Forex News Analysis by LiteForex

LiteForex analitics. EUR/USD: the pair is growing

Current trend

Yesterday, the EUR/USD pair rose within the correction after the “bearish” start of the week, which led to a renewal of the lows since August 20. EUR was supported by USD correction due to a decline in the 10-year government bonds’ yield. Data on Industrial Production from France and Italy affected the instrument positively, too. Thus, August Industrial Production in France rose by 0.3% MoM, which is noticeably worse than the dynamics of last month (0.8% MoM), but still better than analysts' forecasts (+0.1% MoM). The corresponding index in Italy rose by 1.7% MoM against a decrease of 1.6% MoM last month. Experts expected the growth only by +0.8% MoM.

This morning, the pair continues to grow. Investors are waiting for new drivers: ECB meeting report and a block of US September macroeconomic statistics on consumer inflation.

Support and resistance

On the daily chart, Bollinger bands are actively falling. The price range narrows, reflecting a sharp change in the trade direction in the short term. MACD reversed upwards, forming a buy signal (the histogram is above the signal line). Stochastic is growing, rapidly approaching its highs, which reflects that EUR will become overbought soon.

It is better to keep current long positions until the situation is clear.

Resistance Levels: 1.1580, 1.1615, 1.1657, 1.1700, 1.1732.
Support levels: 1.1547, 1.1522, 1.1500, 1.1460, 1.1430.

Trading tips

Long positions can be opened after the breakout of the level of 1.1580 with the target at 1.1657 or 1.1700. Stop loss is 1.1540.
Short positions can be opened after the rebound from the level of 1.1580 and the breakdown of the level of 1.1547 with the targets at 1.1500 or 1.1475–1.1460. Stop loss 1.1580–1.1590.

Implementation period: 2–3 days.

LiteForex analitics. EUR/USD: general review

Current trend

The pair started the week with the growth and reached 1.1575. USD was under pressure after comments by the US president.

Donald Trump did not rule out the introduction of higher tariffs for Chinese goods if the PRC does not open its markets and does not enter into a fair agreement with the US. Washington has implemented three rounds of increasing duties, overlaying Chinese imports totaling USD 250 billion. White House economic adviser Larry Kudlow said that the US President Donald Trump and Chinese leader Xi Jinping should meet in November at the G20 summit in Argentina, where trade talks between the parties are likely to continue.

The data on retail sales in the United States is due today. In September, the indicator may rise from 0.1% to 0.7%, which may cause the beginning of a decline in the instrument.

Support and resistance

The key level for the "bulls" is 1.1596, which is near the center line of Bollinger Bands. If the price consolidates above it, the growth to the levels of 1.1657 (Murrey [6/8]) and 1.1718 (Murrey [7/8]) may continue. A breakdown of the level of 1.1535 (Murrey [5/8]) will give the prospect of continuing the decline to 1.1474 (Murrey [4/8]) and 1.1413 (Murrey [3/8], the bottom line of Bollinger Bands). Technical indicators do not provide a clear signal. MACD histogram is reduced in the negative zone. Stochastic is directed upwards but is approaching the overbought area, which may lead to a downward reverse.

Resistance levels: 1.1596, 1.1657, 1.1718.
Support levels: 1.1535, 1.1474, 1.1413.

Trading tips

Short positions could be opened below 1.1535 with targets at 1.1474, 1.1413 and stop loss at 1.1580.
Long positions may be opened above 1.1600 with target at 1.1657, 1.1718 and stop loss at 1.1570.

Implementation period: 4-5 days.

LiteForex analitics. EUR/USD: euro is restoring

Current trend

After a rapid downward trend, the EUR/USD pair entered a wide sideways consolidation. At the beginning of last week, the price dropped to a strong support level of 1.1430, where it reversed and began to strengthen. The main growth catalyst was the decline in demand for the US currency due to the publication of negative releases on inflation, the labor market, retail sales, and major US indices, while positive data on industrial production released in EU.

Today, US Industrial Production data will be published, and FOMC Meeting Minutes release is expected tomorrow. At the end of the week, special attention should be paid to EU inflation statistics.

Support and resistance

In the short term, a significantly overbought dollar reacts sharply to negative releases in major sectors of the economy and is falling. If the upward momentum of the instrument maintains, the pair may rise to the key resistance levels and local highs of the last five months at the levels of 1.1800, 1.1830, 1.1850.

On the daily chart, the technical indicators confirm a high probability of a reversal: the MACD volumes of short positions are decreasing, Bollinger bands are pointed sideways.

Resistance levels: 1.1600, 1.1665, 1.1690, 1.1730, 1.1775, 1.1800, 1.1830.
Support levels: 1.1550, 1.1515, 1.1500, 1.1430, 1.1400, 1.1370, 1.1300.

Trading tips

It is relevant to increase the volumes of long positions from the current level with the targets at 1.1800, 1.1830, 1.1850 and stop loss 1.1460.

