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EURUSD long-term forecasts updated: more ranging than bearish - Goldman Sachs (based on article)

Goldman Sachs updated their long-term forecast for EUR/USD with more bullish than in previous one: the price will be droped to 1.07 for 3 months instead of 1.02 as the previously forecasted, half a year forecast is 1.05 instead of 1.000, and one year fiorecast is 1.0000 instead of 0.9500 previous one.


Instrument
3 month forecast
6 month forecast
12 month forecast
EUR/USD
1.0700 vs 1.0200 prev1.0500 vs 1.00 prev
1.00 vs 0.9500

According to Goldman Sachs - the price will reach second pivot support level at 1.0672 for 3 months only, and the price will be in the bearish market condition for the ranging within S2 Pivot at 1.0672 and 1.0520 support level. And the bearish trend will be re-started in the second half of 2016 only: price will reach 1.0000 psy level by the end of 2016 for example.

Thus, we will see the ranging bearish market condition since January till June 2016, and the primary bearish condition will be continuing with good breakdown possibility without ranging since July till December 2016.
 

Setups For EUR/USD by Barclays (based on efxnews article)

Barclays Capital made a forecast for EUR/USD for today and tomorrow:

  • the price will break 1.1085/1.1120 resistance area to be reversed to the primary bullish market condition,
  • if the price breaks 1.0795 support area so 1.0700 psy level may be the nearest bearish target in this case.

Let's evaluate this forecast with the technical point of view.

M5 timeframe. Ranging bearish. The price is located below 100 period SMA (100 SMA) and 200 period SMA (200 SMA) for the primary bearish market condition with the secondary ranging within the following support/resistance levels:

  • 1.1042 key reversal resistance level located above 100 SMA/200 SMA in the primary bullish area of the chart, and
  • 1.0932 support level located below 100 SMA/200 SMA in the primary bearish area of intra-day chart.


If the price will break 1.0932 support level on close bar so the bearish trend will be continuing.
If the price will break 1.1042 resistance level on close bar so we may see the reversal of the intra-day price movement to the primary bullish market condition.
If not so the price will be on ranging within the levels.

  • Recommendation for long: watch close the price to break 1.1042 for possible buy trade
  • Recommendation to go short: watch the price to break 1.0932 support level for possible sell trade
  • Trading Summary: ranging near reversal area waiting for direction
 

Trading News Events: U.S. Retail Sales (adapted from the article)

Another 0.2% expansion in U.S. Retail Sales may fuel speculation for a December Fed rate-hike and spur a near-term pullback in EUR/USD as central bank officials largely endorse an upbeat outlook for the world’s largest economy.

What’s Expected:


Why Is This Event Important:

Signs of stronger consumption may encourage the Federal Open Market Committee (FOMC) to remove the zero-interest rate policy (ZIRP) at the next meeting as it remains one of the leading drivers of growth and inflation but, a weak sales report may drag on rate expectations as Chair Janet Yellen appears to be in no rush to normalize monetary policy.

However, subdued wages accompanied by the slowdown in private credit may drag on sales, and a dismal outcome may prompt the FOMC to lower its interest-rate forecast at the December meeting as it undermines the central bank’s scope to achieve the 2% inflation target over the policy horizon.

How To Trade This Event Risk
Bullish USD Trade: Retail Sales Expands 0.2% or Greater in November

  • Need red, five-minute candle following a positive print to consider a short EUR/USD trade.
  • If market reaction favors a bullish dollar trade, sell EUR/USD with two separate position.
  • Set stop at the near-by swing high/reasonable distance from entry; look for at least 1:1 risk-to-reward.
  • Move stop to entry on remaining position once initial target is hit; set reasonable limit.
Bearish USD Trade: U.S. Household Consumption Falls Short of Market Forecast
  • Need green, five-minute candle to favor a long EUR/USD trade.
  • Implement same setup as the bullish dollar trade, just in reverse.
Potential Price Targets For The Release
EUR/USD Daily



  • EUR/USD stands at risk of further retracing the decline from the October high (1.1494) as the bull flag formation takes shape following the European Central Bank (ECB) interest rate decision, while the Relative Strength Index (RSI) appears to breaking out of the bearish formation from back in August.
  • Interim Resistance: 1.1052 (November high) to 1.1090 (50% retracement)
  • Interim Support: Interim Support: 1.0380 (78.6% expansion) to 1.0410 (61.8% expansion)
 

Forex Weekly Outlook December 14-18 (based on the article)

The US dollar was pressured against most currencies in a week that saw very unsettled stock and commodity markets. On  the agenda we have German Economic Sentiment, UK employment data, US housing and inflation data, and the highly important FOMC decision which is dubbed as historic. These are the market movers for this week.

US Consumer confidence rebounded, rising to 91.8 in December, the highest level in four months amid positive views on household finances and consumer spending. Buying conditions for household purchases were rated positively by 81% of all consumers. This helped the greenback recover in a week that saw it losing ground. The euro still enjoyed the Draghi disappointment, the Aussie enjoyed good employment data, the NZD a “hawkish cut” and the yen was powered by safe haven flows. The severe sell-off of oil resulted in a crash of oil prices alongside CAD. The bottom of the barrel is still elusive.

