Forex News Analysis by LiteForex

GBP/USD: review and forecast

Current trend

The pair continues trading in a narrow sideways channel near the level of 1.3100 amid lack of important macroeconomic news form the UK and prior to the Fed Interest Rate Decision that is due today. According to forecasts, the rate will remain unchanged.
At the same time, the majority of market participants expect a rate cut in the UK in the nearest future while the probability of monetary policy tightening in the US before the end of the year significantly increased, which is pressuring the pair.

Support and resistance

In the medium-term, the price is expected to fall to the level of 1.3000, where it will reverse and return to the level of 1.3250.
On the 4-hour chart, the price is trading near the lower MA of Bollinger Bands while bands are narrowing.
Support levels: 1.3050, 1.3000, 1.2860.
Resistance levels: 1.3150, 1.3250, 1.3310, 1.3400, 1.3480.

Trading tips

Pending buy order can be placed at the level of 1.3000 with the target at 1.3250 and stop-loss at 1.2900.
Short positions can be opened from the level of 1.2940 with the target at 1.2860 and stop-loss at 1.3000.

USD/JPY: review and forecast

Current trend

Yesterday the pair showed a volatile trade amid the publication of important news.
The pair was significantly supported by information of a possible expansion in the stimulus program in Japan that could amount to $265 billion. Later in the day, however, the Dollar was pressured by the Fed decision to leave its interest rate unchanged at 0.5%.
Today attention needs to be paid to data on Initial Jobless Claims in the US. Better-than-forecast figure could provide additional support to the pair. Extra attention needs to be paid to tomorrow’s monetary policy decision by the Bank of Japan.

Support and resistance

The pair bounced off the border of the descending channel and at present consolidated below the psychologically important level of 105.00. A breakdown of 50% Fibonacci correction could accelerate pair’s fall.
The RSI is breaking down the 50-point mark suggesting the fall could continue.
Support levels: 104.50, 103.20, 102.40.
Resistance levels: 105.30, 106.00, 106.50, 107.50.

Trading tips

Long positions can be opened after the breakout of the level of 105.40 with targets at 106.00, 106.50.
Short positions can be opened from the level of 104.40 with targets at 103.80, 103.20.

XAU/USD: general review

Current trend

After a significant growth on Thursday amid the US Fed Interest Rate Decision, the price of gold slightly fell. The instrument was pressured by expectations of strong data on the US GDP for the second quarter of the year. According to forecasts, the index will grow from 1.1% to 2.6%. However, the Dollar remains under pressure due to uncertainty regarding plans of the American regulator on monetary policy tightening during this year. The probability of a rate hike at September’s meeting currently stands at only 14%.

Support and resistance

On the 4-hour chart, Bollinger Bands is directed down while the price range is narrowing, suggesting the likelihood of a trend change. MACD is turning down. Stochastic turned up near the border of the oversold zone.
The indicators recommend short positions.
Support levels: 1330.01, 1327.52, 1325.53, 1323.21, 1321.05, 1318.72, 1315.74.
Resistance levels: 1336.32, 1340.46, 1342.29, 1345.28, 1346.77.

Trading tips

Short positions can be opened from current prices with the target at 1321.00 and stop-loss at 1340.00. Validity – 1 day.
Long positions can be opened from the level of 1318.70 with the target at 1323.00 and stop-loss at 1313.50. Validity – 1 day.

EUR/USD: general analysis

Current trend

Last Friday, the EUR/USD pair grew amid statistics on the US GDP. Preliminary data showed that the American economy grew 1.2 percent in the second quarter while economists projected a 2.6 percent rise.
The pair was also supported by data on inflation in the eurozone. The Consumer Price Index grew 0.2 percent in July after a 0.1 percent gain in the previous month.
Today market participants will be following data on the Markit US Manufacturing PMI which is released at 3:45 pm (GMT+2).

