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Forex Markets Wobble on Italy CrisisThe forex markets waggled after Italy Deputy Prime Minister Matteo Salvini called for a snap election. Salvini urged the prime minister to reconvene parliament to back his claim that the coalition government is no longer solid. The EURUSD pair clocked in some losses after the news broke out. Additionally, stocks and bond markets in the EU zone reacted more furiously. Traders sold off Italian assets swiftly. Italy’s political tensions resulted to wider yield spread between German and Italian bonds. This isn’t welcome news for the common currency, which has already been suffering pressure. Meanwhile, traders are also becoming increasingly dovish. They are betting that the European Central Bank could implement a more aggressive September rate cut, increasing dovish expectations. As of writing, there is a 27% probability of a 20-basis-point cut in ECB’s deposit facility rate. That’s way higher than the previous 12% probability. Snap Elections, Forex Markets to Recover? Salvini’s call for snap election is quite obviously a move to solidify his power. He heads the right-wing popular Lega party. According to Salvini, the failure of the Five Star Movement’s attempt to derail plans for a high-speed rail link was evidence the coalition couldn’t govern. He said Italian needed “certainty,” with a government that “does things, not a ‘Mr. No.’” Salvini is enjoying massive support from opinion polls, being a populist and mainly because of his stance against illegal immigration. The forex markets will probably get over the fiasco speedily, with the euro likely getting back some of its losses. The euro zone also absorbed the French industrial production data for June. The data could be consistent with the dismal pattern in Germany. The dollar index that gauges the buck’s strength against the other currencies barely moved. US President Donald Trump once again lashed out on Twitter against the Federal Reserve. However, it didn’t have much effect on the markets, which recovered quite easily and with barely an inconvenience.
by Financebroker
EURUSD - Short Post FED 1.09 next targetWe have been short EURUSD for a while and yesterday's FED meeting where Powell announced a 25bps rate cut but indicated there would be no further cuts led to EURUSD dropping from 1.116 to 1.104. This is because the EU is looking to cut rates and embark on quantitative easing due to the weakness in the Eurozone economy. Therefore we are holding our short position and now expect the currency pair to hit levels not seen since 2017 below 1.05 in the coming months. However, we will start taking profit from 1.09 as we await further developments in particular US data releases starting with ISM manufacturing today and non farm payrolls tomorrow.
Short
by KQMarkets
The Fed, the Banks of Japan and EnglandAt the last meeting, the Governing Council of the European Central Bank (ECB) decided that the interest rate remain unchanged. Also, Mario Draghi said that officials had not discussed the rate cut. Accordingly, the euro has a good chance this week to rebound from the medium-term range lowest level. In this regard, our position on the euro - we buy primarily against the dollar. Boris Johnson Became U.K. Prime Minister, Replacing Theresa May. Markets are frankly afraid of Johnson because of his aggressive position on Brexit. As a result, the pound is under strong downward pressure. But again, it is so far underwater right now given that there are no real reasons for this - market expectations are based on fears and rumours, not facts. We believe that common sense will eventually win and bet on the pound growth. Therefore, we recommend its purchase. The data on the US GDP for the second quarter will be published today. GDP probably expanded 1.8% in the second quarter, down from 3.1%. If the growth is 2.2-2.5%, then the dollar, perhaps, is not in danger until Wednesday. But if 1.8%, it cannot avoid sales. This will be the main event not only of the week but of the summer. Wednesday may well lay the foundation for a dollar downtrend in upcoming months or even years. We are still waiting for the Central Banks of Japan and England meetings, as well as the Eurozone GDP outcome and the US labor market data to come out. In general, it will not be boring. Our trading recommendations for the week are as follows. We will continue to look for opportunities for selling the dollar across the entire spectrum of the foreign exchange market, buying the pound against the dollar as well as against the euro, selling oil and the Russian ruble, and also buying the Japanese yen against the dollar. As for gold, in the oversold we buy and in the overbought area we sell gold.
