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Sergey Golubev, 2015.05.26 09:26
EUR/USD Technical Analysis: Sellers Overcome 1.10 Figure (based on dailyfx article)
The Euro turned lower against the US Dollar as expected
after negative RSI divergence pointed to fading upside momentum.
Near-term support is at 1.0934, the 50% Fibonacci expansion, with a
break below that exposing the 61.8% level at 1.0808. Alternatively, a
reversal above the 38.2% Fib at 1.1059 clears the way for a test of the
23.6% expansion at 1.1214.
Sergey Golubev, 2015.05.26 20:04
Tech Setups For EUR/USD, USD/JPY, GBP/USD, AUD/USD - Barclays (adapted from efxnews article)
The following are the latest technical setups for EUR/USD, USD/JPY,
GBP/USD, and AUD/USD as provided by the technical strategy team at
EUR/USD: Our bearish view was encouraged by the close
below former range highs near 1.1055. We are looking for a move lower
towards targets near 1.0850 and then the 1.0660 area. Our greater
targets are towards 1.0460. 1.1055 reverts to resistance.
USD/JPY: The break above the 122.05 highs confirms our
bullish view and completion of the six-month range trade. Our greater
upside targets are in the 124.15 area.
GBP/USD: Last Friday’s bearish engulfing candle and
the subsequent move through 1.5445 signals a squeeze lower towards our
targets near 1.5335. Breaking below there would signal deeper setback
towards 1.5130, the 50-dma.
AUD/USD: Last week’s bearish engulfing candle
encourages our bearish view. A close below our initial downside targets
near 0.7790 would signal lower towards 0.7680.
Sergey Golubev, 2015.05.27 16:22
if actual > forecast (or previous data) = good for currency (for CAD in our case)
[CAD - Overnight Rate] = Interest rate at which major financial institutions borrow and lend overnight funds between themselves. Short term interest rates are the paramount factor in currency valuation
- traders look at most other indicators merely to predict how rates
will change in the future.
Bank of Canada maintains overnight rate target at 3/4 per cent
"The Bank of Canada today announced that it
is maintaining its target for the overnight rate at 3/4 per cent. The
Bank Rate is correspondingly 1 per cent and the deposit rate is 1/2 per
Inflation in Canada continues to track the path outlined in the Bank’s April Monetary Policy Report
(MPR). Total CPI inflation is near the bottom of the Bank's 1 to 3 per
cent inflation control range, largely due to the transitory effects of
sharply lower energy prices. Core inflation remains above 2 per cent,
boosted by the pass-through effects of past depreciation of the Canadian
dollar, as well as certain sector-specific factors. Seeing through the
various temporary factors, the Bank estimates that the underlying trend
of inflation is 1.6 to 1.8 per cent, consistent with persistent slack in
The outlook for the Canadian economy also remains largely in line
with the April MPR. While a weak first quarter in the United States has
raised questions about that economy’s underlying strength, the Bank
expects a return to solid growth in the second quarter. This will help
advance the rotation of demand in Canada toward more exports and
business investment. Recent indicators suggest consumption in Canada is
holding up relatively well, given the impact of lower oil prices on
gross domestic income."
USDCAD M5: 44 pips range price movement by USDCAD - Overnight Rate news event:
Sergey Golubev, 2015.05.28 07:14
Trading the News: U.K. Gross Domestic Product (GDP) (based on dailyfx article)
An upward revision in the U.K. 1Q Gross Domestic Product (GDP) print may
heighten the appeal of the British Pound and spur a near-term rebound
in GBP/USD as signs of a stronger recovery raises the Bank of England’s
(BoE) scope to normalize monetary policy sooner rather than later.
Why Is This Event Important:
A marked uptick in the growth rate may spur a growing dissent within the
Monetary Policy Committee (MPC) as the central bank remains on course
to normalize monetary policy, and we may see a greater number of BoE
officials prepare U.K. households and business for higher
borrowing-costs as the economy gets on a firmer footing.
However, the widening trade deficit paired with the ongoing slack in
private-sector activity may drag on the growth rate, and a dismal GDP
figure may further delay the BoE’s normalization cycle especially on the
back of the uncertainties clouding the outlook for fiscal policy.
How To Trade This Event Risk
Bullish GBP Trade: U.K. 1Q GDP Expands Annualized 2.5% or Greater
MetaTrader Trading Platform Screenshots
GBPUSD, M5, 2015.05.28
MetaQuotes Software Corp., MetaTrader 5
Sergey Golubev, 2015.05.28 07:48
if actual > forecast (or previous data) = good for currency (for AUD in our case)
[AUD - Private Capital Expenditure] = Change in the total inflation-adjusted value of new capital expenditures made by private businesses. It's a leading indicator of economic health - businesses are quickly
affected by market conditions, and changes in their investment levels
can be an early signal of future economic activity such as hiring,
spending, and earnings.
