Market condition

Where are the Stops? Tuesday, November 12: Gold and Silver


Editor's Note: Professional traders have a very good idea of price levels at which buy and sell stop orders are located on a daily basis. And now you will, too! If pre-placed buy or sell stop order are triggered, bigger price moves can immediately follow. Most stop orders are located and placed based upon key technical support or resistance levels on the daily chart, which if breached, would significantly change the near-term technical posture of that market. Having a good idea, beforehand, where the buy and sell stops are located can give an active trader a better idea regarding at what price level buying or selling pressure will become intensified in that market.

Below are today’s likely price locations of buy and sell stop orders for the active Comex gold and silver futures markets. The asterisks (**) denote the most critical stop order placement level of the day (or likely where the heaviest concentration of stop orders are placed on this day).

See below a detailed explanation of stop orders and why knowing, beforehand, where they are likely located can be beneficial to a trader.

December Gold	Buy Stops	Sell Stops
	$1,288.80	**$1,275.80
	**$1,300.00	$1,270.00
	$1,313.40	$1,260.00
	$1,326.00	$1,251.00
December Silver	Buy Stops	Sell Stops
	$21.45	**$21.05
	$21.75	$20.63
	**$22.075	$20.495
	$22.25	$20.25

Stop Orders Defined

Stop orders in trading markets can be used for three purposes: One: To minimize a loss on a long or short position (protective stop). Two: To protect a profit on an existing long or short position (protective stop). Three: To initiate a new long or short position. A buy stop order is placed above the market and a sell stop order is placed below the market. Once the stop price is touched, the order is treated like a “market order” and will be filled at the best possible price.

Most stop orders are located and placed based upon key technical support or resistance levels on the daily chart, which if breached, would significantly change the near-term technical posture of that market.
Having a good idea, beforehand, where the buy and sell stops are located can give an active trader a better idea regarding at what price level buying or selling pressure will become intensified in that market.
The major advantage of using protective stops is that, before a trade is initiated, you have a pretty good idea of where you will be getting out of the trade if it's a loser. If the trade becomes a winner and profits begin to accrue, you may want to employ "trailing stops," whereby protective stops are adjusted to help lock in a profit should the market turn against your position.

2013-11-12 09:30 GMT | [GBP - Claimant Count Change]

• past data is -44.7K
• forecast data is -35.0K
• actual data is -41.7K according to the latest press release
  

if actual < forecast = good for currency (for GBP in our case)

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This is strange movement by 71 pips : no any news events ... but the price was moved

It must be something going on, USDCHF which is correlation with EURUSD, moving up also.

This is what cause the EURUSD move down

ECB said to consider mini deposit rate cut if more easing needed

The European Central Bank is considering a smaller-than-normal cut in the deposit rate if officials decide to take it negative for the first time, according to two people with knowledge of the debate.

Policy makers would reduce the rate for commercial lenders who park excess cash at the ECB to minus 0.1 percent from zero, said the people who asked not to be identified because the talks aren’t public. It would be the first time the central bank has adjusted interest rates by less than a quarter of a percentage point. The concept, which has been discussed by Governing Council members, doesn’t yet have a consensus, the people said.

Members of the council, which is holding a mid-month meeting in Frankfurt this week, have said that a negative deposit rate is a potential tool for warding off deflation. They’ve also cautioned that the consequences of such an unprecedented measure aren’t clear. The central bank this month refrained from cutting the deposit rate even as it reduced its benchmark lending rate to a record low of 0.25 percent, and Governing Council member Jens Weidmann has warned against further loosening of monetary policy.

A smaller reduction in the deposit rate “would make sense, given this is uncharted territory,” said Nick Kounis, head of macro research at ABN Amro Bank NV in Amsterdam. “The ECB needs to do more to fight uncomfortably low inflation (ECCPEMUY), which could expose the euro zone to deflationary risks.”

Euro Decline

An ECB spokesman declined to comment on the council’s deliberations.

The euro fell as much as 0.6 percent, the most in almost two weeks, and traded at $1.3467 at 4:34 p.m. Frankfurt time. Europe’s Stoxx 600 index rose as much as 0.4 percent.

Inflation in the 17-nation currency bloc slowed to 0.7 percent in October, the slowest pace in four years and less than half the ECB’s target of just under 2 percent. Economic growth was 0.1 percent last quarter, down from the 0.3 percent in the three months through June that marked the end of a record-long recession. The jobless rate is at a record 12.2 percent

ECB President Mario Draghi said on Nov. 7 that the central bank is “technically ready” for a negative deposit rate if the economic outlook warrants it. Executive Board member Peter Praet said in Hong Kong a week later that a rate below zero is possible.

Spurring Lending

Policy makers hope that the measure, obliging banks to pay to hold a liquidity cushion, would prompt them to lend cash to companies and households instead, the people said. At the same time, a negative deposit rate also risks curbing banks’ profit as loan rates fall while the institutions may be unable to pass negative rates onto depositors.

