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Brent: general analysis Current trend At yesterday’s trading session on 1 October crude oil Brent rate fell amid temporary suspension of Government activities. Congressmen did not come to agreement about the new budget. This fact caused temporary suspension of work of government organization, which caused decline in the rate of Brent to the level of 106.78. In addition Brent is under pressure from Chinese news. Business activity index PMI in the manufacturing sector fell by 1 point up to the level of 50.2 points. However, by the end of the trading day Brent managed to regain losses of the day and rose up to the level of 108.00. It seems that the recovery was triggered by the liquidation of short positions. Today investors will be interested in publication of the data on oil and oil products reserves from the US EIA. Experts expect that oil reserves will increase by 2.5 million barrels, while gasoline inventories will fall by 0.7 million barrels. If experts’ predictions are correct, Brent rate can decline. Support and resistance /b] Support level: 0.8215. Support levels: 107.40, 106.60 and 105.80. Resistance levels: 108.60, 109.00 and 109.60. Trading tips If the forecast for the increase of oil inventories is confirmed, it makes sense to open short positions with the target of 106.60. In case of development of the ascending trend, it is recommended to open long positions with the target of 108.60.
Vadim Smarzh Analyst of LiteForex Group of Companies
NZD/USD: New Zealand dollar is regaining losses Current trend Activities of the US government organizations have been partially suspended due to disagreement between Democrats and Republicans on budget issue. However, market quickly recovered from the negative effect of this news and on Monday the US stock market closed in the “green” zone. There is not going to be a lot of news today; however investors will wait for the data on number of mortgage lending requests and on changes in a number of jobs in the US private sector. Technical analysis shows that on the four-hour chart a strong buy signal is being formed. The line Tenkan-sen of Ichimoku indicator has crossed the line Kijun-sen from top to bottom, which is a buy signal. The price is under the Ichimoku cloud, indicating strong support at the level of 0.8281. MACD indicator also demonstrates strong buy signal; histogram is crossing the zero line from bottom to top. It is expected that the pair will get a strong growth momentum from support level of 0.8215 and will go up to resistance level of 0.8281. The speech by a chairman of the US Fed Ben Bernanke, will clarify, whether the level of 0.8296, which is the second line of Ichimoku cloud, can become a resistance level. Movement direction of the currency pair will be determined by the news on American economy. Support and resistance /b] Support level: 0.8215. Resistance levels: 0.8281, 0.8296 and 0.8320. Minor correction can take place from the level of 0.8296, after which the price will resume movement up to 0.8320. Trading tips I recommend to open long positions from the current level of price with profit taking at the level of 0.8296.
Andrey Chupov Analyst of LiteForex Group of Companies
GBP/USD: Correction to the level of 1.6100 is expected Current trend On Wednesday the British currency continued to go up, almost returning to the local highs of 1.6260. Ambiguous situation in the US economy continues to put pressure on the USD. The US government is on unpaid leave, while White House cannot agree with Congress about raising the limit of the public debt. In such conditions even weak British statistics was able slightly to slow down the rise in the pair. Business activity index in construction sector fell to the level of 58.9 points in September. Note, that despite complex situation in the American economy, Fed members do not rule out a chance of gradual reduction of volume of bond redemption. Today, PMI index in the service sector of Great Britain will become known. According to experts this index will fall by 0.1%. In addition attention shall be also paid to statistics of the American labour market: number of initial applications for unemployment benefits for September will be released today. Tomorrow investors will wait for the reporting of Nonfarm Payrolls. If the data is positive, demand for the USD may increase. Support and resistance /b] At the moment the pair is trading in the middle of the ascending channel, reaching support level of 1.6200. Growth in the pair has slowed down and investors are waiting for some actions from American government. Purchasing volume of the British currency is slowly declining, while negative macro-economic news has significant impact on the rate of the pair. In the near future we expect that the pair will rise to the key resistance level of 1.6300, which coincides with the upper limit of the ascending channel and the level of 100% Fibonacci. The pair will not go above the level of 1.6300, which is explained by poor UK statistics, overbought of the Pound and low demand for the British currency. In the medium-term the price may reverse and slowly go down to the level of 1.5880. MACD indicator confirms a chance of downtrend. On the four-hour chart there is a serious divergence; histogram is under the signal line and is directed downward, which is a strong sell signal. Support levels: 1.6150, 1.6050, 1.6000 and 1.5880. Resistance levels: 1.6260 and 1.6300. Trading tips In the current situation it is advisable to place short positions with profit taking at the level of 1.6000 (1.5880). It is also recommended to place pending sell orders from the level of 1.6300 with profit taking at the level of 1.6000.
