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EUR/USD: general analysis Current trend The Unified European currency has reached the upper limit of Murray level at 4/8, which coincides with the level of 1.3855, but failed to break it down. If this level will be finally broken down buy orders can be recommended. Note that interesting research has been done by experts from Oxford University, who tried to find out the influence of financial crisis on the life of people in EU. According to statistics, in the troubled countries like Greece, the increase in unemployment rate caused the rise of suicides by about 1.4%. Most part of young people at the age of 21-35, decided to leave Greece and move to the more successful countries, such as Germany and France. Situation in the healthcare was also under threat. Medical insurance are directly correlated with salaries, therefore, people who lost jobs have also lost access to medical service. It means that austerity measures aimed at combating financial crisis can strike a blow at people’s lives. Support and resistance The nearest resistance level is 1.3855 – 4/8 Murray level. Support level is 1.3821 – moving average with the period 200. Trading tips It is recommended to open long positions after break down off the level of 1.3855 with stop loss at 1.3830 and a target of 1.3916.
Dmitriy Agurbash Analyst of LiteForex Investments Limited
Brent: review and forecast Current trend On Tuesday crude oil Brent fell to the level of 108.50, but failed to consolidate below this level. Today, oil prices try to regain yesterday’s losses. Investors are waiting for the publication of the weekly report on oil and oil products inventories in the USA. According to forecast, oil inventories will increase for about 2.6 million barrels. At the moment Brent quotes are above the level of 109.00 USD per barrel. Oil prices are supported by the news from China, which is one of the world’s largest oil consumers. It became known that PMI in the manufacturing sector of China increased to 48.3 points in April against 48 points in March, which indicates that there is some rise in manufacturing activity, although it is very low. Tension around Ukraine and sanctions against Russia may also provide support to Brent. Attention today shall be focused on preliminary data on business activity index in the US manufacturing sector, as well as on sales of new houses in the American housing market. Support and resistance Resistance levels: 109.50, 109.90 and 110.30. Support levels: 109.00, 108.50, 108.00 and 107.00. On the four-hour chart Bollinger bands are directed sideways, indicating the lull in the market. MACD histogram is in the positive zone, but its volumes are decreasing. Histogram is prepared to move to the negative zone. Trading tips In case of formation of the downtrend sell positions are recommended after breakdown of the level of 109.00 with the targets of 108.50 and 108.00. If the “bulls” will be stronger and Brent will consolidate above the level of 109.50, next target of the bulls will be the levels of 109.90 and 110.30.
Vadim Smarzh Analyst of LiteForex Investments Limited
XAG/USD: technical analysis Current trend The price of the pair XAG/USD has been declining for two consecutive months. The pair has been trading at the level of 20.00 for quite a long time, but finally this level has been broken down and the price of the precious metal fell further down. Since the beginning of this week silver has traded in the range of .25-19.55. Bears try to break down support level of 19.25, in order to come close to their main target of 19.00. Technical indicators give mixed signals. Stochastic and MACD show probability of correction. Stochastic is at the bottom boundary, the line %K has crossed the line %D, they are both directed sideways. If these lines turn upwards, it will give us a buy signal. MACD is in the negative zone, but the signal line is directed upwards; it has started to cross histogram, which is a buy signal. Moving average lines show continuation of the downward movement. Support and resistance Support levels: 19.25 and 19.00; the latter one is the main target of the “bears”. Resistance levels: 19.54, 19.80, 20.00 and 20.30. Trading tips It is possible that the pair will experience correction. Long positions are recommended above the level of 19.55 with the target of 20.00. Limited sell orders can be placed at the same level. Short positions can be placed after consolidation of the price below the level of 19.25.
Ilya Lashenko Analyst of LiteForex Investments Limited
GBP/USD: Investors are in waiting for the data in British retail sales Current trend On Wednesday all attention was focused on the minutes of the last meeting of the Bank of England and comments of the members of Monetary Committee. Although comments were very cautious, investors still awaited at least a hint of possibility of the rise of interest rate, which they did not get. After that “bears” with the help of active sales of British currency, managed to drop the pair to the key support level of 1.6770. The pair has reached bottom boundary of the upward channel and consolidated there. Weak American data on construction sector supported the pair, and the Pound started to regain losses. There will not be any important UK news releases and the pair is trading under the influence of investor sentiments. The British currency continues to regain yesterday’s losses and investors are waiting for the American data on orders for durable goods and initial applications for unemployment benefits. Support and resistance Today, surprises are not expected and the pair is likely to move in the narrow range of 1.6770 – 1.6820. It is likely that the pair will not be under pressure, and “bears” take up the running. British data on retail sales for March, which will be released tomorrow, can become a driver of the movement. According to forecast retail sales will go down after sharp rise a month ago. However, even slight difference with the negative expectations will trigger the rise in British currency. Following insignificant sales the demand for the Pound has grown again. In the medium-term the rise can reach the level of 1.7000. Support levels: 1.6770, 1.6750, 1.6700 and 1.6660. Resistance levels: 1.6820, 1.6900, 1.6950 and 1.7000. Trading tips In the current situation it is advisable to open long positions with take profit at the level of 1.7000 and stop-loss at 1.6750.