Long
by Trade24Fx
Prepare for US GDP, ECB results and Fear IndexAt yesterdays' meeting, the Governing Council of the European Central Bank (ECB) decided that the interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will remain unchanged at 0.00%, 0.25% and -0.40% respectively. Nevertheless, the comments from the Central Bank turned out to be very dovish, opening the way to further monetary easing in September. For the euro, of course, this is not a positive sign. However, we do not throw the euro under a bus yet, because next week’s meeting of the Federal Reserve will likely mark the beginning of a prolonged period of lower interest rates, in our opinion, this event is more important than words about future easing (in the battle of facts with expectations, we will give preference to facts). Also, the euro is supported by the head of the European Central Bank, Mario Draghi, who said that officials had not discussed the rate cut. Our position is unchanged - we buy EURUSD with current price with stops lower than 1.11. The data on the US GDP for the second quarter will be published today. GDP probably expanded 1.8% in the second quarter, down from 3.1%. If the growth is 2.2-2.5%, then the dollar, perhaps, is not in danger until Wednesday. But if 1.8%, it cannot avoid sales. So, dollar current price seems to us extremely attractive for its sales. Meanwhile, the VIX Index ( it is also known by other names like "Fear Gauge" or "Fear Index) dropped to Multi-Year Lows. That is, traders and investors have calmed down. That calls into the question the safe-haven assets growth demand and explains yesterday's weakness of the yen and gold. Given then the level of volatility in gold has increased, we prefer to trade with the Japanese yen. Its purchase against the dollar is still relevant for us. Our trading recommendations for today: We will continue to look for opportunities for selling the dollar across the foreign exchange market entire spectrum, buying the pound against the dollar as well as against the euro, selling oil and the Russian ruble, and also buying the Japanese yen against the dollar. As for gold, in the oversold we buy and in the overbought area we sell gold.
Long
by Trade24Fx
Main Eur/Usd Analysis The price touched the support area set at 1.112 with a post-conference Draghi spike. Causing the stop loss closing on our trade. After it return immediately to the closing level of yesterday's session . Technically, this pair is in a stalemate taking the last six months as a time reference. In fact, the trend has no longer taken a specific direction, continuing to move between the support at 1,112 and the resistance at 1,144. If a time frame of a year and a half is taken into consideration the direction of EURUSD tends to fall. And now we do not see changes of scenery. For the next year and a half we expect the main trend to be maintained and that as final target the area 1.08/1.06 can be reached. This with minor cycles which could also lead to significant bounces. A new cycle should start with the next FED meeting at the end of July. Despite the spike a few hours ago that caused a false break in the support area, we expect a drop in the US currency for the rest of the summer. The objective is the upward break in the resistance zone at 1,144. The maximum extension of this first mini-cycle could be around 1,158. This level is identified by the EMA200 weekly which acts as a dynamic resistance of extreme importance for the short term. Fundamental Analysis At a fundamental level, the scenario that is taking shape is the following. Draghi stated that expectations on future rates are not the best. In fact, it expects that rates could remain unchanged (or even cut) for at least another year. In addition we could see a second edition of quantitative easing. The government bond purchase program, is being studied in Frankfurt. These statements, once implemented, will negatively weigh for the Euro, which will devalue against the other majors. So for the next year and a half, as we said, we expect a continuation of the main trend on this pair. On the other hand, however, on the Fed side, the devaluation of its currency should, make EURUSD carry out this bullish mini-cycle. The market and investors expect at least two cuts of a quarter of a point by the end of the year. To summarize We expect a climb in the very short/short term. Eur/Usd is ready for the bounce and we recommend repositioning long with the final target of the 1,158 (intermediate targets 1,132; 1,144). Stop at 1.103
Long
by BFCMInvest
Dax daily: 26 Jul 2019 Yesterday's session started by the gap closure, just as we pinpointed. The resistance at 12 576 was retested twice and then the price action was dominated by fundamentals. The ECB President Mario Draghi hinted a possible rate cut into negative values to tackle Eurozone's economic stagnation. This scepticism influenced the German stock index DAX as well and we saw this reflected by a prudent downfall by more than 250 points. The session was closed at 12 344. Important zones Resistance: 12 437, 12 470 Support: 12 338 Statistics for today Detailed statistics in the Statistical Application The statistical probability of closing the gap is only 38% Macroeconomic releases 14:30 CEST - USA - Advance GDP q/q Today's session hypothesis Yesterday's volatile activity has dramatically reduced our estimations and today's hypothesis. The moves were caused by fundamental news. The statistical application signifies the gap closure probability of only 38%, yet the price around 12 338 became a balanced consensus for market participants. That's one reason this zone could be retested today as well. Besides, we have enough room for the long correction all the way towards 12 437.
