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GDMFX - Weekly News
#31
Forex Technical Analysis: Price direction governed by Interest Rates and Non Farm Employment Report

EUR/USD
Forex Technical Analysis: The first part of last week was characterized by irregular movement and closed market due to New Year’s Eve and first day of the New Year but once trading resumed the bears took control of the pair, breaking two important levels of support.

[Image: 2014.01.06-2014.01.12-Price-direction-go...24x477.png]

Technical Outlook
After several attempts at breaking the resistance located at 1.3830, the pair finally started to move to the downside, easily breaking 1.3710 and 1.3650 resistance levels. This indicates that bearish pressure has been building and that sellers are ready to shift the balance of power in their favor. The first target of the pair is 1.3455 followed by 1.3295 and the recently broken levels may turn into resistance if touched again from below.

Fundamental Outlook
The first event of the week is Monday’s release of the US Non Manufacturing PMI which is a leading indicator of economic health but excludes the manufacturing sector. Later in the day the US Senate will vote pro or against the nomination of Janet Yellen as Federal Reserve Chairperson, an event which may trigger increased volatility.

Tuesday the German Unemployment Change comes out, offering insights into the employment situation of Europe’s most influential economy and Wednesday’s most significant event will be the release of the FOMC Meeting Minutes. The Minutes reveal details about the reasons which determined the members’ latest vote regarding the interest rate.

Thursday is the busiest day of the week as the European Central Bank will announce their interest rate decision which will be followed by a Press Conference. ECB President Mario Draghi will speak at this conference and he will also answer audience questions; this second part of the conference usually creates the strongest volatility of the day as traders try to interpret his answers.

The trading week finishes Friday with the most important US employment indicator: the Non Farm Employment Change. The report measures fluctuations in the number of employed people excluding the farming sector and it is considered an extremely high impact indicator which can strengthen the US Dollar if higher than anticipated numbers are posted.

GBP/USD
Throughout last week the United Kingdom showed slightly worse than anticipated data, a fact which weakened the Pound and allowed the pair to move lower.

[Image: 2014.01.06-2014.01.12-Price-direction-go...24x477.png]

Technical Outlook
The resistance formed around 1.6550 is holding strong and the first week of the year brought us a bounce lower off this level. Although the pair is in an uptrend on a Daily chart, the latest move down shows that the bears are making an attempt to reverse this trend. If they succeed, the first target is the support located at 1.6250 and a break of this level would bring the pair back into the ranging zone created between the mentioned level and 1.5915.

Fundamental Outlook
Early Monday morning the United Kingdom releases the Services Purchasing Managers’ Index which shows the performance of the services sector as perceived by purchasing managers and acts as a leading indicator of economic health. The main event is the announcement of the Official Bank Rate which occurs Thursday and usually creates strong movement although no change is anticipated.

The last UK event of the week comes out Friday in the form of the Manufacturing Production which holds a great importance as manufacturing represents about 80% of all Industrial production and tends to have a strong impact on the Pound. The important US events of the week will directly affect the pair’s direction as well.

Written by: Bogdan Giulvezan

The article above is based on the writer’s 5-year experience and it does not constitute trading advice or investment recommendations, just a personal opinion and view of the market.

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#32
FOREX TECHNICAL ANALYSIS: RESUMING THE UPTREND OR JUST A SINGLE BULLISH MOVE?

EUR/USD

Forex Technical Analysis: Trading last week was choppy and price didn’t find a clear direction until the release of the US Non Farm Employment report which showed surprisingly worse than anticipated numbers. Earlier in the week, the ECB decided to keep the interest rate unchanged but the event was overshadowed by the Dollar weakness generated by the US employment numbers.

[Image: 2014.01.13-2014.01.19-Resuming-the-uptre...24x477.png]

Technical Outlook
The pair broke 1.3650 resistance and the week ended above this level, following a bounce off the uptrend line drawn from the low created in July last year. If the US Dollar weakness will trigger an extended move to the upside, the resistance at 1.3710 is the first target of the pair and this is very likely to be touched. However, a break of the uptrend line mentioned earlier would indicate that bears are reversing the medium term direction of the pair and we are headed for new lows.

