Forex news and analysis regular update

[⭐ MIchel Kalib]

What’s next? – USDJPY 21.03.18

The dollar was trading 0.05 percent lower vs the Japanese yen at 106.47 as of 04:40 GMT on Wednesday, with the dollar easing as Fed’s monetary event approaches.

The US dollar index, which measures the greenback against six major currencies, was trading 0.10 percent lower at 89.86 by the time of this writing.

The Federal Reserve is expected to raise interest rates for the first time this year by 25 basis points, which would put the benchmark rate in a range between 1.50 and 1.75 percent.

According to Fed funds CME Group’s FedWatch program, market players are currently pricing in a nearly 94 percent chance of a rate hike this week. It would be the first hike of 2018.

Analysts have pointed out Fed’s interest rate hike has already been priced in, explaining a downward correction is likely once the official announcement is done.

However, the dollar could extend gains if Jerome Powell opts for a more hawkish rhetoric. The US regulator has forecasted at least three rate moves for 2018.

No relevant data was released on Tuesday.

Ahead in the day, market players will be paying attention the release of existing home sales for February at 14:00 GMT and the interest rate decision for March as of 18:00 GMT. Investors will also carefully monitor a speech by Fed Chair Jerome Powell.

 

#forex analysis

[⭐ MIchel Kalib]

Dollar dips on dot-plot disappointment, BoE in focus'

 

The Federal Reserve has lifted interest rates to their highest level since the financial crisis, but Dollar bulls are clearly unnamed. Although on Wednesday, as widely expected, US interest rates were raised by 0.25% to a new band of 1.5%-1.75%, investors were more concerned with the dot-plot and Powell’s press conference. While the policy statement was generally positive and US economic growth was revised higher for 2018 and 2019, a crucial ingredient for hawks was missing. There is a suspicion that the Fed heavily disappointed markets by leaving the dot-plot unchanged for 2018 at a grand total of three hikes. Although there was a small upgrade to the dot-plot forecast for 2019 and 2020, this did little to support King Dollar. Jerome Powell’s noticeable caution during his conference and statement on how there was no clear indication in data of an accelerating inflation, encouraged investors to attack the Dollar further.

Taking a look at the technical picture, the Dollar Index was vulnerable to heavy losses after the Federa Reserve turned out to be less hawkish than anticipated. The breakdown below 90.00 could invite a decline towards 89.50 and 89.00, respectively.

 Sterling higher ahead of BoE

 

The main event risk for Sterling today will be the Bank of England monetary policy decision, which is widely expected to conclude with interest rates left unchanged at 0.5%.

 Investors will direct their attention towards the language of the statement for any fresh insights about potential timings of a change in UK interest rates this year. A sense of optimism over the Brexit transition deal, coupled with the fact that wage growth accelerated at the fastest pace in over two years, has boosted speculation of a rate hike in May. Sterling could receive a further boost if BoE policymakers mirror these expectations by adopting a hawkish stance and signalling a rate hike in May.

 Focusing on the technical perspective, the GBPUSD extended gains on Thursday with prices hitting a fresh one-month high at 1.4170 as of writing. The combination of Dollar weakness following Wednesday’s dot-plot disappointment and Sterling strength has brought GBPUSD bulls back into the game. A breach above 1.4180 could encourage an appreciation towards 1.4260 and 1.4300.'

#forex analysis

[⭐ MIchel Kalib]

What’s next? – OIL 23.03.18

Oil prices were higher in Asian trading hours on Friday, with market players awaiting the weekly US oil rig count later in the session.

 

The US West Texas Intermediate crude contracts were up 0.93 percent to $64.90 per barrel as of 06:30 GMT. Meanwhile, Brent futures rose 0.74 percent to $69.42 a barrel.

 

Baker Hughes is expected to release its weekly oil rig count for the US as of 18:00 GMT.

 

Crude benchmarks settled lower on Thursday as most investors opted to take profits following strong gains this week, although sentiment remained on the green side, opening the doors to a potential short-term upward correction forex news.

 

Morgan Stanley said US crude inventories are expected to fall later in 2018 if geopolitical tensions in the Middle East continue to grow.

 

“On May 12, the US government will need to decide on the renewal of the waiver of Iranian sanctions,” the bank said.” “Depending on the outcome, this could affect Iranian exports, including possibly taking a few hundred thousand barrels per day off the market.”

 

Also, the investment bank said crude prices could benefit from Venezuela’s output shortage.

 

“Any restrictions imposed by the US government on diluent exports from the US or crude imports from Venezuela into the US could lead to a further decline in overall production.”

 

Earlier this week, the US Energy Information Administration said that crude stockpiles for the week ended March 16 dropped by 2.6 million barrels vs a forecasted gain of 2.6 million barrels.

#forex analysis

[⭐ MIchel Kalib]

Weekly Trading Forecasts for Major Pairs (March 26 - 30, 2018)

 

Here’s the market outlook for the week:

EURUSD

This pair has consolidated so far this month. Price has been ranging between the support line at 1.2250 and the resistance line at 1.2450. This week may see an end to the neutrality of the market, as price would either move above the resistance line at 1.2450 (staying above it); or it would move below the support line at 0.2250 (staying below it). However, a strong movement to the south is much more likely this week, owing to a bearish outlook on EUR pairs.  

USDCHF

In the short-term, this pair is bullish. Since the support level at 0.9200 was tested in February 16, 2018, price has rallied by over 350 pips, moving briefly above the resistance level at 0.9550. The market has been corrected lower since then, closing below the resistance level at 0.9500. A rally from here would save the bullish bias; while a plunge from here would render it invalid. Nonetheless, the market is more likely to go upwards as a result of a bearish outlook on EURUSD.

