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EURUSD Technical Analysis 30.06 - 07.07 : Possible Reversal

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Sergey Golubev
Moderator
93764
Sergey Golubev 2013.06.30 14:54 

This was bullish market condition as a primary one with correction started on D1 timeframe for the last week. The price came very close to Ichimoku cloud trying to break thin cloud with 1.2984 resistance line and trying to be reversed to primary bearish. Besides, Chinkou Spam line is near historical price for crossing it from above to below which is indicating the possible breakdown.

If price will break 1.2984 and 1.2961 support levels with historical price to be broken by Chonkou Span line so we may have very good breakdown situation with primary reversal to bearish market condition. If the price will finish with the correction and will break 1.3236 support line (which is Sinkou Span B line) to be above Ichimoku cloud (kumo) so the bullish primary trend will be continuing.

  • Recommendation for long: watch the price to break 1.3236 resistance level on H4 timeframe
  • Recommendation to go short: watch the price to break 1.2961 support line (the border of the cloud on D1) with Chinkou Span to be crossed the historical price on close bar for good possibilities for to open sell trades.
  • Trading Summary: possible reversal


UPCOMING EVENTS (high/medium impacted news events which may be affected on EURUSD price movement for the next week)

2013-07-01 01:00 GMT | [CNY - Manufacturing PMI]

2013-07-01 09:00 GMT | [EUR - Consumer Price Index (CPI)]

2013-07-01 14:00 GMT | [USD - ISM Manufacturing PMI]

2013-07-02 09:00 GMT | [EUR - Producer Price Index (PPI)]

2013-07-03 09:00 GMT | [EUR - Retail Sales]

2013-07-03 12:15 GMT | [USD - Automatic Data Processing Employment Change (ADP Employment Change]

2013-07-03 12:30 GMT | [USD - Trade Balance]

2013-07-04 11:45 GMT | [EUR - ECB Interest Rate Decision]

2013-07-04 12:30 GMT | [EUR - ECB press conference]

2013-07-05 10:00 GMT | [EUR - German Factory Orders]

2013-07-05 12:30 GMT | [USD - Non-farm Payrolls]


Resistance
 Support
1.3103
1.2991
1.3236
1.2984
1.3254
1.2961




SUMMARY : trying to be reversed

TREND : possible reversal to bearish


Intraday Chart


Sergey Golubev
Moderator
93764
Sergey Golubev 2013.07.01 07:51  

The price (EURUSD D1) is continuing to go along Sinkou Span B line (which is the border of the cloud) indicating Sideway Market (flat) on D1 timeframe :

MetaTrader Trading Platform Screenshots

EURUSD, D1, 2013.07.01

MetaQuotes Software Corp., MetaTrader 5, Demo

Sideways Market

EURUSD, D1, 2013.07.01, MetaQuotes Software Corp., MetaTrader 5, Demo



Just want to remind that we can measure the market condition using this indicator from MT5 CodeBase : AbsoluteStrengthMarket

Sergey Golubev
Moderator
93764
Sergey Golubev 2013.07.01 16:07  

2013-07-01 14:00 GMT | [USD - ISM Manufacturing PMI]

If actual > forecast = good for currency (for USD in our case)

past data is 49.0 according to release

forecast is 50.6

actual is 50.9 according to latest release.

Sergey Golubev
Moderator
93764
Sergey Golubev 2013.07.01 16:16  
newdigital:

2013-07-01 14:00 GMT | [USD - ISM Manufacturing PMI]

If actual > forecast = good for currency (for USD in our case)

past data is 49.0 according to release

forecast is 50.6

actual is 50.9 according to latest release.

This was 13 pips only:

MetaTrader Trading Platform Screenshots

EURUSD, M5, 2013.07.01

MetaQuotes Software Corp., MetaTrader 5, Demo

13 pips

EURUSD, M5, 2013.07.01, MetaQuotes Software Corp., MetaTrader 5, Demo


Why? read this press release:

Forum

Press review

newdigital, 2013.07.01 16:14



U.S. Manufacturing Index Climbs Slightly More Than Expected In June

After reporting a contraction in U.S. manufacturing activity in the previous month, the Institute for Supply Management released a report on Monday showing that manufacturing activity expanded by a little more than expected in June.

The ISM said its purchasing managers index climbed to 50.9 in June from 49.0 in May, with a reading above 50 indicating an increase in manufacturing activity. Economists had been expecting the index to edge up to a reading of 50.5.


Sergey Golubev
Moderator
93764
Sergey Golubev 2013.07.02 08:04  

EURUSD H4 - flat (see image below). But Chinkou Span line (see light blue line on the left of the chart) is very near to be crossed with historical price. But this crossing is going on horizontal way ... because of flat. If the price will cross 1.3070 resistance level so we can get few pips by buy trade; if the price will cross 1.3005 support level so the primary bearish will be continuing. So, just a situation ...