Fundamental Outlook
The first important event of the week comes out Tuesday in the form of the US Retail Sales numbers. Consumer spending represents about two thirds of the entire US economic activity and sales made at a retail level represent about one third of such spending, making the indicator a high impact one. Better numbers suggest increased economic activity and potentially a stronger greenback.
Wednesday the US Producer Price Index is announced, showing the change in prices charged by producers for their goods and services. The indicator has inflationary implications because a higher price charged by producers will eventually be reflected in a higher price paid by consumers for those goods. Thursday the US Consumer Price Index comes out and it’s closely related to the Producer Price Index for the reasons outlined above. The same day the ECB Monthly Bulletin is made public, containing the Bank’s viewpoint on economic conditions and also details about the data which was analyzed when the Rate decision was made.
Friday the University of Michigan Consumer Confidence report is released; its importance comes from the fact that consumer confidence is a leading indicator of consumer spending so better numbers suggest that economic activity might pick up and the Dollar will strengthen.


GBP/USD
Bank of England kept the interest rate unchanged, as expected but last week’s main event was definitely the worse than expected US Non Farm Employment report which weakened the greenback and took the pair higher.

[Image: 2014.01.13-2014.01.19-Resuming-the-uptre...24x477.png]

Technical Outlook
Similar to the EUR/USD, the pair bounced higher from an uptrend line starting July last year and now it appears to be headed towards the resistance zone created around 1.6550. This level stopped strong moves in the past so we cannot assume yet that it will be broken but a touch is very likely. If the uptrend line will be broken, the support located at 1.6250 might be the pair’s next objective.

Fundamental Outlook
Just two important UK events are released this week: Tuesday the Consumer Price Index comes out, showing changes in the price paid by consumers for the goods and services they purchase. The UK Retail Sales numbers are announced Friday; the indicator is a gauge of consumer spending and economic activity and has the potential to affect the pair strongly.

Written by: Bogdan Giulvezan
The article above is based on the writer’s 5-year experience and it does not constitute trading advice or investment recommendations, just a personal opinion and view of the market.
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#33
Forex Technical Analysis: The break of diagonal support shifts the balance of power

EUR/USD

Forex Technical Analysis: Throughout last week the US Dollar strengthened against the Euro and the bearish movement seen at the beginning of the year was resumed. Overall the bears were in control for most of the week.

[Image: 2014.01.20-2014.01.26-The-break-of-diago...24x477.png]

Technical Outlook
The trend line drawn upwards from last July’s low was broken during the week that just ended and we consider this a major victory for the bears. In the process, the support located at 1.3550 was also broken but moves up to re-test the broken level (and potentially the broken trend line) are possible; however, we consider the market to be in a medium term downtrend and we favor moves lower, towards 1.3455.

Fundamental Outlook
Monday the US banks are closed celebrating Martin Luther King Day so there will be no US economic releases. Tuesday the German ZEW Economic Sentiment is released and it’s considered a high-impact indicator because its value is derived from the opinions of about 275 German analysts and professional investors who are well informed about the economy due to the nature of their jobs.

Europe and the United States didn’t schedule any economic releases for Wednesday but Thursday the French and German Manufacturing PMI come out, showing the opinion of purchasing managers regarding the manufacturing sector in their respective countries. Better than expected numbers suggest increased optimism and a thriving economy. Later in the day the United States announce the Existing Home Sales which show the number of homes sold during last month, excluding new buildings.

Friday will be a slow day, with no scheduled US events; the Italian Retail Sales will be released by the Euro Zone but this is considered a low impact indicator.


GBP/USD
Last week’s main event and a huge market mover was the surprisingly better than anticipated value of the United Kingdom Retail Sales which took the pair back into the resistance located at 1.6440.

[Image: 2014.01.20-2014.01.26-The-break-of-diago...24x477.png]

Technical Outlook
The uptrend line drawn from the lowest point of last July was broken during last week but the UK Retail Sales numbers strengthened the Pound and at the moment price is testing from below the diagonal S/R level we just mentioned. We anticipate a bounce lower during this week and a move into the important support located at 1.6250 but a move back above the trend line could trigger additional buying pressure and a bullish move towards 1.6550.

Fundamental Outlook
The week is characterized by a lot of medium and low impact indicators released by the UK but the most important event is the release of the Bank of England Meeting Minutes scheduled Wednesday. The minutes contain the breakdown of the votes regarding the Asset Purchase Facility and the Interest Rate and also important insights into the reasons which stood behind those votes. The same day the British Claimant Count Change is announced, showing the fluctuation in the number of people who ask for social benefits derived from unemployment. The US events will have a direct impact on the pair as well.