LiteForex analitics. XAG/USD: general analysis

Current trend

Since the opening of the European session, the price of silver is growing but the downward trend is still relevant. A key support level is around 5/8 Murrey or 14.55. If the price consolidates below it, then the next target will be the level of 14.00.

The precious metals are under pressure of the Fed’s aggressive policy, which continues to raise interest rates and provides an increase in government bonds’ yield and makes these instruments attractive for investment. On the other hand, criticism of the regulators’ actions by Donald Trump may affect the global balance of power in the market, and as monetary policy changes, silver will increase again. Nevertheless, the US economy continues to grow, and many economists believe that there is no point in mitigating the policy. Thus, the published data on Industrial Production for September increased by +5.1%. Capacity Utilization decreased slightly to 78.1% against a forecast of 78.2%, which may be a short-term recession, which will reverse upwards again.

Support and resistance

Stochastic is at 22 points and reflects a possibility of a correction.
Resistance Levels: 14.74, 14.84.
Support levels: 14.55, 14.00.

Trading tips

Short positions can be opened after the breakdown of the level of 14.55 with the target at 14.00 and the stop loss at 14.74.

LiteForex analitics. USD/CHF: technical analysis

USD/CHF, D1

On the D1 chart, the pair is strengthening in the upper part of Bollinger Bands. The indicator is directed upwards, and the price range expanded, indicating further growth of the pair. MACD histogram is in the positive zone keeping a buy signal. Stochastic has entered the oversold area; a strong sell signal can be formed during 2-3 days.

USD/CHF, H4

On the H4 chart, the instrument is testing the upper boundary of Bollinger Bands. The indicator is directed horizontally and the price range expanded, which serves as a basis for continuing uptrend. MACD histogram is in positive zone, keeping the buy signal. Stochastic is about to leave the overbought area; a sell signal can be formed during the day.

Support and resistance

Resistance levels: 0.9959, 1.0003, 1.0035, 1.0060.
Support levels: 0.9916, 0.9883, 0.9841, 0.9804, 0.9760, 0.9706.

Trading tips

Long positions may be opened from the current level with target at 1.0030 and stop loss at 0.9915. Implementation period: 1-3 days.
Short positions may be opened below 0.9910 with target at 0.9840 and stop loss at 0.9940. Implementation period: 2-3 days.

LiteForex analitics. EUR/USD: euro remains under pressure

Current trend

Yesterday, EUR fell significantly against USD, renewing its lows since October 10, due to the general strengthening of USD after strict Fed’s statements on further interest rate growth. USD was additionally supported by a sharp decline in the Chinese yuan, which continues today due to poor data on China's Q3 GDP.

EUR is under pressure of uncertain Brexit prospects and the tightening of the situation around the Italian budget for the next year. Yesterday, investors were focused on the summit of EU leaders in Brussels. There were no new proposals to solve the Irish border problem, and an agreement with the UK was not concluded. However, officials are developing a new mechanism to allow the UK to leave the EU as painlessly as possible. The idea is to extend the negotiations on the Irish border for a certain period after the end of the Brexit procedure itself.

Support and resistance

On the daily chart, Bollinger bands are moderately reduced. The price range is narrowing, letting the "bears" renew local lows. MACD is decreasing, keeping a moderate sell signal (the histogram is below the signal line). Stochastic falls, however, is in close proximity to zero values, which reflects that EUR is oversold in the super short term.

It is better to keep current short positions until the situation is clear.
Resistance levels: 1.1460, 1.1500, 1.1522, 1.1547.
Support levels: 1.1430, 1.1400, 1.1352.

Trading tips

Long positions can be opened after a reversal near the current support levels and the breakout of 1.1460–1.1470 with the target of 1.1580 or 1.1600. Stop loss is 1.1430. Implementation period: 2–3 days.
Short positions can be opened after the breakdown of 1.1430 with the target at 1.1352. Stop loss is 1.1460–1.1470. Implementation period: 1–2 days.

LiteForex analitics. Brent Crude Oil: technical analysis

Brent Crude Oil, D1

On the daily chart, the instrument returned to growth after a correction, and it is now trading between the middle line and the bottom border of Bollinger bands. MACD histogram is in the positive region, its volumes are reduced, the signal line is directed downwards. Stochastic could not consolidate in the oversold zone and is currently in the neutral zone, moving horizontally.

Brent Crude Oil, H4

On the 4-hour chart, there is a correction of the downward movement to the middle line of Bollinger bands. MACD histogram is in the negative zone, keeping the signal to open short positions. Stochastic is in the neutral zone, the lines of the oscillator are directed downwards.

Key levels

Resistance levels: 81.69, 83.05, 84.47, 85.79, 87.21.
Support levels: 80.11, 78.88, 78.14, 77.20.

Trading tips

In the short term, it is better to open short positions may be opened from the current level with target at 79.00 and stop loss 79.70. Implementation period: 1–3 days.

Long positions can be opened from the level of 82.20 with the target at 83.00. Stop loss is 81.90. Implementation period: 3–5 days.