GBPUSD

The bias on GBPUSD has become bullish again, for price went upwards by 250 pups last week. Even the movement this month has been largely bullish (price has gained a minimum of 400 pips). The distribution territory at 1.4200 was tested, but price closed below the distribution territory at 1.4100 on Friday. There is a Bullish Confirmation Pattern the market, which points to a possibility of further bullish journey, as price targets the distribution territories of 1.4150, 1.4200 and 1.4250. This, nevertheless, cannot rule out a possibility of a strong pullback in the market. GBP pairs will experience high volatility this week.    

USDJPY

The pair traded southwards last week, to corroborate the presence of bears. Since January 8, 2018, price has lost 830 pips. It lost 170 pips last week, after testing the supply level at 106.50. Since there is a huge Bearish Confirmation Pattern in the market, price can still reach the demand levels at 104.50, 104.00 and 103.50 before the end of this week. A rally may occur along the way, but it should not be something that would override the extant bearish outlook on the market.

EURJPY

Although the market is choppy, the bearish trend has been maintained.  Price has been going southward since February 5, having lost almost 800 pips since then. Last week, there was a rally attempt in the context of an uptrend, which was halted once the supply zone at 131.50 was tested. The market shed 250 pips following that, to test the demand zone at 129.00, and closed below the supply zone at 129.50. The expected weakness in EUR, as well as the bearish outlook on the market, may enable the demand zones at 129.00, 128.50 and 128.00 to be tested this week.

GBPJPY

The cross is bearish in the long-term, but neutral in the short-term. This is a choppy market: An abortive bullish attempt was made last week, but that was rejected as the supply zone at 150.00 was tested. Price came down after that, thus cancelling the short-term effect of the bullish attempt. This week, there may not be any rallies that will cancel the existing bearishness in the market. Price could go further southwards, but it is not expected to go below the demand zone at 145.00, which is the ultimate target for the week forex analysis.

This forecast is concluded with the quote below:

“Volatility is good for trading… Volatility can and should be used to a trader’s advantage. It all comes back to understanding and believing in your trading system.” - Jasper Lawler.

#forex analysis

 

[⭐ MIchel Kalib]

Forex Weekly Outlook - Mar. 26-30 - Trade fears ahead of Good Friday

The US dollar rocked and rolled on the Fed’s dovish hike and the renewed fears of a trade war. Politics will continue moving currencies and we also have final US, UK, and Canadian GDP as well as other figures ahead of Easter. Here are the highlights for the upcoming week forex news.

The Fed raised rates as expected but did not change the dot-plot forecast for 2018, leaving two more rate hikes on the cards this year. The upgrades for 2019, 2020, and the long-term were minimal. In addition, Powell echoed concerns about trade and said he was surprised wages did not rise. The dollar did not like it. On the trade front, the Administration approved exemptions to Europe, Canada, Mexico, Australia and several other countries and turned its attention to China. The greenback continued struggling especially against the yen and not so much against the Australian dollar. The pound enjoyed the announcement of transition Brexit deal, even though there are a few holes in it. The euro was relatively steady as the dollar’s weakness was countered by fears that euro-zone growth has peaked.

Updates:

US CB Consumer Confidence: Wednesday, 14:00. The Conference Board’s measure of consumer confidence rose to a high level of 130.8 points in February and another increase to 131.2 is on the cards now. The parallel University of Michigan figure for March has already surprised to the upside.

US GDP (final): Wednesday, 12:30. The third and final read of US growth for Q4 2017 is expected to show a small upgrade from 2.5% to 2.7% annualized growth. The world’s largest economy enjoyed robust growth in Q2, Q3, and also Q4, while prospects for Q1 2018 already look dimmer.

Pending Home Sales: Wednesday, 14:00. Sales pending the final transaction fell sharply in January, by 4.7%. A rebound is now on the cards. Figures from the housing sector were mixed lately.

UK GDP: Thursday, 8:30. The UK economy grew at a slower pace than many of its peers in 2017. The final quarter saw a growth rate of 0.4% q/q according to the second estimate and the final read is expected to confirm it. While changes to the quarterly growth figures are not common, a change to the annual number happens quite often.

Canadian GDP: Thursday, 12:30. Canada is unique in publishing growth figures on a monthly basis. Back in December, the economy grew by 0.1% m/m. We will now get the first read for January, a peek into the new year 
forex analysis.
US Core PCE Price Index: Thursday, 12:30. This is the Fed’s favorite inflation measure and has an impact despite coming after the CPI data. Year over year, the Core PCE increased by 1.5% in January and the same figures are projected for February. Month over month, core prices are projected to rise at a slower pace: 0.2% after 0.3% beforehand. The US also releases personal spending, personal income, and weekly jobless claims at the same time.

#forex analysis

[⭐ MIchel Kalib]

Forex Forecast and Cryptocurrencies Forecast for March 26 - 30, 2018

First, a review of last week’s forecast forex analyisis:

• EUR/USD has been in a sideways trend for the whole of March, with a slight predominance of bearish trends. This is exactly the kind of movement that was forecasted last week. Pressed by the bears, the pair tried to reach support at 1.2200, but failed even this, and fixed the local bottom at 1.2239. After that, the pair turned around and completed the trading session in the 2018 Pivot Point zone, at 1.2350;  
• GBP/USD. At the time of writing the previous forecast, the indicators on D1 pointed to the north, believing that both the two-week uptrend and the more global one, which began in January 2017, would continue. This scenario was supported by 40% of experts as well, referring to the height of 1.4145. This forecast turned out to be correct, and at the very beginning of the five-day period the pair went up sharply. Basing on information from the Bank of England on Thursday, March 22, it even tried to break through resistance 1.4145, but failed to gain a foothold above this level, and rolled back very soon. As for the end of the week, the pair spent it making fluctuations around the same level of 1.4145;
• 70% of experts, graphical analysis on D1 and 90% of indicators on H4 and D1 expected the continuation of the USD/JPY movement in the medium-term channel. This was what happened - it dropped to the level of 104.63 on Friday forex news, after which there was a slight retreat, and the pair met Saturday at the level of 104.75;
• Now, cryptocurrencies. As for bitcoin, the experts expected its rise to 8,850-9,400, and by the middle of the week the pair BTC/USD fulfilled the above task, reaching the level of 9,145.
  For the pair LTC/USD, a rise to the zone of 170.00-181.00 was forecasted. However, after its fall on Saturday and Sunday, it seemed to be impossible. But the bulls managed to regain strength and managed to raise the pair to a height of 174.00 on Wednesday. Similar dynamics was demonstrated by the Ripple, having risen to the set level of 0.70, but still failing to gain a foothold above it.   
  But the Ethereum did not please the experts who expected its growth to the level of 655.00. In reality, it was only able to reach 587.00.