Written by: Bogdan Giulvezan

The article above is based on the writer’s 5-year experience and it does not constitute trading advice or investment recommendations, just a personal opinion and view of the market.

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#34
Forex Technical Analysis: A week filled with major economic indicators

EUR/USD

Forex Technical Analysis: Last week started without strong movement and a calm economic scene but as soon as better than expected Euro Zone Manufacturing data came out, the Euro strengthened substantially and the pair touched 1.3710 resistance once more.

[Image: 2014.01.27-2014.02.02-A-week-filled-with...24x477.png]

Technical Outlook
Although the bullish trend line was previously broken to the down side, last week’s developments brought price back above it and pierced through 1.3710 resistance. However, on the Daily chart we can notice a pin bar (candle with long upper wick) which suggests rejection and a potential move lower. If 1.3710 holds, the next target may be 1.3550 support but a move above the mentioned resistance will open the door for a move towards 1.3830.

Fundamental Outlook
The first event of the week is scheduled Monday and it’s the German Ifo Business Climate which draws its importance for the large sample used: about 7,000 businesses are surveyed and asked to rate the current economic conditions and to offer a 6-month outlook. The US New Home Sales are released the same day, showing the number of houses sold during the previous month.

Tuesday the United States announce the Durable Goods Sales which represent purchases of goods with a life expectancy of at least three years. Later in the day the US Consumer Confidence indicator is released and is often regarded as a leading indicator of consumer spending.

The most important event of the week is release of the FOMC Statement and US Federal Funds rate decision scheduled Wednesday. The rate is not expected to change and probably the monetary stimulus issue will be the more important aspect which will most likely create huge volatility in the market.

Thursday Germany announces the Consumer Price Index which is the main gauge of inflation; the same day, the US releases the Gross Domestic Product which is an economy’s main performance measurement. The trading week finishes Friday with the release of the Euro Zone Consumer Price Index and the German Retail Sales; both are considered high-impact indicators which have the ability to move the market strongly.


GBP/USD
The Pound made substantial advances last week and the pair traveled a respectable distance to the north, breaking 1.6600 resistance and printing a new high at 1.6668.

[Image: 2014.01.27-2014.02.02-A-week-filled-with...24x477.png]

Technical Outlook
Although the bulls were in control for almost the entire week, taking the pair above 1.6600 resistance, during the last day of the previous week price dropped for almost 200 pips indicating that a reversal may be happening. The bullish trend line is not clearly broken but if this occurs, the pair’s medium term direction will be bearish and a move toward 1.6250 will be highly probable. Otherwise, 1.6750 is the next target for the bulls.

Fundamental Outlook
The main event of the week for the Pound is the release of UK’s Preliminary Gross Domestic Product which is scheduled Tuesday. As mentioned before, the Gross Domestic Product is an economy’s main gauge of performance and the Preliminary release tends to have the greatest impact on price action. Wednesday the UK Nationwide House Price Index is released and Thursday the value of Net Lending to Individuals comes out but both are considered medium-impact indicators and the effect on the pair varies from month to month. Of course, the US events mentioned earlier will have a direct impact on the pair’s movement.

Written by: Bogdan Giulvezan

The article above is based on the writer’s 5-year experience and it does not constitute trading advice or investment recommendations, just a personal opinion and view of the market.

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#35
Forex Technical Analysis: Interest Rates and Non Farm Payrolls guarantee an action-packed week

EUR/USD

Forex Technical Analysis: Last week the bears scored an important victory and the pair dropped significantly on the back of the US bond purchase program tapering. Although Fed’s decision didn’t trigger an immediate response in the market, the effect was clearly seen during the next two days.

[Image: image0011-1024x477.png]

Technical Outlook
The uptrend line drawn from July last year was broken decisively and so was the support located at 1.3550. This puts the bears in control from a medium term perspective and opens the door for additional moves to the down side, making 1.3400 the first target of the week. Retracements higher may find good resistance at the recently broken level of 1.3550.

Fundamental Outlook
We have a full week ahead of us, with the first important economic indicator being released Monday in the form of the US Manufacturing Purchasing Managers’ Index. Wednesday the ADP Non Farm Employment Change is released; this report is put together by a private company but it usually offers hints about the Government released report which comes out 2 days later.

