Forex News Analysis by LiteForex

GBP/USD: review and forecast

Current trend

The British currency continues strengthening. Since the beginning of the week, the GBP/USD pair has gained back about 500 points. There is a good chance that the pair has already reached its lows after the results of the British referendum were released, and, therefore, might continue developing its upward trend.

Support and resistance

On the daily chart, the price remains between the lower and the middle MAs of Bollinger Bands and might continue moving up towards the middle one and reach the level of 1.3500 which is one of recent local highs.
Support levels: 1.3225, 1.3150, 1.3060, 1.2860.
Resistance levels: 1.3400, 1.3470, 1.3500, 1.3585.

Trading tips

Long positions can be opened from the current level with the target at 1.3500 and stop-loss at 1.3235.
Short positions can be opened from the level of 1.3235 with the target at 1.2860 and stop-loss at 1.3310.

AUD/USD: review and forecast

Current trend

The AUD/USD pair has been moving up for two weeks already, and the dynamics is likely to continue. Since yesterday, the Australian Dollar has strengthened by about 70 points.
Today attention needs to be paid to data on the Initial Jobless Claims, due in the US at 14:30 pm (GMT+2). The indicator is expected to grow from 254,000 to 265,000 that might have a negative impact on the US currency.

Support and resistance

Bollinger Bands on the daily chart is directed up. The price is growing from the middle to the upper MA, and at present there is no indication that the price tends to reverse.
Support levels: 0.7600, 0.7550, 0.7540.
Resistance levels: 0.7650, 0.7690, 0.7720.

Trading tips

Long positions can be opened from the current level with the target at 0.7700 and stop-loss at 0.7600.
Pending sell orders can be placed at the level of 0.7700.

EUR/USD: general analysis

Current trend

The EUR/USD pair is moving up and strengthened by 35 points in the previous trading session. Yesterday US macroeconomic statistics had almost no influence on dynamics in the pair. It should, nevertheless, be noted that the number of initial jobless claims remained unchanged at 254,000 while economists expected an increase to 265,000. Today market participants will be following data on the Consumer Price Index and Retail Sales, due in the US at 2:30 pm (GMT+2).

Support and resistance

Bollinger Bands on the 4-hour chart is directed up. MACD histogram is in the positive zone, and its volumes are growing.
The indicators recommend long positions.
Support levels: 1.1115, 1.1087, 1.1050, 1.1010.
Resistance levels: 1.1148, 1.1185, 1.1220, 1.1276.

Trading tips

Long positions can be opened above the level of 1.1148 with targets at 1.1185 and 1.1220.
Short positions can be opened below the level of 1.1087 with targets at 1.1050 and 1.1010.

UKBrent: technical analysis

BRENT, D1

On the daily chart, the instrument is trading in the lower Bollinger band. The indicator is directed down while the price range is expanding. MACD histogram entered the negative zone and formed a sell signal. Stochastic is approaching the oversold zone.

BRENT, H4

On the 4-hour chart, the instrument broke down a strong support level at 47.38. Bollinger Bands is directed horizontally while the price range is narrowing, suggesting a change in the trend possibility. MACD histogram is trying to turn up but keeping a sell signal. Stochastic is about to enter the oversold zone.

Key levels

Support levels: 46.47 (local low), 46.09, 45.71 (lower MA of Bollinger Bands).
Resistance levels: 47.38, 47.91, 48.63 (middle MA of Bollinger Bands), 49.20.

Trading tips

Short positions can be opened from current prices with the target at 45.71 and stop-loss at 47.38. Validity – 1-2 days.
Long positions can be opened from the level of 47.91 with targets at 48.30, 48.65 and stop-loss at 47.15. Validity – 1-2 days.

USD/CAD: pair trades flat

Current trend

The USD/CAD pair started this week with a growth but then lost most of its gains. This dynamics in the pair can be explained by the lack of important macroeconomic publications in the US and fluctuation in the oil market.
The price of oil lost about 2 percent on Friday after data on crude supplies and the number of active oil rigs were released. Genscape reported an increase of 26,460 barrels in the week to 15 July at Cushing delivery hub. Data from Baker Hughes showed that the number of active oil rigs rose by six to 357. These statistics are seen as a negative factor that might cause a shift in the supply and demand fragile balance in the oil market.

Support and resistance

Bollinger Bands on the daily chart is moving horizontally while the price range remains narrow. MACD is trying to turn up while still keeping a sell signal. Stochastic is turning up near the border of the oversold zone.
Support levels: 1.2962, 1.2930, 1.2900, 1.2861 (local low), 1.2831 (4 July low), 1.2800, 1.2762, 1.2700 (23 June level).
Resistance levels: 1.3000, 1.3021 (local high), 1.3055, 1.3083, 1.3100, 1.3139 (11 July high).

Trading tips

Long positions can be opened above the level of 1.3000 (with appropriate indicators signals) with targets at 1.3100, 1.3139 and stop-loss at 1.2962, 1.2950. Validity – 2-3 days.
Short positions can be opened after the price rebounds down from the level of 1.3000 with the target at 1.2900 and stop-loss at 1.3050. Validity – 2-3 days.