 

As for the forecast for the coming week, summarizing the opinions of a number of analysts, as well as forecasts made on the basis of a variety of methods of technical and graphical analysis, we can say the following:

• 60% of analysts expect the pair EUR/USD to rise to the level of 1.2415, and then even higher - to the height of 1.2445. The next target is 1.2520. Graphical analysis on D1, 100% of trend indicators and 85% of oscillators on H4 agree with this forecast.
  As for most of the indicators on D1, they have taken a neutral position. This time, 40% of experts and 15% of oscillators side with the bears, giving signals that the pair is overbought. The support levels are 1.2240, 1.2200 and 1.2155;
• GBP/USD. Most analysts (60%) still forecast a decline of the pair first to 1.4115, and in case of its breakdown, even lower - to 1.4080. However, only 5% of the indicators agree with this development. The remaining 95 percent, supported by 40% of analysts, have sided with the bulls, expecting the continuation of the uptrend. The nearest resistance levels are 1.4215 and 1.4275, the final target is January 2018 high, at 1.4345;
• Opinions on the future of the USD/JPY looks almost the same as last week: 70% of experts, 90% of indicators on H4 and D1, look to the south, expecting the pair to continue moving in the medium-term down channel. The targets are 104.00 and 102.65.
  At the same time, graphical analysis on D1 warns that, before continuing to fall, the pair may rise to 105.70-106.30 for a while, and possibly even higher - to 107.00. 10% of oscillators, giving signals that the pair is oversold, expect correction as well;

 

• The forecast for the basic currency pairs looks as follows.
  BTC/USD - Experts expect the continuation of the uptrend. Targets that the pair can reach by the middle of the week, are 9,870 and 10,080. At the same time, it is possible that the bullish impulse will be stronger, and it will rise to the zone 11,500-11,750. At the end of the week, there may be a change of trend and a relatively small decline;
  Similar dynamics are expected for other pairs. ETH/USD: targets are 740.00 and 866.00. LTC/USD: 193.40 and 217.30. XRP/USD: 0.670, 0.730 and 0.890.

We would like to stress at this point that even minor events can influence the trends and volatility of cryptocurrencies. Therefore, we strongly suggest that you pay attention to smart money management, which, combined with leverage of 1:1000, will significantly reduce your trading risks. After all, to buy 10 Bitcoins, 100 Ethereums, 500 Litecoins or 100,000 Ripples, with such leverage you will only need $100, and you can keep the rest of your money in reserve. 

#forex analysis

[⭐ MIchel Kalib]

Global stocks bruised by US tech selloff

 

Stock markets are likely to remain explosively volatile and wildly unpredictable amid the ongoing trade drama between the US and China.

The fact that global equities roared back to life on Monday only to surrender gains yesterday, continues to highlight how extremely skittish the market is currently. While easing fears of a trade war initially supported risk sentiment, reports that the Trump administration may crackdown on Chinese investments into US companies rekindled jitters. With the US-China trade developments being a key theme driving markets, investors should expect the unexpected.

Asian stock markets were under pressure during early trading, following a steep tech-driven selloff on Wall Street overnight. The negative domino effect from Asia could weigh on European shares this morning. If investors adopt a guarded approach today and caution prevails, Wall Street is at risk of extended losses this afternoon.

 

Dollar flat ahead of final Q4 GDP estimate 

The Dollar struggled for direction against a basket of major currencies on Wednesday morning, as global trade tensions continued to weigh on sentiment.

This has certainly been a painful trading month for the Greenback, as the awful combination of US political uncertainty and trade war fears punished the currency. The “dot plot” disappointment from March’s FOMC meeting which poured cold water on four rate hikes this year, simply compounded the Dollar’s woes. Bulls are pleading for a lifeline and this could come in the form of the final US Q4 GDP estimates released this afternoon. Markets are expecting to see a revised GDP estimate of 2.7% for the final quarter of 2017. A figure that meets or exceeds market expectations has the ability to support the Dollar.

Taking a look at the technical picture, the Dollar Index is under pressure on the daily charts. Prices are trading below the 20 SMA, while the lagging MACD has crossed to the downside. A breakdown and daily close below 89.00 could invite a decline lower towards 88.60 and 88.30.

Commodity spotlight – Gold

Gold was exposed to heavy losses on Tuesday amid a stabilizing US Dollar.

Easing concerns about US-China trade tensions complimented the downside with prices dipping towards $1340. While an appreciating Dollar could result in further pain for Gold in the short term, the yellow metal remains supported by increasing geopolitical tensions, stock market volatility and lingering trade war concerns.

Focusing on the technical picture, the yellow metal remains somewhat supported above the $1340 level. Previous resistance around $1340 could transform into a dynamic support that encourages an incline back towards $1355 and $1360, respectively. Alternatively, a failure for bulls to defend $1340 could result in a decline back to $1330 and $1326, respectively. 

 

[⭐ MIchel Kalib]

What’s next? – DAX 28.03.18

The DAX futures were down 1.40 percent at 11,810 in early trading hours on Tuesday, with focus turning to the US calendar amid a lack of European publications.

