Market Condition Evaluation based on standard indicators in Metatrader 5 - page 128

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Sergey Golubev, 2015.09.24 11:04

Trading the News: U.S. Durable Goods Orders (based on dailyfx article)

A 2.3% decline in demand for U.S. Durable Goods accompanied by a weakening outlook for business investments may produce near-term headwinds for the greenback as it fuels speculation for a further delay in the Fed liftoff.

What’s Expected:


Why Is This Event Important:

The Federal Open Market Committee (FOMC) may continue to endorse a wait-and-see approach at the October 28 interest rate decision as the central bank adopts a more cautious outlook for the region, and signs of a slower recovery may encourage Chair Janet Yellen to preserve the zero-interest rate policy (ZIRP) throughout 2015 in an effort to further insulate the real economy.

On the other hand, the ongoing expansion in building and service-based activity may spur greater demand for durable goods, and a positive data print may keep the central bank on course to raise the benchmark interest rate in 2015 as Chair Yellen remains confident in achieving the Fed’s dual mandate for full-employment and price stability.

How To Trade This Event Risk

Bearish USD Trade: Orders Contract 2.3% or Greater in August

  • Need to see green, five-minute candle following the release to consider a long trade on EURUSD.
  • If market reaction favors a bearish dollar trade, buy EURUSD with two separate position.
  • Set stop at the near-by swing low/reasonable distance from entry; look for at least 1:1 risk-to-reward.
  • Move stop to entry on remaining position once initial target is hit; set reasonable limit.
Bullish USD Trade: Demand for Large-Ticket Items Beat Market Forecast
  • Need red, five-minute candle to favor a short EURUSD trade.
  • Implement same setup as the bearish dollar trade, just in the opposite direction.
Potential Price Targets For The Release

EURUSD Daily


  • EUR/USD may face a larger rebound as it fails to retain the recent series of lower-highs and preserves the monthly-opening low (1.1086); need a break of the bullish RSI formation carried over from March to favor a resumption of the long-term downward trend.
  • Interim Resistance: 1.1760 (61.8% retracement) to 1.1810 (38.2% retracement)
  • Interim Support: Interim Support: 1.0790 (50% expansion) to 1.0800 (23.6% expansion)

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Sergey Golubev, 2015.09.25 08:59

EUR/USD: Levels & Targets - UOB (based on efxnews article)


  • "The wild swing has resulted in a mixed outlook for today. In other words, the 1.1105 low seen two days ago is the extent of the current down-move and the 1.1085 target is not met."
  • "From here, we hold a neutral view and expect the recent volatile to persist for a while more. Expected range; 1.1085/1.1300."

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Sergey Golubev, 2015.09.25 11:33

Here Are The Trades We Like - SocGen (based on efxnews article)

Societe Generale is forecasting the ranging market condition for EUR/USD and USD/JPY, short for CHF/SEK and long-term short in GBP/JPY. In the short-term situation: shorts for USD/CAD and EUR/NOK.



  • "Market volatility has been elevated following the Chinese FX regime shift and has remained so despite the Fed delaying its rate lift-off. Pressure on risk assets have persisted, and the fragile market sentiment is restraining G3 bond yields, which are in turn constraining EUR/USD and USD/JPY in tight ranges."
  • "We like shorts in CHF/SEK as the case for such negative rates in Sweden slowly fades."
  • "We like long-term shorts in GBP/JPY as the UK growth rate crests and Brexit risk flares higher."
  • "Being short the G10 economies with the biggest current account deficits appeals too. USD/CAD and EUR/NOK are too oil-sensitive to have conviction about here. For choice, we like to be short NOK and CAD in the very short-term."
  • "As for EUR/USD, it’s barely worth trading. It fell this week with the VW share price, and having a view on where it goes next is way outside my skill set."

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Sergey Golubev, 2015.09.27 08:48

Forecast for the Week - levels for EUR/USD by Morgan Stanley (based on efxnews article)

Fundamentals for EUR/USD: neutral. "Draghi and other ECB members were unable to provide new information on policy tools they could use, so the EUR weakness (as markets priced in a deposit rate cut) was limited. This was followed by back-to-business for the EUR and its inverse correlation with risk appetite. As markets continue to be worried about global growth, especially in the emerging markets, the EUR will likely continue to see support. The stronger trade is to buy EUR/GBP as opposed to EUR/USD."


Technicals for EUR/USD: ranging within intermediate levels with breakdown expectations. This pair is on bearish ranging condition since end of March this year to be moved within 1.1713 resistance and 1.0847 support level. If the price breaks 1.1016 support from above to below so the next bearish targets will be 1.0847 and 1.0461. By the way, if the price breaks 1.1713 resistance from below to above so the next real target will be 1.2069 in this case. The trend line of symmetric triangle pattern may be broken by the price to below at 1.1016, and if so - we may see the good breakdown for this week up to 1.0847 target. Thus, the expectation for bearish breakdown for EUR/USD is very high and the breaking 1.1016 support level is the most likely scenario for this week for example.

Resistance
Support
1.1713
1.1016
1.2069
1.0847
N/A
1.0461

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Sergey Golubev, 2015.09.28 07:53

What To Expect Into This Week: US NFP - Barclays (based on efxnews article)

"We expect, in line with consensus, an increase of 200k in the headline number (190k for the private payroll), a steady unemployment rate of 5.1%, and a 2.4% y/y increase in wages. We see these figures as robust indicators of tighter labor market conditions and supportive of inflation in the months to come."