  1. UK inflation data: Tuesday, 9:30. UK inflation was negative for a second consecutive month in October, reaching -0.1%. Clothing prices were the biggest contributors to inflation, but declining food prices offset this price rise. The subdued inflation suggests the Bank of England’s monetary policy committee will be in no hurry to push up interest rates in the coming months. A rise of 0.1% is expected this time.
  2. German ZEW Economic Sentiment: Tuesday, 10:00. German economic sentiment edged up in November following a seven-month decline, suggesting renewed momentum. The index rose to 10.4 from 1.9 in October, but remained below its average of 24.8. Economists expected the index to rise to 6.7. The outlook section has improved and the rising domestic consumption together with the ongoing improvement in the US economy is expected to increase growth in the coming months. German economic sentiment is expected to reach15.2 in December.
  3. US inflation data: Tuesday, 13:30. U.S. consumer prices increased 0.2% in October after two straight months of declines. Rising prices of gasoline and a range of other goods caused this modest increase in CPI. The reading was in line with market forecast. Meanwhile, core CPI excluding food and energy costs, closely monitored by the Fed, also gained 0.2% after a similar rise in the previous month. This is a positive sign for the coming months. CPI is expected to remain flat while core CPI is expected to climb 0.2%.
  4. UK employment data: Wednesday, 9:30. UK Claimant Count Change increased from 0.5K to 3.3K in October, beating forecasts of a 1.6K rise. The Average Earnings Index remained unchanged at 3.0%, a bit lower than the 3.2% rise estimated. The U.K. Unemployment Rate decreased unexpectedly from 5.4% to 5.3% in September, while analysts estimated no change. Claimant Count Change is expected to rise 0.9K this time.
  5. US Building Permits: Wednesday, 13:30 New applications for building permits gained 4.1% to a seasonally adjusted annual rate of 1.15 million. Single-family permits increased to their highest level since December 2007. Economists expected the same reading. The overall housing data suggests the market has been improving this year but still below its prerecession levels. The number of building permits is predicted to rise to 1.16 million in November.
  6. US FOMC rate decision: Wednesday, 19:00 with a press conference at 19:30. Federal Reserve Chair Janet Yellen said she was “looking forward” to a U.S. interest rate, noting this rise will prove that the economy has recovered from recession. The majority of policymakers believe the first rate hike in almost a decade will be announced at their next meeting on Dec. 15-16. U.S. consumer spending is solid and inflation outlook is expected to rebound next year after pressures related to the strong dollar and low energy prices will fade. The recent positive NFP seemed to have cemented the hike. The Fed is expected to raise interest rate from 0.25% to 0.50%. If the Fed follows through, it will be the first hike since 2006. See all the updates for this historic decision.
  7. NZ GDP: Wednesday, 21:45. New Zealand economic growth expanded less expected in the second quarter, rising 0.4% amid a decline in manufacturing and residential construction, offsetting a recovery in farm output. Economists expected a stronger growth of 0.5%. Annual growth slowed from a revised 2.7% in the first quarter. Falling export prices, fewer investments and weak demand, stall growth.
  8. Eurozone German Ifo Business Climate: Thursday, 9:00. Germany’s business sentiment edged up to 109.0 in November, following 108.2 in the prior month. Economists expected a reading of 108.3. The outlook index increased to 104.7 compared to 103.9 in October and the current assessment index increased to 113.4 from the upwardly revised 112.7 in October. German business climate is expected to rise further to 109.2 in December.
  9. US Philly Fed Manufacturing Index: Thursday, 13:30.  The Philadelphia area manufacturing index rose from -4.5 in October to 1.9 in November, returning into positive territory for the first time in two months. The reading was higher than the -0.8 reading forecasted. However, new orders and shipments remained negative while the number of employees rose to 2.6 after a print of -1.7 in the month before. The Philly index is expected to reach 2.1 this time.
  10. US Unemployment Claims: Thursday, 13:30. The number of Americans filing initial claims for unemployment benefits edged up to a five-month high of 282,000. However, the underlying trend remained positive. The reports did not change views the Federal Reserve will raise interest rates in December since jobless claims tend to be volatile. The four-week moving average of claims rose 1,500 to 270,750 last week. Claims have remained below the 300,000 threshold for 40 straight weeks. This is the longest stretch since the early 1970s. The number of jobless claims is estimated to reach 271,000.
  11. Japan rate decision: Friday. The Bank of Japan kept monetary policy unchanged despite a worsening in economic conditions. However, policy makers continued to argue the recovery is on track. The BOJ signaled it will keep policy until inflation is back on track. The central bank’s decision came after Japan recorded an unexpected Y111bn trade surplus for October showing the economy’s gain from falling oil prices. However, exports declined 2.1% due to the slowdown in China.
 