Earlier in today’s session, the GfK German consumer climate indicator for April came in at 10.9 points, outperforming a forecasted 10.7 reading and a prior 10.8 points.

The German benchmark ended Tuesday higher, adding 1.56 percent with Technology, Financial Services and Construction components contributing most gains.

The best performers of the session were Deutsche Boerse, which added 3.45 percent or 3.700 points to 111.100, followed by Infineon Technologies rising 3.07 percent or 0.670 points at 22.460 and Fresenius Medical Care up 2.59 percent or 2.060 points to 81.460.

The worst performers of the session were Commerzbank, which eased 0.40 percent or 0.044 points to 10.850. Muench. Rueckvers. was up 0.19 percent or 0.35 points to close at 184.60 and E.ON added 0.40 percent or 0.035 points to 8.854.

From a technical perspective, the German index could storm the 11,726 mark pretty soon. There is no much support and therefore, a downward extension is likely unless data helps out.

The 12,000 points are still on the watch for bulls, but they have been struggling to find enough momentum to break above and consolidate once for all there.

With no other relevant reports scheduled in Europe for the day, attention will move to the United States, where investors expect a fresh look at the fourth-quarter gross domestic product at 12:30 GMT, with an upgrade to 2.6 percent expected. At the same time traders await the goods trade balance for Feb. Pending home sales are due for release at 14:00 GMT.

[⭐ MIchel Kalib]

What’s next? – USDJPY 29.03.18

The dollar was trading 0.16 percent lower vs the Japanese yen at 106.67 as of 08:50 GMT on Thursday, as the dollar eased in early hours.

 

Overnight, the US dollar index added more than 0.80 percent to trade around 89.71, a five-day peak, with upbeat economic data offering support, as well as an improving market sentiment.

 

The US Commerce Department said the gross domestic product (GDP) rose to an annual growth rate of 2.9 percent, above a prior revision of 2.5 percent and a 2.7 percent rate seen.

 

The US dollar index, which measures the greenback against six major currencies, was trading 0.01 percent lower at 89.61 by the time of this writing.

 

Also, reports indicating that North Korean leader Kim Jong Un pledged to denuclearize the Korean peninsula contributed to the dollar’s rally. Xinhua news agency said an unofficial meeting between President Xi Jinping and Kim took place in Beijing.                                                                                                                                                                                                                                                                                                            

 

President Donald Trump, who is expected to meet Kim in the near future, recognized that positive steps are being taken in order to guarantee a full denuclearization of the region.

 

“Received message last night from Xi Jinping of China that his meeting with Kim Jong Un went very well and that Kim looks forward to his meeting with me,” Trump tweeted.

 

The USDJPY is perceived as a risk on/ risk off pair, in which the dollar represents demand for risk and the yen for safe havens. At the time, the balance is turning to the dollar, but it is still too early to define a sustainable trend. Next week’s employment reports will probably help with it. 

 

On the data front, Fed’s favorite inflation measure - the core PCE price index - is scheduled for release at 12:30 GMT. Data will come along with personal spending for February. Michigan University will release consumer expectations and sentiment surveys for March at 14:00 GMT.

 

Moving closer to midnight, Japan’s jobs/applications ratio for February will be available at 23:30 GMT. Tokyo’s core CPI for March will be out at the same time. Twenty minutes later, market players will count on February’s industrial production, with a 4.2 percent reduction seen.

 

#forex analyis

[⭐ MIchel Kalib]

Ripple, Litecoin and Bitcoin Cash Daily Analysis - 30/03/18

Bitcoin Cash looking to make a name for itself early on, as it bucks the trend of yet another slide through the early part of the day, adding further pressure on the cryptomarket, with the talk of bubbles likely to do its rounds.

Bitcoin Cash Breaks the Mould

Bitcoin Cash investors will be feeling a little bruised this morning, following Thursday’s 17.36% tumble to an end of day $710.1, marking a 4^th consecutive day of decline in what has become quite a bearish run for Bitcoin Cash and the broader cryptomarket.

There were hopes of a possible reversal of the bearish trend formed back on 21^st March in the early part of the day, with Bitcoin Cash managing to move into positive territory to hit an early intraday high $868.

Falling short of the day’s first major resistance level of $888.53 and 23.6% FIB Retracement Level of $904 ultimately led to another sell-off through the 2^nd half of the day, pulling Bitcoin Cash down to an intraday low $694, which tumbled through the day’s 3 support levels with relative ease.

It’s all about regulation and, while the unknown continues to drag down the majors, some of the regulatory upheaval will actually be a positive, with many investors having steered clear of the Wild West due to the lack of regulatory oversight and lack of investor protection.

That’s for another day however, with regs likely to be fed through until July’s anticipated major globally coordinated roll out.

Investors waking up in the early hours to look at the direction of the markets will have been somewhat shocked to see heavy declines once more, though there was some good news for Bitcoin Cash investors, with Bitcoin Cash up 3.02% to $731.4 at the time of writing.

This morning’s moves are certainly not in line with the broader market, with the love hate relationship between Bitcoin and Bitcoin cash in evidence and favouring Bitcoin Cash that recovered from an early morning low $680.

While managing to avoid the day’s first major support level of $646.7, the negative sentiment across the broader market is unlikely to do Bitcoin Cash any favours today, any gains likely to lead to investors locking in profits ahead of any tumble later in the day.

Barring a material shift in investor sentiment, we would expect the day’s first major resistance level of $820.73 to remain untested, while a move back through the morning’s $738.8 high would support a run at the day’s 23.6% FIB Retracement Level of $786.

That bearish trend has been going on for a while and the lack of a rally last weekend was certainly an early warning signal of the lack of investor appetite in the current cryptomarket environment.

Get Into Bitcoin Cash Trading Today

Litecoin Facing the Prospect of Sub-$100

Litecoin had a slightly better day than Bitcoin Cash on Thursday, falling 12.84% to end the day at $114.79, with Litecoin also down for a 4^th consecutive day.