XAG/USD: technical analysis

XAG/USD, H4

On the 4-hour chart, the instrument is moving down along the lower MA of Bollinger Bands. The price remains above EMA100 and EMA144, both directed up, and below EMA50. MACD histogram is in the negative zone, and its volumes are gradually growing. The indicator is giving a sell signal. Stochastic is falling.

XAG/USD, D1

On the daily chart, the instrument rebounded down from the upper MA of Bollinger Bands in the region of 20.50 and is now moving towards the middle MA. At present, the price remains above EMA50, EMA100 and EMA144 that are directed up. MACD histogram is in the positive zone, and its volumes, having reached their highs, are now gradually falling. The indicator is giving a sell signal. Stochastic lines are directed down.

Key levels

Support levels: 19.70, 19.45, 19.00, 18.30, 18.00, 17.50, 17.20, 16.65, 16.30, 15.80.
Resistance levels: 20.00, 20.25, 20.50, 20.95, 21.15.

Trading tips

According to the indicators, short positions are preferable and can be opened from the level of 19.70 with targets at 19.45, 19.00 and stop-loss at 19.85. Validity – 1-2 days.
Long positions can be opened from the level of 20.00 with targets at 20.25, 20.50 and stop-loss at 19.90. Validity – 1-3 days.

EUR/USD: general review

Current trend

The pair continues trading at its local lows amid weakening in the Euro, which remains under pressure prior to the ECB monetary policy meeting. According to forecasts, the regulator will keep its interest rate unchanged but will announce its readiness to further ease monetary policy in the nearest future. At the same time, additional uncertainty to ECB’s decision comes from a growing problem in the Italian banking sector, which could worsen the situation of UK’s departure from the European Union. According to the IMF estimates, the total size of bad debts on banks’ balance sheets amounts to around 360 billion Euro.
In addition, the pair is pressured by strengthening in the Dollar that receives support from strong macroeconomic statistics from the US. The latest data increased the probability of an interest rate hike by the Fed before the year-end.

Support and resistance

The nearest support level is at 1.0984.
The nearest resistance level is at 1.1023.

Trading tips

Short positions can be opened from the level of 1.0984 with the target at 1.0750 and stop-loss at 1.1023.

Brent: general analysis

Current trend

The price of Brent crude oil remains under pressure as gasoline inventories grew to a record high. In particular, the US Energy Information Administration reported a rise in gasoline stocks by 0.9 million barrels to 241 million barrels in the week ended 15 July that is 25% increase compared to the previous year. The same situation can be seen in Europe where gasoline stocks were up by 12%.
Moreover, strengthening in the US Dollar and a sluggish pace of the world economic growth have a negative impact on oil prices dynamics.

Support and resistance

RSI is growing suggesting the possibility of a correction towards the level of 46.50 from which a fall in the price should be expected.
The nearest support level is at 45.80.
The nearest resistance level is at 46.50.

Trading tips

Short positions can be opened from the level of 46.50 with the target at 45.00 and stop-loss at 47.00.

USD/JPY: general analysis

Current trend

Despite strong macroeconomic statistics that were released today in Japan, the Yen remains under pressure amid expectations of a cut in interest rates at the upcoming Bank of Japan meeting, due 29 July. Moreover, it should also be noted that other major central banks also consider further easing of monetary policy to overcome negative effects of Britain’s exit from the EU. Thus, the US Dollar is seen as a more attractive asset in the current situation.

Support and resistance

Bollinger Bands on the 4-hour chart is directed horizontally while the price range is showing no changes. The instrument fell below the support level of 106.27. MACD histogram is in the positive zone, but its volumes are falling. The indicator is giving a sell signal. Stochastic reached the border of the overbought zone and turned down.
The indicators recommend short positions.
Support levels: 105.98, 105.67, 105.43, 105.04.
Resistance levels: 106.27, 106.50, 106.70, 107.16, 107.45.

Trading tips

Short positions can be opened from the current levels with the target at 105.43 and stop-loss at 106.70. Validity – 1-2 days.
Long positions can be opened from the level of 106.50 with the target at 107.00 and stop-loss at 106.15. Validity – 1-2 days.

USD/CAD: general review

Current trend

The pair continues growing amid falling oil prices that pressure the Canadian Dollar. In addition, the pair is supported by strengthening in the US Dollar due to an increased probability of monetary policy tightening by the Fed before the end of the year.
Tomorrow extra attention needs to be paid to the Fed Interest Rate Decision and its Monetary Policy Statement. According to forecasts, the rate will remain unchanged while commentaries by the regulator might cause high volatility on the market.

Support and resistance

The pair is testing a strong resistance at 1.3223.
On the 4-hour chart, Bollinger Bands is directed up while the price range is widening. MACD histogram is in the positive zone and its volumes are growing. Stochastic is falling as it has left the overbought zone.
The indicators recommend long positions.
Support levels: 1.3182, 1.3140, 1.3099, 1.3065, 1.3021.
Resistance levels: 1.3223, 1.3240, 1.3259.

Trading tips

Long positions can be opened from the level of 1.3230 with the target at 1.3260 and stop-loss at 1.3205. Validity – 1-2 days.
Short positions can be opened from the level of 1.3200 with the target at 1.3140 and stop-loss at 1.3235. Validity – 1-2 days.