Forex News Analysis by LiteForex

XAG/USD: technical analysis
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XAG/USD, D1
On the daily chart, the pair is trading above the upper MA of Bollinger Bands. The price remains below the EMA100 and EMA144, both directed horizontally. MACD histogram is in the positive zone, its volumes are insignificant. The DI lines are directed down; ADX is growing.
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XAG/USD, H4
On the 4-hour chart, the pair is trading in the area of the upper MA of Bollinger Bands. The price remains above the EMA50, EMA100 and EMA144, all directed up. MACD histogram is in the positive zone. The DI lines are moving in different directions; ADX is falling.
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Support and resistance
Support levels: 14.37, 14.25, 13.99, 13.78, 13.68.
Resistance levels: 14.52, 14.70, 14.95, 15.28, 15.51, 16.13, 16.34.
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Trading tips
Long positions can be opened from the level of 14.52 with targets at 14.70, 14.95 and stop-loss at 14.37.
Short positions can be opened from the level of 14.37 with targets at 14.25, 14.00 and stop-loss at 14.50.
Validity – 1-2 days.

USD/JPY: general review
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Current trend
The pair continues growing even though the Fed at yesterday’s meeting left the interest rate unchanged.
At the same time, the Bank of Japan is expected to expand its stimulation program to reach the inflation target of 2% that would lead to further fall in the Yen. Furthermore, cheaper national currency would allow increasing Japanese exports and making them more competitive, that would have a positive effect on the economy.
According to forecasts, the pair can grow to the level of 125.00.
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Support and resistance
Support levels: 117.85.
Resistance levels: 119.10.
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Trading tips
Open long positions from the level of 119.20 with the target at 122.35 and stop-loss at 118.90.

EUR/USD: general review

Current trend
Today the pair continued growing despite the publication of mixed data in the eurozone. The Producer Price Index for December fell to -0.8% that was substantially worse than forecasts of economists. At the same time, the Unemployment Rate slightly fell as well, from 10.5% to 10.4%. Therefore, continuous decline in prices could force the ECB to expand its stimulation program or cut interest rates further, either of which would significantly pressure the Euro.

Support and resistance
Support levels: 1.0894.
Resistance levels: 1.0943.

Trading tips
Short positions can be opened from the level of 1.0943 with the target at 1.0890 and stop-loss at 1.0955.

AUD/USD: pair resumed fall

Current trend
Yesterday the pair significantly fell after the RBA decision on interest rates. As was expected, the regulator left the rate unchanged at 2%.
At the same time, in its Rate Statement the regulator noted that it does not rule out further monetary policy easing this year if the economy continues slowing down due to the outside factors. It also noted that inflation is likely to remain very low in the medium-term.

Support and resistance
Bollinger Bands on the daily chart is moving up while the price range is narrowing. MACD is turning down and forming a sell signal. Stochastic is falling.
The indicators recommend short positions.
Support levels: 0.7015 (local low), 0.6981, 0.6936, 0.6900 (21 January low), 0.6875, 0.6850, 0.6826 (15 January low).
Resistance levels: 0.7045 (local high), 0.7068, 0.7100, 0.7128 (local high), 0.7158, 0.7183, 0.7200 (5 January high).

Trading tips
Short positions can be opened after the breakdown of the level of 0.7015 with the target at 0.6900 and stop-loss at 0.7060. Validity – 2-3 days.
Long positions can be opened after the price rebound from the level of 0.7015 (with the appropriate indicators signals) with the target at 0.7100 and stop-loss at 0.6960. Validity – 2-3 days.

Analytics from LiteForex

USD/CAD: pair is falling

Current trend
Yesterday the pair significantly declined amid growing oil prices that were supported by strong data on the Caixin China Services PMI.
In addition, the pair was pressured by mixed data from the US. The ADP Employment Change for January came out at 205 thousands that was better than forecasts but substantially worse than the previous figure. The Markit Services PMI for January fell from 53.7 to 53.2 points, which did not match the expectations.
Tomorrow attention needs to be paid to labour market data from the US and Canada.

Support and resistance
Bollinger Bands on the daily chart is moving down while the price range is slowly widening. MACD continues growing. Stochastic is in the oversold zone and trying to turn up.
The indicators recommend waiting for clearer trading signals.
Support levels: 1.3780 (local low), 1.3700, 1.3650, 1.3622 (10 December 2015 low), 1.3554, 1.3500.
Resistance levels: 1.3850 (local high), 1.3900, 1.3947, 1.4000 (psychologically important level), 1.4050, 1.4100 (local high), 1.4169, 1.4200, 1.4325 (26 January high).

Trading tips
Long positions can be opened after the breakout of the level of 1.3780 with the target at 1.4000 and stop-loss at 1.3700. Validity – 2-3 days.
Short positions can be opened after the breakdown of the level of 1.3700 with targets at 1.3550, 1.3500 and stop-loss at 1.3760. Validity – 2-3 days.

