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XAU/USD: technical analysis
On the daily chart, the price remains below its moving averages with periods 10, 20 and 50 that are directed down, which indicates a downward movement in the pair. MACD’s histogram is in the negative zone that also indicates a fall. ADX also suggest decline as the DI lines are heading down and ADX is falling.
On the 4-hour chart, the pair is trading near the middle MA of Bollinger Bands, which is directed horizontally. The price remains below its MA10, MA20 and MA50, directed sideways. ADX turned down as it reached the level of 46.30, the DI lines are heading towards each other. MACD is at the zero line.
Support and resistance
Support levels: 1065.85 (local low), 1064.63 (last week low).
Resistance levels: 1075.27 (middle MA of Bollinger Bands on the 4-hour chart), 1080.00, 1081.25 (this week high), 1087.99 (last week high).
Short positions can be opened from current prices with the target at 1066.67 and stop-loss at 1075.27.
Long positions can be opened from the level of 1076.50 with the target at 1087.00 and stop-loss at 1072.70.
USD/CAD: in upward trend
Since the opening of the Asian session, the US Dollar has been growing. Yesterday, the US currency gained support from macroeconomic statistics that strengthened expectations of a hike in US interest rates at the upcoming Fed meeting.
US Energy Information Administration reported a rise by 0.961 billion barrels in crude oil stocks that added pressure on Canada's currency.
Amid expectations of US interest rates increase, oversupply of the world oil market and Canada's loose monetary policy, the USD/CAD pair tends to continue growing in the medium term.
Though OsMA and Stochastic on the daily chart recommend short positions, they are still giving buy signals on the weekly chart. On the 4-hour chart, the indicators are turning to long positions as well.
Long positions remain valid while the price is trading above the key support level of 1.2965 (38.2% Fibonacci and EMA 144 on the daily chart).
Support levels: 1.3240, 1.3200, 1.3140, 1.3100, 1.3050, 1.2965.
Resistance levels: 1.3350, 1.3400, 1.3450.
Long positions can be opened at the current level or from 1.3310, 1.3290, 1.3260, 1.3230 with targets at 1.3350, 1.3390, 1.3410, 1.3450 and stop-loss at 1.3190.
Short positions can be opened from the level of 1.3180 with targets at 1.3140, 1.3090, 1.3050, 1.2965 and stop-loss at 1.3220.
XAG/USD: pair in flat
Today the XAG/USD pair is growing.
However, the pair remains under pressure amid investors’ expectations of an interest rates hike in the US in December. According to the Fed Fund Futures, the probability of the rate increase in December is at 78%. On Friday, March futures on silver fell by 12.7 cents, while the WSJ Dollar index remains at 13-year highs.
Investors’ attention is focused on the US labour market data for November that is due on Friday and which is going to play a key role for the decision on interest rates at Fed’s December meeting
On the daily chart, the XAG/USD pair is falling along a channel with the lower border below the level of 13.85.
Prior to the publication of important data the price will stabilise near the level of 14.00 (year lows). An upwards correction towards the level of 14.60 (ЕМА144, ЕМА200 on the 4-hour chart) is possible. However, a breakdown of the level of 14.00 would accelerate the fall.
On the 4-hour and daily charts, OsMA and Stochastic are turning to purchases.
Support levels: 14.00, 13.80, 13.50.
Resistance levels: 14.35, 14.60, 14.80, 15.30.
Short positions can be opened from current prices with targets at 14.00, 13.80, 13.50 and stop-loss at 14.35.
Long positions can be opened after the price consolidation above the level of 14.60 with targets at 15.30, 15.50.
USD/CHF: growth potential remains
Since the beginning of this week the USD/CHF pair was falling.
However, today poor macroeconomic statistics from Switzerland supported the pair. The SVME – Purchasing Managers’ Index for November fell to 49.7 points, while Real Retail Sales shrank by 0.8%. Both indices came out significantly worse than forecasts. Furthermore, the third quarter GDP grew by only 0.8% against the previous year that was also worse than expected.