MetaTrader Trading Platform Screenshots

EURUSD, H4, 2013.07.02

MetaQuotes Software Corp., MetaTrader 5, Demo

eurusd h4 flat

EURUSD, H4, 2013.07.02, MetaQuotes Software Corp., MetaTrader 5, Demo


Sergey Golubev
Moderator
93764
Sergey Golubev 2013.07.02 13:40  

They will not be high impacted news events today anymore ... flat on EURUSD :

MetaTrader Trading Platform Screenshots

EURUSD, M5, 2013.07.02

MetaQuotes Software Corp., MetaTrader 5, Demo

flat

EURUSD, M5, 2013.07.02, MetaQuotes Software Corp., MetaTrader 5, Demo



It may be 2 news events which may be good watch for example: speeches -

  • 2013-07-02 16:30 GMT | [USD - FOMC Member Dudley Speaks] - see release here
  • 2013-07-02 21:45 GMT | [USD - FOMC Member Powell Speaks] - see release here

========

Just to understand something about FOMC - read this post - What is FOMC Meeting :

The Federal Open Market Committee (FOMC) is the policy-making arm of the Federal Reserve. It determines short-term interest rates in the U.S. when it decides the overnight rate that banks pay each other for borrowing reserves when a bank has a shortfall in required reserves. This rate is the fed funds rate. The FOMC also determines whether the Fed should add or subtract liquidity in credit markets separately from that related to changes in the fed funds rate. The Fed announces its policy decision (typically whether to change the fed funds target rate) at the end of each FOMC meeting. This is the FOMC announcement. The announcement also includes brief comments on the FOMC's views on the economy and how many FOMC members voted for and how many voted against the policy decision.



Sergey Golubev
Moderator
93764
Sergey Golubev 2013.07.02 18:49  

This speech costs 10 pips for EURUSD :) yes, I am not joking ...


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EURUSD, M1, 2013.07.02

MetaQuotes Software Corp., MetaTrader 5, Demo

10 pips

EURUSD, M1, 2013.07.02, MetaQuotes Software Corp., MetaTrader 5, Demo


Forum

Press review

newdigital, 2013.07.02 18:47

2013-07-02 16:30 GMT | [USD - FOMC Member Dudley Speaks] - see release here

The whole speech is here : The National and Regional Economy :

Since the end of the Great Recession in mid-2009, we have had 15 consecutive quarters of positive growth of real GDP.  However, the average annual growth rate over that period has been just 2.1 percent.  Although the unemployment rate has declined by 2.5 percentage points from its peak of 10 percent in October of 2009, much of this decline is due to the fact that the labor force participation rate has fallen by 1.5 percentage points over this period.  Recall that discouraged workers who do not actively look for work are regarded as not participating in the labor force and so are not counted as unemployed even though they are without jobs. Using an alternative measure, the employment to population ratio, which is not influenced by changes in the number of discouraged workers, there has been limited improvement in labor market conditions.  Job loss rates have fallen, but hiring rates remain depressed at low levels.  Taken together, the labor market still cannot be regarded as healthy.  Numerous indicators, including the behavior of labor compensation and household assessments of labor market conditions, are all consistent with the view that there remains a great deal of slack in the economy.

That being said, I see persuasive evidence of improved underlying fundamentals for much of the private sector of the U.S. economy.  Key measures of household leverage have declined and are now at the lowest levels they have been in well over a decade.  Household net worth, expressed as a percent of disposable income, has increased back to its average of the previous decade, reflecting rising equity and home prices and declining liabilities.  Banks are beginning to ease credit standards somewhat after a prolonged period of tightness.  As a result, we are now experiencing a fairly typical cyclical recovery of consumer spending on durable goods.  For example, light-weight motor vehicles sold at a seasonally-adjusted annual rate of 15.3 million in May, not far from the 16.1 million sales in 2007.



Laurentiu Octavian Niculescu
6690
Laurentiu Octavian Niculescu 2013.07.02 19:13  

I see the speech as a positive news for the US economy therefore for the US Dollar

and as a result this one will be appreciated against the other currencies EUR, CHF or Gold.

I think for at least a moment the:

EURUSD will fall

USDCHF will rise

XAUUSD will fall. 

 

What do you mean about the 10 pips cost ?

is that the EURUSD will fall from 1.30190 to  1.30094 ?

Sergey Golubev
Moderator
93764
Sergey Golubev 2013.07.02 19:45  
EURUSD was dropped for 10 pips only during (as a result of) this speech.
Laurentiu Octavian Niculescu
6690
Laurentiu Octavian Niculescu 2013.07.02 20:44  

Yes,

and it is falling also now after the speech.

Thanks ;) 

Sergey Golubev
Moderator
93764
Sergey Golubev 2013.07.02 20:48  

I did not find the reason why EURUSD price was moved on this way so fast :

MetaTrader Trading Platform Screenshots

EURUSD, M5, 2013.07.02

MetaQuotes Software Corp., MetaTrader 5, Demo

no reason

EURUSD, M5, 2013.07.02, MetaQuotes Software Corp., MetaTrader 5, Demo


and seems it is for EURUSD only:

MetaTrader Trading Platform Screenshots

USDCHF, M15, 2013.07.02

MetaQuotes Software Corp., MetaTrader 5, Demo

for eurusd only

USDCHF, M15, 2013.07.02, MetaQuotes Software Corp., MetaTrader 5, Demo

 

because no speeches ... nothing ...

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