Dmitry Likhachev Analyst of LiteForex Group of Companies
GBP/CHF: General analysis Current trend Analysis of the four-hour chart shows that although bearish sentiments dominate in the market, the pair GBP/CHF exceeded the pivot points at the level of 1.4597 and at the moment is testing the level of 1.4634. The Pound started to grow against the CHF. The pair was supported by favourable British macro-economic data. It became known that business activity index in the service sector has exceeded the forecast, amounting to 60.3 points. Investors believe that the Bank of England may introduce tightening of the monetary policy earlier than expected. However, it is worth noting that at the moment the Pound looks overvalued and its rate is above all forecasts. “Bollinger bands” indicator, as well as MACD shows that the pair will grow. Moving average line of “Bollinger bands” is directed upward, while histogram of MACD is in the oversold zone and its volumes are decreasing. Support and resistance /b] Support level: 1.4597. Resistance levels: 1.4625, 1.4630, 1.4637 and 1.4660. Trading tips Regardless the signals of technical indicators I recommend to open short positions from the current level of price with stop-loss at the levels of 1.4637 and 1.4646. Long positions at the current price level can be opened if resistance level of 1.4637 is broken down.
Andrey Chupov Analyst of LiteForex Group of Companies
USD/CAD: Technical analysis USD/CAD, H4 This week, the currency pair USD/CAD has traded in the uptrend. On Monday the price broke down the lower limit of the channel and reached the level of 1.0276; however soon the price went back to the limits of the channel. Such price behavior was triggered by the data on Canadian GDP, which rose by 0.6% in July. On the four-hour chart Bollinger bands are directed upward; the price chart rapidly goes to the upper moving average line, giving a chance of the upward movement up to the level of 1.0350 or even up to 1.0390. MACD histogram is in the overbought zone, not giving clear signals yet. Stochastic lines are directed upward.
USD/CAD, D1 On the daily chart Bollinger bands demonstrate strong consolidation, which usually takes priority of the strong price movement. This strong movement can be caused by the decision on the American budget. The price chart has moved to the upper band, suggesting that ascending movement can reach the level of 1.0390. MACD histogram is in the oversold zone, its volumes are decreasing. Stochastic lines are directed upward.
Trading tips Judging by the technical indicator we can assume that in the near future the price will go up to the levels of 1.0350 and 1.0390. In the medium-term the price can reverse and go down. As a trading strategy I recommend to open long positions from the current price level with profit taking at 1.0390. Dmitriy Zolotov Analyst of LiteForex Group of Companies
EUR/USD: Growth in the USD is not expected Current trend The American dollar continues to weaken amid budget crisis and due to the fact that some government organizations in the USA have not been operating for the fourth day. Insuperable contradictions between Democrats and Republicans have prevented from approval of the next year budget. The longer the officials will stay in the enforced leave, the more losses will bear the American economy. The crisis has already thrown aside EUR/USD to the four-week lows. Due to suspension of the government activities, the data on number of jobs outside agricultural sector, which is usually issued on the first Friday of the month, has been released. It is likely that the USD will continue to weaken until Congressmen do not reach consensus. Support and resistance The nearest resistance level is 1.3650; the main target of the “bulls” is the level of 1.3700. Support levels are 1.3600, 1.3585 and 1.3575. Trading tips It is likely that amid the development of the crisis the pair will go up to the level of 1.3700; however, it is unlikely that the pair will exceed this level.
