Forex Trading Technical Analysis By forum.forex

EURUSD has fallen for five consecutive days Bearish.

Looking at the daily chart, the move saw price expand below its downtrend line currently at 1.1300 and the 61.8% retracement of the move from the March 23 low at 1.12876. However, these breakouts have since been retraced with the price currently trading above the 1.1300 to 1.1310 level. Some cash purchases / profit taking.

Looking at the hourly chart, the high correcting the low peaked at 1.13315. That’s still below its 38.2% retracement of the downward movement this week which stands at 1.13389. Price moved into positive territory for the day above 1.13195, but has since fallen below.

GBP/USD edged higher on Thursday, albeit lacked follow-through beyond the 1.3500 mark.

The GBP/USD pair traded with a positive bias through the first half of the European session, with bulls making a fresh attempt to build on the momentum beyond the key 1.3500 psychological mark.

The pair built on the previous day's hotter-than-expected UK CPI-inspired rally of around 100 pips from sub-1.3400 levels and gained some follow-through traction on Thursday. This marked the third successive day of a positive move – also the fourth in the previous five – and was supported by rising bets for an imminent interest rate hike by the Bank of England in December.

EUR/JPY Sideways range to emerge between 127.93/88 and 130.08/12

“EUR/JPY has extended its expected recovery to the back of its broken uptrend from May last year, seen at 129.63 today, with further key resistance seen not far above here at the recent reaction highs and 13-day exponential average at 129.99/130.12. Our bias remains for the recovery to stall here and for the immediate risk to turn back lower in what we look to be a broader sideways range.”

“Near-term support moves to 128.91, then 128.56/54, below which can see a retest of pivotal support from the 127.97/88 key price lows of August, September and earlier this month and 50% retracement of the rally from last October. Failure to hold here would be seen to mark a large and important top.”

GBP/USD Trading Analysis

The retail trader data show 74.24% of GBP/USD traders are net-long, with the ratio of traders long to short at 2.88 to 1. The number of traders net-long is 1.89% higher than yesterday and 8.91% higher than last week, while the number of traders net-short is 3.78% lower than yesterday and 13.67% lower than last week.

Here at forum.forex, we typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests GBP/USD may continue to fall.Traders are further net-long than yesterday and last week, and the combination of current sentiment and recent changes gives us a stronger GBP/USD-bearish contrarian trading bias.

AUD/USD Technical Analysis Nov-26, 2021

AUD/USD tumbled below key support in the form of the late September low at 0.7170 on Friday and eventually fell as low as 0.71125, as risk assets were pummeled amid a spike in pandemic-related fears. The pair has since recovered back to close to 0.7140, but still trades with losses of about 0.7% or 50 pips on the day and is on course to end the week down 1.2%.

For now, dip-buying and profit-taking on previous short positions have kept AUD/USD above support in the 0.7100 area. Should this support break, a run towards the next key area of support around 0.7000 is likely.

EUR/JPY extends the leg lower and breaks below 128.00

EUR/JPY extends the leg lower and breaks below 128.00 to clinch fresh 9-month lows in the id-127.00s on Monday.

The continuation of the downtrend remains well on the cards for the time being. A sustainable breach of 127.48 (November 29) exposes a deeper pullback to the 2021 lows in the 125.00 neighbourhood (January 18).

Looking at the broader picture, the outlook for the cross is expected to remain negative while below the 200-day SMA, today at 130.54.

USD Buying Picks Up Prior to Omicron Scare

In the week to November 23rd, speculative net longs in the USD grew notably ($3.82bln) as market participants reacted to the announcement of Chair Powell’s renomination. In turn, with a faster QE taper becoming the consensus view, a more hawkish Fed had been repriced, subsequently lifting the greenback.

However, this view has been challenged given the surprise Omicron variant newsflow, where the USD has since come under pressure amid the potential near term implications for Fed policy, in which markets have slightly paired back Fed tightening bets.

Money markets now see the first rate rise in September 2022 vs July 2022 previously.

GBP/USD around the 1.3325 region in the last hour.

The USD witnessed some selling during the early part of the European session and pushed the GBP/USD pair to a fresh daily high, around the 1.3325 region in the last hour.

The pair attracted fresh buying near the 1.3265 area on Thursday and for now, seems to have snapped three consecutive days of the losing streak. The uptick was exclusively sponsored by some US dollar weakness, though any meaningful recovery still seems elusive.

EUR/USD Weekly Price Forecast
The Euro has gone back and forth during the course of the week to form a massive neutral candlestick, after the hammer from the previous week. At this point in time, the market looks as if it is trying to form some type of basing pattern, but the Euro itself seems to be very soft. At the 1.15 level, the market is likely to continue to be important, because if we can break above there it is likely that the Euro will try to go higher. Any signs of exhaustion on a rally would be a selling opportunity from what I can see.

