applications for unemployment benefit were published, which indicated stabilization of the observed trend (245,000, previously: 245,000). The ISM index was boosted by the barometer of the economic climate prepared by Chicago economists. The 67.6 point indicator clearly surprised the expectations that the rally was to be expected from 63.9 points to 62.0 points. Behind this movement, there is, among others, a more substantial increase in new orders or the strongest sentiment among consumers since September.Nevertheless, all the good data did not help much the US Dollar as it is deteriorating slowly across the board.

Let's now take a look at the EUR/USD technical picture at the H4 time frame. The market has broken above the technical resistance at the level of 1.1961 and currently is rallying higher towards the next technical resistance at the level of 1.2000. The market conditions are overbought, but the momentum remains strong. The nearest technical support is seen at the level of 1.1941.

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Market Snapshot: Crude Oil trading above $60.00

The price of Crude Oil has made another higher high above the level of $60 at $60.33. Nevertheless, due to the overbought market conditions and clear bearish divergence at the H4 time frame, the price might start to pull-back from the elevated levels and test the technical support at the level of $60.00 and in a case of extension $59.50.

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Market Snapshot: DAX at the key support

The German DAX index is trading at the key support at the level of 12,953 after the right shoulder high was made at the level of 13,306. If this level will be broken, then the next support is seen at the level of 12,848, just above the neckline of the Head & Shoulders technical pattern. Breakout to the downside is still possible.

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Burning Forecast 28/12/2017

Burning Forecast 28/12/2017

EURUSD: Buy from the kickbacks.

The euro exchange rate showed new signals for growth: reach the top level of a daily order of 1.1900, closing the day higher.

Keep buying from 1.1815 and lock in profits at inputs from 1.1900.

Buy from the rollback from 1.1900.

Important: New Year is approaching - and sudden price jumps are possible, it is necessary to strictly control the risks.

Conservative investors should think about a break in trading. Happy New Year, all health and all the best!

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Fundamental Analysis of NZD/USD for December 28, 2017

NZD/USD has broken above the 0.7050 resistance area recently which led to creating a new higher high in the process. NZD has been quite strong with the gains recently amid temporary weakness in USD due to recent downbeat economic reports and conditions. Today, US Unemployment Claims report was published with an unchanged figure of 245k which was expected to decrease to 240k, Goods Trade Balance was published with a greater deficit of -69.7B from the previous figure of -68.1B which was expected to be at -67.7B, and Chicago PMI report showed an increase to 67.6 from the previous figure of 63.9 which was expected to be at 62.2. On the NZD side, New Zealand presented no economic reports this week and despite that NZD gained impulsive momentum to break above a strong level of 0.7050. As for the current scenario, the impulsive break against USD signals weakness of USD against NZD and how far NZD can dominate USD in the coming days. As the pressure builds up, NZD is expected to gain more momentum in the coming days until the US comes up with better than expected macroeconomic reports to support its recovery or future gains.

Now let us look at the technical chart. The price is currently residing above the 0.7050 event level which is expected to be retested before price proceeds higher towards 0.72 resistance area in the coming days. The price has been bullish since the bounce off the 0.68 support area and the bullish bias is expected to continue further until price remains above 0.70 support area in the coming days.

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