Dmitry Likhachev Analyst of LiteForex Investments Limited
EUR/USD: It is expected that the pair will continue to grow Current trend On Thursday the pair EUR/USD traded with high volatility, in the midday the pair was supported by positive index of business activity in Germany. Due to the restrained statement by Mario Draghi the pair significantly declined reaching key support level of 1.3790. However, pessimistic sentiment has been replaced by increasing demand among investors when chairman of the European Central Bank did not mention of the threat of high exchange rate of European currency. Increasing demand for Euro and weak data on the US labour market helped the pair to regain from losses and return to the level of 1.3830. This morning the pair continued to strengthen, although there was no important news release in Europe. Attention today shall be paid to the USA business activity index in the service sector as well as consumer confidence index. Support and resistance Given all circumstances it is likely that Euro will continue to grow against the USD. American statistics show that economy has not yet stabilized after long-term recession and reduction in volume of asset purchase program did not boost expected demand for the USD. In Europe high exchange rate of Euro has negative impact on export regions of Eurozone causing the threat to price stability. Despite the fact that European currency is overbought, demand for Euro continues to increase; while the USD is losing positions against major currencies. Considering current situation it is expected that the pair will continue to go to the target level of 1.4000. Support levels: 1.3790, 1.3710, 1.3630 and 1.3550. Resistance levels: 1.3850, 1.3900, 1.3950 and 1.4000. Trading tips It the current situation it is advisable to open long positions with take profit at the level of 1.4000 and stop-loss below support level of 1.3790.
Dmitry Likhachev Analyst of LiteForex Investments Limited
XAU/USD: general analysis Current trend Gold is trading near important resistance level of 1300.00. If this level is broken down, next target will be at the level of 1312.00, which coincides with Murray level of 4/8. Gold was supported by negative US statistics. It became known that number of applications for unemployment benefits increased to 329 thousand, while sales in the primary housing market fell by 14.5%. These facts give ground to assume that programs to stimulate American economy will be continued in case of further slowdown of economy. On the other hand, Ukraine crisis remains to be a negative factor for the gold. Sanctions that can be introduced against Russian companies can force them to sell gold in order to get liquidity, which can negatively affect the price of gold. However, if full-scale military operation involving three parties will start in Ukraine, demand for gold will exceed supply and precious metal will be used as an asset to preserve capital. Support and resistance The nearest resistance target is 1300.00 – psychologically important level. Support level is 1281.25 – 2/8 Murray level. Trading tips It is advisable to open long positions after breakdown of the level of 1300.00 with protective order of 1290.00 and a target of 1312.00.
Dmitriy Agurbash Analyst of LiteForex Investments Limited
GBP/USD: Preliminary data on the UK GDP can trigger the rise in the pair Current trend At the end of last week the pair traded in the range of 1.6820-1.6770. Investors continued to maintain high level of the pair. This morning quotes of the pair have grown up. Support to the Pound was provided by positive retail sales index of Great Britain, released on Friday. Prices in the British real estate market are also increasing due to low rates of loans This favourable news encouraged investors to buy the Pound and the pair sharply went up, breaking down key resistance level of 1.6840. Purchase of the British currency is also supported by expectation of preliminary UK GDP. The data will become known tomorrow and it is expected that the index will be positive. Support and resistance If the pair manages to consolidate above local highs and key resistance level of 1.6840,and tomorrow’s data confirms favourable forecast of the UK GDP, the price may go up to new highs at the level of 1.6900 (1.7000). The pair continues to move in the upward channel. In the medium-term important resistance level will be at 1.7000. Main trading indicators confirm continuation of ascending movement. Support levels: 1.6720, 1.6770, 1.6730 and 1.6700. Resistance levels: 1.6860, 1.6900, 1.6950 and 1.7000. Trading tips In the current situation it makes sense to place long positions and pending long positions at the levels of 1.6840 and 1.6820 with take profit at the level of 1.7000.
