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Technical Analysis – Gold, Daily, consolidation with downside risk under 1276

Posted on May 8, 2014 at 6:35 am GMT

[caption id="attachment_16411" align="alignnone" width="570"] (Click to enlarge)[/caption] Following a strong up move so far this year that peaked on March 17, gold has retraced 50% of the 200+ dollar move from 1187 to 1392. Since the end of March it has been hovering around this 50% retracement level of 1290, with both attempts to break and stay above the psychologically important 1300 level failing – one at 1331 and another at 1315. 1315 and 1331 are two resistance levels – [..]

European Session – Currency ranges ahead of Yellen’s testimony

Posted on May 7, 2014 at 1:48 pm GMT

It was a quiet day on the data calendar today keeping most major currency pairs in ranges except for dollar/ yen which rose ahead of Fed Chair Yellen’s testimony later today before the Joint Economic Committee of Congress. The only data released out of Europe were the French Industrial Production and the German Factory Orders numbers, with both sets of data disappointing markets and coming in well below forecasts. Despite the soft data, the euro held steady against the dollar [..]

Forex News – Dollar index down more than 1% year-to-date, defying predictions of rise

Posted on May 7, 2014 at 11:58 am GMT

[caption id="attachment_16400" align="alignnone" width="570"] (click to enlarge)[/caption] One development that has surprised many market participants so far this year has been the drop in the dollar index. The index was down by 1.18% on Tuesday 6th May, compared to the end of 2013. The dollar has slipped by 1.23% against the euro and 2.50% versus sterling. Both currencies have climbed to record multi-year highs against the dollar recently. The yen, reacting after its severe drop in 2013, is up 3.4%, [..]

Technical Analysis – S&P downside potential remains

Posted on May 7, 2014 at 10:01 am GMT

S&P has turned bearish after approaching close to resistance at 1882. On the 4-hour chart RSI is below 50 suggesting downside potential exists, and the MACD is crossing below the zero line, also adding to the bearish bias. Also, prices have penetrated back into the Ichimoku cloud to find support at 1861, at the 100-period moving average. A move to the downside would target the April 28 low of 1843.75 as the next support level. Below this, support comes in [..]

Technical Analysis – GBPUSD bullish flag suggests further upside

Posted on May 7, 2014 at 8:44 am GMT

GBPUSD hit an over 4-year high of 1.6995 on Tuesday. Technical indicators are giving bullish signals on the 4-hour chart. RSI is above 70 and MACD is above zero, indicating further upside potential. The market is far above the Ichimoku cloud and above the tenkan-sen and kijun-sen lines which are positively aligned, adding to the strong bullish bias. Prices have formed a bullish flag formation. As prices are consolidating after the strong rally, the market is expected to continue the [..]

Technical Analysis – USDJPY bearish below cloud

Posted on May 7, 2014 at 7:25 am GMT

USDJPY is falling towards support at 101.31, the April 11 low, which if it fails to hold, will open the way towards 100.74, (February 4 low). To the upside, Friday’s high of 103.00 is an important resistance level. This is the 61.8% Fibonacci retracement level of the downleg from April 4 (104.11) to April 10 (101.32). Overall, the USDJPY pair is bearish in the short term. On the 4-hour chart, the RSI is below 50 and downwardly inclined, adding to [..]

Asian Session – Dollar falls broadly ahead of Yellen; yen benefits from risk-off

Posted on May 7, 2014 at 6:34 am GMT

The dollar index dropped to a 6-month low on Wednesday, as markets reacted to treasury yields falling to 3-month lows. The safe haven yen gained as falling tech stocks hurt market risk sentiment and the fighting in Eastern Ukraine made investors cautious. The yen was a significant beneficiary of dollar weakness, as dollar / yen was driven below the 102 level to 101.46 following a sell-off in global stock markets as the end of the lockup period for Twitter shareholders [..]

European Session – Pound hits 4 1/2 year high after strong Services PMI

Posted on May 6, 2014 at 1:45 pm GMT

The euro was lifted to a 7-week high against the dollar after strong numbers from the Purchasing Managers’ Index (PMI) survey compiled by research firm Markit. What attracted the market’s attention was a big improvement in Spain’s Services PMI which rose in April to 56.5 from a prior 54.4 and beat forecasts of 54.0. The overall Eurozone Composite PMI rose to 54 in April, in line with expectations and up from 53.1 in March. Other data from the Eurozone showed [..]

Forex News – Reserve Bank of Australia to keep low rates as austerity sets in

Posted on May 6, 2014 at 9:17 am GMT

The Reserve Bank of Australia (RBA) kept interest rates unchanged at 2.50% during its meeting today. This was widely anticipated by economists, as a hot housing market is preventing the RBA from cutting interest rates further as it perhaps would like. Inflation during the first quarter was at the high end of the bank’s 2-3% target range, at 2.93% year-on-year. The key interest rate has been at 2.50% since August 2013. According to the IMF, the Australian economy will grow [..]

Technical Analysis – EURUSD bullish

Posted on May 6, 2014 at 8:57 am GMT

EURUSD breached the resistance level of 1.3904 to move higher to trade at 1.3930 by 09:00 GMT. The pair has scope to target the March 13 high at 1.3966 (the strongest level since November 2011.) On the 4-hour chart the RSI and MACD are positive, adding to the possibility of further upside for prices to target 1.3940, 1.3966 and then 1.4000. Support is seen at 1.3904, 1.3880, 1.3850 and 1.3812. EURUSD is bullish on the 4-hour chart, trading above the [..]

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