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Forex Analysis by LiteForex

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  • NZD/USD: updating local highs

    Current trend

    NZD is showing active gains against USD in today’s Asian trading, building on the weak "bullish" momentum it had formed the day before. The pair adds about 0.50% and is about to test the level of 0.7100 for a breakout.

    In addition to the weak positions of USD, the decision of the Reserve Bank of New Zealand (RBNZ) on the interest rate provides moderate support to NZD. As expected, the regulator did not change the parameters of monetary policy, maintaining the key interest rate at 0.25%. In the follow-up statement, the RBNZ Monetary Policy Committee noted the continued uncertainty in the global economy amid still strong epidemiological risks and existing restrictions on tourism and supply. At the same time, the regulator is very optimistic and its current forecasts for the development of economic activity in the country are not inferior to the February estimates.

    Support and resistance

    On the D1 chart Bollinger Bands are reversing into the ascending plane. The price range is expanding but it fails to conform to the surge of "bullish" activity at the moment. MACD indicator is growing preserving a stable buy signal (located above the signal line). Stochastic is showing similar dynamics; however, the indicator line is rapidly approaching its highs, indicating the risks of overbought NZD in the ultra-short term.

    Existing long positions should be kept until technical indicators are clarified.

    Resistance levels: 0.7100, 0.7150, 0.7200, 0.7250.
    Support levels: 0.7050, 0.7000, 0.6954, 0.6913.



    Comment


    • EUR/USD: vaccination in the EU is again in jeopardy

      Current trend

      EUR is strengthening against USD, trading at 1.1974, but the positive dynamics is mainly facilitated by weak USD.

      Vaccination problems continue in the EU. Following the AstraZeneca Plc., whose supply of the drug was disrupted, and some countries in the eurozone completely limited its use, it became known that the use of the Janssen vaccine from Johnson & Johnson Co. was also temporarily suspended because of the recently identified danger of thrombosis development. The European Medicines Agency is currently conducting analysis of the submitted samples, but there is no official conclusion yet, so a large batch of Janssen was sent to warehouses.

      USD continues to decline. The Chair of the US Fed, Jerome Powell, said yesterday that the regulator is considering the possibility of reducing the volume of purchases of government bonds, which is now USD 120B per month, and this will not be related to the course of monetary policy. In other words, the department will reduce purchases of bonds, but at the same time the key interest rate will remain unchanged. Investors were disappointed with this announcement, as the previous rise in USD was associated with hopes for a rate hike.

      Support and resistance

      On the global chart of the asset, the price continues trading within a wide descending channel. Technical indicators reversed and issued a buy signal. The fast Alligator indicator EMAs crossed the signal line from below, and the histogram of the AO oscillator moved to the purchase area.

      Resistance levels: 1.2035, 1.2325.
      Support levels: 1.1899, 1.1710.

      Comment


      • NZD/USD: NZD loses "bullish" momentum

        Current trend

        NZD is showing ambiguous dynamics during today's Asian session, consolidating near its local highs since March 22. The instrument is under pressure from technical factors, as in the last three trading sessions NZD has shown strong growth.

        Some support for the pair on Friday was provided by upbeat macroeconomic data from New Zealand and China. Business NZ PMI in March soared from 53.4 to 63.6 points, which turned out to be much better than the negative forecasts of a decline to 51.3 points. China supported the positive sentiment in the market, showing GDP growth in Q1 2021 by an impressive 18.3% YoY after increasing by 6.5% YoY in the previous quarter. However, forecasts assumed an increase of 18.9% YoY. On a quarterly basis, the Chinese economy continues to slow down: in Q1 2021, GDP grew by only 0.6% QoQ, with the forecast of an increase of 1.5% QoQ.

        Support and resistance

        Bollinger Bands in D1 chart show stable growth. The price range is expanding but it fails to conform to the development of "bullish" sentiments at the moment. MACD indicator is growing keeping a strong buy signal (located above the signal line). Stochastic has reached its highs and currently indicates the risks of a corrective decline in the ultra-short term.

        Resistance levels: 0.7200, 0.7250, 0.7305.
        Support levels: 0.7150, 0.7100, 0.7050, 0.7000.




        Comment


        • USD/JPY: USD demonstrates downtrend

          Current trend

          USD is declining against JPY this morning session, developing a fairly strong "bearish" trend in the short term and renewing local lows since March 24. USD expects the emergence of new drivers in the market, but for now it remains under the pressure of the declining yields of Treasury bonds.