Dmitry Likhachev Analyst of LiteForex Investments Limited
AUD/USD: technical analysis Current trend The currency pair AUD/USD has been trading in the downward channel for three consecutive weeks. Last week the price failed to break down resistance level of 0.9378, which coincides with Fibonacci line of 61.8%. After that the price continued to decline to support level of 0.9250. At the moment the pair is experiencing upward correction. Trend reversal can be expected after breakdown of the level of 0.9300 and consolidation of the price above this level. Technical indicators show the rise, so upward correction will probably continue. Support and resistance Important support levels: 0.9275 and 0.9250. The main target of the “bears” is 0.9200. Resistance levels: 0.9300, 0.9330, 0.9360 and 0.9380. Trading tips It is recommended to open long positions after consolidation of the price above the level of 0.9300. Sell orders can be placed after breakdown of the level of 0.9250 and 0.9200.
Ilya Lashenko Analyst of LiteForex Investments Limited
EUR/USD: will ECB decide to lower interest rate? Current trend As expected, European currency continues to strengthen against the USD. On Monday the pair received considerable support from investors and slowly went up, despite weak German data and concerns of ECB about high rate of Euro. Yesterday negative price imports index of Germany was released, the index fell below expectations. At the last meeting of European Central Bank, bank representative Christian Noyer noted that insignificant decline of European currency can help accelerate inflation and increase demand for exports. At the moment the pair maintains the level of 1.3870. Investors’ interest in the pair fell in advance of the US Fed meeting. Investors fear to invest to the risky assets expecting reduction of the quantitative easing program. Today, attention shall be paid to the preliminary index of consumer price in Germany. Support and resistance Weak German statistics can drop the pair to the lower limit of the upward channel and key support level of 1.3790 (1.3770). One of the main reasons of decrease in demand for European currency is the fact that it is overbought. However, most members of ECB believe that current exchange rate of Euro does not have a negative impact on economic growth rate. Investors’ fear to buy risky assets in advance of US Fed meeting is easy to understand. However, we can see that the USD continues to cheapen and even reduction of volume of the assets purchase program by 10 billion USD cannot change existing situation, which means that the pair will continue to rise up to the target level of 1.4000. Meanwhile a chance of deep correction is still there. Support levels: 1.3820, 1.3790, 1.3770, 1.3710, 1.3630 and 1.3550. Resistance levels: 1.3900, 1.3950 and 1.4000. Trading tips In the current situation it makes sense to place long positions and pending long positions at the levels of 1.3820 and 1.3790 with take profit at 1.4000.
Dmitry Likhachev Analyst of LiteForex Investments Limited
USD/JPY: Investors are in anticipation of the decisions by the Bank of Japan and US Fed Current trend The currency pair USD/JPY started this week with the rise in quotes, which was caused by the speech of Finance Minister of Japan Taro Aso, who said that government continued to take measures to weaken the Yen. Additional reason that caused weakening in the Yen was the fact that Japan decided to participate in international sanctions against Russian Federation. Investors fear that the decisions of the Japanese government can lead to the decrease of turnover between two countries. Due to such developments, quotes in the pair rose to the level of 102.65 (upper moving average line of Bollinger bands). Note that fundamental events, which can affect exchange rate in the pair, will become known on Wednesday. The Bank of Japan will make announcement about further monetary policy. Investors have been waiting for the expansion of the program to stimulate Japanese economy for quite a long time. The meeting of the Open Market Committee of the US fed will be also held on Wednesday. The decision to reduce volume of bond purchase for 10 billion USD can be made at this meeting. Support and resistance At the moment the pair is still testing the level of 102.65. During the day the pair can go up to the level of 102.80. Correction to the level of 102.48 is also possible. Investors are not expected to take risk in advance of the events of Wednesday. However, if the Bank of Japan decides to expand program to stimulate national economy, and US Fed reduces stimulation program once again, quotes in the pair may soar up to the levels of 103.00, 103.35 and 103.65. Technical indicators confirm probability of upward movement. MACD histogram has moved to the positive zone, forming a buy signal. Stochastic lines have entered overbought zone. Trading tips In the current situation it is advisable to open long positions with the target of 103.35 after completion of the downward correction at the level of 102.48.
Dmitriy Zolotov Analyst of LiteForex Investments Limited