USD/CHF: Franc continues growing

Current trend
Last week the pair significantly fell.
The pair was pressured by the latest Fed monetary policy meeting that substantially decreased chances of further interest rate hikes in the US. In addition, the USD was pressured by poor data on the Nonfarm Payrolls that fell from 262 to 151 thousands, while economists predicted 190 thousands. However, the Unemployment Rate unexpectedly fell by 0.1% to 4.9%, while Average Hourly Earnings grew by 0.5%.

Support and resistance
Bollinger Bands on the daily chart is turning down while the price range is widening. At the same time, the indicator formed a signal for correctional growth as the price has left the range. MACD is falling and giving a strong sell signal. Stochastic is in the oversold zone and turning horizontally.
The indicators recommend waiting for clearer trading signals.
Support levels: 0.9920 (local low), 0.9900, 0.9879 (11 January low), 0.9851 (24 December low), 0.9818, 0.9800, 0.9784 (14 December low).
Resistance levels: 0.9956 (local high), 1.0000 (psychologically important level), 1.0032, 1.0067, 1.0100, 1.0123 (3 February high), 1.0166, 1.0200, 1.0254 (29 January high), 1.0281.

Trading tips
Long positions can be opened after the breakout and consolidation above the level of 1.0000 (with the appropriate indicators signals) with the target at 1.0100 and stop-loss at 0.9960. Validity – 2-4 days.
Short positions can be opened after the price rebound from the level of 1.0000 with the target at 0.9900 and stop-loss at 1.0050. Validity – 2-3 days.

EUR/USD: general analysis

Current trend

The European currency was strengthening against the US Dollar. The pair gained support from Iran’s decision to replace the US Dollar with the Euro in its oil sales. Moreover, Teheran has required buyers of its oil to pay their debts in euros as well. Thus, India, which owes about $6 billion, has already reached an agreement on this issue with Iran. In this situation, the demand for the Euro might increase, and the currency is likely to continue strengthening.

Support and resistance

Support level: 1.1105.
Resistance level: 1.1246.

Trading tips

Long positions can be opened from the level of 1.1246 with the target at 1.1370 and stop-loss at 1.1200.

EUR/USD: general analysis

Current trend

The EUR/USD pair is trading near the important resistance level of 1.1230 (4/8 Murrey), after the breakdown of which, the pair continues declining to 1.1060 (MA200).

The European currency is under pressure from concerns about future of Deutsche Bank. The bank owns a capital of about $60 billion and has about $75 trillion in derivatives, so the bank’s debt is incredibly high. Thus, one of Germany’s largest and systematically important banks might repeat Lehman Brothers’s fate. ECB is likely to support such a large bank, but panics might trigger another fall in the European currency and European indices.

Support and resistance

Support level: 1.1230.
Resistance level: 1.1353.

Trading tips

Short positions can be opened from the level of 1.1230 with the target at 1.1108 and stop-loss at 1.1250.

AUD/USD: technical analysis

Current trend

This week, the AUD/USD pair was falling and reached its three week low at 0.6972. However, a correction started, the level of 0.7078, where the middle MA of Bollinger Bands and the 38.2% Fibonacci correction have concentrated, was broken out. At present, the pair is likely to strengthen to 0.7136 (23.6% Fibonacci correction) and 0.7160 (upper MA of Bollinger Bands). At the same time, the Head and Shoulders pattern seems to be forming that indicates a possibility of a fall from 0.7136 and 0.7160 to 0.7032 (50.0% correction), 0.6986 (61.8% correction) and 0.6937.

Support and resistance

Technical indicators are giving mixed signals. Bollinger Bands are turning down, limiting a growth in the pair. MACD histogram is about to enter the positive zone and form a buy signal. Stochastic lines have started turning down near the overbought zone.

Support levels: 0.7078, 0.7032, 0.6986, 0.6937.
Resistance levels: 0.7136, 0.7160, 0.7229, 0.7300.

Trading tips

Short positions are preferable but can be opened below the level of 0.7078 with targets at 0.7032, 0.6986 and stop-loss at 0.7110.
Long positions would become valid in case of the consolidation above the level of 0.7160 with targets at 0.7229, 0.7300 and stop-loss at 0.7130.

Brent: analysis and forecast

Current trend

Since the beginning of the week, the price of Brent crude oil has been gradually falling. Yesterday, the Energy Information Administration reported a decline by 754K barrels in US crude oil stocks; however, the price of oil did not manage to get any support. Despite a general decline in US crude inventories, investors were disappointed by the news about an increase at the country’s biggest oil storage hub in Cushing. According to the statistics, Cushing stocks rose by 0.5 million barrels to 64.7 million barrels that put the price of oil under more pressure.

Support and resistance

On the 4-hour chart, Bollinger Bands are directed down. MACD histogram is in the negative zone, its volumes are growing. According to the indicators, the price will continue moving down.

Support levels: 30.20, 29.20, 28.20.
Resistance levels: 31.84, 32.30, 32.90, 33.90.

Trading tips

Short positions can be opened after the breakdown of the level of 30.20 with the target at 29.20. If the price breaks down and consolidates below the level of 29.20, the next target will be 28.20.

Long positions can be opened after the breakout of the level of 31.84 with targets at 32.30, 32.90.