An intraday high $132.54 in the early part of the day followed a common theme across the cryptomarkets, with Litecoin taking a tumble through the 2^nd half of the day, hitting an intraday low $112 before a partial recovery to $114 levels by the day’s end.

Litecoin not only tumbled through the day’s 3 support levels, but also closed out the day sitting on the day’s 3^rd support level of $114.17, supporting further pain for investors through the early part of this morning.

Unsurprisingly, the day’s $132.54 high fell well short of the first major resistance level of $137.75 and 23.6% FIB Retracement Level of $140.82, affirming the continuing bearish trend formed from a swing hi $175.5 struck on 21^st March.

For the day ahead, investors will need to be patient, with a move back through to today’s opening $114.4 likely to support a run at the day’s 23.6% FIB Retracement Level and first major resistance level of $127, though for any moves beyond a material shift in market sentiment would be needed and that looks unlikely this morning.

Failure to make a move through to $120 levels would certainly add further selling pressure on Litecoin, with the day’s first major support level of $107.01 and 2^nd support level of $99.24 certainly in play later in the day.

At the time of writing, Litecoin was down 1.98% to $112.26.

 

Ripple Makes the Wrong Kind of Splash

Following Wednesday’s 0.62% gain that broke the broader market trend, moves through the early part of Thursday, saw Ripple’s XRP continue to head north to hit an intraday high $0.57645. In stark contrast to its peers, Ripple’s XRP came within touching distance of the day’s first major resistance level of $0.5895 and 23.6% FIB Retracement Level of $0.5953, with the talk of more banks exploring Ripple’s cross border payment platform providing much needed support.

In the end, the broader market sentiment laid claim to Ripple’s XRP, which tumbled to an intraday low $0.49014 in the 2^nd half of the day, brushing aside the day’s 3 major support levels on its way down.

Ending the day below the 3^rd support level of $0.5086, with a 12.2% slide to $0.50332, was certainly bearish for the day ahead, supporting Ripple XRP’s 4.93% fall to $0.4785 at the time of writing.

This morning’s $0.46331 low fell through the day’s first major support level of $0.4701 before support kicked in to avoid a further slide to the day’s 2^nd support level of $0.4370, though the move may well be on the cards later today if investors are unable to break out of the current tail spin.

A move through to the day’s high $0.516 would certainly provide support, any hint of a relief rally likely to see Ripple’s XRP make significant ground, but when considering all of the factors that have contributed to this year’s collapse, key resistance levels are unlikely to be in range through the remainder of the day, selling pressure at the day’s 23.6% FIB Retracement Level of $0.5464 anticipated to be on the higher side forex news.

#forex analysis

[⭐ MIchel Kalib]

Do you trade for money or emotional satisfaction?

 

DO YOU WANT TO BE ENTERTAINED OR RICH?…IT’S YOUR CHOICE

I came across this excellent chart the other day. It shows those times in history when the S&P 500 doubled over a ten year period and the trajectory that this doubling took.

Much commentary that followed on twitter related to the steady low volatility climb that characterised the latest run and how boring this was. One of the interesting thing about markets and money in general is that people betray their true desires and personality.

Markets are the true window into the soul and in this instance what traders were actually saying is that they wanted to be entertained and not rich. The constant current moaning about the lack of volatility is little more than the plaintiff cries of children who bedevil their parents every school holidays with cries of …I’m bored.

This lay observation tallies with what others have found. The seminal work in this field of trader immaturity is An Analysis of the Profiles and Motivations of Habitual Commodity Speculators by W.B. Canoles, S.R. Thompson, S.H. Irwin, and V.G. France. I have summarised their findings below and have added my own emphasis.

“The typical trader assumes a good deal of risk in most phases of his life. He is both an aggressive investor and an active gambler.

[He] does not consider preservation of capital to be a very high trading priority.

As a result, he rarely uses stop loss orders. He wins more frequently than he loses (over 51% of the time) but is an overall net loser in dollar terms. In spite of recurring trading losses, he has never made any substantial change in his basic trading style.

To this trader, whether he won or lost on a particular trade is more important than the size of the win or loss. Thus he consistently cuts his profits short while letting his losses run.

 He also worries more about missing a move in the market by being on the sidelines than about losing by being on the wrong side of a market move; i.e., being in the action is more important than the financial consequences.

Participating brokers confirmed that for the majority of the speculators studied, the primary motivation for continuous trading is the recreational utility derived largely from having a market position.

Numerous indications in our survey indicate that they are not trading solely or even primarily for profit, but may be maximizing excitement or the number of winning trades.”

So we come back to the original question. Do you want to rich or be entertained as the choice is entirely yours.

#forex analysis

[⭐ MIchel Kalib]

Attention turns back to data this week

 

 

Asian equities kicked off Q2 on a positive note, taking their cue from Wall Street’s rally on Thursday. The gains came despite China imposing retaliatory tariffs on U.S. imports and Manufacturing PMI data falling short of economists’ forecasts.

So far China’s response has only been on the aluminum and steel tariffs, announced by the White House last month, and not on the proposed $60 billion in annual tariffs against Chinese products. This shows Beijing is unwilling to enter a trade war with the U.S., knowing that it has more to lose than to win. However, trade dispute will continue to dominate investors’ decisions heading into Q2.

Many traders remain away from their desks on Monday to spend time with their friends and family, so barring an unexpected announcement from the White House, expect markets to stay calm.

Macro data will be back in focus

Manufacturing and Service PMIs from Europe, UK, and the U.S. will be closely scrutinized by investors this week. In March, the euro area private sector expanded at its weakest pace since 2017, raising questions on whether the robust economic performance in the Eurozone during 2017 has come close to an end. Another slip in these leading indicators may well reinforce the belief that the global synchronized growth is losing momentum.  This will also justify the under performance in European equities, where the DAX, CAC and IBEX fell 6.35%, 2.73% and 4.4% YTD respectively.