==========

2015-10-02 13:30 GMT (or 15:30 MQ MT5 time) | [USD - Non-Farm Employment Change]

  • past data is 173K
  • forecast data is 202K
  • actual data is n/a according to the latest press release

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

[USD - Non-Farm Employment Change] = Change in the number of employed people during the previous month, excluding the farming industry. Job creation is an important leading indicator of consumer spending, which accounts for a majority of overall economic activity.

==========

EURUSD M5: 100 pips ranging price movement by USD - Non-Farm Employment Change news event:



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Sergey Golubev, 2015.09.28 17:37

Bullish intra-day reversal based on negative data for Pending Home Sales news event (adapted from realtor.org article)


The price for EUR/USD M5 timeframe broke 100-SMA and 200-SMA from below to above together with symmetric triangle pattern and stopped below 1.1234 resistance level. The price was reversed from the bearish to the bullish market condition because of negative data for Pending Home Sales news event. If this level is broken so the bullish trend will be continuing on this timeframe.


"Pending home sales retreated in August but remained at a healthy level of activity and have now risen year–over–year for 12 consecutive months, according to the National Association of Realtors®. A modest increase in the West was offset by declines in all other regions."

"The Pending Home Sales Index, a forward–looking indicator based on contract signings, decreased 1.4 percent to 109.4 in August from 110.9 in July but is still 6.1 percent above August 2014 (103.1)."

"Lawrence Yun, NAR chief economist, says even with the modest decline in contract signings, demand continues to outpace housing supply and elevate price growth in numerous markets. "Pending sales have leveled off since mid–summer, with buyers being bounded by rising prices and few available and affordable properties within their budget," he said. "Even with existing–housing supply barely budging all summer and no relief coming from new construction, contract activity is still higher than earlier this year and a year ago."


As to the GOLD (XAU/USD) so M5 price was on bear market rally within the primary bearish market condition for trying to break 100-SMA to come to the ranging area of the chart. The key 'reversal' resistance for this timeframe is 1135.28, and if the price breaks this level so we may see the ranging condition with the good possibility to the bullish reversal in the near future.


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Sergey Golubev, 2015.09.29 12:19

EUR/USD Fundamentals - Non-Farm Employment Change Forecast by Credit Suisse (based on efxnews article)

Credit Suisse made a fundamental forecast for the high impacted news events which will be on Friday: Non-Farm Employment Change:

"We project Friday’s payrolls to show +195k jobs in September (consensus), up from last month’s +173k, due to strong growth in the construction and service producing sectors. Unemployment is forecasted to remain at 5.1% in line with consensus, while average hourly earnings should increase 0.2% (consensus 0.2%), taking the year over year figure to 2.4%, its highest point since August 2009."

2015-10-02 13:30 GMT (or 15:30 MQ MT5 time) | [USD - Non-Farm Employment Change]

  • past data is 173K
  • forecast data is 202K
  • actual data is n/a according to the latest press release

If actual data > forecast or previous data = good for currency (for USD in our case)

[USD - Non-Farm Employment Change]= Change in the number of employed people during the previous month, excluding the farming industry.
Job creation is an important leading indicator of consumer spending, which accounts for a majority of overall economic activity.

==========

As we see - Credit Suisse estimated for NFP to be 195K against 202K forecast and 173K previous data. It means that we should expect the bullish condition in short term situation during and immediate after this news event on Friday.

==========

EURUSD M5: 100 pips ranging price movement by USD - Non-Farm Employment Change news event:

M5 chart



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Sergey Golubev, 2015.09.30 08:20

FX Signals by RBC (based on efxnews article)


Royal Bank of Canada provided month-end long-term forecasts for some pairs:
  • "In the absence of a significant rally in US equities today, our model will suggest buying USD against GBP, AUD, CAD and NOK at the NY close today."
  • "On the last trading day of August, the model’s signals were all long USD and the return was +0.2%."



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Sergey Golubev, 2015.09.30 18:41

Trading ideas for EUR/USD by UBS Group (based on efxnews article)

UBS described some trading strategies which may be used for EUR/USD in short and medium term situation:

EUR/USD: "the pair has had a slow week so far with no clear direction and we should see more of the same ahead of Friday's US payrolls. Keep playing the intraday moves and only get involved on the extremes. Month-end moves might provide some opportunities today, but overall we think that the 1.1000-1.1400 range is the new 1.0800-1.1200."

As we see - UBS changed the key s/r range from 1.1000/1.1400 to 1.0800/1.1200 expecting the more bearish in medium term. The price will be ranging within the following key support/resistance levels:

  • 1.1295 resistance level located near above 200 day SMA, and
  • 1.0847 support level located far below 200 day SMA in the primary bearish area of the chart.



On the weeky point of view - it means that symmetric triangle pattern will be broken from above to below for 1.0847 as a nearest bearish target.


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Sergey Golubev, 2015.10.02 08:56

EUR/USD: Monitor Key Levels - UOB (based on efxnews article)

United Overseas Bank expects sideways trading within 1.1145 and 1.1245 which means the following:

  • the price will be ranging between 1.1245 resistance level located on 100-SMA/200-SMA on the border between the primary bearish and the primary bullish on the chart, and
  • 1.1145/1.1143 support level located below 100-SMA/200-SMA in the primary bearish area of the chart.


According to UOB - EUR/USD pair is on ranging market condition for waiting for direction:

"EUR continues to trade in a listless manner and at this stage, we still prefer to hold a neutral view. Only a clear move beyond the key levels of 1.1085 or 1.1295 would suggests the start of a directional movement in the coming weeks."

Resistance
 Support
1.12451.1145
1.12951.1085

Thus, intermediate support/resistance levels are 1.1145 and 1.1245, and key reversal directional levels for today and for the coming week are 1.1085 and 1.1295.