Today attention needs to be paid to data on the ISM Manufacturing PMI for November from the US that is forecasted to grow from 50.1 to 50.3 points. A high volatility is expected on the market.
On the daily chart, the pair is moving along an ascending channel between the levels of 1.0340 and 0.9800. Despite the price is trading at year highs, the growth potential towards the level of 1.0600 (ЕМА144 on the monthly chart) remains in the pair.
At the same time, a downward correction to the level of 1.0215 (ЕМА50, lower border of an ascending channel on the 4-hour chart) is possible.
On the daily and weekly charts, OsMA and Stochastic indicate a growth continuation, while on the 4-hour chart they turned to sales.
Support levels: 1.0215, 1.0130, 1.0000, 0.9880, 0.9800.
Resistance levels: 1.0300, 1.0340, 1.0400.
Pending sell order can be placed from the level of 1.0270 with targets at 1.0190, 1.0100, 1.0080, 1.0000 and stop-loss at 1.0310.
Pending buy orders can be placed from the level of 1.0320 with targets at 1.0340, 1.0400, 1.0600 and stop-loss at 1.0280.
USD/JPY: long positions preferred
Since the beginning of Asian session today the USD/JPY pair fell.
The pair was pressured by poor data on the Chinese manufacturing sector that showed further cooling of the Chinese economy. In addition, pressure on the pair comes amid investors’ expectations of further monetary policy easing in the eurozone because the Yen serves as the safe-haven currency during market instability.
At the same time the pair is supported by expectations of an interest rates hike in the US in December and further monetary policy easing in Japan as it was mentioned before by Bank of Japan Governor Kuroda.
On the daily chart, the pair is moving along an ascending channel with the upper border near the level of 124.50, while the last 4 weeks it has been trading in a range between the levels of 123.70 (23.6% Fibonacci correction) and 122.50 (38.2% correction).
The pair is prevented from further fall by strong support levels at 122.50, 122.25 (ЕМА144), 122.00 (ЕМА200 on the 4-hour chart), while a breakout of the level of 123.70 would send the pair to 125.00, 125.65 (year highs).
On the 4-hour, daily and weekly charts, OsMA and Stochastic recommend long positions.
Support levels: 122.50, 122.25, 122.00, 121.50.
Resistance levels: 123.50, 123.70, 124.00, 124.50.
Pending buy orders can be placed at the levels of 122.50, 122.25, 122.00 with targets at 123.00, 123.50, 123.70, 124.00, 124.50 and stop-loss at 121.70; and at 123.30 with targets at 123.50, 123.70, 124.00, 124.50 and stop-loss at 122.80.
Pending sell orders can be placed at the level of 121.40 with targets at 121.10, 120.70 and stop-loss at 121.70.
EUR/USD: general analysis
Yesterday, the European currency strengthened slightly against the US Dollar, which was under pressure from US statistics on ISM Manufacturing PMI. In November, the indicator declined from 50.1 to 48.6 points, while analysts forecasted a growth to 50.4 points.
November Data on Consumer Price Index is due today in the EU. The indicator is expected to come in at 0.2%. Even if the forecast is confirmed, a possible growth in the EUR will be limited as ECB is expected to continue easing its monetary policy at the upcoming meeting.
Later on, Fed’s Chair Janet Yellen gives her speech. Market participants might get more confirming evidence that the Regulator will raise its interest rates before the year is out. The futures market is pricing in up to a 75.2% probability of a hike at the December meeting.
On the 4-hour chart, MACD indicator recommends long positions. Stochastic is giving a sell signal – the indicator has left the overbought zone; the %K line has crossed the %D line from top-to-bottom.
A likelier scenario seems to be continuation of downward movement within a descending channel.
The nearest support levels are 1.0555, 1.0500.
The nearest resistance levels are 1.0688, 1.0762, 1.0820.
Long positions can be opened if the price breaks out the level of 1.0640 with the target at 1.0685 and stop-loss at 1.0630.
