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EURo to extend gains in August

al_dcdemo Posted 24 July as Analysis on EUR/USD, Target: 1.1825, Date: 1st of September, 12:00 GMT  in #Technical analysis #Daily Chart #EUR/USD #Weekly Chart #Technical Tools #Neutral Fundamentals #Long Term Trendline #Net Long Positioning #Capitulation Spike
Technical Tools
Support and resistance (S/R). Price levels, trendlines and Fibonacci retracements. Price action, candlestick and chart patterns. Simple moving averages (SMA). Commitments of traders (COT) indicator, which displays speculative positioning in FX futures market, used as a proxy for speculative positioning in spot FX market.
Weekly Chart
After trading to the lowest level in fourteen years, Euro consolidated below the long term trendline, drawn off of 1985 and 2000 lows, for five mont…
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al_dcdemo 19 Aug.

UPDATE 6: This week was to some extent a reversal of last week's risk-off moves. Canadian and Australian dollars were beneficiaries with yen and franc recording just marginal losses. It was not a good week for European currencies. Pound was the loser of the week while euro remains to be buoyed by dip buyers. Next week will be a quiet one data-wise. All eyes will be on Jackson Hole Symposium at the end of the week, which will feature speeches by Yellen and Draghi. Rumours go that the ECB president will avoid talking monetary policy. That should increase volatility if he does say something.

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al_dcdemo 24 Aug.

UPDATE 7: Price action has been pretty sedate so far this week with most major currencies sitting near the middle of their weekly ranges. Euro and Canadian dollar are the only two that are marginally better than the U.S. dollar. There's been a little bit more action in the New Zealand dollar but selling stalled ahead of the strong support at 0.72. Tomorrow could prove to be the most lively day of the week with German Ifo Business Climate, U.S. (Core) Durable Goods Orders and Day 2 of the Jackson Hole Symposium which will bring Fed Chair Yellen and ECB President Draghi speeches.

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al_dcdemo 26 Aug.

UPDATE 8: Speeches by Yellen and Draghi at Jackson Hole Symposium met expectations. Yellen didn't even talk about monetary policy while Draghi avoided giving any new information on what ECB may do in autumn. Lack of hawkish clues from Yellen were enough to send the U.S. dollar lower across the board and then later some upbeat comments from Draghi (even though he warned about inflation not yet being self-sustained) propelled the euro to a new two-year high. Yen, pound and Australian dollar were flat on the week while New Zealand dollar was the laggard.

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al_dcdemo 31 Aug.

UPDATE 9: U.S. dollar index broke to the lowest level since 2015 on Monday before staging a sharp pullback. That coincided with euro breaking above 1.20 and 2012 low (1.2040) and franc below 0.95. Yen was once again contained by the strong support at 108. Kiwi is out of favour ahead of N.Z. general election. Canadian dollar sold off hard yesterday but already recouped all losses and some after exceptional Q2 GDP figures. Australian dollar has been the least volatile of the bunch but with some impressive reversals. NFP report tomorrow will be a nice finale to this exciting week.

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al_dcdemo 1 Sep.

UPDATE 10: U.S. jobs & wages report for August fell short of expectations on most metrics. August is historically weak with regard to NFP figure but Wednesday's strong ADP figure gave U.S. dollar bulls some hope that this time was different. It wasn't and the immediate reaction was to sell the dollar. The report itself was not great but was solid enough and subsequent price action seemed to agree. The dollar ended the week higher against euro, franc, yen and New Zealand dollar, and lower against pound, Canadian dollar and Australian dollar.

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EURo to consolidate in July

al_dcdemo Posted 19 June as Analysis on EUR/USD, Target: 1.1125, Date: 1st of August, 12:00 GMT  in #Technical analysis #Daily Chart #EUR/USD #Weekly Chart #Technical Tools #Neutral Fundamentals #Long Term Trendline #Net Long Positioning #Breakaway Gap
Technical Tools
Support and resistance (S/R). Price levels, trendlines and Fibonacci retracements. Price action, candlestick and chart patterns. Simple moving averages (SMA). Commitments of traders (COT) indicator, which displays speculative positioning in FX futures market, used as a proxy for speculative positioning in spot FX market.
Weekly Chart
The pair convincingly broke below the long term trendline drawn off of 1985 and 2000 lows in Q4 2016. In the process, the pair extended the 1.05 - 1…
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al_dcdemo 15 July

UPDATE 6: It was a worst week for the U.S. dollar in a while. It started with the BOC decision on Wednesday after which Canadian dollar surged about 200 pips. The next day, Aussie and Kiwi played catch-up and rose about 100 pips respectively. Eagerly anticipated U.S. inflation and retail sales reports came in weaker than expected yesterday and exacerbated dollar losses across the board. Cable sliced through 1.30 to 1.3115, the highest in ten months. Euro had tough time holding above 1.14 but ended the week near the high, poised for a break higher. Exciting week ahead.