Eurozone inflation

Euro traders will have to give a special attention to the Eurozone preliminary CPI release for March on Wednesday. In February the harmonized inflation came at 1.1%, a 0.2% fall from January’s reading and slipping further away from European Central Bank’s target of just under 2%. Another disappointment on this front will raise the voices within the ECB members, advising against tightening monetary policy which is likely to add further pressure on the EURUSD after falling by more than 1.3% from last week’s highs.

U.S. NFP, the main event of the week

Friday’s U.S. nonfarm payrolls release is undoubtedly the key event of the week. The U.S. is expected to have added 198,000 jobs in March versus 313,000 in February. Meanwhile, unemployment is expected to drop by 0.1% to 4%, the level last seen 18 years ago. However, wage growth remains to be the key market moving piece, after showing an unexpected fall from 2.8% to 2.6% last month. Given that one of the main arguments in markets today is whether the Fed will raise rates by another 2 or 3 times in 2018, this figure will play an important role in pricing interest rates expectations, and thus the dollar’s direction.

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[⭐ MIchel Kalib]

S&P 500 breaks 200 day moving average

Easter Monday is normally characterised by light trading, but today was anything but out the ordinary, as the US equity markets swung lower sharply on the back of the announcements of tariffs from China on the US. This is quite serious as the 200 day moving average has been broken, and this held back bearish movements previously. With the last line of defence now gone, it could be a case of the bears looking to push their control. This in theory has not been helped by President Trumps attacks on Amazon which have sent tech stocks down as he looks for a target. If the market sentiment is anything to go by then I would be deeply concerned for the bulls, as many have long thought of the share market being overbought, and this could be the start of some serious bearish pressure.

With the 200 day moving average being broken I would expect to see some bullish pressure to see what the market is made of. In this instance I believe any push-back up higher would likely treat the 200 day moving average as dynamic resistance in this instance. The target now for any bears looking for lower lows will be of course the 2532 resistance level, closely followed up by the 2508 level. This area will be the key to see if the S&P 500 has the legs to go even lower, and the bulls and bears will battle it out around here. In the event the bulls cane reassert control, then as mentioned before the 200 day moving average will be a hard task to beat with such a huge extension lower. All in all market sentiment is bearish now, and it will be hard to beat. But it's also worth noting that this is no 2008 scenario, the American economy is still doing strong and it's mainly politics which is driving the lower lows. In reality we could just end up with the market correction we've anticipated for some time.

Crude oil has been one of the big movers today as well, but this should come as no surprise after the recent economic woes on equity markets have spooked bulls, and as the USD lifted strongly against most of the major pairs. Many market commentators have been quick to point that over $70.00 a barrel seems unlikely as demand stays static and they expect a range of 50-70 dollars in the short to medium term. Then again time and time again we've seen commentators be wrong and oil can swing quite wildly.

On the charts the fall lower has so far been stopped by the 20 day moving average. This shows reluctance from the bears to test the technical's, so this looks more like a test the waters sort of move today. However, the ceiling at 66.05 has held for some time and is not looking like it may face much pressure. As a result this could just be trending sideways for the short term and levels will be key for traders looking to take profits. In particular support levels at 62.64, 61.00 and 58.88. With the long term daily bullish trend line to also take into consideration.

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[⭐ MIchel Kalib]

Global markets consolidate, but remain indecisive

Investors are likely to have breathed a sigh of relief after the US stock markets’ worst start to the second quarter since the 1929 Great Depression failed to encourage a widespread selloff across the global markets, as traders returned to their desks after the annual Easter holidays.

While we are still encountering quite a subdued trading atmosphere, where major stock markets are in general struggling to find their direction, we are not facing the type of selling pressure that should worry people that there is some serious distress in the equity markets. It does remain difficult to pinpoint whether trade war concerns, or the recent selloff in stocks like Amazon, are driving the market volatility but there is some room to side with the latter. Another tweet from President Trump reinforcing his negative view on Amazon sent the US stock markets on another volatile ride overnight. It does not appear that trade tensions between the US and China are driving the price action this week.

The general consensus is that a trade war will be of no benefit to anyone, which indicates why investors are not reacting that sensitively to the ongoing headlines between Beijing and Washington. Beijing has, as you would expect, condemned the news that the United States published a list of over 1000 Chinese products that it plans to hit with a 25% tariff, but it has not created much of a reaction in the financial markets as it stands.

There has been just as muted of a reaction in the currency markets, where it can be said that many currencies are not reacting as heavily to the ongoing shifts in sentiment for the equity markets as you would usually expect in a period of higher volatility. This can be seen as another reason to suggest that trade war concerns are not driving the direction of the markets, and that it is the selloff in corporations like Amazon that is behind the erratic behaviour in stock markets. If investors were significantly concerned that there was a risk of a trade war, currencies like the Japanese Yen and the Swiss Franc would be performing much stronger than they have over recent trading sessions.  Emerging market currencies like the Malaysian Ringgit, Thai Baht, Indonesian Rupiah and even the Chinese Yuan itself are, on the other hand, outperforming what you would expect if there were fears that a trade war is upon us.

Rand showing signs of weakness

The South African Rand has outperformed expectations given that trade war concerns are dominating the news flow. While South Africa might appear to be heavily isolated from the ongoing diplomatic tensions over trade between the US and China, the Rand would be at risk to weakness if the trade tensions between China and the United States intensify and investor attraction towards higher-risk assets takes a hit.

We have seen some weakness in the Rand over the Easter holiday, although the catalyst behind the fluctuation is likely to be last week’s comments from the South African Reserve Bank (SARB) that the local currency is overvalued.