Thanking you all for giving valuable information, I did

GBPUSD: Sell, 1.49712 & 1.51257 and I think have to do one more sell at 1.52100

Please guide, am i going on right path

After all I know no body knows about future but we can predict only 

 
Khurram Mustafa:

Thanking you all for giving valuable information, I did

GBPUSD: Sell, 1.49712 & 1.51257 and I think have to do one more sell at 1.52100

Please guide, am i going on right path

After all I know no body knows about future but we can predict only 

It depends on the timeframe you are trading with. For example, if we are talking about D1 and H4 so it may be the following:

1. D1 timeframe: daily breakout with the possible bullish reversal.
Chinkou Span line is crossing the price to above (on open bar for now) for good possible breakout. Key reversal resistance level is 1.5340 (Senkou Span line), if the price breaks this line from below to above so the price will be reversed to the bullish market condition.


2. H4 timeframe: price action reversal - the price was already to be reversed to the bullish by breaking 200 period SMA to above on close H4 bar.

3. M5 timeframe: Correction within the primary bullish to the ranging bearish reversal. If you are looking to sell so it may be M5 timeframe only but we need to wait for the market to be open anyway (because support/resistance lines are dynamic ones so they can be moved by the price on the chart for example):


Key support level for M5 is 1.5219 (we see it from the chart) so the pending order (sell stop order) may be placeв somewhere at 1.5210 especially if 100 period SMA value for now is 1.5215. But it will be the ranging condition anyway (the price will be between 100 SMA and 200 SMA) - means: risky anyway.

The key reversal bearish support level for this timeframe is 1.5149 so it the price breaks this level to below so it will be the downtrend just to sure.

 
Thanks a lot for giving extreme knowledge :)
 
AUD/USD Fundamental Analysis and Forecast (based on the article)

With no major domestic data scheduled on this week, CBA's Chief Currency Strategist Richard Grace believes markets will be paying close attention to movements in the Chinese renminbi given the PBOC signaled on Friday its intention to change the way it will manage the value of the CNY moving forward.

"The PBoC signaled its intention to change the way it will manage the value of the CNY by potentially loosening the peg to the USD and starting to track CNY against a trade-weighted basket of currencies," wrote Grace.


From the technical point of view - intra-day price (H4) is on ranging market condition: the price was bounced from 0.7159 support level to be between 100 SMA/200 SMA area breaking 23.6% Fibo level from below to above for 50.0% Fibo level as the next target:

  • if the price breaks 50.0% Fibo resistance level at 0.7246 to above so the reversal of intra-day price to the primary bullish market condition will be started;
  • if the price breaks 0.7159 support level so we may see the bearish market condition for this pair on intra-day H4 chart;
  • if not so the price will be ranging within the levels.
 

FOMC Preview: taking it easy - we expect the FOMC adopt a dovish tone - Credit Suisse (based on the article)

  • "The Committee likely will increase its fed funds rate target range by 25bp, but we expect the FOMC adopt a dovish tone in its guidance about the future path of policy."
  • "Vehicles by which the FOMC can communicate gradual policy normalization going forward include the official policy statement, the dot plot, and Fed Chair Yellen's post-meeting press conference."
  • "Assuming policy liftoff this month, we look for three more rate hikes in 2016, with the first coming at the March meeting, at the earliest. Current market pricing is for two rate hikes next year, though this may increase once investors absorb the reality of a new tightening cycle."

H4 price is located above 200 period SMA and 100 period SMA for the primary bullish ranging between 50.0% Fibo support level at 1.0783 and Fibo resistance level at 1.1042. RSI indicator is estimating the ranging bullish market condition to be continuing.


If the price will break 50.0% Fibo support level at 1.0783 on close H4 bar so we may see the reversal of the price movement from the primary bullish to the primary bearish market condition with the secondary ranging.
If the price will break Fibo resistance level at 1.1042 from below to above so the primary bullish market condition will be continuing.
If not so the price will be ranging within the levels.

Trend:

H4 - ranging bullish
 

AUD/USD: short-term strategy, long-term strategy and the levels to watch - Swiss Finance Corporation (based on the article)

  • Short-term strategy: "Negative below 0.7240/7310 with scope for limited losses ahead. Short strategy off 0.7250 is stil in the money. Reconsider booking profits on downticks or stick to shorts with stops trailed down to entry level, targeting retest of recent lows."
  • Long-term strategy: "No change. Positive above m/t support @ 0.7020. Sustained break above 0.7720 opens 0.7380/7440 (partially met)as next targets. Sharp rejection off 0.7380 signals bull exhaustion and possible top in place. Book profits on upticks or trail stops up to 0.7160."
  • Levels to watch: "0.7160 on the downside 0.73 on the upside."


As we see from the chart above - the price (H4) is ranging between 100 period SMA and 200 period SMA waiting for direction.

  • If the price will break 0.7262 resistance level on close H4 bar so the bullish trend to be started on this timeframe.
  • If price will break 0.7158 support on close H4 bar so we may see the bearish market condition for this intra-day price.
  • If not so the price will be ranging within the levels.
Resistance
Support
0.72620.7171
0.73410.7158
  • Recommendation to go short: watch the price to break 0.7158 support level for possible sell trade
  • Recommendation to go long: watch the price to break 0.7262 resistance level for possible buy trade
  • Trading Summary: ranging
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