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al_dcdemo 23 July

UPDATE 7: U.S. dollar ended another week of underperformance, falling against all major currencies bar the British pound. Euro confirmed break above 1.145 to trade to the highest since mid 2015. Mirroring its cousin, Swiss franc closed the week below 0.95. Yen was bought down to 111. Canadian dollar extended its rally to approach 1.25. Australian dollar broke above 38.2% retracement of the 2014 - 2016 downswing. New Zealand dollar closed the week near 0.745, just below the 50.0% retracement of the 2014 - 2015 decline. Momentum suggests further losses for the dollar in the week ahead.

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al_dcdemo 24 July

UPDATE 8: A mixed start to the week saw yen, pound, Canadian dollar and Australian dollar extend gains while euro, franc and New Zealand dollar are lagging. Data-wise, it's a quiet one until Wednesday when Australia publishes inflation data, U.K. releases preliminary GDP and FOMC concludes its meeting. U.S. reports durable goods orders on Thursday and GDP on Friday. Unless FOMC pulls a surprise, neither of these events has the potential change the current macroeconomic landscape. U.S. politics seems a more likely source from where some kind of a twist could come.

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al_dcdemo 27 July

UPDATE 9: Yesterday's reaction to the latest FOMC statement was quite strong for a meeting without press conference. The statement didn't reveal anything new but clearly the market was expecting something more hawkish. The committee indicated that it will begin with balance sheet adjustment "relatively soon". The language on inflation, however, has deteriorated a bit and that was probably the main reason the market sold the dollar. While balance sheet adjustment is now virtually a done deal, we may see further hikes in federal funds rate only if inflation picks up.

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al_dcdemo 31 July

UPDATE 10: Last week was an interesting one. Major currencies traded to fresh highs against the U.S. dollar. The single exception was Swiss franc which sold off strongly against all those currencies, including the dollar. Two cent and a half surge from sub 0.95 to above 0.97 might well have had SNB backing. There's nothing on the calendar for the week ahead that has the potential to reverse the current U.S. dollar weakness. Perhaps a concerted dovish effort from RBA and BOE could put a dent into this trend but probably not for too long.

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USD/CHF will gain in the near-term

al_dcdemo Posted 30 May as Analysis on USD/CHF, Target: 0.9625, Date: 1st of July, 12:00 GMT  in #Technical analysis #Double Bottom #USD/CHF #Fomc Meeting #Range #Parity #Snb Shocker #200 Day Sma #Bullish Technicals #Neutral Fundamentals
Monthly chart:
The pair has broken parity on the first trading day of the year. It was trading around 1.02 when SNB shocker sent it all the way down to 2011 lows. The actual low was 0.7263 or roughly just 70% of its value before the announcement. The turnaround was equally impressive and after barely two months the pair found itself testing middle of the pre-SNB range between parity and 1.03. That was near-term top and it declined from there but it still managed to recoup more than three quarter…
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al_dcdemo 7 June

UPDATE 4: The pair ended the week near opening levels what may signal indecision in the market. Initial support is seen around 0.9350 and then between 0.9270 - 0.9300. If that gives way, a retest of May lows below 0.91 may ensue. On the upside, 50 and 100 DMA (currently just above 0.9450) are the first stronger levels of resistance, but the pair will need to convincingly break above 0.95 and 200 DMA to re-establish the bullish bias.

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al_dcdemo 14 June

UPDATE 5: Even though the pair reversed half of post-NFP losses on Friday and proceeded with a strong decline on Monday, support at 0.9250 held twice before sending the pair back toward 0.94, to just below declining trendline (drawn off March, April and May highs) where it stalled and turned back lower. The pair ended the week slightly behind EUR/USD, but the weekly candle looks more convincing with regard to the trend continuation likehood.

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al_dcdemo 15 June

UPDATE 6: Besides the Fed, the SNB is another central bank that will hold its meeting in the week ahead. No change from them is the most probable and widely expected outcome. The pair has been trading below 50, 100 and 200 DMA since the beginning of the month and, while it is holding below the averages (especially 200), the sellers appear to be in control. Trendline, drawn off March, April and May highs, will be the first level to watch on the upside.

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al_dcdemo 26 June

UPDATE 7: In the beginning of the week the pair mostly mirrored its cousin EUR/USD as it hasn't been able to break lower on Monday and then rocketed on Tuesday instead. The remaining three days were range-bound, but the range was wider and swings looked wilder. EUR/CHF flows were likely responsible for the part of this action as the Greek story and uncertainty was weighing on traders' decisions every day.

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al_dcdemo 27 June

UPDATE 8: There's nothing of note from Switzerland on the calendar for the week ahead. Saturday's Eurogroup Meeting and the rest of the weekend talks appear to be the single most important fundamental factor. Given that the pair usually closely follows the Euro, we may get huge gap open on Monday if we get a deal or if potential for Greek default rises. Especially in the latter case it will be interesting to see the reaction in the pair.

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