EUREX:FDAX1!
by FTMO
Pound losses set for recoveryFollowing ECB's decision to keep rates on hold and President Draghi's comments aimed at giving confidence to the Eurozone, the common currency saw a sharp rise. However the pair price has now reached a point of saturation near 0.8955 which was previously a support level. The pound, although under Brexit-related pressures, is likely to push the price down to 0.8940. That level can be followed by 0.8920. In the case of further rise though, 0.8970 close to the lower band of the ascending channel will provide resistance.
Short
by LimitMarkets
Johnson and Pound, ECB and Euro, US and ChinaBoris Johnson becomes the UK's new prime minister and, made his first statement. Despite the apocalyptic forecasts, we could observe a pound growth on Wednesday. Once again, chances that Johnson will have enough support to implement the no-deal Brexit are extremely low. An agreement with the EU or a general referendum is more likely to happen. In any case, until October 31, it’s not necessary to expect “exit without a deal”. And this means that buying pounds with current prices is a safe enough trading strategy, that could provide more than a solid income with minimal risks. So our recommendation is unchanged - we are looking for points for pound purchases across the foreign exchange market entire spectrum. Speaking of the euro. Perhaps, he is today the “prospective candidate” for sales against the pound, as well as it is quite possible to buy it against the dollar. Markets cautious with that fact that today the ECB may start to reverse the easing of policy, therefore the euro is trading at the very bottom of the medium-term range. We do not think that it would happen. The ECB is quite a conservative Central Bank. It would rather wait for the Fed to lower the rate, obtain additional economic data, update its economic forecasts, and just after that n begin to act at the beginning of September may be, but not now. So its purchases against the dollar seem like a good trading idea. We are actively buying EURUSD - the risk/reward balance is too enticing: with stops 40-50 points with a potential profit 200 points. Stops must be put up necessarily, because the Eurozone economy is in a bad form, and theoretically could provoke the ECB to act. Yesterday's data on the EU economic loco - in Germany came out weak. The PMI index in the production sector was only 43.1 (with the forecast was 45.2). the minimum level over the last 7 years (!). The PMI index in the Eurozone manufacturing sector also came out below 50 and again worse than forecasts. Unexpectedly the data on new homes sales in the USA came out quite positive( which grew by 7.0% to 646,000 (expected + 5.1%)). However, we will not revise our position on the dollar and continue to look for points for its sales. Meanwhile, the US and China are trying to get on well. On Monday, the US delegation is going to China to find a compromise. There is still no progress in the negotiation process, the IMF lowered forecasts for the growth of the world economy, again. Forecasts in connection with the slow-down in growth of the world economy. was reduced by 0.1% to 3.2% and 3.5% for 2910 and 2020. So, purchases of the Japanese yen continue to be relevant. Our trading recommendations for today: we will continue to look for opportunities for selling the dollar across the entire spectrum of the foreign exchange market, buying the pound against the dollar as well as against the euro, selling oil and the Russian ruble, and also buying the Japanese yen against the dollar. As for gold, buy it from oversold and sell in the overbought zone.