GBPUSD attempting 4 days of consecutive gains

The British Pound appears to be attempting its fourth day of gains against the US Dollar during early Wednesday trading, with the Sterling receiving support after the UK manufacturing survey for March exceeded expectations yesterday. As long as the GBPUSD maintains its ground above 1.40, there is potential for the Pound to trade higher this month. We have noticed in recent weeks that investors are potentially using the 1.40 level in the GBPUSD as a possible pivot level, before deciding what direction the Pound could trade next; therefore, I will continue to monitor the 1.40 level in this pair.

If the GBPUSD manages to slip back below 1.40, it would put the Cable at risk to concluding its current run of gains.

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[⭐ MIchel Kalib]

What’s next? – USDJPY 06.04.18

The dollar was trading 0.08 percent lower vs the Japanese yen at 107.28 as of 06:35 GMT on Friday, with market players looking ahead to fresh data.

The US dollar index, which measures the greenback against six major currencies, was trading 0.02 percent lower at 90.14 by the time of this writing.

White House National Economic Council Director Larry Kudlow said Washington was hoping to reach an agreement with the Beijing.

“Our intention is not to punish anybody. Our intention is to open markets and investments and lower barriers — that’s the deal,” Kudlow said.

This posture is in strict contrast with White House Trade Adviser Peter Navarro, who had previously stated “the expectation is that at the end of 60 days there will be tariffs imposed.”

Easing concerns over the trade dispute between the US and China reduces demand for safe-haven yen, opening the doors to further gains for the pair.

Also prospecting an upward extension is employment data. A strong labor market builds a case for the Federal Reserve to further adjust monetary policy and interest rates.

Ahead in today’s session, the trade dispute will remain in focus, but also attention will turn to a batch of fresh economic reports, including the latest employment figures in the US.

 

The Labor Department will present its employment report for March, which includes average hourly earnings, nonfarm payrolls, participation rate and the unemployment rate. Currently, economists estimate the following results: 0.2%; 203,000; 195,000 and 4.0% respectively.

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[⭐ MIchel Kalib]

Forex Weekly Outlook April 9-13 - Can the dollar continue higher?

The US dollar extended its recovery in the new quarter, at least against the majors. Is this trend real? US inflation data and the FOMC meeting minutes stand out in the second week of April. Here are the highlights for the upcoming week.

The US gained only 103K jobs in March, fewer than expected. However, wage growth accelerated to 2.7%, in line with early projections. The greenback continued its recovery against its major peers, clawing back lost ground, regardless of the turbulence in stocks and the worsening tensions around trade. The only exception was the Canadian dollar, which enjoyed a strong gain in domestic jobs and also the rising chances for a deal on NAFTA.

Updates:

US PPI: Tuesday, 12:30. The Producer Price Index is often considered a leading indicator towards the more significant Consumer Price Index. Prices at factory gates perpetuate further. Headline PPI is expected to rise by 0.1% m/m in March, half the rate of February, while Core PPI is forecast to repeat the previous gain of 0.2%.
Mario Draghi talks Wednesday, 11:00. The President of the European Central Bank will appear in front of a student conference in Frankfurt and will also take questions from the crowd. He will have an opportunity to respond to the growing signs of a slowdown in the euro-zone economies, or at least the peak of the cycle, around December. Any comments about inflation will be interesting to watch.

US inflation: Wednesday, 12:30. Inflation remains the missing ingredient in the US growth story. Despite healthy gains in jobs and decent GDP growth, inflation remains stubbornly low. Core CPI remained stuck at 1.8% y/y in February with a monthly rise of 0.2%. This time, yet another 0.2% increase is expected in core CPI while headline prices are projected to remain unchanged in March.

FOMC Meeting Minutes: Wednesday, 18:00. The Fed releases the minutes from the first meeting overseen by Fed Chair Jerome Powell. While the FOMC raised rates and upgrade the outlook for 2019 and 2020, they did not upgrade the prospects for 2018. The meeting minutes may shed some light on the deliberations. Is the sentiment growing more hawkish and are they on the verge of a fourth hike? How worried are they on the ongoing jitters around global trade? We may get a notion of the mindset.

ECB Meeting Minutes: Thursday, 11:30. These are minutes from the ECB’s meeting in March, where forecasts were hardly changed and Draghi made an effort to downplay the slightly more hawkish stance in the statement. The publication is over a month after the event, making it somewhat stale as we have received quite a few data points since then. However, the ongoing battle between the hawks and the doves about ending QE and a potential rate hike somewhere in 2019 rages on.

US Consumer Confidence: Friday, 14:00. The preliminary release of the University of Michigan’s consumer confidence provides an outlook towards the retail sale sales. In March, the figure reached 101.4 points, higher than in previous months and above the round number of 100. A minor slide to 100.8 points is on the cards now.

JOLTS Job Openings: Friday, 14:00. This lagging indicator for the jobs market is watched closely by the Fed and is of importance after jumping to an annualized level of 6.31 million back in January. The data for February is projected to show a dip to 6.22 million. The number of quits is also of interest as it is a measure of confidence. More quits imply people are confident to move on, and often to better jobs.

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[⭐ MIchel Kalib]

Ethereum Weekly Price Analysis – April 8


ETHUSD Long-term Trend – Bearish

Distribution territories: $500.00, $600.00, $700.00.

Accumulation territories: $300.00, $200.00, $100.00.

This week ETHUSD pair continues to trend southward almost the same bearish outlook as last week’s formation. On April 3rd, the price managed to form a lower high above distribution territory of $400.00, April 4th marked another noticeable bearish movement in the market. Presently, price has also moved deeply southward and has now been trading around the accumulation territory of $400.00.

Moving average 50 is far above moving average 13. The price action has been traded along the bearish path of moving average 13 consecutively with a wide space notification to moving average 50. The stochastic oscillator remains crossed into the oversold zone and also pointing southward. However, the current price trend could, in the long-term, accumulate momentum from breaking below the next accumulation territory of $300.00 and form a trading range towards another accumulation territory of $200.00. Pit stops can be experienced if that eventually cropped up. Traders can look out at that point in time to take on the bull from a reversal or a pullback which can lead to a potential markup in price in the next few weeks.