Thursday is an important day as the ECB will announce the Interest Rate decision and President Mario Draghi will hold a Press Conference during which he will answer journalists’ questions and will talk about the reasons which determined the interest rate vote. The Press Conference usually creates more volatility than the rate decision itself so we recommend caution if trading at the time.

Friday the most anticipated report of the week is released: the US Non Farm Employment Change which is considered to be the most important gauge of the employment situation in the United States and almost always a huge market mover.


GBP/USD
The pair had another encounter with the resistance located at 1.6600 but this was soon followed by a drop which was mainly triggered by the US developments regarding the reduction of bond purchases.

[Image: image002-1024x477.png]

Technical Outlook
Although the pair had a bearish week, the drop wasn’t as significant as the one seen on the EUR/USD and moves to the upside are very possible. However, we favor the short side for the week to come, taking into consideration the fact that price pierced through the uptrend line for the second time and 1.6600 resistance rejected price lower again. First major support is located at 1.6250 and resistance at 1.6600.

Fundamental Outlook

Three Purchasing Managers’ Indexes are released throughout the first three days of the week: Manufacturing PMI, Construction PMI and Services PMI, each showing the opinions of purchasing managers about their respective sectors and each having the ability to strengthen the Pound if better than expected values are posted. The most important Pound-affecting event is the Bank of England Interest Rate decision and the Asset Purchase Facility value, both released Thursday. No change is anticipated for either of them but a surprise will trigger huge volatility. The US events mentioned earlier will have a direct impact on the pair.

Written by: Bogdan Giulvezan

The article above is based on the writer’s 5-year experience and it does not constitute trading advice or investment recommendations, just a personal opinion and view of the market.

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#36
Forex Technical Analysis: Bulls struggling to continue last week’s momentum

EUR/USD

Forex Technical Analysis: Last week the pair’s direction has been highly influenced by the Fundamental aspect: ECB President Mario Draghi made positive comments regarding signs of economic recovery, strengthening the Euro and the US Non Farm Payrolls posted a worse than anticipated value, weakening the greenback.

[Image: 2014.02.10-2014.02.16-Bulls-struggling-t...24x477.png]

Technical Outlook
Price bounced higher after a touch of 1.3480 and moved into the strong resistance zone created by the confluence of 1.3650 and the down trend line drawn from last year’s high. This is a potential turning point which could bring sellers into the market and make 1.3480 the first target to the down side but US Dollar weakness generated by the Non Farm Payrolls report combined with Euro strength may generate an extended move into 1.3710 resistance. At the moment there are no clear signs of a reversal to the down side, just a strong resistance zone ahead.

Fundamental Outlook
The first important event comes Tuesday in the form of Fed Chairwoman Janet Yellen’s testimony on the Semiannual Monetary Policy Report in Washington DC and is followed Wednesday By Mario Draghi’s speech at the European Monetary Institute Conference in Brussels. Both speeches can create strong moves, depending on the matters discussed and the attitude of the participants.

Thursday the US Retail Sales are released, showing the change in the volume of sales made at retail level compared to the previous month. Since retail sales represent about two thirds of the entire consumer spending, the indicator has a high impact on the pair. Friday the German Gross Domestic Product is announced; being an economy’s main performance gauge, it has the potential to affect the Euro strongly, pushing it higher if better values are shown and weakening it if the numbers don’t meet expectations. Later in the day the University of Michigan will announce the US Consumer Sentiment which is a leading indicator of consumer spending.


GBP/USD
Last week Bank of England kept both the Interest Rate and the Asset Purchase Facility value unchanged and the main market mover was the US Non Farm Payrolls report which weakened the US Dollar and allowed the pair to move higher.

[Image: 2014.02.10-2014.02.16-Bulls-struggling-t...24x477.png]

Technical Outlook
On a Daily chart we can notice an almost perfect bounce off the support level located at 1.6250 which confirms once again the strength of this level. The first important resistance is located at 1.6600 but we don’t anticipate price to travel such a long distance to the north; bullish moves are very probable during the week to come but we still consider the medium term direction is controlled by the bears and this makes another touch of support a high probability scenario.

Fundamental Outlook
The only Pound affecting event of the week is Wednesday’s release of the Bank of England Inflation Report which will be accompanied by a Press Conference held by Governor Mark Carney and other Monetary Policy Committee members. The Inflation Report contains the Bank’s expectations regarding inflation and economic growth for the next two years and will most likely strengthen the Pound if it contains a positive outlook. Of course, the US events mentioned earlier will have a direct impact on the pair’s direction.

