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NZD/USD: Graeme Wheeler’s speech caused a drop of NZD 1. Current trend of NZD/USD Today, quotes of the New Zealand currency has declined sharply, losing over 100 points and reached support level of 0.7990. The decline in the NZD was caused by the speech of the head of the Reserve bank of New Zealand Graeme Wheeler, who said that the Bank is concerned about rapid rise in the house prices. Housing market of New Zealand has been significantly overvalued, which bears potential risks for the entire financial system. In order to resolve this situation RBNZ decided that the banks of the country should reduce mortgage lending limits. 2. Important levels: support and resistance At the moment the pair is trading near the level of 0.7990. This level coincides with the moving average line of the “Bollinger bands” indicator and seems the key one. If the “bears” fail to overcome this level, the price can go back to the levels of 0.8100 and 0.8150. However it is likely that downward movement will continue up to the levels of 0.7900 and 0.7830 in the near future. In the current situation it is advisable to open short positions with profit taking at the level of 0.7830. Long positions can be opened from the level of 0.8030 with profit taking at the level of 0.8150. 3. Technical indicators Technical indicators confirm the possibility of the downtrend. Bollinger bands are directed upward; however the price chart is testing the moving average line and if this line is broken down, the price chart will decline to the lower level of 0.7830. MACD histogram is in the overbought zone, its volumes are decreasing. In the near future histogram can cross the signal line from bottom to top, forming a sell signal. Stochastic lines are intersecting, moving down and also giving a sell signal.
Dmitriy Zolotov Analyst
GBP/USD: downward correction is expected 1. Current trend This week the pair is slowly rising, moving along the upper border of the upward channel. On Thursday Pound hit two-month highs at 1.5695. Today the pair is in the correction waiting for the public sector net borrowing data to be published. According to experts UK budget deficit may reach 3.7 billion pounds weakening British currency. The attention should also be paid to the FOMC meeting minutes, which can clarify the intentions of American regulator towards QE program. 2. Support and resistance The pair is trading around 1.5650. The fall to the level of 1.5600 and even 1.5550 will be the most probable scenario. However any of these levels can be a turning point for the trend. I would recommend to open short trades with targets at 1.5600. At the levels of 1.5600 and1.5550 buy limit orders can be placed. 3. Technical indicators On the daily chart Bollinger Bands are directed upwards, confirming the upward trend. The price chart has bounced off the upper line of the indicator, which can be a sign of downward correction. MACD histogram is in overbought zone; its volumes have stopped to grow. Stochastic lines have crossed within overbought zone and can soon give us a signal to sell.
Dmitriy Zolotov Analyst
EUR/USD: sales growth in the US real estate market can strengthen the USD 1. Current trend At the opening of the American trading session yesterday the pair rapidly went up. The rise was triggered by high demand for Euro and publication of the US macro-economic statistics, showing the decrease in indices against the previous period. Attention today shall be paid to important indicator of economic state- sales at the secondary housing market. Experts believe that this index will go up. Mortgage lending index and index of refinancing mortgage lending can also affect the USD rate. Later, minutes of FOMC meeting will become known. Sales growth in the secondary housing market can provide some support to the USD. 2. Important levels: support and resistance At the moment the pair is trading near resistance level of 1.3416, it is likely that downward movement will continue up to the level of 1.3311. The pair will encounter resistance at the level of 1.336, not far from which the moving average line of “Bollinger bands” is located. Intersection with the moving average will indicate further movement to the lower boundary of the ascending channel. 3. Technical indicators MACD indicator is still demonstrating “bullish” trend. We will be able to speak about the development of the downward movement if the signal line goes beyond the histogram area. However, keep in mind that it may be just a short-term correction. 4. Trading tips It is recommended to open short positions in anticipation of the further decline in quotes to the lower boundary of the channel. Do not forget about protective stop-order, as “bullish” trend has not yet completed and the rise to the level of 1.3520 is still possible.
