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USD/JPY: analysis and forecast Current trend The beginning of the week was favourable for the pair USD/JPY. The pair USD/JPY rapidly went up from support level of 101.30 to up resistance level of 101.65. The rise was triggered by the report of the head of the US Fed Janet Yellen. However, the “bulls” failed to reach resistance level of 102.00. At the opening of today’s trading session, Nikkei index declined, which triggered the fall in the price of JPY. Today the data on the US construction sector will become known. This index keeps declining lately, which indicates problems in the American economy. Support and resistance Support levels are 101.50, 101.30 and 101.10; the latter one is the main target of the “bears”. Resistance levels are 101.80, 101.95 and 102.25. Trading tips It is advisable to open short positions after breakdown of the level of 101.10 and consolidation of the price below this level. It also makes sense to open limit buy orders at the level of 101.30. Buy orders can be placed after breakdown of the level of 101.65.
Ilya Lashenko Analyst of LiteForex Investments Limited
Forex: Ichimoku Clouds. Review of USD/CHF USD/CHF, H4 Let’s look at the four-hour chart. Tenkan-sen line is above Kijun-sen, they are both horizontal. Chinkou Span line is above the price chart; current Kumo-cloud is still ascending. After an abrupt rise the pair has been corrected to the level of Tenkan-sen line. Kijun-sen line becomes a support level (0.8943). One of the previous maximums of Chinkou Span line is expected to be a resistance level at 0.9000.
USD/CHF, D1 On the daily chart Tenkan-sen line has crossed Kijun-sen from below, confirming a new wave of the upward movement. Chinkou Span line is following the price chart, current cloud is ascending. The closest support level is Tenkan-sen line (0.8943). One of the previous maximums of Chinkou Span line is expected to be a resistance level at 0.9040.
Key levels Support levels: 0.8943. Resistance levels: 0.9000, 0.9040. Trading tips On the both charts we can see the renewal of the upward trend. Targets for the long positions are 0.9000 and 0.9040. Anastasiya Glushkova Analyst of LiteForex Investments Limited
GBP/USD: analysis and forecast Current trend On Thursday the pair GBP/USD had dropped by 60 points, reaching the level of 1.7082. Then, the pair corrected and returned to the horizontal channel of 1.7000-1.7180. The American currency was supported by positive data on the U.S. labour market and the speech by the head of FRB of St. Louis- Mr. James Bullard. The number of initial applications for unemployment benefits is slowly reducing. Last week the number amounted to 302 thousand. James Bullard said yesterday that the American regulator may increase interest rates sooner, than expected by investors. Moreover, Mr. Bullard believes that the US Fed shall take measures against the threat of inflation, which may rise because of the high employment rate in the country. He believes that the decline of unemployment rate below the level of 6% may trigger the decline in wages and the rise in the prices. Recall the U.S. unemployment rate in June has reached the level of 6.1% Important news which will become known later today is the U.S. consumer confidence index estimated by Michigan University. This is a leading indicator compared to the Federal index. Support and resistance The price has again broken down the lower limit of the horizontal channel at 1.7100, trying to reach the level of 1.7085 (middle line of “Bollinger bands.”) At this level the price may reverse and go back to the horizontal channel. On the four-hour chart technical indicators demonstrate mixed signals. MACD histogram is in the negative zone; its volumes are stable. Stochastic lines are crossing and moving upwards. Trading tips In the current situation it makes sense to open long positions when the price pushes off from the level of 1.7085. Take profit is advisable at the level of 1.7130.
Dmitriy Zolotov Analyst of LiteForex Investments Limited
Forex: Ichimoku Clouds. Review of NZD/USD UNZD/USD, H4 On the four-hour chart Tenkan-sen line is below Kijun-sen, both lines are horizontal. Chinkou Span line is below the price chart, current cloud is descending. After long fall the pair has been corrected above Tenkan-sen line, which becomes a support level (0.8684). The closest resistance level is Kijun-sen line (0.8783).