Written by: Bogdan Giulvezan

The article above is based on the writer’s 5-year experience and it does not constitute trading advice or investment recommendations, just a personal opinion and view of the market.

More articles from the best forex broker.
Need help? Click here to talk to our customer support
Site: http://www.gdmfx.com
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#37
Forex Technical Analysis: The US Dollar rebounds?

EUR/USD


Forex Technical Analysis: Throughout last week the US Dollar declined against its counterpart as the released data showed a slowing of economic growth due to bad weather conditions which negatively affected business activity.

[Image: 2014.02.17-2014.02.23-The-US-Dollar-rebo...24x477.png]

Technical Outlook

The pair finished last week right on 1.3710 resistance, a level which rejected rising prices several times in the past. Lower moves are very possible but the latest momentum is bullish, especially after the bounce off 1.3480 and the break of 1.3650. A move above 1.3710 would consolidate the control of the bulls and would make 1.3830 the next target, while a bounce lower will shift the balance of power only if 1.3650 is clearly broken to the downside.

Fundamental Outlook

Monday US Banks will be closed celebrating Presidents’ Day and no major European data is released so the first important event of the week occurs Tuesday in the form of the German ZEW Economic Sentiment. Wednesday the FOMC Meeting Minutes will be released, showing the details of the latest Fed meeting regarding the interest rate and the reasons that influenced the members’ vote.

Thursday is an important day as the French and German Manufacturing PMIs are released and Fed Chairwoman Yellen testifies on the Semiannual Monetary Policy Report. This testimony was originally scheduled last week but was postponed due to weather conditions. The US Consumer Price Index which is the main inflation gauge is announced the same day.

Friday the US Existing Home Sales are released and the G20 Meetings start. The meetings will be attended by central bankers and finance ministers from the 20 member states and have the potential to generate strong, fast moves.


GBP/USD

The Pound climbed to 1.6754, the highest level since 2011, fueled by speculation that Bank of England will raise interest rates if the economic conditions keep improving. A positive Inflation Report strongly contributed to the Pound’s strength.

[Image: 2014.02.17-2014.02.23-The-US-Dollar-rebo...24x477.png]

Technical Outlook

Although we considered the bulls to be in control and we expected moves higher, we didn’t anticipate that a move into the resistance located at 1.6750 would come before a retracement lower occurred. If this week the pair will complete a retracement, 1.6600 will most likely act as support while the upper target is 1.6880. The Relative Strength Index is approaching the 70 level even on a weekly chart and price traveled a huge distance with no retracement so we anticipate moves to the down side but the main direction is bullish.

Fundamental Outlook

United Kingdom’s Consumer Price Index which is considered the main gauge of inflation comes out Tuesday but Wednesday will probably be the most important day of the week as the Bank of England will release the Minutes of their latest meeting. The Minutes contain a breakdown of the votes regarding the Interest Rate and the Asset Purchase Facility and important insights into the reasons which determined the members’ votes. At the same time the Claimant Count Change is released, showing the change in the number of unemployed people who ask for social help. The week finishes Friday with the release of the UK Retail Sales which account for the major part of consumer spending and are regarded as a strong market mover.

Written by: Bogdan Giulvezan

The article above is based on the writer’s 5-year experience and it does not constitute trading advice or investment recommendations, just a personal opinion and view of the market.

More articles from the best forex broker.
Need help? Click here to talk to our customer support
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#38
Forex Technical Analysis: Turmoil on the fundamental scene – Interest Rates and Employment situation

EUR/USD


Forex Technical Analysis: Throughout last week data was mixed for both European and American economies, a fact which generated a lot of back and forth movement. A clear move finally came during the week’s final trading day on the back of a higher than anticipated European CPI and a weaker US Gross Domestic Product.

[Image: 2014.03.03-2014.03.09-Turmoil-on-the-fun...24x477.png]

Technical Outlook

The recent rally took the pair close to the most important resistance of the year so far: 1.3830. The month that just ended was controlled by the bulls almost completely but this doesn’t mean that a break of the mentioned resistance is mandatory. In the past, 1.3830 acted as a strong barrier in front of rising prices and another rejection is very possible. If this is the case, 1.3710 will be the first level of importance to the down side. The week ahead is full of high impact events which will most likely decide the pair’s next direction; the technical aspect will be overshadowed by these major events.