Support and resistance

Bollinger Bands on the 4-hour chart is directed up. The price broke out the upper border of the range that indicates the possibility of a downward correction towards the middle MA. MACD histogram is in the positive zone, its volumes are growing.
Support levels: 1.1148, 1.1115, 1.1087, 1.1010.
Resistance levels: 1.1196, 1.1276, 1.1321, 1.1365.

Trading tips

Long positions can be opened after the price breaks out and consolidates above the level of 1.1196 with targets at 1.1276, 1.1321, 1.1365 and stop-loss at 1.1166.
Short positions can be opened after the price breaks down and consolidates below the level of 1.1087 with targets at 1.1050, 1.1010 and stop-loss at 1.1115.

AUD/USD: general analysis

Current trend

Today the Reserve bank of Australia announced its decision on interest rates. In line with expectations, interest rates were cut from 1.75% to 1.50% that had a strong negative impact on the AUD/USD pair.
This afternoon attention needs to be paid to a report on US personal income and spending in June. A growth in both indicators might add to pressure on the pair.

Support and resistance

Bollinger Bands on the daily chart is directed up while the price range is narrowing. MACD histogram is in the positive zone, but its volumes are falling. Stochastic has left the oversold zone.
The indicators recommend waiting for clearer trading signals.
Support levels: 0.7525, 0.7510, 0.7491, 0.7481, 0.7467, 0.7454, 0.7442.
Resistance levels: 0.7546, 0.7554, 0.7566, 0.7579, 0.7589, 0.7601.

Trading tips

Long positions can be opened from the current level with the target at 0.7650 and stop-loss at 0.7505. Validity – 1 day.
Short positions can be opened from the level of 0.7505 with targets at 0.7480, 0.7440 and stop-loss at 0.7525. Validity – 1-2 day.

Brent: general analysis

Current trend

The price of Brent crude oil grew slightly after the American petroleum Institute (API) reported a drawdown in US crude oil inventories. Today attention needs to be paid to data, released by the Energy Information Administration. The oil reserves in US storages are expected to be down by more than 1.8 million barrels that might provide support for the price. Dynamics in the instrument, however, is likely to remain downward as long as the global oil market remains oversupplied.

Support and resistance

On the 4-hour chart, the instrument is trading in the lower part of Bollinger Bands. The indicator is directed down, the price range is widening. MACD histogram is in the negative zone. Stochastic has turned up at the border of the oversold zone.
The indicators recommend waiting for clearer trading signals.
Support levels: 42.00, 41.72, 41.51, 41.18, 40.97.
Resistance levels: 42.41, 42.84, 43.08, 43.33, 43.61, 43.77.

Trading tips

Long positions can be opened from the level of 42.40 with the target at 43.08 and stop-loss at 42.00. Validity – 1-2 days.
Short positions can be opened from the level of 41.70 with targets at 41.18, 41.00 and stop-loss at 42.00. Validity – 1-2 days.

GBP/USD: general analysis

Current trend

After the Bank of England decided its cut interest rates to 0.25%, the GBP/USD pair lost more than 200 points. Having reached its low in the region of 1.3111, the price corrected up. The instrument gained moderate support when data on US Initial Jobless Claims showed a 3 000 increase to 269 000 for the week ended July 30.
On Friday market participants will turn their attention to statistics for July on US Nonfarm Payrolls and Unemployment Rate. Economists project 180 000 new jobs were created last month that is substantially below
the previous reading of 287 000. The Unemployment Rate, at the same time, is expected to be down from 4.9% to 4.8%.

Support and resistance

Bollinger Bands on the 4-hour chart is directed down, but the price was falling below the lower band that suggests the possibility of an upward correction towards the middle MA and the level of 1.3272. MACD histogram is in the positive zone, but its volumes are falling. The indicator is giving a sell signal.
Support levels: 1.3111, 1.3065, 1.3007.
Resistance levels: 1.3190, 1.3272, 1.3374.