          In turn, JPY is getting some support after the release of macroeconomic statistics from Japan on Monday. Japanese Exports went up by 16.1% YoY in March after the decline by 4.5% YoY in the previous month. Analysts had expected growth by 11.6% YoY only. Imports for the same period rose by 5.7% YoY, which turned out to be better than projected by 1.0%, but noticeably weaker than the dynamics of the previous month at the level of 11.8% YoY. Merchandise Trade Balance Total in March increased from JPY 215.9B to JPY 663.7B. Analysts predicted trade balance at JPY 490B.

          Support and resistance

          Bollinger Bands in D1 chart demonstrate active decrease. The price range narrows slightly from above, but still remains spacious enough for the current level of market activity. MACD is going down preserving a stable sell signal (located below the signal line). The indicator is about to test the zero level for a breakdown. Stochastic, having reached the zero level, reversed into a horizontal plane, signaling the risks of oversold USD in the ultra-short term.

          Resistance levels: 109.00, 109.37, 109.84, 110.23.
          Support levels: 108.54, 108.15, 107.78, 107.42.



          Comment


          • PayPal Holdings Inc.: wave analysis

            The price may grow.

            On the daily chart, the third wave of the higher level (3) develops, within which the wave 3 of (3) formed. Now, a downward correction has developed as the wave 4 of (3), and the development of the wave 5 of (3) has started, within which the wave iii of 5 of the lower level is forming. If the assumption is correct, the price will grow to the levels of 330.00–357.90. In this scenario, critical stop loss level is 226.40.



            Comment


            • Brent Crude Oil: the instrument develops "bearish" momentum

              Current trend

              Brent crude oil prices are showing a slight decline, developing the "bearish" momentum formed the day before and preparing to test 66.00 for a breakdown. The instrument's positions are under pressure from the alarming situation with the incidence of coronavirus in Asia, while interruptions in the supply of Libyan oil somewhat counterbalance the situation.

              The report of the American Petroleum Institute (API) on oil reserves released yesterday did not have a noticeable effect on the dynamics of the instrument. For the week ending April 16, published data showed a slight increase by 0.436M barrels after a decline of 3.608M barrels in the previous period.

              Today, investors are waiting for the statistics on crude oil stocks from the US EIA. Forecasts assume a further 2.86M barrels decline after a 5.889M barrels decline in the previous period.

              Support and resistance

              Bollinger Bands in D1 chart show weak growth. The price range is slightly expanded from above, remaining spacious enough for the current activity level in the market. MACD reversed downwards having formed a weak sell signal (located below the signal line). Stochastic is showing similar dynamics, retreating from its highs, indicating the overbought instrument in the ultra-short term.

              Current indicators do not contradict the further development of the "bearish" trend in the ultra-short term.

              Resistance levels: 67.00, 68.00, 69.00, 70.00.
              Support levels: 66.00, 65.00, 64.00, 63.00.



              Comment


              • American Express Co.: wave analysis

                The price may grow.

                On the daily chart, the fifth wave of the higher level (5) develops, within which the wave 3 of (5) forms. Now, the fifth wave of the lower level v of 3 is developing. If the assumption is correct, the price will grow to the levels of 160.00–170.00. In this scenario, critical stop loss level is 134.73.




                Comment


                • GBP/USD: the instrument shows uncertain growth

                  Current trend

                  GBP demonstrates weak growth in trading this morning session, recovering from the active decline the day before, which was caused by the emergence of positive macroeconomic statistics from the US, as well as the continuing long-term profit-taking by investors.

                  Markets were positively greeted by data on a decrease in the number of initial jobless claims for the week ending April 16 from 586K to 547K, which turned out to be much better than the negative forecast of growth to 617K. The number of continuing jobless claims fell from 3.708M to 3.674M, but the market was counting on a slightly larger decline to 3.667M.

                  Today, GBP is in anticipation of the publication of statistics on the UK Markit PMIs in the manufacturing and services sector for April.

                  Support and resistance

                  Bollinger Bands in D1 chart demonstrate flat dynamics. The price range is almost unchanged, but it remains rather spacious for the current level of activity in the market. MACD reversed downwards having formed a weak sell signal (located below the signal line). Stochastic shows a somewhat more confident decline, signaling the prospects for a downtrend in the nearest future.

                  Existing short positions should be kept until technical indicators are clarified.

                  Resistance levels: 1.3900, 1.3960, 1.4000.
                  Support levels: 1.3822, 1.3800, 1.3750, 1.3700.



                  Comment


                  • EUR/USD: updating February highs

                    Current trend

                    EUR is showing moderate gains against USD during today's Asian session, continuing its Friday rally and renewing local highs since February 26.