Long
by Trade24Fx
EURUSD near multi-month lows ahead of ECBThe US dollar strengthened against the euro this week as markets assess the likelihood of an ECB rate cut. We've already locked some profits of the earlier bull-move in our Trading Club and closed the remaining position until the dust in the market settles. Bear in mind that, although the Fed took a dovish stance, there is an important difference between the position of the Fed and the ECB. While the Fed wants to cut rates to move the US dollar lower, the US economy is still pretty strong unlike the European economy, particularly Germany. The EURUSD pair triggered a H&S pattern that projects a profit target around the 1.10 level, and the pair is already near multi-month and multi-year lows. A dovish ECB may send the pair below 1.11 and trigger a cluster of stop orders, in which case the 1.10 level will act as a magnet. Like our analysis? Please hit the "LIKE" button to support us. Thanks!
by MujkanovicFX
ECB PreviewEURGBP, Daily The risk of a surprise from the ECB has risen after yesterday’s round of weak PMI numbers,¹ which not only highlighted that the German manufacturing sector is sliding deeper into recession, but also that the fallout from global trade tensions and rising risks of a no-deal Brexit scenario is not limited to Germany. Today’s Ifo reading is unlikely to be much better and the doves at the ECB will likely push for a quick move. There ARE good reasons for Draghi to wait until September, when not only the next round of forecasts will be due, but also the outlook on the Brexit front should have become a bit clearer. Most importantly perhaps, the Fed cutting rates as expected next week would likely see markets expecting another follow up move from the ECB, although the doves countering that and easing measures from both the Eurozone and the US ahead of the summer lull in August should help market sentiment to stabilise. Ultimately a 10 bp cut from the ECB will not make much of a difference in real terms and the main merit for many will lie in the signalling effect. With that in mind Draghi will have to deliver a very dovish presser today to keep investors happy and a cut without a signal that there is more to come could have a more negative impact on markets than a very clear signal that the ECB is readying a comprehensive set of measures for September. However, Draghi & Co. have been bold before, so it would be unwise to rule anything out. The Euro continues to trade softer ahead of the Rate Announcement at 11:45 GMT and the Press conference 45 minutes later. Even EURGBP broke below the key 20-day moving average yesterday, to end 52 consecutive trading days above this important baseline. We will be LIVE on our main Facebook page from 11:30 GMT for analysis of the key event
Short
by HotForex
1
EURUSD - Short long term - Key data this weekOn our analysis on the 02.07 we were short EURUSD after a strong payroll and have since taken profit as the currency pair fell below 1.12. We are still short and long term we expected EURUSD to keep falling and believe it could fall to multi years lows below 1.08 by the end of 2019. This week could bring a significant amount of movement in the currency pair with the ECB on Thursday which could provide clues as to future EU monetary policy with Draghi to comment on potential rate cuts and further quantitative easing. Additionally US GDP data released Friday could impact the odds of a US rate cut and how aggressive the FED are in cutting rates. Therefore we hold our short position and will look for EURUSD to break 1.11 before taking further profit.