LiteForex analitics. XAU/USD: technical analysis

XAU/USD, D1

On the daily chart, the instrument grows towards the upper border of Bollinger bands, and the price range is widened, which reflects a possibility of further upward movement development. MACD histogram is in the positive area, the signal line crosses the zero line and the body of the histogram upwards, forming a signal to open long positions. Stochastic is in the neutral zone, the signal line of the oscillator is directed downwards.

XAU/USD, H4

On the 4-hour chart, the instrument broke through the upper border of Bollinger bands, and the price is now growing. MACD histogram is in the positive area, its volumes are minimal, the indicator signal line moves horizontally. Stochastic is in the neutral zone, the lines of the oscillator are directed upwards.

Key levels

Resistance levels: 1235.54, 1245.43, 1257.05, 1267.00.
The levels of support: 1228.52, 1222.71, 1217.95, 1214.00, 1207.60, 1205.05, 1198.69, 1192.75, 1182.79.

Trading tips

In the short term, long positions can be opened from the current level with the target at 1245.00 and stop loss 1230.00.
Short positions can be opened from the level of 1214.00 with the target at 1207.50. Stop loss is 1218.00.

Implementation period: 1–3 days.

LiteForex analitics. GBP/USD: general review

Current trend

GBP remains under pressure after the EU summit in Brussels ended in vain.

This week, British Prime Minister Theresa May meets members of parliament to explain the future strategy. On Monday, she said that the agreement with the EU was 95% confirmed; the Irish border remains an issue. A new meeting will be held tonight with members of the Conservative Party, some of whom want to change the prime minister.

There is also no unity inside the British cabinet. According to Bloomberg, seven officials headed by Foreign Minister Jeremy Hunt disagree with the proposal to leave the UK indefinitely within the EU customs rules. Deputy Prime Minister David Lidington warned that a “divorce” without a deal could lead to a serious reduction in transit through the Eurotunnel, and Transport Minister Chris Grayling even offered to charter ships to supply Britain by sea. Anyway, the issue should be resolved by the end of November, otherwise, there would not be enough time for its ratification.

Support and resistance

The price has fallen below 1.2940 (Murrey [4/8]) and may continue to decline to 1.2878 (Murrey [3/8]) and 1.2817 (Murrey [2/8]). The key for the "bulls" is the level of 1.3000 (Murrey [5/8], the midline of Bollinger Bands); after breaking it out, growth targets will be 1.3061 (Murrey [5/8]) and 1.3122 (Murrey [6/8]). However, the decline seems more probable, since Stochastic and Bollinger Bands are directed downwards, MACD histogram is stable in the negative zone.

Support levels: 1.2878, 1.2817.
Resistance levels: 1.3000, 1.3061, 1.3122.

Trading tips

Sell positions may be opened from the level of 1.2920 with targets at 1.2878, 1.2817 and stop loss at 1.1580.
Buy positions may be opened above 1.3000 with targets at 1.3061, 1.3122 and stop loss at 1.2950.

Implementation period: 3-4 days.

LiteForex analitics. EUR/USD: general review

Current trend

This week, the pair was corrected to the level of 1.1352 (Murray [2/8]). On Wednesday, the European currency was under pressure from the results of the ECB meeting. The rates remained the same: the key one – at the level of 0.0%, and the deposit one – at the level of -0.4%. The rhetoric of the regulator has not changed. The accompanying statement noted that officials expect rates to increase no earlier than the end of the summer of 2019, and purchases of bonds in the amount of 15 billion euros will continue until December. During the press conference, ECB Head Mario Draghi noted that the increase in protectionism and the volatility of the financial market are important risks for the recovery of the Eurozone. Currently the European economy is weakening due to the uncertainty with Brexit, the new Italian budget and the US-China trade war. However, the ECB's policy helps support domestic demand and private consumption. Current regulatory measures are still needed to ensure a steady increase in inflation to a target level of 2.0%.

Today the data on US GDP for the third quarter will be published. The figure may decline from 4.2% to 3.3%, which may slow down the downward trend.

Support and resistance

The price is testing the level of 1.1352 (Murray [2/8]), the breakdown of which may cause a fall to the levels of 1.1291 (Murray [1/8]) and 1.1230 (Murray [0/8]). A breakout of the level of 1.1413 (Murray [3/8]) may cause an upward correction to the levels of 1.1474 (Murray [4/8], the middle line of the Bollinger bands) and 1.1535 (Murray [5/8]). However, the decline looks more likely, as the Bollinger and Stochastic are directed downwards, and the MACD histogram is increasing in the positive zone.

Support Levels: 1.1352, 1.1291, 1.1230.
Resistance Levels: 1.1413, 1.1474, 1.1535.

Trading tips

Short positions can be opened at 1.1340 with targets at 1.1291, 1.1230 and a stop loss at 1.1390.
Long positions will become relevant above the level of 1.1413 with targets at 1.1474, 1.1535 and a stop loss in the region of 1.1380.

Implementation of scenarios: 4-5 days.