NZD/USD, D1 Let’s look at the daily chart. Tenkan-sen and Kijun-sen lines are getting closer above the cloud and can soon form trend reversal pattern. Chinkou Span line is approaching the price chart from above; current cloud is ascending. The pair has broken down the levels of Tenkan-sen and Kijun-sen, the latter is the closest resistance now (0.8739). The next obstacle for the price on its way down will be the upper border of the cloud (0.8590).
Key levels Support levels: 0.8684, 0.8590. Resistance levels: 0.8783, 0.8739. Trading tips On the four-hour chart we can see a correction of the downward movement, on the daily chart we can soon witness a trend reversal. Targets for the short positions are 0.8684 and 0.8590. Anastasiya Glushkova Analyst of LiteForex Investments Limited
GBP/USD: general analysis Current trend According to the latest data British economy demonstrates stable growth; therefore, the Pound is likely to strengthen in the long-term. It is expected that GDP growth can reach 3.1%. Experts explain such rapid growth by the increase of investments by 12.5%. Nevertheless, because of slow growth of wages, it is unlikely that interest rates can be increased in the near future, even despite the fact that consumer price index in June amounted to 1.9%. Volume of stimulus programs has remained unchanged at the level of 375 billion pounds. Today the data on industrial order expectations in the UK will become known. The index may drop by 9 points, which will increase pressure on the Pound in the short-term. Support and resistance Despite favourable macro-economic statistics, technical indicators show that on the weekly chart the pair has crossed important Murray level of 3/8. If the pair consolidates below support level of 1.7050, it is likely that the decline will continue. The nearest resistance level is 1.7090. Trading tips It is recommended to open short positions after breakdown of the level of 1.7050 with stop-loss at 1.7090 and the target of 1.6855.
Dmitriy Agurbash Analyst of LiteForex Investments Limited
GBP/USD: the pair may experience downward correction Current trend At the beginning of this week the currency pair GBP/USD continued downward correction: the quotes fell to the level of 1.7041, almost reaching the bottom moving average of the Bollinger bands. Today’s main event is the release of the minutes of the meeting of the Bank of England and the speech of Mark Carney, the head of the bank. Now market participant pay close attention to all statements made by the British officials, trying to detect when the interest rates are going to be raised. Many investors believe that Great Britain will be the first country, which will decide to tighten monetary policy. Tomorrow’s UK statistics will be also of high importance: it will be the data on retail sales for June. It is expected that this index will grow by 0.2%, which will support the British currency. Support and resistance Technical indicators show that downward correction may reach the levels of 1.7030 and 1.6980. The price chart has broken down the middle line of the Bollinger bands indicator. MACD histogram is in the positive zone; its volumes are decreasing. Stochastic lines are directed downwards. Resistance levels: 1.7100 and 1.7180 Support levels: 1.7030 and 1.6980. Trading tips In the current situation it makes sense to open short positions at the current price with the first target of 1.7030 and the main target of 1.6980. Note that the movement in the pair will depend on Mark Carney’s speech. If he gives hopes that interest rates will be raised, the quotes of the pair GBP/USD can significantly grow. In this case it is advisable to open long positions from the level of 1.7100 with taking profit at 1.7180.
Dmitriy Zolotov Analyst of LiteForex Investments Limited
EUR/USD: investors are waiting for the data on the U.S. housing market Current trend The currency pair EUR/USD has traded near support level of 1.3460 for two days, but failed to consolidate below this level. At the moment the price is growing amid positive European macro-economic statistics. It became known that preliminary business activity index in the industrial sector of Germany for July rose to 52.9 points; while the same index in the countries of Eurozone grew up to 51.9 points. Both indexes have exceeded experts’ forecasts. Today market participants are waiting for the weekly data on number of initial application for unemployment benefits in the USA. This index can increase up to 308 thousand; the US statistics on the number of new houses construction for June will also become known. It is expected that the index will drop against the previous value, amounting to 479 thousand houses. Note also that US housing market statistics, released earlier, was unfavourable. Number of permits to construct was 0.96 million; while the number foundations of new houses was 0.89 million. Therefore, if negative forecast proves to be correct, the USD will significantly fall. Support and resistance Currently the pair tends to grow. The key level is 1.3485 (middle line of the Bollinger bands indicator). Breakdown of this level will enable the rise in price up to 1.3525 and 1.3550. If the “bulls” fails to breakout the level of 1.3485, the price is likely to go to the key support level of 1.3460. Technical indicators confirm probability of the ascending movement. MACD histogram is in the negative zone; its volumes are increasing. Histogram is crossing the signal line from bottom to top. Stochastic lines have crossed and are rising. Trading tips In the current situation it makes sense to open long positions above the level of 1.3485 with the target of 1.3525. Short positions can be opened only if the price pushes off from the level 1.3485 and reaches the level of 1.3470.
