Market Condition Evaluation based on standard indicators in Metatrader 5 - page 130

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Gold is Reaching at 1270

Sergey Golubev, 2013.07.01 21:04

How can we know: correction, or bullish etc (in case of using indicator for example)?

well ... let's take AbsoluteStrength indicator from MT5 CodeBase.

bullish (Bull market) :

bearish (Bear market) :

ranging (choppy market - means: buy and sell on the same time) :


flat (sideways market - means: no buy and no sell) :

correction :

correction in a bear market (Bear Market Rally) :



 

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Sergey Golubev, 2015.10.12 08:56

EUR/USD: calm before storm - Barclays (based on efxnews article)

Barclays made a fundamental forecast for EURUSD expecting big volatility for this pair and for USD/JPY as well:

  • "Last week saw a significant improvement in global risk sentiment, benefitting risky assets, despite soft data prints and cautious central bank rhetoric (Figures 1 and 2). However, the market is likely heading into an environment of lower growth, soft inflation and additional policy stimulus."
  • "Central bank rhetoric is starting to reflect this new reality. The September FOMC minutes showed that the decision not to hike was not a close call, though some FOMC participants had described it as such.. At the same time, the ECB highlighted downside risks to euro area growth and inflation while the BoE also erred on the side of caution."
  • "We look for the ECB to announce further easing before year-end and have frontloaded our call for additional BoJ easing at its 30 October meeting."
  • "Strategically, we like being long USD heading into those central bank meetings."
  • "In line with this view, we maintains a short EUR/USD position in its portfolio from 1.1278, with a stop at 1.1562, and a targets at 1.0460."


So, Barclays is still keeping sell position with 1.0460 take profit and stop loss as 1.1562. And as we see from the chart above - the price is on bearish market condition for the secondary ranging within 1.0461 key support level and 1.1713 key resistance level, so 1.0460 may be the real bearish target at year-end for example.


 

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Sergey Golubev, 2015.10.13 08:57

EURUSD Intra-Day Fundamentals - ZEW Economic Sentiment (based on efxnews article)

Credit Agricole made a fundamental forecast concerning ZEW news event - German ZEW Economic Sentiment and ZEW Economic Sentiment. It's a leading indicator of economic health - investors and analysts are highly informed by virtue of their job, and changes in their sentiment can be an early signal of future economic activity:

  • "Investors will focus on the German the ZEW index for October. ZEW should point at some worsening in business sentiment on account of China, VW and, more recently, Deutsche Bank. We expect the former to be a longer-term drag on business sentiment in the Eurozone’s growth engine."
  • "Indeed, recent trade and industrial orders data has already signalled that the German exporters are struggling in the face of the global demand shock emanating from China."
  • "A disappointing ZEW today could add to the worries in the market. All that said, however, with the ECB still not actively considering more easing measures, there need not be an immediate impact on EUR."


From the technical point of view - EURUSD price is on bullish market condition in intra-day basis for the ranging within 1.1396 key resistance level and 1.1343 key support level. The 'reversal' level for this pair is 1.1270 so if the price breaks this support level from above to below - the reversal from the primary bullish to the primary bearish market condition may be started.

 

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Sergey Golubev, 2015.10.14 09:47

EURUSD Intra-Day Fundamentals - USD Into Retail Sales (based on efxnews article)

BNP Paribas made fundamental forecast concerning Retail Sales news event for today:

  • "They expect only a flat reading in total retail sales although the control group sales should come in at a more respectable pace of 0.3% m/m. They also expect softer producer prices ahead of what should be similarly soft headline CPI numbers on Thursday."
  • "That said, the September payrolls report and dovish Fed communications have already lead to an even further pullback in US rates, with the amount of priced in Fed tightening now in line with the most dovish FOMC policymakers."
  • "This, as well as lighter positioning, should make the USD less vulnerable to bad news."


From the technical points of view - the price is located to be above 200 period SMA and above 100 period SMA for the bullish breakout: the price broke key resistance levels in intra-day basis and stopped near 1.1469 level. If the price will break this 1.1469 resistance level from below to above so the bullish breakout will be continuing, otherwise - ranging bullish.


 

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Sergey Golubev, 2015.10.15 11:11

Outlooks For EUR/USD: Sell Signal - SEB (based on efxnews article)

Skandinaviska Enskilda Banken made a technical forecast for EUR/USD pair related to intra-day and day basis:

  • "The buyers continued to be in control pushing prices up close to the 1.15 handle. With 1.1476 achieved also the ideal target point for a three wave upside correction (from the early Sept low point), a-b-c, has been fulfilled. So if the past month and a half is a corrective climb, well then it should end right here and now."
  • "We are keeping a close eye on 1.1461 as its break kicks off an hourly sell signal and confirming an hourly RSI bear divergence."



Thus, SEB is estimating two key levels for this pair: 1.14 in intra-day base and 1.15 on long term situation. Anyway, the bearish AB=CD pattern was formed on W1 timeframe together with the bearish retracement pattern so we can expect more bearish situation with this pair in the few coming weeks for example.




 

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Sergey Golubev, 2015.10.16 09:35

3 reasons to sell EUR/USD - BNP Paribas (based on efxnews article)

BNP Paribas suggested to make a short with EUR/USD with 1.0900 target and 1.1630 stop loss, and it is based on 3 fundamental reasons:

  • "Further risk-on – Eurozone capital outflows resume and markets start to reprice Fed hikes = EURUSD lower."
  • "Stable risk – Without a strong impulse from risk sentiment, the eurozone’s trade surplus is probably still putting some natural upward pressure on EURUSD. But with valuations already expensive, EUR funding should be more attractive = no clear signal for EURUSD."
  • "Return of risk-off – EURUSD continues to rally, which forces the ECB to step up dovish rhetoric and ultimately ease policy = EURUSD first higher, then lower."