By cutting by less than a quarter-point, the central bank could test the policy while minimizing disruption to the financial system, one of the people said. The ECB’s next interest-rate decision will be announced on Dec. 5. Denmark currently has a deposit rate of minus 0.1 percent.

Any moves to ease monetary policy further will probably face resistance from Germany, the euro area’s biggest economy. Bundesbank President Weidmann said in an interview with Die Zeit to be published tomorrow that it is not “sensible” to consider further monetary loosening. That would distract from the roots of the financial crisis, he said.

And because of the ECB news, Euro weaken across other currencies, as show by this dashboard.

There are 2 interesting indicators related to market condition (support/resistance/trend lines): WSOWROTrend indicator (attached) and wso & wro_ma indicator (attached).

The explanation of the author :

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1. The indicator was developed on the basis of the Widners Oscilator indicator.
2. The horizontal lines : WSO from 1 to 6 red lines of support, and WRO from 1 to 6 blue lines of resistance
3. The trend lines are built not with the fractals, but with the points of uprising of WSO or WRO
4. The trend lines Trend UP and Trend DN sometimes intersect and form a triangle. The angle of the triangle points at the target of the price movement and the approximate time when the price will be near this level. (the observation showed that the prcie reaches it earlier by 1-3 bars)
5. If the price passes above or below the last WSO/WRO point, the target will be cancelled. For better understanding have a look at the point 3 on the screenshot.
6. If the price doesn't surpass the angle of the triangle, then it is the signal of trend reverse (a high time to enter the market)
7. The break through of any line by the price upward/downward demonstrates if the price will continue its movement in the same direction.

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WSO WRO = Widner’s Support Oscillator / Widner’s Resistance Oscillator

Gold at 4-Month Lows- November Close in Focus Amid Thin Holiday Trade

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Fundamental Forecast for Gold: Neutral

• Gold Gets a Reprieve before 6/28 Close
• Price & Time: Key Couple of Days For Gold

Gold plummeted more than 3.5% this week with the precious metal trading at $1244 ahead of the New York close on Friday. The decline marks the largest weekly loss in two months and comes on the heels of the FOMC minutes from the October 30th meeting where the committee showed a willingness to begin tapering in the “coming months” if US economic data continued to improve. The remarks saw taper expectations moved back up with investors now looking to December as a viable timeframe.

Strength in the greenback further exacerbated the move with the Dow Jones FXCM Dollar Index (Ticker: USDDOLLAR) closing the week just off 2-month highs. But with the November close and a shortened week ahead, can the sell-off be sustained?

The economic docket will be rather limited amid a shorted week ahead of the Thanksgiving holiday with only a hand full of housing data and November consumer confidence on tap. As such, price action is unlikely to inspire much confidence as volume thins out heading into the holiday and we will look to broader market sentiment and the greenback for guidance. The focus remains on Fed policy and whether the recent batch of stronger than expected data out of the US is enough to warrant action from the central bank to begin its exit strategy in December. Also note that it is a shortened holiday week and thin liquidity conditions / end of month flows could lead to some choppy price conditions. Near-term traders should remain prudent heading into the November close with the December opening range likely to offer further conviction on our broader directional bias.


From a technical standpoint, gold invalidated last week’s bullish outlook early in the week with the break & subsequent close below $1268 and while the technical damage now keeps our broader bias weighted to the downside, we will remain neutral into the close of the month. Bearish invalidation has now been brought down to $1294 with only a break above shifting our focus higher. Short-side support targets are eyed at $1233/34, $1209 and $1179/81. Note that daily RSI has made a slight rebound off the 30-thresholds and risks a near-term relief rally early next week. We will continue to sell into rallies and a break below $1233 with RSI conviction puts subsequent support targets into focus. Interim resistance stands at $1250 backed by $1268 and $1294. Note that the November opening range made a clear break early in the month and we should expect prices to close the month not too far off these lows.

Forex - Weekly outlook: November 25 - 29

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The euro moved higher against the dollar on Friday and rose to four year peaks against the yen as stronger-than-forecast German business confidence data indicated that the economic recovery in the euro zone is gaining traction.

Germany’s Ifo business climate index rose to 109.3 in November, its highest level since April 2012, from 107.4 in October. Economists had expected the index to tick up to 107.7.

The data pointed to a broad based recovery in the euro zone’s largest economy and eased concerns over the possibility of further rate cuts by the European Central Bank. The euro also remained supported after ECB President Mario Draghi after downplayed speculation over negative deposit rates in the euro zone in a speech on Thursday.

EUR/USD ended Friday’s session at 1.3556, up from 1.3480 on Thursday. For the week, the pair gained 0.39%.

The euro ended the week 1.81% higher against the broadly weaker yen, with EUR/JPY settling at 137.28, the highest level since October 2009.

Elsewhere, the dollar rose to four-and-a-half month highs against the yen, with USD/JPY ending Friday’s session at 101.25, the highest level since July 8. For the week, the pair jumped 1.40%, the fourth consecutive weekly gain.

The yen remained under pressure amid mounting expectations that the Bank of Japan will implement additional monetary easing measures next year.

