EURUSD Technical Highlights:
- Euro seeing limited sponsorship around important support
- Change in character from before may be sign of momentum to come
Euro seeing limited sponsorship around important support
Heading into last Monday, given the way the Euro has traded in recent months in this low volatility environment, the expectation was for a bounce from support instead of slicing on through. The bounce on Tuesday started to look like other prior lows in recent months, but the final days of the week began to demonstrate a change in characterThe fact that EURUSD is struggling to bounce after selling off and hitting support suggests that sellers are growing in number and that a breakdown of meaning could be just around the bend. As long as price on a closing basis stays below the weekly high at 11341, a neutral bias at the least will be intact.
A drop below 11215, the November low, will leave behind the support we saw hold last week and have the worst levels since June 2017 in play. As discussed on numerous occasions in recent weeks, Euro volatility is very low and due for a pop. A break of key support levels may do the trick in the days ahead.
If the November low breaks, next up is support by way of 11119 and the underside trend-line from November 2017. This could certainly quash any excitement of real momentum coming in, but if that can't hold along then there isn't much in the way of visible support for a good way lower.
All-in-all, price action is showing signs of changing from the recent norm, which should have traders on higher-than-normal alert for momentum to develop. It could be another false signal, but then again it might not, and as the saying goes, 'chance favors the prepared mind.'
Traders are long EURUSD by a good amount, see the IG Client Sentiment page to find out how changes in positioning can act as a signal for price direction.
EURUSD Daily Chart (Breakdown could be very near)
Helpful Resources for Forex Traders
Whether you are a new or experienced trader, we have several resources available to help you; indicator for tracking trader sentiment, quarterly trading forecasts, analytical and educational webinars held daily, trading guides to help you improve trading performance, and one specifically for those who are new to forex.
---Written by Paul Robinson, Market Analyst
You can follow Paul on Twitter at@PaulRobinsonFX
Other Weekly Technical Forecast:
Australian Dollar Forecast – AUD/USD Eyes Resistance, AUD/NZD Resumes Fall, GBP/AUD May Bounce
Oil Forecast – The 2019 Crude Bull Market Has Arrived
British Pound Forecast – GBPUSD & EURGBP
US Dollar Forecast – Dollar Within Reach of Two-Year High but Reversal Pressure High
Gold Forecast – Gold Prices Stopped Short of Resuming Dominant Uptrend, Watch RSI
Source link
Gold Talking Points
Gold quickly approaches the 2019-high ($1326) as fresh data prints coming out of the U.S. economy dampen bets for a Federal Reserve rate-hike, and the Federal Open Market Committee (FOMC) Minutes may continue to shake up the near-term outlook for bullion as a bull-flag formation appears to be panning out.
Fundamental Forecast for Gold: Bullish
Gold breaks out of a narrow range as the 1.2% drop in U.S. Retail Sales along with the unexpected contraction in Industrial Production curbs the FOMC's scope to implement higher interest rates, and it seems as though the central bank will continue to change its tune over the coming months amid the weakening outlook for growth and inflation.
After accounting for the dismal data prints, the Atlanta Fed's 'GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the fourth quarter of 2018 is 1.5 percent on February 14, down from 2.7 percent on February 6,' and signs of a more meaningful slowdown may continue to drag on interest-rate expectations as a growing number of Fed officials endorse a wait-and-see approach for monetary policy.
At the same time, the Fed appears to be on track to taper the $50B/month in quantitative tightening (QT) as Governor Lael Brainard indicates that the 'balance-sheet normalization process probably should come to an end later this year,' and it seems as though there's a growing consensus at the central bank to conclude the normalization cycle ahead of schedule amid the 'cross-currents' surrounding the economic outlook.
Looking for a technical perspective on Gold? Check out the Weekly Gold Technical Forecast.
In turn, market participants may pay increased attention to the FOMC Minutes amid the material change in central bank rhetoric, and a further shift in the forward-guidance may heighten the appeal of gold especially as Fed Fund Futures shows the central bank on hold throughout 2019. With that said, gold may continue to exhibit a bullish behavior over the coming days, with the topside targets on the radar as the price and the Relative Strength Index (RSI)continue to track the upward trends from late-2018.Sign up and join DailyFX Currency Analyst David Song LIVE for an opportunity to discuss potential trade setups.
Gold Daily Chart
Gold appears to be on its way to test the 2019-high ($1326) as the former-resistance zone around $1298 (23.6% retracement) to $1302 (50% retracement) offers support, with the RSI highlighting a similar dynamic as it responds to trendline support. In turn, the $1328 (50% expansion) hurdle is back on the radar, with a break/close above the stated region opening up the $1340 (61.8% expansion) area.
Additional Trading Resources
Are you looking to improve your trading approach? Review the 'Traits of a Successful Trader' series on how to effectively use leverage along with other best practices that any trader can follow.
Want to know what other markets the DailyFX team is watching? Download and review the Top Trading Opportunities for 2019.
--- Written by David Song, Currency Analyst
Follow me on Twitter at @DavidJSong.
Other Weekly Fundamental Forecast:
Source link
Gold Technical Forecast: Neutral
- Gold prices made attempt to breach immediate resistance towards the end of last week
- XAU/USD fell short of resuming dominant uptrend, reinforcing 1323.60 as resistance
- Watch for fading upside momentum, may place gains at risk. Support at 1302.97 eyed
Find out what the #1 mistake that traders make is and how you can fix it!
Aside from a small push higher towards the end of this past week, gold prices remained in congestion mode after topping around 1323.60. Gold's pause under this area occurred with fading upside momentum via negative RSI divergence. The rising trend line from November 2018 held alongside support at 1302.97 (the March 1, 2018 low). Prices were unable to breach 1323.60, further reinforcing it as immediate resistance.
Keep a close eye on RSI next week as XAU/USD may attempt another push above resistance. Fading upside momentum may remerge, undermining progress higher that the anti-fiat commodity may make. A push in that direction exposes the November 9, 2016 high at 1337.34. Ascending through it then exposes a range of resistance between 1357 – 1366.
Meanwhile, near-term support remains the rising support line from November. A descent through it exposes 1295.46 which is former resistance from 2017. Should this area be cleared, the next area of support may halt gold's descent around 1260.80 which is the October 2017 low.Taking all of this into consideration, the gold weekly technical outlook appears to be neutral.
Looking for a fundamental perspective on Gold? Check out the Weekly Gold Fundamental Forecast. Gold Daily Chart
Charts created in TradingView
FX Trading Resources
--- Written by Daniel Dubrovsky, Junior Currency Analyst for DailyFX.comTo contact Daniel, use the comments section below or @ddubrovskyFX on Twitter
Other Weekly Technical Forecast:
Australian Dollar Forecast – AUD/USD Eyes Resistance, AUD/NZD Resumes Fall, GBP/AUD May BounceOil Forecast – The 2019 Crude Bull Market Has Arrived
British Pound Forecast – GBPUSD & EURGBP
US Dollar Forecast – Dollar Within Reach of Two-Year High but Reversal Pressure High
Source link
Chart Prepared by Jamie Saettele, CMT
DailyFX Trading Guides and Forecasts
-The last update remarked that "crude is crashing. The 200 day average is right here but the trendline is just above 47. If that doesn't hold, then 37 (61.8% of rally from February 2016 and August 2015 low) is probably in the cards." Low thus far is 47.07 so if crude isn't going to spill then it needs to turn up now. A close back above the 200 day average would be a positive sign (a la what happened in August and November).
Source link
No longer interested email from Forex News 24?. Please click here to unsubscribe