Short positions can be opened from the level of 1.0590 with targets at 1.0555, 1.0500 and stop-loss at 1.0600.
XAU/USD: price of gold declines
Since the opening of the trading day, the prices of gold and other precious metals are declining amid the strengthening in the US Dollar.
The correlation between the price of gold and the EUR/USD pair is nearly 92%. The EUR is under strong pressure ahead of ECB interest rate decision, therefore, a decline in the price of gold is likely to continue.
Demand for the USD, on the contrary, continues growing due to expectations of a hike in US interest rates. At present, gold does not seem to be a profitable investment as borrowing costs of buying and storing it tend to increase.
Though on the daily chart, OsMA and Stochastic recommend long positions, they are giving sell signals on the 4-hour and weekly charts.
Short positions are preferable. A growth to 1138.00 (38.2% Fibonacci correction and EMA144) seems possible if the price consolidates above the levels of 1085.00 and 1095.00.
Support levels: 1065.00, 1060.00, 1057.00.
Resistance levels: 1075.00, 1085.00, 1095.00, 1105.00, 1118.00.
Short positions can be opened from the level of 1060.00 with targets at 1050.00, 1010.00 and stop-loss at 1072.00.
Long positions can be opened from the level of 1076.00 with targets at 1085.00, 1095.00, 1105.00 and stop-loss at 1073.00.
USD/CHF: safe-haven currency
Since the beginning of the week, the USD/CHF pair was declining.
The pair was falling despite the publication of poor data in Switzerland that came out significantly worse than forecasts and strong statistics on the US labour market. The Swiss GDP in the third quarter failed to show any growth, Real Retail Sales shrank by 0.8%, while the SVME Purchasing Managers’ Index fell to 49.7 points.
The main pressure on the pair resulted from increased cautiousness on the market prior to the publication of key statistics in the US that pushed investors to switch their funds into the safe-haven Franc.
Today attention needs to be paid to the ECB Press conference and its Interest Rate Decision, Fed’s Yellen testifies, FOMC Member Mester speech, and Markit and ISM PMI’s in the US.
On the 4-hour chart, the pair is moving along an ascending channel with the lower border near the level of 1.0185 and upper border above the level of 1.0340.
A downward correction can continue to the levels of 1.0180, 1.0130. At the same time, a growth in the pair can go up to the level of 1.0600 (ЕМА144 on the monthly chart).
On the daily chart, OsMA and Stochastic recommend short positions, while on the 4-hour chart they are turning to purchases.
Support levels: 1.0230, 1.0185, 1.0130, 1.0000, 0.9880, 0.9800.
Pending sell orders can be placed at the level of 1.0180 with targets at 1.0100, 1.0080, 1.0000 and stop-loss at 1.0220.
Pending buy orders can be placed at the level of 1.0240 with targets at 1.0300, 1.0340, 1.0400, 1.0600 and stop-loss at 1.0190.
AUD/USD: general analysis
The AUD/USD pair is strengthening, though, according to macroeconomic statistics, Australia’s trade balance deficit grew to 3.305 billion.
The Australian Dollar is under pressure due to a fall in iron ore prices and uncertainty about China’s economic outlook.
Today, attention needs to be paid to Initial Jobless Claims and ISM Non-Manufacturing PMI statistics. The ISM Non-Manufacturing PMI is expected to decline from 59.1 to 58.0 points that might affect the US Dollar.
On the 4-hour chart, the pair is trading between the upper and the middle MAs of Bollinger Bands. The price remains above the MA50, MA100 and MA144, all directed up. MACD histogram is in the positive zone, while ADX indicates downward movement.
Today, the price is expected to trade within the range of 0.7330-0.7287.
Support levels: 0.7287, 0.7261 (MA50).
Resistance levels: 0.7330, 0.7342 (local high), 0.7360, 0.7400.
Long positions can be opened after the consolidation above the level of 0.7330 with the target at 0.7360 and stop-loss at 0.7315.
Short positions can be opened from the level of 0.7287 with the target at 0.7250 and stop-loss at 0.7300.