Kamil Avad Analyst of LiteForex Group of Companies
Forex: Ichimoku Clouds. Review of XAG/USD XAG/USD, H4 Let’s look at the four-hour chart. Tenkan-sen line is above Kijun-sen line and they are both horizontal. Chinkou Span line is above the price chart, current Kumo is ascending. After long rise the price decreases to the level of Tenkan-sen line, which becomes support level (22.79). One of the previous extremums of Chinkou Span line is expected to be resistance level at 23.45.
XAG/USD, D1 On the daily chart Tenkan-sen line is above Kijun-sen line, the blue one remains horizontal while the red one is directed upwards. Chinkou Span line is above the price chart, current Kumo is ascending. The closest support level is Tenkan-Sen (21.84). One of the previous extremums of Chinkou Span line is expected to be resistance level at 23.24.
Key levels Support levels: 23.45, 23.24. Resistance levels: 22.79, 21.84. Trading tips On the four-hour chart the price has slowed down its upward movement. It is good opportunity to open new long trades. On the daily chart Ichimoku lines confirm Bullish trend. Anastasiya Glushkova Analyst
EUR/USD: the pair may continue to decline 1. Current trend of EUR/USD On Wednesday the currency pair EUR/USD fell to the level of 1.3335. The rise in the American dollar was caused by publication of the minutes of July’s meeting of the US Fed Open Markets Committee. According to the minutes, majority of FOMC members agreed that phasedown of the quantitative easing program can be launched before the end of this year; however no specific dates have been indicated. 2. Important levels: support and resistance At the moment the pair continues to decline, tending to the level of 1.3305. This level seems the key one, as it practically coincides with the moving average line of “Bollinger bands” indicator, with the level of 61.8% Fibonacci and also with the boundary of the ascending channel. In case of breakdown of this level, the price will drop to the level of 1.3200, which coincides with the lower line of “Bollinger bands” and the level of 50.0* Fibonacci. Otherwise, the price can return to the level of 1.3400. Attention shall be drawn to US Fed conference in Jackson Hole that starts today and which will be one of the fundamental events. Decisions made at this Forum can have dramatic impact on the movement in the pair. In the current situation it is advisable to place short positions if the price consolidates below the level of 1.3305. Profit taking is recommended at the level of 1.3200. Long positions can be opened from the level of 1.3360. 3. Technical indicators Technical indicators on the daily chart confirm possibility of downward movement. Bollinger bands are directed upward; however, the price chart tends to the moving average, which is at the level of 1.3305. MACD histogram is in the overbought zone, its volumes are decreasing. Stochastic lines are crossing and directed downward, giving a sell signal.
Dmitriy Zolotov Analyst
USD/CHF: chance of growth 1. Fundamental data The pair has steadily grown throughout yesterday’s trading session. It seems that Franc has tested the bottom and now, based on existing grounds it will lay a course for the rise. Minutes of the FOMC indicated that the US Fed has not yet made final decision on the dates for phasing down economic stimulus program. Only a few members of the Committee said that it would be possible to reduce the volume of bond purchase in the near future. Majority stated that there should not be any rush in regards to this issue. However, Fed officials noted that following the launch of a new stimulus program, unemployment rate has reduced significantly and reached the level of 7.4% in July. Market participants are confident that considering current pace of economic recovery in America volumes of stimulus programs will be gradually reduced. Given the fact that efficiency of the program is decreasing, investors started to buy the USD, which became a driver for the rise in the pair. 2. Important levels: support and resistance At the moment the pair consolidates near resistance level of 0.9250. Next obstacle on the “bulls’ way will be the level of 0.9280. The target for growth is the level of 0.9390. Support levels are 0.9200 and 0.9150. 3. Technical indicators Given the current trend it is advisable to place buy orders today. It is recommended to enter the market after the breakdown of the resistance level. Attention shall be focused on the data on US labour market. This information can either heat up or dent investors’ interest to the American currency.
