EURUSD Technical Analysis 2016, 24.07 - 31.07: daily bearish and weekly bearish reversal with 1.0911 as a target - page 2

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Asif Naveed, 2016.07.28 15:38

So everyone, I hope you have all had a successful week so far and enjoyed the action of yesterday, after a slow beginning of the week. 
So what happened yesterday, which made the markets react negatively towards the USD , despite the FOMC not being dovish but more slightly hawkish? . 
It seems like the market had expected the FOMC to give a more clear direction, hinting when they anticipated to hike the rates, but it was left to "wait and see " really , which very likely has damaged the credibility of the FOMC and hence the negative response. When we saw the FED hiking in November of last year, another 4 hikes were expected in 2016, but now the chances for a September hike is diminishing and the market is leaning more towards a hike in December . Which then means that we can expect maximum 1 hike instead of 4 . 
So from a low yesterday of 1.0961 and now back to where we were 2 weeks ago around the 1.11 level. So does this mean that the market now believe in a stronger USD v the Euro ? . I do not think so and below 1.1160-80 we should consider the market bearish. We could see the pair positioning itself in the previous range of 1.11-1.1160 but going higher than this, I can´t find any reson for in the short term and I would say that getting to the middle of the 1.11 area would be a good entry for sell positions. 
As I said previously then the I didn´t expect the FED to be overly enthusiastic about the much better than expected numbers of the past month , as it is too short term to make any real conclusions, especially considering the NFP for June came in at 38k which was a ridiculous low number. We did however at the same time, see the unemployment rate drop, which normally should have been positive, but in this case it was not as it didn´t indicate a drop in unemployement but simply that more people had left the job market in despair of the current market conditions. 
Also remember that the US jobless numbers are in need of real interpretation, as unlike most other countries then a part time job in the US is counting as a job. So we have seen a trend in more part time jobs, low paid being filled and a drop in full time employement. Remember we have a lot of people in the US which now have 2 or even 3 part time jobs to pay their bills, people with highly expensive college degrees, which they now are paying off by flipping burger in the daytime, then waiting tables in the evening and cleaning office spaces in the night. This is not indicating growth really but just an illusion. 
So now we will have to keep a close eye on the NFP next week, the numbers of the previous month will be hard to beat, but anything above 220k should be considered positive. Also we have the manufacturing index for the US next week and then of course the ECB non-monetary policy meeting, we have the US PMI numbers and of course the unemployment rate for the US, so all in all a full schedule to look forward to. 
Now what you especially have to look for in the near term is the US salaries, the unemployment numbers , NFP and consumer spending as these are indicators for the next rate hike. In the US the GDP is to 70% made of consumer spending, so the more jobs created, the more spending, if the salaries of course follow suit, so if we see improvement in these numbers, we can expect the USD to continue its strength, as if these numbers all go together we can also expect inflation to rise. So we could be in for a rocking month in August. 
August should normally be considered a slow month as most decision makers are on holiday in August, but we have on numerous occasions seen it to be very active, so always be alert and follow the numbers closely and also study what numbers makes up the bigger news . 
All in all we could see the EURUSD continue to stay in a range between 1.1160-80 and 1.0913 which is the post Brexit range until now, but I do still see the USD strengthening in the medium term and we could see it pushing for lower levels around 1.08-1.0740. 
I wish you all a successful rest of the week and hope you all will make lots of profits.

 

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Sergey Golubev, 2016.07.29 11:49

Technical Targets for EUR/USD by United Overseas Bank (based on the article)

H4 price is located below 100 SMA and near 200 SMA: the price is testing 1.1119 resistance level to above for the reversal of the price movement to the primary bullish market condition. For now - the ptrice is located within the following key reversal support/resistance levels:

  • 1.1119 resistance level located in the beginning of the bullish trend to be started, and
  • 1.1055 support level located below 200 SMA and near 100 SMA in the beginning of the bearish trend to be resumed.

Symmetric triangle pattern was formed by the price to be crossed for direction.


Daily price. United Overseas Bank is considering for EUR/USD for the ranging market condition with the high range to be expended up to 1.1150 level:

"We shifted to a neutral EUR stance yesterday and held the view that the current rebound in EUR could extend higher to 1.1150. We have seen a high of 1.1118 so far and the pullback from the top appears to be corrective in nature and from here, we continue to anticipate a move to 1.1150 (next resistance is at 1.1180/85). Support is at 1.1040 but the key level is 1.1000 (breach of this level would indicate that immediate upward pressure has eased)."


  • If daily price breaks 1.1119 resistance level on close bar so the bullish reversal will be started with 1.1150 level as a nearest target to re-enter.
  • If daily price breaks 1.0951 support level on close bar so the primary bearish trend will be resumed.
  • If not so the price will be ranging within the levels.

 

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Sergey Golubev, 2016.07.29 14:51

Intra-Day Fundamentals - EUR/USD and Dollar Index: U.S. Gross Domestic Product


2016-07-29 12:30 GMT | [USD - GDP]

if actual > forecast (or previous one) = good for currency (for USD in our case)

[USD - GDP] = Annualized change in the inflation-adjusted value of all goods and services produced by the economy.

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  • "Real gross domestic product increased at an annual rate of 1.2 percent in the second quarter of 2016, according to the "advance" estimate released by the Bureau of Economic Analysis. In the first quarter, real GDP increased 0.8 percent (revised)."
  • "The Bureau emphasized that the second-quarter advance estimate released today is based on source data that are incomplete or subject to further revision by the source agency. The "second" estimate for the second quarter, based on more complete data, will be released on August 26, 2016."
  • "The increase in real GDP in the second quarter reflected positive contributions from personal consumption expenditures (PCE) and exports that were partly offset by negative contributions from private inventory investment, nonresidential fixed investment, residential fixed investment, and state and local government spending. Imports, which are a subtraction in the calculation of GDP, decreased."

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EUR/USD M5: 31 pips range price movement by U.S. Gross Domestic Product news event


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Dollar Index M5: intra-day bearish breakdown by U.S. Gross Domestic Product news event



 
Guys your findings, articles and charts are very interesting and useful. Keep up the good job. 
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