Furthermore, if we were to break down below the hammer from the previous week, then the market is likely to go much lower.

EUR/USD has been trying to recover from its recent collapse.

Since the start of this week, the EUR/USD has been trying to recover from its recent collapse, but the rebound attempts did not pass the 1.1383 level. With the continuation of negative pressure factors on the euro, the currency pair could not go further and settled around the 1.1317 level as of this writing. I expect it to remain in a narrow range until the US jobs numbers are announced tomorrow.

Major indices move higher. Dow erases losses from last week/Nasdaq higher but lags

The major US stock indices are closing the session with varied gains. The major three indices was led by the Dow. The Russell 2000 which has been beaten down the most from all time highs, had the best gains for the day.

The Nasdaq index which is 6% off the all time high, lagged but still rose 0.93% on the day.
All the S&P sectors rose on the day with consumer staples, industrials and communication services leading the way.

The Bank of Canada will release its monthly policy report and interest rate today, which may trigger volatility in the Canadian dollar. The market is not expecting any change in the Canadian interest rate to be announced.

The Forex market has been relatively quiet, although we have seen a small move against the long-term bullish US dollar trend, with riskier currencies advancing against safe-havens. The British pound stands out as relatively weak.

Almost all major cryptocurrencies have seen a bullish rebound but are no longer advancing strongly. Ethereum is currently stronger than Bitcoin, although Bitcoin is still trading above $50k.

The EUR/USD climbs 0.14%, trading at 1.1310 during the New York session.

The US bond yields trim some earlier losses at press time, except for 2s, down two basis points at 0.6604%, a headwind for the greenback, with the US Dollar Index down 0.23%, sitting at 96.05. Meanwhile, the US 10-year benchmark note is flat at 1.482%, after dropping almost two basis points as market participants dug deep into the CPI report.

Once the European desks head into the weekend and the US inflation reaction settled down, the EUR/USD climbs 0.14%, trading at 1.1310 during the New York session at the time of writing.

Ahead of the Wall Street open, the US Bureau of Labor Statistics (BLS) reported that US inflation for November increased to 6.8%, as shown by the CPI annually based. Also, the Core CPI, which means inflation without volatile items like food and energy, rose to 4.9%, as foreseen by analysts.

The US economy experienced its most severe downturn in decades last year, but has gained back the lost ground, though at a fluctuating pace. The economy expanded at a strong annual rate of 6.7 percent in the second quarter, but a much weaker 2.1 percent in the third quarter, dragged down by the Delta variant of COVID-19, which complicated business and scared consumers. But with infections from that wave dropping off, economists foresee better growth in the final three months of this year.

Biden’s complicated agenda
Biden took office in January and not long after secured passage of the $1.9 trillion American Rescue Plan, Washington’s third pandemic stimulus package. The White House has pointed to falling unemployment and rapid growth as evidence that the spending has paid off.

UK inflation news and updates, Dec-15, 2021

The latest UK inflation data will be a stark reminder to the Bank of England that price pressures are getting out of control and that interest rate hikes are needed, and quickly. Headline UK inflation hit a decade high 5.1% in November, beating forecasts of 4.7% and a prior month's reading of 4.2%.

These levels of inflation would normally prompt a response from the BoE, especially when taken alongside another set of robust employment figures released yesterday. However, the central bank may put off hiking rates at tomorrow's policy meeting with the rapid spread of Omicron now seemingly dictating monetary policy. The BoE is now stuck between a rock and a hard place.

GBP/USD has nudged higher post-release but remains in a longer-term downtrend off the June 1.4250 high. Support at 1.3162 has held. Cable traders are now facing two high-impact events over the next day, tonight's FOMC meeting and tomorrow's BoE meeting, both of which could move cable sharply.

On the other hand,
The U.S. dollar held firm on Wednesday, with currency markets quiet as investors waited to see if the U.S. Federal Reserve would reinforce market expectations for rate hikes next year.

Analysts at Danske Bank forecast the EUR/USD pair at 1.13 in a one-month period, at 1.12 in 3M and at 1.10 in 12M. They see downside risks to these forecasts.

We keep our EUR/USD forecast at 1.10 in 12M and see downside risks to this. This reflects our view that market themes are increasingly pro dollar. The manufacturing cycle is clearly slowing but central banks need to tighten to catch-up with inflation pressures and this is quite negative for EUR/USD, especially at current levels."

"The key risk to see EUR/USD above 1.20 is seeing global inflation pressures to fade. However, 'transitory' has substantially lost credibility and we are likely to see a further EUR-negative environment as manufacturing growth slows down. The risk to take EUR/USD below 1.10 is a scenario where central banks tighten further amid a cyclical slowdown, akin a scenario like seen in early 80's."