Short
by KQMarkets
ECB - Could the Euro's dive continue?By Andria Pichidi - July 23, 2019 All eyes will be on the ECB on Thursday with Draghi and Co set to confirm that the central bank is heading for additional easing measures as global growth slows down while global trade tensions escalate. First quarter Eurozone GDP numbers came in stronger than expected, but were boosted by special factors including stock building ahead of the original Brexit deadline, as well as the later timing of Easter this year. Data since then suggests a marked slowdown in the second quarter and forward looking surveys leave the balance of risks firmly tilted to the downside. The above along with geopolitical trade tensions and ongoing Brexit uncertainty are weighing on confidence and adding to pressure on the ECB to ease policy again. Some council members would likely want the central bank to cut rates now and this clearly is a “live” meeting with a non-negligible risk that the central bank lowers rates by 10 bp. However, if the ECB moves ahead of the Fed, the impact of the dovish signal would likely evaporate quickly if the central bank doesn’t follow up the Fed’s likely move at the end of July with yet another cut. Against that background we see a somewhat greater chance, however, that the central bank will wait for September for the great reveal of a package of measures, that will likely include a rate cut as well as a mechanism to limit the impact of the negative deposit rate. This could involve setting an additional reserve “allowance” above the required reserves. Source stories this month also suggested that the central bank is considering moving to a symmetrical inflation target rather than the current “upper limit”, which if set at 2% would create more room for temporary inflation overshoots over time, but mainly have a signaling effect at the current juncture. In practice this may not change much as inflation has already been allowed to rise above the medium term limit but it will send a message that many believe will help to anchor inflation expectations. Officials are also looking into ways to expand the room for QE purchases and how to limit the impact of further cuts in the deposit rate, which already stands at -0.40%. Unless things change decisively the central bank is expected to cut rates by 10 bp at the September meeting and a tiering of the deposit rate, where at least part of banks’ deposit with the ECB get preferential treatment and won’t face even higher “penalties” seems also under discussion, even if ECB studies suggest that the impact of negative rates on bank profits has been limited so far. What about EURO? Away from the economic side of things, EURUSD established a bearish outlook after coming off from a bullish June, and as it headed today a southwards move below the key Support level at 1.1180 (June 18 low and Neckline of Head and Shoulders formation pattern). Hence, as market has retained a more circumspect view of Fed easing potential and as ECB is heading in the direction of the stimulus spigot, the move below 1.1180 today considered to be crucial, as it confirms the bearish view from technical perspective as well rather only from fundamental. The breakout of bearish head and shoulders neckline for the first time, turns our attention towards second quarter of 2019 low area, at 1.1115-1.1135 area, with short term Support at 1.1159 (June’s low) and Resistance at 1.1210-1.1220. Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
Short
by HotForex
1
Preparing for ECB and UK Prime MinisterTrump said Thursday that a U.S. Navy ship had destroyed an Iranian drone in a “defensive action,” escalating already high tensions in the Gulf region. On the next day, Iran dismissed the report. So, investors’ reaction was expressed by rescuing in safe heaven assets and it is understandable. Later, the gold price was correlated with a decrease in the gold price. By the way, on Friday we recommended to sell gold, so those of our readers who followed our recommendation had to earn good money. We have already recommended selling the oil (see our previous reviews) so, those of our readers had a chance to earn good money by selling oil (one of our main trading recommendation). So this week we continue to look for the opportunity to sell the asset, but be careful it is all about the unstable situation. There was a lot of talk about a possible dollar intervention last week. It hadn't got to that part yet but the risk should be disregarded. The easiest and risk-free option to trade in such case is a short dollar. Moreover, at the end of the week, we are waiting for the outcome on US GDP. So this week we will continue to look for points to open short positions on the dollar. Primarily against the Japanese yen and the British pound. This week (on July 24th ) a new prime minister should appear in the UK. Odds are about 100% that Boris Johnson is going to be. In this regard, attention to Brexit among participants of the foreign exchange market is increased sharply, which means pound volatility will increase significantly. Our midterm position - short-pound. But let us warn you, some days it is quite possible the pound could be sold out quite tough. Nevertheless, we do not doubt the final outlook for its growth. We will buy a pound not only against the dollar but also against the euro. And against the euro, this can be done in double volumes. EURGBP has climbed very high, and its decline seems to us the most likely scenario. The reason for its sales may be the outcome of the ECB meeting, which will be announced this week on Thursday. If the Central Bank gives us a hint to easing monetary policy, sales in EURGBP cannot be avoided. So we took a medium-term short position in EURGBP and look forward to a jackpot.