AUDUSD, M5, 2015.05.28
Sergey Golubev, 2015.05.28 15:09
if actual < forecast (or previous data) = good for currency (for USD in our case)
[USD - Unemployment Claims] = The number of individuals who filed for unemployment insurance for the first time during the past week. Although it's generally viewed as a lagging indicator, the number of
unemployed people is an important signal of overall economic health
because consumer spending is highly correlated with labor-market
conditions. Unemployment is also a major consideration for those
steering the country's monetary policy.
"In the week ending May 23, the advance figure for seasonally adjusted initial claimswas 282,000, an increase of 7,000 from the previous week's revised level. The previous week's level was revised up by 1,000 from 274,000 to 275,000. The 4-week moving average was 271,500, an increase of 5,000 from the previous week's revised average. The previous week's average was revised up by 250 from 266,250 to 266,500."
USDJPY, M5, 2015.05.28
USDJPY M5: 24 pips range price movement by USD - Unemployment Claims news event
Sergey Golubev, 2015.05.29 06:19
A fresh factor will drive EUR/USD declines - Deutsche Bank (based on forexlive article)
Cleaner positioning. "Equally, positioning metrics suggest
that dollar longs have being pared back. A regression of currency manager index
returns against the DXY now points to flat positioning, while the IMM shows a
greater than 50% paring back in dollar longs," Deutsche Bank notes.
All about the Fed. "History has been all about the ECB, but the
dominant driver of FX is now likely to be the Fed. On that front, monetary
policy could come back in focus sooner than many expect," Deutsche Bank argues.
Euro still a good short. "While market focus is very likely
to shift to the other side of the Atlantic, EUR/USD is still a good vehicle to
express dollar longs. To start with, the euro is a consistent underperformer
around Fed turning points," DB advises.
Negative euro flows. "Beyond that, the European flow picture
remains very negative. The recent VaR shock in bund yields is likely to further
discourage, rather than encourage fixed income inflows," Deutsche Bank adds.
Sergey Golubev, 2015.05.29 08:20
if actual > forecast (or previous data) = good for currency (for NZD in our case)
[NZD - NBNZ Business Confidence] = Level of a diffusion index based on surveyed manufacturers, builders, retailers, agricultural firms, and service providers. It's a leading indicator of economic health - businesses react quickly
to market conditions, and changes in their sentiment can be an early
signal of future economic activity such as spending, hiring, and
NZDUSD, M5, 2015.05.29
NZDUSD M5: 28 pips price movement by NZD - NBNZ Business Confidence news event
Sergey Golubev, 2015.05.29 10:37
Trading News Events: U.S. Gross Domestic Product (GDP) (based on dailyfx article)
A marked downward revision in the preliminary 1Q U.S. Gross Domestic
Product (GDP) report may drag on the greenback and spur a near-term
rebound in EUR/USD as the Federal Reserve looks to carry its
zero-interest rate policy into the second-half of 2015.
Why Is This Event Important:
Even though the Fed pledges to look past the economic weakness drive by
transitory factors, a larger-than-expected contraction in the growth
rate may spur a further delay in the central bank’s normalization cycle
as it undermines expectations for a stronger recovery.
Nevertheless, increased business outputs paired with the expansion in
private-sector credit may offer a better-than-expected GDP print, and
prospects for a stronger recovery may spur a bullish reaction in the
dollar as the Fed remains on course to remove the zero-interest rate
policy (ZIRP) in 2015.
How To Trade This Event Risk
Bearish USD Trade: Growth Rate Contracts 0.9% or Greater
4Q 2014 U.S. Gross Domestic Product (GDP)
EURUSD M5: 19 pips price movement by USD - GDP news event:
Even though the preliminary 4Q U.S. GDP print was revised down to an
annualized 2.2% from an initial forecast of 2.6%, the print still
managed to exceed market expectations for a 2.0% rate of growth. At the
same time, Personal Consumption was also revised down to 4.2% from 4.3%,
while the core Personal Consumption Expenditure (PCE) remained
unchanged at 1.1% during the same period. The better-than-expected GDP
reading may keep the Fed on course to normalize monetary policy in 2015
as the central bank anticipates a stronger recovery in the year ahead.
The greenback strengthened following the report, with EUR/USD slipping
below the 1.1200 handle to end the North American session at 1.1189.
GBPUSD, M5, 2015.05.29
GBPUSD M5: 59 pips range price movement by USD - GDP news event
USDCAD, M5, 2015.05.29
USDCAD M5: 83 pips price movement by USD - GDP news event
Sergey Golubev, 2015.06.01 11:43