Forex News Analysis by LiteForex

USD/JPY: general analysis

Current trend

Last Friday the USD/JPY pair showed a strong growth.
During the week, favorable statistics on the New Home Sales and Durable Goods Orders were released in the US, and the Gross Domestic Product Annualized came out in line with forecasts. On Friday Fed Chair Janet Yellen in her speech at the symposium in Jackson Hole supported further cautious tightening in US monetary policy. Japan, in its turn, posted relatively weak data on the Consumer Price Index.

Support and resistance

The pair broke out the upper line of Bollinger Bands. MACD histogram remains in the positive zone, its volumes are growing. Stochastic has entered the overbought zone and is moving sideways.
Support levels: 101.90, 101.60, 101.30, 101.00, 100.70, 100.30, 100.00.
Resistance levels: 102.25, 102.80.

Trading tips
Short positions can be opened from the level of 102.15 with targets at 101.60, 101.30 and stop-loss at 102.35.
Long positions can be opened from the level of 102.40 with the target at 102.80 and stop-loss at 102.25.
Validity – 1-3 days.

EUR/USD: general review

Current trend

The EUR/USD pair is trading within a downward trend. The instrument is being pressured by strengthening in the US Dollar amid expectations that the Fed will raise interest rates in September if macroeconomic indicators come out in line with Fed’s forecasts. This week is full of important macroeconomic releases that can have a strong impact on dynamics in the EUR/USD pair. This week’s key publication is data on the US labor market. Statistics on the Nonfarm Payrolls and Unemployment Rate are due on Friday. Favorable data will boost chances of an interest rate increase and allow the US Dollar to strengthen more against the Euro. Thus, short-term dynamics in the EUR/USD pair will be influenced by US macroeconomic statistics.

Support and resistance

MACD histogram on the 4-hour chart remains in the negative zone and its volumes are growing. The indicator is forming a sell signal. Bollinger bands are directed down, suggesting a downward trend continuation.
Support levels: 1.1160, 1.1110, 1.1048.
Resistance levels: 1.1205, 1.1267, 1.1310.

Trading tips

Short positions can be opened after the price consolidation below the level of 1.1160 with targets at 1.1110, 1.1048.
Long positions can be opened after the price consolidation above the level of 1.1205 with the target at 1.1267.

USD/CAD: general analysis

Current trend

The USD/CAD pair continues growing amid a fall in oil prices, which were pressured by data on US crude oil stocks. At the same time, it should be noted that though Canada’s economy showed a strong growth in July, it had no influence on dynamics in the pair. At present, further upward movement seems a likelier scenario amid expectations that the Fed will soon raise its interest rates.
Today the US Dollar can gain support in case of strong data for August on the ISM Manufacturing PMI and ISM Prices Paid.

Support and resistance

Bollinger Bands on the 4-hour chart is directed up while the price range is showing no changes. MACD is in the positive zone, its volumes remain high. Stochastic is approaching the border of the oversold zone.
According to the indicators, long positions seem preferable.
Support levels: 1.3090, 1.3076, 1.3049, 1.3028, 1.3001.
Resistance levels: 1.3128, 1.3140, 1.3151, 1.3176, 1.3198.

Trading tips

Long positions can be opened from the current level with targets at 1.3140, 1.3150 and stop-loss at 1.3090. Validity – 1-3 days.
Short Long positions can be opened from the level of 1.3155 with the target at 1.3100 and stop-loss at 1.3175. Validity – 2-4 days.

EUR/USD: general review

Current trend

Yesterday the pair substantially grew amid weakening in the US Dollar, which was pressured by poor data on the ISM Manufacturing PMI from the US. In August, the index fell from 52.6 points to 49.4 points while economists predicted a fall to only 52.0 points.

Today extra attention needs to be paid to data on the US labour market. According to forecasts, the Unemployment Rate will fall to 4.8% while the Nonfarm Payrolls will amount to 180 thousands. Data below forecasts might significantly pressure the Dollar, as it would decrease the chances of an interest rate hike by the Fed in September.
High volatility is expected on the market. Traders should refrain from opening new positions before the publication.

Support and resistance

The nearest support level: 1.1126.
The nearest resistance level: 1.1207.

Trading tips

Long positions can be opened from the level of 1.1207 with the target at 1.1255 and stop-loss at 1.1190.

EUR/USD: pair trades mixed

Current trend

The Euro is trying to grow during the morning session after sharp fluctuations last Friday amid the publication of data on the US labour market.
The US Labour Department reported nonfarm payrolls rose by 151 000 jobs in August, following a gain of 275 000 in July, and against market consensus of 180 000. The unemployment rate remained at 4.9% while a decline to 4.8% was expected.

Despite relatively weak data, market reactions were generally positive. The US economy is close to full employment, and a certain slowdown in hiring is a quite natural tendency. It should be noted that the report
had just a slight influence on assessments of rate hike chances. Markets see a 21% likelihood that the Fed would raise rates in September and a 50.6% probability of a hike in December.

Support and resistance

Bollinger Bands on the daily chart is falling while the price range is widening actively. MACD is keeping a weak sell signal and trying to consolidate below the zero line. Stochastic has left the oversold zone.
The indicators recommend waiting for clearer trading signals.

Support levels: 1.1148 (2 September low), 1.1130, 1.1122 (31 August low), 1.1100, 1.1083, 1.1070 (9 August low), 1.1045 (5 August low).
Resistance levels: 1.1171, 1.1200, 1.1233, 1.1270 (26 August level), 1.1300, 1.1321, 1.1365 (18 August high).

Trading tips

Long positions can be opened after the reversal and breakout of the level of 1.1171 with targets at 1.1233, 1.1270 and stop-loss at 1.1122. Validity – 2-4 days.
Short positions can be opened after the breakdown of the level of 1.1130 with targets at 1.1083, 1.1070, 1.1045 and stop-loss at 1.1200. Validity – 2-4 days.