Short
by Trade24Fx
Why I am going short on EURAUDEURAUD has reached to one of its strongest resistance zone. In the past few years price fell down sharply after reaching this point in several occasions. Now again market is in this area. If you look at the oscillators like RSI, MACD, Stochastic on the chart to measure the energy of the market, you see divergences and RSI overbought which all means market doesn't have enough energy to break this resistance zone. Based on price action and the Japaneese Candle Stick patterns we can easily see a few small candles has been shaped on that area which is showing buyers are not very strong to push the price higher. The last candle for yesterday is a kind of high test bar which has a long leg on its top and then a long red body indicated the pressure from sellers. As you see this candle went below the low's of its previous candle which is another selling signal. Based on Elliot Waves we had an ABC correction when priced came down from this zone last time ( From Jan 2019 to mid Apr). After than a new set of 5 waves completed. If you test the idea with Fibonacci it confirms the 5 impulse waves are counted correctly. From the fundamental analysis point of view, Mario Draghi said ECB could cut interest rates again or provide further asset purchases if inflation doesn't reach its target. He admits the only option to increase the rate is when inflation goes much higher than the target. So this sounds like a sell signal or at least not supporting a bullish rally for EUR anymore. These are just a couple of signals we have to go short on EURAUD. The other possible scenario is EUR breaking this area upward which means our forecast failed, we change the position direction and get ready for a long position then, but we don't want to put much emphasis on this scenario as it is not really high probability.
Short
by hugh_me
EURCHF Likely To Fall Further After Support & Trendline Break!Oh make no mistake, technically most of the EUR related are starting to show a strong bearish pattern . EURUSD could tumble to 1.09000 level in the coming months even on the back of a weaker USD!. The above link is shows the analysis behind the EURNZD which has a potential to drop . However since many central banks are shifting towards easing, typically in this scenario fundamentally makes the SAFEHAVEN FX currencies perform the best. CHF being one of the SAFEHAVEN alongside the JPY in my view would be best performers against the EUR in the coming months! Have a look at the main chart weekly TF chart of the EURCHF. The horizontal lines are concrete support and resistance taken from the monthly TF. At the moment i am awaiting the monthly candle to close beneath the orange support located at 1.11000 level for added confluence. Furthermore, we have a long term trendline which has been violated on a weekly TF, for added confirmation that is why its advisable to wait for the monthly candle to close below orange line. This would confirm the broken support turned resistance and channel has been officially broken! The next support lies at 1.06000 level, where the price could potentially head towards. This seems like a big PIP move but if you look at the fundamental factors, we are seeing the ECB shifting their monetary policy to accommodate the changes which would likely result in EURO depreciation over long term. I am seeing the monthly would close comfortably beneath the support by the end of this month and then its advisable to execute the trade SHORT with the target of 1.06000 and RR of 1:1. This just represent my analysis on this pair and i feel this a high probability trade setup in play. shall there be any trade entries i would post them in a new post.
Short
by FX618Analysis
Ascending Channel+H&S Pattern In Favor Of EURNZD Bears! Have a look at the main weekly TF chart of EURNZD pair. From here its clearly visible that the price is confined in an ascending channel which has been held on numerous occasions. However at the moment the price seems to be too aggressive to the downside and has potentially violated the channel pending today's weekly candle close! The four horizontal red lines represent solid support and resistance levels taken from the monthly TF. Just below the trendline there lies a psychological 1.65000 support level , which in this case is a must to be broken level in order to confirm a bearish outlook. For this level to be broken i would personally prefer the monthly candle to close below 1.65000 level . Furthermore, there is an almost complete H & S pattern on the chart , which would be complete when the trendline/channel breaks together with the 1.65000 level. In this case the potential 1.65000 turned resistance would also act as the neckline of the H & S . So to put all this together in favor of the bears there 3 concrete confluence factors to take this pair towards the next support that is present at 1.58000! Fundamentally the Euro is weak at the moment and is predicted to get weak in the coming months, whereas the NZD shows a mixed outlook. So putting all this together the probability of this pair breaking down is HIGH. Shall there be any updates regarding the trade entries i will post them in a new post. This just represents my outlook on this current pair
Short
by FX618Analysis