Dmitriy Zolotov Analyst of LiteForex Investments Limited
USD/JPY: the pair continues to grow Current trend On Thursday the currency pair USD/JPY continued to grow reaching the level of 101.85. Sharp rise of quotes was caused by the increase in deficit of trading balance of Japan by 822.2 billion yen in June, which was above the forecasts. It became known today that Japanese consumer price index in June dropped from 3.7% to 3.6%. Following this news the pair resumed growth and reached three-week highs of 101.94. Attention today shall be paid to statistics on the number of orders for durable goods in the USA. It is expected that this index will rise by 0.5%, which will provide support to the American currency triggering the rise in the pair USD/JPY. Support and resistance Technically, the price may continue to grow. The price chart has broken down the moving average line of “Bollinger bands”, indicating probability of minor correction to the level of 101.80. However, it is likely that the price will go up to the levels of 102.05 and 102.20. Technical indicators demonstrate mixed signals. Bollinger bands are directed upwards. MACD histogram is in the positive zone, its volumes are increasing. Stochastic lines are directed downwards; they are still in the overbought zone and have not yet formed a sell signal. Trading tips In the current situation it makes sense to open long positions at the current price level with the target of 102.20. Short positions with the target of 101.60 can be only opened if the price consolidates below the level of 101.80.
Dmitriy Zolotov Analyst of LiteForex Investments Limited
GBP/USD: general review Current trend Last Friday the pair GBP/USD demonstrated poor dynamics, since, following the decline on Thursday the pair remained almost at the same price level. Preliminary British GDP has grown by 0.8% in Q2, which was correctly predicted by experts. Drop in the pair below 1.7000 last Thursday was caused by favourable U.S. labour market statistics. It became known that initial claims for unemployment benefits fell to 284 thousand against expectations of 310 thousand. Such positive data brought back to the market an idea that US Fed might introduce monetary policy tightening earlier than expected, which will provide significant support to the USD. Support and resistance Resistance levels: 1.7000 (important psychological level), 1.7053 (highs of 24 July), 1.7100 (moving average with the period of 21), 1.7191 (highs of 15 July). Support levels: 1.6953 (moving average with the period of 55), 1.6923 (lows of 18 June), 1.6900 (important psychological level), 1.6845 (moving average with the period of 100). Trading tips Buy positions can be opened from the level of 1.7005 with the first target of 1.7050 and the second target of 1.7095. Short positions are recommended below the level of 1.6950. Short-term target is at the level of 1.6925, the main target — 1.6850. Andrey Cherkas Analyst of LiteForex Investments Limited
EUR/USD: general analysis Current trend In general forecasts for Euro are not encouraging. While reducing public expenses, Italian government accumulated huge debts. Debts to the private companies have reached about 75 billion euro. Finance Minister of Italy, Pier Carlo Padoan said that the problem will be resolved before the end of this year. However, previous promises offered by Prime-Minister Matteo Renzi have not been implemented. Economic situation in Italy is still complex. Unemployment rate is at the level of 12.5%, despite minor economic growth of 0.2%. Support and resistance After reaching support level of 0/8 1.3428 (0/8 Murray) European currency has slightly slowed down and is now trading at the level of 1.3450. The nearest resistance level is Murray level of 1/8 (1.3458). Trading tips It is recommended to open short positions after breakdown of the level of 1.3428 with stop-loss at 1.3458 and the target of 1.3367.
Dmitriy Agurbash Analyst of LiteForex Investments Limited