The Bank of England surprised market participants yet again by raising interest rates by 15bps to 0.25%. I say surprised given that ahead of the December meeting, notorious MPC hawk, such as Saunders cast doubts over a rate rise, having mentioned the potential advantages of delaying a hike in order to assess the impact of Omicron. That said, with the latest inflation reading making the MPC’s November forecast already outdated and the labour market remaining robust post furlough expiration, there was little excuse to not raise rates. Although, while it is a step in the right direction, I would say it is a rather tentative step, given that a 15bps rate hike is not exactly a move that shows a determination to curb inflationary pressures. Although, what it allows now is for the next hike to move in 25bps increments going forward. Yet again, this shows the BoE’s communication leaves very little to be desired when trying to gauge the timing of a BoE rate hike.

Hawkish FED is causing a sharp reversal in the markets, with stocks coming down as US yields rise which makes USD very strong across the board. So we think that volatility is likely going to stay here because of Central banks policy divergences.

So one pair that we track closely is EURUSD for more weakness as ECB seems to be on the different side compared to FED. In fact, we see nice five wave drop from 1.1380 followed by only three-wave rally into 61.8% Fib so we assume that trend will stay bearish.

EUR/USD
Current level – 1.1308

The situation with the single European currency remained unchanged at the beginning of today's session as the range move currently stays locked between 1.1278 and 1.1359. The forecast remains neutral, but today's announcement of the initial jobless claims data for the U.S. at 13:30 GMT could affect the volatility of the currency pair. Only a successful breach of one of the mentioned boundaries of the narrow range, however, could determine the future mood of investors. Of course, the non-farm payrolls change data for the U.S. (Friday; 13:30 GMT) will also be followed just as attentively.

Jan-17, 2022, GBP/EUR/USD/JPY technical analysis and forecast, by Forex Forum.

The Euro (EUR) firmed early last week amid a drop in Eurozone unemployment, a weaker US Dollar (USD) and a risk-off market mood.

The single currency then wavered through much of the week. A retreating US Dollar buoyed EUR while a dovish European Central Bank (ECB) and an improving market mood offset the upside.

Finally, EUR lost ground to GBP by the end of the week. The Eurozone reported its first trade deficit since January 2014, while German GDP data confirmed that Europe's largest economy remains below pre-pandemic levels.

Meanwhile, the Pound (GBP) spiked on Tuesday amid strong sales data and Bank of England (BoE) rate hike expectations. However, profit-taking saw Sterling shed these gains.

Moreover, According to the technical analysis of the pair: the price of the GBP/USD currency pair is still moving steadily inside its ascending channel and the bulls are trying to break through the upper line from that channel as the factors of its gains are still valid. The breach of the resistance 1.3775 is important to move towards stronger ascending levels 1.3830 and the psychological top 1.4000, respectively. Bearing in mind that the move towards these areas moves the technical indicators towards strong overbought levels, and unless the sterling gains momentum, profit-taking may start at any time.

Jan-25, 2022, EUR/USD, EUR/GBP, USD/JPY technical analysis and forecast, By Forex Forum

https://www.forum.forex/attachments/...-copy-jpg.710/

EUR/USD keeps testing the two-month channel support line at $1.1292 which may still be slipped through ahead of key policy decisions from the Federal Open Market Committee (FOMC) tomorrow.

Together with the late December and early January lows at $1.1274 to $1.1272 the channel support line has held since late December. A fall through this support zone would put the mid-December low at $1.1222 as well as the November trough at $1.1186 on the map.

The downtrend remains firmly entrenched while the currency pair stays below the 16 January high at $1.1369 and, more importantly, the late November and December highs at $1.1383 to $1.1387.

Moreover, EUR/GBP has formed a bottom and is likely to rise further still.
Now that the November low and last week's high at £0.8379 to £0.8381 have been exceeded, EUR/GBP is deemed to have formed a bottom at its year-to-date low at £0.8305. It was made right between the £0.8313 to £0.8277 December 2016, April 2017, December 2019 and February 2020 lows which represent key long-term support.

On the other hand, The dollar edged higher on Tuesday to within striking distance of its two-week peak, as investors bought safe-haven currencies amid tensions between Russia and the West over Ukraine while awaiting the outcome of the Federal Reserve's policy meeting.

The US military put about 8,500 troops on alert to be ready to deploy to Europe if needed, in the latest effort to reassure jittery NATO allies in the face of a Russian military build-up near Ukraine.

"Much greater exposure of European economies to the crisis does not make the euro a particularly attractive vehicle to ride out the current storm," ING analysts said.

The euro was down 0.2% at 0848 GMT to $1.1300, trading just off its lowest since on 20 December touched on Monday.