The views and opinions expressed here do not reflect that of CryptoGlobe.com and do not constitute financial advice. Always do your own research.

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[⭐ MIchel Kalib]

Xi Jinping provided equity bulls a much-needed boost

 

Appetite for risk bolstered Tuesday morning, as Chinese President Xi Jinping offered plans to further open up the second largest economy. Xi’s public speech at the Boao Forum came days after the U.S. and China exchanged tit-for-tat tariffs threats, which kept investors on edge for several weeks. He promised to lower import tariffs for autos, as well as on some other products, open up the financial and insurance sectors, and most importantly, to increase protection to intellectual property.

Xi’s speech calmed markets by responding to all of Donald Trump’s concerns, without even mentioning him. Now it’s time for China to provide specific figures and a timeline on how these reforms will be implemented. I think what was achieved today is likely to reduce trade tensions and buy some extra time. Whether the U.S. will wave back with an olive branch to China remains to be seen, but certainly, the probability of a full-blown trade war is now much lower than a week ago.

Asian equities were all in the green this morning with the Hang Seng Index and Nikkei 225 climbing more than 1%. Futures are also indicating a positive start to Europe and U.S. – the S&P 500 futures are up 1.3% at the time of writing.

However, the new geopolitical risks over the increased conflict in Syria cannot be ignored. This came after the U.S. imposed a wide range of financial sanctions on Russian assets, causing stocks to suffer their worst performance in four years and the ruble falling as much as 4.1%.  Russia warned the U.S. that any military reprisal to Saturdays’ chemical attack in Syria could have “grave repercussions”. Will U.S. and Russia go into a confrontation in Syria? This likely depends on Trump’s decision over the next 24 hours, but the risks are high.

Although oil prices may have risen on hopes that trade tensions will ease, investors may start pricing in a much higher risk premium. So far, it seems the conflict in Syria has no impact on the supply from the Middle East, but if the battle spills outside the Syrian border, I expect another $10 risk premium to be added to the current price.

The economic calendar is light today, so expect currency traders to continue taking the cue from equity markets.

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[⭐ MIchel Kalib]

CAD surges further on weaker USD

It was all downhill today for the USDCAD as the USD weakness continued to be a major factor. This comes as China looks to work together with the US in order to help deal with intellectual property rights and bring about the end of the trade war. However, it seems that the USD is currently not in favour with traders and they're pushing it lower every chance they get, and no more so than against the CAD which is currently one of the strongest currencies out there. One thing that is worrisome, and on the horizon, is of course the US CPI reading which if strong could potentially lead to a bounce in the USDCAD as it does show signs of being oversold at present. In the long run though the USDCAD does seem like it could potentially run away further on the back of the head and shoulders pattern which has given the bears so much more hunger as of late.

For the USDCAD bears the bottom is looking all the more possible and I am expecting to see some sort of push to support at 1.2548 on the chart. A bounce here not be a surprise as it's oversold at present and probably some traders will look to take profit. However, if we see sustained momentum and we have so far - with the 200 day moving average being swept aside - then I would expect further extensions to potentially 1.2406. In the event the bounce leads to a push back higher the neck line around 1.2807 is likely to be some hard work for the bulls to even crack through, as I would expect the vast majority of traders to defend this heavily.

Oil has been one of the surprise movers in recent times as it rebounded sharply up the charts recently. This should not come as a surprise as the USD has been weaker over the last few days. The question now remains can it sustain a push to resistance at 66.05, as the majority of traders believe that at present 60-70 is the current market range we should expect in the near future. Beyond this level is something we've not seen since 2014. I would anticipate that any moves higher may be met with some bearish resistance but it's hard to tell just yet as oil has not been above this level for some time.

On the charts in the long run momentum has always been bullish with a strong long term trend line. And the bulls today certainly showed they were keen to continue momentum with that push to resistance at 66.05. I would be surprised to see it breakthrough and I expect markets will look for a bounce here, especially if the USD does strengthen. If we do see that bounce then expect the bears to pull it back to 64.57, which will be the next level of support as the market falls. If we do however see a breakthrough then I would need to see a close above the resistance level to keep bullish momentum going.

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[⭐ MIchel Kalib]

What’s next? – USDJPY 12.04.18

The dollar was trading 0.15 percent higher vs the Japanese yen at 106.94 as of 06:25 GMT on Thursday, as the dollar recovered moderately on the back of upbeat inflation data.

Yesterday, the core consumer price index showed a 2.1 percent year-on-year growth for March, its best performance since February 2017, compared to a prior month 1.8 percent.

The US dollar index, which gauges the greenback against six major currencies, was trading 0.08 percent higher at 89.33 by the time of this writing.

Ahead in the day, the US export/import price index is up at 12:30 GMT. No other relevant reports are scheduled for today’s session. We believe attention will turn to political developments.

Overnight, the Trump administration warned Moscow about its position in the Syria conflict, suggesting serious military actions would be taken against Bashar al-Assad’s regime.

President Donald Trump tweeted: “Russia vows to shoot down any and all missiles fired at Syria. Get ready Russia,  because they will be coming, nice and new and “smart!” You shouldn’t be partners with a Gas Killing Animal who kills his people and enjoys it!”

Earlier this week, the Republican leader told a group of reporters that “[the United States] have a lot of options, militarily. And we'll be letting you know pretty soon"

It seems investors’ focus is not shifting from US-China trade relations to US-Russia war relations. This matter could potentially be much more damaging than a trade war, therefore market players are likely to closely monitor the situation.

 

The pair is expected to run high on the back of higher geopolitical uncertainty. The USDJPY will be driven by fear and the Japanese yen will take the lead in that case.

USDJPY Forex analysis