Anton Kharat Analyst of LiteForex Group of Companies
AUD/USD: analysis and forecast 1. Current trend of AUD/USD This Wednesday the pair AUD/USD has hit three-week lows at 0.8930 reacting to the FOMC Meeting Minutes release. The majority of the Comittee shared the opinion that QE program can be curtailed at the end of the year. Thursday morning the pair has won back its positions due to positive statistics from Heavenly Empire. China manufacturing index has overcome the level of 50 points first time for 4 months, showing the revival of the industry. 2. Important levels: support and resistance The price is descending now. A small rise to 0.9050 is possible, but we expect the price to go down to support level at 0.8860, which coincide with lower line of Bollinger Bands. Reversal of the trend can happen at this level. Keeping in mind current situation, I would recommend to open long positions at current price with Take Profit orders at 0.8860. Sell limit orders can be placed at 0.9050. 3. Technical indicators On the daily chart Bollinger Bands are directed downwards, price chart is within the lower band. MACD histogram is in oversold zone, it can soon cross signal line, forming a signal to buy. Stochastic lines are in overbought zone and give us the same signal.
Dmitriy Zolotov
NZD/USD: the fall will continue 1. Current trend of NZD/USD This week the NZD/USD has hit three-week lows at 0.7800. The fall was determined by the RBNZ decision. National banks are to limit mortgage lending in order to reduce price bubble in real estate. Under additional pressure from FOMC Meeting Minutes Kiwi went further down. FRS announced the start of the curtailment of the QE program at the end of the year. The pair still has a potential to downward movement due to experts’ confidence that the volumes of the quantitive easing program will be reduced in September. 2. Important levels: support and resistance The pair is trading around support level of 0.7800, trying to break through it. Next week we expect fall down to level of 0.7700 and a reverse of the trend from this point. I would recommend to open short trades with targets at 0.7700. 3. Technical indicators On the daily chart technical indicators confirm the possibility of price fall. Bollinger Bands has turned down, the price chart is moving along the lower line of the indicator. MACD histogram is in oversold zone, giving a signal to buy. Stochastic lines are also in the oversold zone, confirming buy signal.
Dmitriy Zolotov Analyst
USD/CAD: technical analysis 1. Current trend Look at the daily chart of the currency pair USD/CAD. The pair has been in the large ascending channel with the long-term corrections. The pair had repeatedly tried to break down the lower limit of the channel, but did not succeed. After that the pair rebounded sharply and is now trading at the level of 1.0550. Similar leap took place about two months ago. This time the pair reached the upper limit, but failed to break it down and started to decline. Therefore, we cannot rule out repetition of the old scenario. MACD indicator shows continuation of uptrend. Histogram is in the positive zone, volumes continue to increase. The signal line is in the negative zone but directed upward and will soon go beyond it. All three moving average lines indicate further growth. Stochastic is in the overbought zone. Its lines are coming closer to each other and if they intersect, we will get a signal of correction. 2. Levels of support and resistance The nearest support levels are 1.0560 and 1.0580; the key level for the “bulls” is 1.0608. Resistance lines are 1.0530 and 1.0490. The main target of the “bulls” is to go back to the level of 1.0450. 3. Trading tips Many analysts believe that the pair is too overbought and correction will take place soon. However, it is also likely that the pair will test the local highs, therefore I would recommend to place limit sell orders at the level of 1.0600.
Ilya Lashenko Analyst
GBP/USD: general analysis 1. Current trend At the opening of European trading session GBP/USD rate has slightly rose and reached the lower boundary of the ascending channel. Today the data on a number of approvals for mortgage lending and GDP in UK will become known. According to experts forecast gross domestic product will retain the increase of 0.6%, number of approved mortgage lending will increase by 1.5 thousand. These facts can add momentum to the pair and the price can go up. At the opening of the American session attention shall be paid to a number of sales of new houses in the USA, which can decrease by 10 thousand. This fact can trigger the rise in the pair. 2. Levels of support and resistance The pair is supported by the lower boundary of the channel, close to which is located the red line MA of the Envelopes (1.5560). Resistance levels are the local highs of 1.5651 and 1.5671. 3. Trading tips Amid expectations of the news from UK and US I would recommend to open long positions at the current price with the target of 1.5651. If this level is broken down, I would recommend to move stop-loss to the loss-free zone.
Kamil Avad Analyst