Trading tips

Short positions can be opened below the level of 1.3111 with targets at 1.3065 and 1.3007.
Long positions can be opened above the level of 1.3272 with the target at 1.3374.

AUD/USD: review and forecast

Current trend

Today the pair continued growing and reached the level of 0.7665 amid commentaries from the Reserve Bank of Australia on its monetary policy. In its statement, the regulator noted that the pace of growth of the world economy remain below the average while inflation will stay below the targeted 2%-3%. Nonetheless, the regulator did not revise its economy growth forecast, which supported the AUD.
Today attention should be paid to data on the Nonfarm Payrolls in the US. According to forecasts, the figure will come out at 180 thousands. In case the actual data exceeds forecasts, the US Dollar might receive a significant support.

Support and resistance

The pair continues moving along the ascending channel, trading near a strong resistance level of 0.7675.
Technical indicators suggest a growth continuation. Bollinger bands are directed up. Stochastic is in the overbought zone and continues growing.
Support levels: 0.7620, 0.7550, 0.7500.
Resistance levels: 0.7675, 0.7720, 0.7765, 0.7800.

Trading tips

Long positions can be opened after the breakout of the level of 0.7680 with targets at 0.7720, 0.7760 and stop-loss at 0.7650. *
Short positions can be opened from the level of 0.7620 with targets at 0.7550, 0.7500 and stop-loss at 0.7650.

EUR/USD: general analysis

Current trend
Last week, the US Dollar gained strong support from the ADP employment report and Friday's non-farm payrolls report. At the same time, it should be noted that US trade deficit widened to $44.50 billion that is considered as a negative factor for the American currency.
Favorable data on Germany’s industrial production was released in this morning. In June industrial output grew 0.5% and 0.8% in monthly and annual terms respectively.
On Tuesday dynamics in the pair might be influenced by data on Germany’s trade balance. A strong growth in the country’s exports and favorable data on trade surplus could support the European currency.

Support and resistance
On the 4-hour chart, the pair is trading between the middle and lower lines of Bollinger Bands. MACD histogram is in the negative zone, its volumes are gradually growing. Stochastic is moving up.
Support levels: 1.1070, 1.1040, 1.1015, 1.0990, 1.0965, 1.0950.
Resistance levels: 1.1105, 1.1125, 1.1160, 1.1185, 1.1200, 1.1235, 1.1250.

Trading tips
Short positions can be opened from the level of 1.1060 with the target at 1.1015 and stop-loss at 1.1080.
Long positions can be opened from the level of 1.1110 with the target at 1.1160 and stop-loss at 1.1090.
Validity – 1-3 days.

AUD/USD: in ascending trend

Current trend

The pair continues moving along a narrow ascending channel that was formed in the end of June.
The pair was supported by the RBA decision to keep its key interest rate unchanged which increased demand for the Australian currency amid growing appetite for risk assets. At the same time, the US Dollar was pressure by poor statistics on country’s GDP for the second quarter of the year that substantially lowered the probability of an interest rate hike before the end of the year.
This week, extra attention needs to be paid to data on Home Loans from Australia and Retail Sales and the Producer Price Index in the US.

Support and resistance

In the short-term, there is a chance of a downward correction towards the lower border of the channel at the level of 0.7635 that coincides with the middle MA of Bollinger Bands on the 4-hour chart, from where the growth will resume. At the same time, if the RBA cuts the interest rate, the price could break down the lower border of the channel and fall to the level of 0.7565.

Technical indicators suggest a growth continuation. Bollinger bands are directed up. MACD histogram is in the positive zone and its volumes are growing.

Support levels: 0.7635, 0.7600, 0.7565, 0.7530, 0.7500, 0.7450, 0.7420, 0.7375, 0.7300, 0.7150.
Resistance levels: 0.7670, 0.7685, 0.7715, 0.7750, 0.7800, 0.7835.

Trading tips

Long positions can be opened from current levels and from the levels of 0.7635, 0.7600 with targets at 0.7750, 0.7800, 0.7835.