Ilya Lashenko Analyst of LiteForex Group of Companies.
EUR/CHF: Euro is regaining positions Current trend Experts predict that European GDP will go up, which will add additional momentum to the pair EUR/CHF. In addition, the most optimistic investors expect the rise of the consumer price index and growth of retail sales in Switzerland. The US economic situation also has influence on European currency, since attention of the market participants are focused on the problem of the American state debt. Support and resistance Analysis of the four-hour chart suggests that the currency pair will go up. The signal line of MACD indicator has crossed the zero line; histogram is in the overbought zone. Moving average line of “Bollinger Bands” indicator is directed upward, confirming ascending trend. The price has entered the cloud of Ichimoku Kinko Hyo indicator, indicating that market is flat. Levels of support and resistance are the boundaries of the cloud. Support levels: 1.2227, 1.2250. Resistance levels: 1.2282, 1.2294, 1.2308. Trading tips As a trading strategy it is recommended to open long positions at the current price with profit taking at resistance levels of 1.2282, 1.2294 and 1.2308.
Andrey Chupov Analyst of LiteForex Group of Companies
EUR/USD: general analysis Current trend Situation of the US budget “paralysis” has not been resolved yet. Due to this fact macro-economic statistics scheduled for the release last Friday, has not been published. Nevertheless, the pair fell to the level of 1.3536. Nearly 800 thousand employees of various Ministries and Departments do not go to work. The US economic problems are becoming politicized, as everyone clearly realize that sooner or later the ceiling of the public debt will be raised legally and current situation is just an excuse for Republicans and Democrats to measure their strength against each other. Changes in the exchange rate are not expected until resolution of the US budget problem. Fundamental factor that can cause movement in the pair today- will be European statistics. It is expected that investor confidence index in Eurozone Sentix will go up to 10.9 points. Final data on European GDP coincides with the preliminary data; the index will amount to 0.3%. All these facts can provide support to Euro and trigger the rise in the price of the pair up to the local highs of 1.3645, which is near the upper moving average of “Bollinger bands: indicator. Support and resistance The nearest resistance level is at the moving average line of “Bollinger bands: indicator. Breakdown of this level will give a buy signal. The pair is supported by the local lows at the level of 1.3536 and 23.6% Fibonacci (1.3518). Trading tips As a trading strategy I recommend to open long positions with the target of 1.3645.
Kamil Avad Analyst of LiteForex Group of Companies
Brent: review Current trend Following recent significant growth rate, quotes of Brent are declining. Oil price is under pressure from the news that oil production in the Gulf of Mexico has been resumed in previous volumes. Last week oil and gas companies of the Gulf of Mexico temporarily suspended oil production because of threat of tropical storm; however at the end of the week production was resumed. Situation of the US budget does not add optimism to market participants. Congressmen were not able to come to consensus about the state debt of the country, thus condemning country’s economy to default. Situation in the oil market depends on the news from the USA. Support and resistance /b] Support levels: 108.05, 107.60 and 106.70. Resistance levels: 109.80 and 110.00. Trading tips In case of breakdown of the level of 108.05, it is recommended to open short positions with the target of 107.60.
Vadim Smarzh Analyst of LiteForex Group of Companies
Weekly analytical video review for currency pairs EUR/USD, GBP/USD and USD/JPY 7-11.10.2013
Weekly analytical video review for instruments EUR/USD, GBP/USD and USD/JPY based on fundamental analysis and technical indicators (MACD, Stochastic, Bollinger Bands). Daily reviews and forecast are available at LiteForex site Forex Trading : Top Forex Broker : LiteForex