GBP/USD: general review

Current trend

The pair continues growing amid positive macroeconomic statistics from the UK. The Markit Services PMI showed a significant increase from 47.4 to 52.9 points, against forecasted 50.0 points. In addition, the US Dollar remains under pressure after Friday’s publication of the labour market report that did not match the expectations.
Today pair’s dynamics can be affected by data on the ISM Non-Manufacturing PMI from the US. A forecasted increase in the index could break current upward tendency. Otherwise, the pair might consolidate above the level of 1.3400.

Support and resistance

On the 4-hour chart, the pair is testing the level of 1.3340. Bollinger Bands is directed up while the price range is narrowing, suggesting the possibility of a trend change. MCD histogram is in the positive zone and its volumes are falling. Stochastic is growing having bounced off the border of the oversold zone.
Support levels: 1.3311, 1.3299, 1.3285, 1.3267, 1.3253, 1.3240.
Resistance levels: 1.3344, 1.3359, 1.3371, 1.3400.

Trading tips

Long positons can be opened from current prices with targets at 1.3360, 1.3370 and stop-loss at 1.3300. Validity – 1-2 days.
Short positions can be opened from the level of 1.3310 with the target at 1.3270 and stop-loss at 1.3330. Validity – 1-2 days.

EUR/USD: general review

Current trend

Yesterday the EUR/USD pair significantly grew and reached the level of 1.1262.
The pair was supported by weak data on the ISM Non-Manufacturing PMI in the US. In August, the index fell from 55.5 to 51.4 points while experts forecasted a decline to only 55.0 points. After the release, the probability of an interest rate hike in September fell to 9%.
Tomorrow extra attention needs to be paid to the ECB Interest Rate Decision. Experts anticipate an expansion in the stimulus program that might substantially pressure the Euro.

Support and resistance

On the 4-hour chart, the pair continues moving along a narrow sideway channel.
Technical indicators give contradicting signals. MACD histogram is in the positive zone and its volumes are growing. Stochastic is turning down in the overbought zone.
Support levels: 1.1230, 1.1180, 1.1125.
Resistance levels: 1.1270, 1.1305, 1.1340.

Trading tips

Long positions can be opened from the level of 1.1270 with the target at 1.1340 and stop-loss at 1.1250.
Short positions can be opened from the level of 1.1230 with the target at 1.1180 and stop-loss at 1.1250.

EUR/USD: general analysis

Current trend

Yesterday the EUR/USD pair was consolidating after its growth on Tuesday amid the publication of the US ISM Non-Manufacturing PMI. The index fell from 55.5 to 51.4 points in August against an expected decline to 55.0 points. Market participants now see only a 15% chance of an increase in interest rates at the Fed’s September meeting.
Today attention needs to be paid to ECB’s decision on interest rates and a press conference, in which ECB president will give commentaries regarding current state of the economy in the eurozone and prospects of monetary policy.

Support and resistance

The instrument continues trading within an upward channel; a bullish engulfing pattern has been formed. Stochastic and RSI lines are directed up suggesting a growth in the pair.
Support levels: 1.1230, 1.1180, 1.1135.
Resistance levels: 1.1300, 1.1370, 1.1430.

Trading tips

Long positions can be opened from the level of 1.1310 with the target at 1.1370 and stop-loss at 1.1280.
Short positions can be opened from the level of 1.1230 with the target at 1.1180 and stop-loss at 1.1250.

EUR/USD: general analysis

Current trend

Yesterday amid the publication of ECB decision on interest rates, EUR/USD volatility was high. Interest rates remained unchanged, and ECB President Mario Draghi said that it would be inappropriate to adopt any radical measures at this time. By the end of the trading session, the pair returned in the region of 1.1245-1.1260. Moreover, weak macroeconomic statistics were released today in Germany that could be a negative factor for the European currency.

Support and resistance

Bollinger Bands on the 4-hour chart is directed up while the price range is narrowing. MACD histogram is in the positive zone; its volumes remain quite high. Stochastic has turned up near the border of the oversold zone.
The indicators recommend waiting for clearer trading signals.
Support levels: 1.1261, 1.1255, 1.1245, 1.1233, 1.1219, 1.1209.
Resistance levels: 1.1276, 1.1284, 1.1294, 1.1307, 1.1312.

Trading tips

Long positions can be opened form the level of 1.1275 with the target at 1.1310 and stop-loss at 1.1255. Validity – 1-2 days.
Short positions can be opened form the level of 1.1255 with the target at 1.1230 and stop-loss at 1.1265. Validity – 1-2 days.

UKBrent: technical analysis

UKBrent, D1

On the daily chart, the instrument failed to overcome a strong resistance level at 48.55. Bollinger Bands is about to turn down while its price range remains unchanged. MACD histogram is in the positive zone and its volumes are falling. Stochastic turned down near the border of the overbought zone.

UKBrent, H4

On the 4-hour chart, the instrument is trading in the lower Bollinger band while bands are horizontal. MACD histogram is about to cross over the zero line from above. Stochastic is growing and approaching the border of the overbought zone.

Key levels

Support levels: 47.73, 47.61, 47.51, 47.32, 47.11, 46.97, 46.81 (local low).
Resistance levels: 48.14, 48.43 (middle MA of Bollinger Bands), 48.68, 48.98, 49.18, 49.41.

Trading tips

Short positions can be opened from current prices with the target at 47.30 and stop-loss at 48.45. Validity – 1-2 days.
Long positions can be opened from the level of 48.45 with the target at 48.90 and stop-loss at 48.25. Validity – 1-2 days.