Fundamental Outlook

Monday’s main event will be Mario Draghi’s testimony in Brussels, before European Parliament’s Committee on Economic and Monetary Affairs. As always, his public speeches are a source of volatility and sharp moves, depending on the president’s attitude and answers so we recommend caution if trading at the time. The US Manufacturing Purchasing Managers’ Index is released the same day, offering an overview of the American manufacturing sector health.

The next important release of the week comes Wednesday in the form of the American Non Farm Payrolls, a report which is released by Automatic Data Processing, Inc., not by the US Government; usually this report offers hints about the government-released report which comes out 2 days later.

Thursday’s main event is the ECB Interest Rate decision which will be followed by the ECB Press Conference. No rate change is expected but the Conference is almost always a market mover; however, price direction cannot be anticipated and will depend almost entirely on Mario Draghi’s attitude and answers to journalists’ questions.

Friday the focus shifts towards the United States for the release of the Non Farm Employment Change report (also known as Non Farm Payrolls). This is the most important data regarding the jobs situation in the US and has the potential to be the week’s main market mover, especially if a surprising number is posted.


GBP/USD

Last week was mostly controlled by the bulls and the pair bounced off the support located at 1.6600, climbing to touch 1.6750. However, a worse than expected UK Gross Domestic Product was posted and the optimism which surrounds the Pound seems to fade away.

[Image: 2014.03.03-2014.03.09-Turmoil-on-the-fun...24x477.png]

Technical Outlook

A major resistance sits in front of rising prices and although the bulls were in control last week, the rally lacks momentum. The Daily candles are small, with long wicks compared to the real body, a fact which suggests that indecision is present in the market. We anticipate a clear break of either 1.6750 resistance or 1.6600 support but the direction of this break will be highly affected by the week’s fundamental events.

Fundamental Outlook

The week opens Monday with the release of the British Manufacturing Purchasing Managers’ Index (PMI), followed Tuesday by the Construction PMI and Wednesday by the Services PMI. All are leading indicators of economic health focused on their respective sectors and have the potential to strengthen the Pound if better numbers are posted.

Bank of England will announce their Interest Rate decision on Thursday, as well as the Asset Purchase Facility value. Although no change is anticipated for either of them, strong movement is likely to be generated. The important US events will have a direct impact on the pair as well.


Written by: Bogdan Giulvezan

The article above is based on the writer’s 5-year experience and it does not constitute trading advice or investment recommendations, just a personal opinion and view of the market.

Source of article from the best forex broker.
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#39
Forex Technical Analysis: High prices become difficult to sustain

EUR/USD


Forex Technical Analysis: Mario Draghi’s comments made during last week’s ECB Press Conference strengthened the Euro and boosted the pair above major resistance but a better than expected US Non Farm Employment report stopped some of the bullish momentum.

[Image: 2014.03.10-2014.03.16-High-prices-become...24x477.png]

Technical Outlook

Last week was bullish overall and the major resistance located at 1.3830 was broken, a fact which suggests that buyers may take price on a continued move north. However, the week finished with a move lower which is likely to bring in more sellers, taking price below the recently broken level. If this occurs, 1.3710 will become the first support and 1.3830 will remain resistance as the latest move above would be considered a false break. The recent high located at 1.3914 will most likely act as minor resistance if the pair continues north.

Fundamental Outlook

The Euro Group meetings take place Monday in Brussels and may bring some volatility to an otherwise calm fundamental scene. The next notable event takes place Wednesday in the form of the European Industrial Production which shows the change in the total output produced by the industrial sector. The most important US event of the week is the Thursday release of the Retail Sales which account for the main part of the entire consumer spending which in turn represents more than two thirds of the entire US economic activity.

Friday the German Consumer Price Index is announced, an indicator which is considered the main gauge of inflation; high inflation may eventually determine the ECB to raise interest rates, a fact which is considered beneficial for the Euro. The same day the United States announces the Producer Price Index and the Consumer Sentiment, both important indicators which offer insights into the state of the American economy and the confidence of the consumers.


GBP/USD

The pair had a week which lacked clear direction and price moved in a difficult to trade manner. Bank of England left the interest rate unchanged and most of the economic indicators met expectations last week. The most important event was the release of the US employment situation which took the pair lower on the back of a better than forecast value.