"We entered a short EUR/USD position with a target at 1.0900, and a stop at 1.1630."

 

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Sergey Golubev, 2015.10.18 18:35

EUR: outlook for the coming week by Morgan Stanley (based on efxnews article)

EUR: Bullish
"We believe that EURUSD could head higher before we see pushback from the ECB. Indeed, we don’t expect anything from next week’s meeting. Our base case is for no further easing, but in the tail risk that the central bank does decide to do more, this would be likely to come in December alongside the ECB’s new forecasts. With further action from the ECB unlikely in the near term, and US rates falling, EUR is becoming less attractive as a short term funder, offering it support."


From the technical point of view - the price is on primary bearish market condition for the ranging between the following key support/resistance levels:

  • 1.1956 resistance level, and
  • 1.0607 support level.

The price may start the bear market rally by the breaking 1.1459 and 1.1713 resistance levels from below to above, and we may see the local uptrend in this case only for example.


 

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Sergey Golubev, 2015.10.19 08:08

Trading The ECB: the most likely scenario, key levels and EUR/USD forecasts (based on efxnews article)

As ECB will take center stage this week so Barclays Capital made some fundamental and technical forecasts concerning EUR/USD.

Fundamental Forecast.

  • "An increasingly cautious Fed, coupled with an uncertain EM outlook, has benefited the EUR recently, contributing to tighter euro area financial conditions. Coupled with the recent drop in inflation expectations, such tightening has significantly raised expectations for additional ECB stimulus, making this week’s ECB meeting (Thursday) the market’s key focus."
  • "The most likely scenario, in our view, is a continuation of the dovish rhetoric, followed by the announcement of a QE time extension in December, when the ECB updates its Q4 15 staff economic forecasts."
  • "Moreover, recent price action in front-end euro rates suggests that the market is pricing a non-zero probability for a further deposit rate cut. While we do not rule out this possibility, we do not think it is an option for the next two meetings. However, we estimate that the rates market is already pricing a 20% likelihood of a 10bp deposit rate cut before year-end. In our view, a likely trigger for a rate cut would be a further material appreciation of the euro, possibly related to more signs that the Fed will remain on hold for longer. Although a measure of last resort, such policy action would be the most effective in weakening the EUR."
  • "We expect more monetary easing before year-end. We believe that the details and magnitude matter for the price action of the EUR, as an extension and increase in the QE program would probably have less of an effect than an outright cut in the deposit rate. We think that it is just a matter of time until the ECB decides to drive EURUSD lower."
  • "We believe that amid a lack of policy options, the ECB will step in in the months to come to try to fulfill its inflation mandate. As such, we expect further EUR downside. Our view should be supported by further USD strength, as monetary policy expectations in the US seem too benign compared with the healthy dynamics of internal demand in the US."


Technical Forecast.

  • "We recommend buying a 3m 25delta EURUSD risk-reversal (EUR put/USD call) for a cost of 13.2bp (strikes: 1.1004, 1.1737, spot ref: 1.1357, atm vol: 9.19%), which offers a compelling risk-reward should EURUSD break below its recent range."
  • "We maintain a short EUR/USD from 1.1278 targeting a move to 1.0460, with a stop at 1.1562."

 

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Sergey Golubev, 2015.10.21 06:27

Trading setup for EUR/USD by Barclays Capital (based on efxnews article)

Barclays Capital made a technical forecast for EUR/USD explaining their position opened with key targets:

  • "The move below 1.1335 encourages our bearish view. Our initial targets are near 1.1260. A move below 1.1260 would open our next targets in the 1.1105/1.1085 area."

So, they opened sell trade at 1.1335 with 1.1260 as an initial target having re-enter to 1.1105/1.1085 targets in case the price will move to below 1.1260. If we see from the chart above - there are the following targets for this pair:

  • 1.1086 as the nearest bearish target with 1.0807 and 1.0607 as the next bearish levels;
  • 1.1713 as the nearest bullish target with 1.1956 as the next bearish level.

Thus, if the price breaks 1.1086 support level from above to below so the next profit targets will be 1.0807, if the price breaks 1.1713 resistance level from below to above so profit level will be 1.1956.


 

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Sergey Golubev, 2015.10.22 09:13

EUR/USD - in view of ECB meeting (based on efxnews article)

United Overseas Bank made a fundamental forecast concerning ECB’s meeting later today:

  • "With daily MACD heading lower and with internal momentum showing signs of weakness, the bias appears to be greater on the downside. However, 1.1300 is a major support and this level has to break before a sustained down-move in EUR can be expected in the coming days."
  • "That said, the next support is not that far away at 1.1240 and being a cluster of supports, this is clearly a major level. The next significant support below 1.1240 is closer to 1.1085."
  • "Overall, a move to 1.1415/20 resistance will not be surprising but at this stage, 1.1460 appears to be strong enough to contain any EUR strength in the next couple of days."


As we see from the image above - the nearest support level is 1.1305 located on the border between the primary bearish and the primary bullish on the chart, and if this level is going to be broken so we may see the bearish reversal to be started by the daily price for example.


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