BoJ Governor Haruhiko Kuroda reiterated Thursday that the bank will stick to its easing program and is prepared to take additional steps in order to meet its 2% inflation target. The comments came at a news conference following a decision by the bank to keep monetary policy on hold.

The Australian dollar dropped to 11-week lows against the U.S. dollar on Friday after Reserve Bank of Australia Governor Glenn Stevens said the bank believed that intervening in the currency market to lower the Aussie’s value could be effective in the right circumstances.

AUD/USD ended Friday’s session at 0.9170, the lowest level since September 6, down from 0.9232 on Thursday. The pair lost 2.11% for the week, the fifth weekly decline.

Demand for the U.S. dollar continued to be underpinned after Wednesday’s minutes of the Federal Reserve’s October meeting said the bank could start scaling back its USD85 billion-a-month asset purchase program in the “coming months” if the economy continues to improve as expected.

In the week ahead, the euro zone is to release what will be closely watched data on consumer prices and the unemployment rate.

The U.S. is to release a series of reports on the housing sector, as well as data on consumer confidence and durable goods orders. Meanwhile, Canada and Switzerland are to release official data on economic growth rates.

Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.

Monday, November 25

Switzerland is to release data on the employment level during the previous quarter, a leading economic indicator.

The U.S. is to release private sector data on pending home sales, a leading indicator of economic health.

Tuesday, November 26

The Bank of Japan is to publish the minutes of its latest policy meeting, which contain valuable insights into economic conditions from the bank’s perspective.

Bank of England Governor Mark Carney and several BoE policymakers are to testify on the outlook for inflation and economic growth before parliament’s Treasury Committee.

The U.S. is to produce data on building permits, a leading indicator of future construction activity as well as a report on housing starts. The nation is also to release private sector data on consumer confidence and house price inflation.

Later Tuesday, New Zealand is to publish data on the trade balance, the difference in value between imports and exports.

Wednesday, October 27

Australia is to release data on completed construction work, an important gauge of activity in the sector.

In the euro zone, Germany is to release the Gfk report on consumer climate.

The U.K. is to release revised data on third quarter economic growth, as well as preliminary data on business investment.

The U.S. is to release data on durable goods orders, a leading indicator of production, as well as a report on manufacturing activity in the Chicago region and revised data on consumer sentiment. The Labor Department is to release the weekly report on initial jobless claims one day ahead of schedule due to Thursday’s Thanksgiving holiday.

Thursday, November 28

Japan is to produce official data on retail sales, the government measure of consumer spending, which accounts for the majority of overall economic activity.

New Zealand is to release private sector data on business confidence and a separate report on building consents, while Australia is to produce data on private capital expenditure.

Switzerland is to release data on third quarter gross domestic product, the broadest indicator of economic activity and the leading measure of the economy’s health.

In the euro zone, Germany is to release preliminary data on consumer inflation, in addition to data on the change in the number of people unemployed.

The BoE is to publish its twice yearly financial stability report. BoE Governor Mark Carney is to hold a press conference about the report.

Canada is to release data on the current account and a separate report on raw materials price inflation.

Markets in the U.S. will be closed for the Thanksgiving holiday.

Friday, November 29

Japan is to release a series of data, including reports on household spending, inflation, and industrial production.

Australia is to produce data on private sector credit.

Switzerland is to publish its KOF economic barometer.

The U.K. is to release data on net lending to individuals and mortgage approvals.

The euro zone is to release preliminary data on consumer inflation and a separate report on the unemployment rate across the currency bloc. Germany is to release data on retail sales.

Canada is to round up the week with the monthly report on GDP growth.

Stronger Japanese Inflation to Spur Yen Correction as BoJ Sits Pat

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The USDJPY climbed to a fresh yearly high of 104.62 as the Federal Reserve unexpectedly tapered its asset-purchase program by $10B, but the fundamental developments due out next week may spur a near-term correction in the dollar-yen as the Bank of Japan (BoJ) retains its pledge to achieve the 2% target for inflation by 2015.


The headline reading for Japanese inflation may prop up the Yen as price growth is expected to accelerate to an annualized 1.5% in November, while core consumer prices are projected to increase 1.1%, which would mark the fastest pace of growth since October 2008. As the outlook for growth and inflation improves, it seems as though the BoJ will largely preserve its wait-and-see approach throughout the first-quarter of 2014, and Governor Haruhiko Kuroda may persistently resist calls to further embark on the easing cycle as Prime Minister Shinzo Abe continues to draw up the ‘Third Arrow’ stimulus package.


With that said, the BoJ Minutes schedule for December 24 may highlight a more neutral tone for monetary policy, and a material shift in the policy outlook may help to limit the downside for the Japanese Yen as Governor Kuroda does not anticipate a material change in its bond-purchasing program for 2014.


From a technical standpoint, the USDJPY appears to be at risk for a near-term correction as the pair marks a higher high (104.62), and the Relative Strength Index may foreshadow a larger decline in the coming days as it struggles to push back into overbought territory.