[Image: 2014.03.10-2014.03.16-High-prices-become...24x477.png]

Technical Outlook

As we mentioned many times before, our bias is neutral on the pair until a clear breakout occurs. We maintain this stance but we must note the fact that bulls tried several times to break 1.6750 to the upside and failed to produce satisfactory results. This shows that sellers are offering strong resistance at this level and may step in to take price lower, with 1.6600 being the first target. If a bullish breakout occurs, the first important level is 1.6880 which is better seen on a weekly chart.

Fundamental Outlook

The most important day for the Pound is Tuesday when the Inflation Report Hearings take place. Bank of England Governor Mark Carney will testify before the Parliament’s Treasury Committee regarding the economic outlook and inflation; the hearings last for a few hours and volatility may be present at the time. The same day the British Manufacturing Production numbers come out, offering insights into the state of the manufacturing sector; the rest of the week is slow in terms of data releases for the Pound but the US events will most likely affect the pair’s behavior.


Written by: Bogdan Giulvezan

The article above is based on the writer’s 5-year experience and it does not constitute trading advice or investment recommendations, just a personal opinion and view of the market.

More articles from the best forex broker.
Need help? Click here to talk to our customer support
Site: http://www.gdmfx.com
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#40
Forex Technical Analysis: Bearish pressure is building up. Fundamentals hold center-stage

EUR/USD


Forex Technical Analysis: Trading was affected last week by growing tensions regarding the Ukraine crisis which generated choppy price action and a lot of reversals. US economic data was mixed and contributed to the pair’s lack of clear direction.

[Image: 2014.03.17-2014.03.23-Bearish-pressure-i...24x477.png]

Technical Outlook

The fact that bulls managed to keep price above 1.3830 for an entire week and also printed a new high at 1.3965, shows that the uptrend is still not exhausted. If this new high will be broken again this week, the next level of interest to the upside is the psychological resistance located at 1.4000 which is also a big round number and this kind of levels tend to have great importance for price action. Although the pair is in an uptrend, a move below 1.3830 would be proof of bear-strength and would make 1.3710 the next target of the week.

Fundamental Outlook

The first day of the week brings us the release of the Euro Zone Consumer Price Index which is the most important gauge of inflation but it tends to have a limited impact on the pair because the German CPI (which accounts for the major part of European inflation) was already released. Tuesday the German ZEW Economic Sentiment will be the main European event while the US will release the Consumer Price Index which, as mentioned before, has high inflationary implications.

Wednesday has the potential to be the most volatile day of the week and all eyes will be on the US for the release of the Interest Rate, FOMC’s Economic Projections and Fed Chairman Yellen’s Press Conference. The press conference is likely to be a huge market mover, especially in its second part when Janet Yellen will answer audience questions. The Fed will also decide whether they will further adjust the monetary stimulus program or not, an issue which has been a top concern of market participants and is likely to generate tremendous volatility.

Thursday the US Existing Home Sales and the Philly Fed Manufacturing Index are released, offering insights into the situation of the housing market and the progress of the manufacturing sector. The last important event of the week comes out Friday in the form of the Euro Zone Trade Balance which shows the difference between imported and exported goods. The impact of this indicator is not always high, especially if the actual number is close to the forecast.


GBP/USD

The beginning of last week was characterized by a strong move lower which took the pair close to 1.6600 support but for the rest of the week, the bears struggled without success to continue the move and break the mentioned level.

[Image: 2014.03.17-2014.03.23-Bearish-pressure-i...24x477.png]

Technical Outlook

The balance of power starts to shift in favor of the bears although the pair is still in a range defined by 1.6750 resistance and 1.6600 support. Important to note is the fact that last week price moved up after a touch of 1.6600 but the bears quickly took it back down, resulting in a Daily pin candle (Thursday). Pin bars usually indicate rejection and in this particular case, a move south is expected, but the fundamental aspect of the week will have an important role and may change this scenario.

Fundamental Outlook

Bank of England Governor Mark Carney is scheduled to speak Tuesday in London at the Annual Mais Lecture. His speeches are potential market movers and the market often reacts to his attitude or to clues about future interest rates. Wednesday the Band of England will make public the Minutes of their latest Meeting; the Claimant Count Change which is released the same day will offer insights into the British jobs situation. These are the main events for the Pound but the pair will be directly affected by the US data released throughout the week.


Written by: Bogdan Giulvezan

The article above is based on the writer’s 5-year experience and it does not constitute trading advice or investment recommendations, just a personal opinion and view of the market.

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