                    A noticeable support for EUR at the end of the last trading week was provided by the optimistic macroeconomic statistics from the eurozone. Markit Manufacturing PMI in April rose from 62.5 to 63.3 points with a forecast of a decline to 62 points. Composite PMI for the same period rose from 53.2 to 53.7 points, which also turned out to be better than expectations at 52.8 points. For the first time in a long time, Services PMI managed to consolidate above the psychological level of 50 points: in April, the indicator rose from 49.6 to 50.3 points, contrary to forecasts of a fall to 49.1 points.

                    Today, investors are focused on the publication of data from the IFO on the level of business optimism in Germany in April. In addition, during the day, the markets expect speeches by representatives of the European Central Bank Fabio Panetta and Philip Lane.

                    Support and resistance

                    Bollinger Bands in D1 chart show stable growth. The price range expands slightly, freeing a path to new local highs for the "bulls". MACD indicator is growing preserving a stable buy signal (located above the signal line). Stochastic, after a short decline, reverses upwards, signaling strongly overbought EUR in the ultra-short term.

                    Resistance levels: 1.2150, 1.2200, 1.2234, 1.2271.
                    Support levels: 1.2078, 1.2000, 1.1950, 1.1900.




                    Comment


                    • Nvidia Corp.: wave analysis

                      The price may grow.

                      On the daily chart, the upward third wave of the higher level (3) develops, within which the wave 3 of (3) formed. Now, a local correction has developed as the fourth wave 4 of (3), and the formation of the wave 5 of (3) has started, within which the first wave of the lower level i of 5 is developing. If the assumption is correct, the price will grow to the levels of 700.00–750.00. In this scenario, critical stop loss level is 547.76.




                      Comment


                      • Mastercard Inc.: wave analysis

                        The price may grow.

                        On the daily chart, the fifth wave of the higher level (5) develops, within which the wave 1 of (5) formed, and a local correction developed as the second wave 2 of (5). Now, the third wave 3 of (5) is forming, within which the wave of the lower level iii of 3 is developing. If the assumption is correct, the price will grow to the levels of 450.00–500.00. In this scenario, critical stop loss level is 355.08.



                        Comment


                        • Alibaba Group Holdings Ltd.: wave analysis

                          The price may grow.

                          On the daily chart, the upward fifth wave of the higher level (5) develops, within which a downward correction ended as the fourth wave 4 of (5). Now, the development of the fifth wave of the lower level 5 of (5) has started, within which the wave i of 5 has formed, a local correction has developed as the wave ii of 5, and the formation of the wave iii of 5 has started. If the assumption is correct, the price will grow to the levels of 299.84–318.84. In this scenario, critical stop loss level is 220.97.




                          Comment


                          • Microsoft Corp.: wave analysis

                            The price is in a correction and may grow.

                            On the daily chart, the fifth wave of the higher level (5) of 3 develops, within which the wave 3 of (5) forms. Now, the third wave of the lower level iii of 3 has developed, and a local correction is forming as the fourth wave iv of 3. If the assumption is correct, the price will grow to the levels of 285.00–300.00. In this scenario, critical stop loss level is 231.09.



                            Comment


                            • Bank of America Corp.: wave analysis

                              The price may grow.

                              On the daily chart, the third wave of the higher level (3) forms, within which the wave 3 of (3) developed. Now, a local correction has formed as the fourth wave 4 of (3), and the development of the wave 5 of (3) has started. If the assumption is correct, the price will grow to the levels of 44.50–47.00. In this scenario, critical stop loss level is 37.66.




                              Comment


                              • EUR/USD: EUR quotes remain under pressure

                                Current trend

                                EUR shows a slight increase against USD during today's Asian session, correcting after yesterday's decline, which led to the renewal of local lows of April 22.

                                USD retains its previous growth momentum, which was formed at the end of last week, receiving additional support after the speech of the US Treasury Secretary Janet Yellen, who did not rule out the possibility of an early rate hike in order to avoid overheating the American economy, which is demonstrating impressive growth rates. Investors are also optimistic about news of the gradual reopening of the US states against the backdrop of an active vaccination campaign and a general stabilization of the epidemiological situation.

                                Market participants are focused on statistics on business activity in the services and manufacturing sectors of the eurozone from Markit. In addition, a speech by the European Central Bank representative Philip Lane is expected, who may hint on tightening monetary policy in the region.

                                Support and resistance

                                In the D1 chart, Bollinger Bands are reversing horizontally. The price range is narrowing, reflecting the emergence of ambiguous dynamics of trading in the short term. MACD is going down preserving a stable sell signal (located below the signal line). Stochastic, having approached its lows, is trying to reverse upwards, indicating the risks of oversold EUR in the ultra-short term.

                                To open new positions, it is necessary to wait for the trade signals to become clear.

                                Resistance levels: 1.2037, 1.2087, 1.2148, 1.2200.
                                Support levels: 1.2000, 1.1945, 1.1900, 1.1850.



                                Comment

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