welcome to our weekly forex market analysis call and this is in preparation
for trading on or for the week of May 29th to June the 1st 2018 just a quick
disclaimer before we get started this is for educational purposes only and is not
intended to be individual investment advice and if you need individual
investment advice I recommend you talk to your investment advisor alright so
let's go on to our forex factory calendar now and we will get started
with our analysis of today so this week I think I got my dates a little wrong so
it'll take a look at this week here where are we that's not correct alright
so starting off here we have bank holiday ok
US UK bank holiday here so tomorrow holiday coming up on Tuesday we have
consumer confidence numbers so this will be important for the US dollar we also
have Reserve Bank of New Zealand financial stability report so anytime
there is a Reserve Bank announcement or the central bank announcement that is
very important so we do need to keep that in mind um how's the audio for
everyone can you guys hear me okay
you
okay so audio is good and so there may be a problem at your end there Felix I
would check the audio there alright so looks like our audio is good so let's
let's dive in here anytime there's a central bank we have to be very very
careful with that because the mantra policies are changing now for the
central bank's and as they change they tend to have a lot of impact on the
markets and the markets will be expecting changes and as a result it
creates that negative or positive sentiments whether the central bank
meets expectations that will create a positive sentiment and if they don't do
anything if they don't you know if they're if they talk about economic
growth not being in line with what they were looking for that type of stuff that
will have a negative impact so keep that in mind we also have Bank of Japan
governor Kuroda speaking we have seen with all the different stuff going on
last week or the last couple of weeks we have had president Trump he there was a
first day we're going to meet with North Korea us was going to meet with North
Korea and then and then president Trump released a statement that they are not
going to meet with with Korea and then later on there was some sort of kind of
I don't know communication saying maybe there will be a summit and then over the
weekend we have seen that North Korea and South Korea were actually talking
once again so there's a lot of uncertainty so when when these political
things are going on in the market or in the world it creates uncertainty in the
market so if North Korea and South Korea are talking that is good which means
Japanese yen will actually drop and all the Japanese yen crosses will go up
whereas when we see when we hear comments like us not meeting with Korea
or North Korea and South Korea not talking the talks falling apart that
will have that creates a risk off environment and in that case the stock
market drops and then Japanese yen and Swiss franc Gold these type of safe
assets will go up so that's why it's very important right now to keep keep
I out for what's going on in terms of news because it will drive what we do so
keep that in mind and then Japan has to be concerned about the currency because
when Japanese yen becomes more expensive that it impacts Japan's exports and
exports are very very important for Japan because it is such a such a big
exporting economy so just keep that in mind so Bank of Japan can actually do
verbal intervention and by that what I mean is that they may say things that
will actually drive the price of Japanese yen down so always keep that in
mind Japan is very very concerned about their currency and they can do they can
make comments that could drive weakness in Japanese yen so just keep that in
mind and then we have is a Reserve Bank of New Zealand governor or speaking
again very important so keep keep an eye on that on Wednesday we have ADP
non-farm employment so we are into that into that week here so we have non-farm
we have preliminary GDP which will have an impact on the US especially if it
comes below expectations and then we have another central bank here Bank of
Canada rate statement so right now we are not expecting Bank of Canada to
raise rates they are in fact there are a lot of stuff going on in terms of NAFTA
talks have not yielded anything at this point and from the economic point of
view oil has gone up but it dropped last week and other than that things haven't
really changed their stance right now is neutral so we're not expecting an
interest rate hike but again what they say about the economy will have an
impact any positive statement by the economy about economic growth will lead
the the Canadian dollar to go up whereas if they have their stance is a little
bit negative or they're not so not so bullish on the economy that will have a
negative impact on Canadian dollar so again keep that in mind
so it's National Bank chairman Jordan speaking here again Swiss franc is
another currency that tends to tends to go up when there there's
uncertainty in the market so again central bankers can say things that can
have the opposite impact on the currencies to just just be aware of that
and and then for New Zealand we have business confidence number again very
important number to keep track of private capital expenditure for
Australia that will be important on Thursday we have GDP for Canada so that
will be important and then this Chicago PMI and pending home sales numbers are
also important especially after the big financial crash we saw or the housing
market crash we saw back in 2008 2009 since then these housing numbers are
important to pay attention to okay finally the big one on Friday here will
be the non-farm employment numbers there are always market movers so we do have
to keep that in mind PMI numbers tend to be important because they are leading
indicators for retail sales and then leading to GDP and stuff as well so
manufacturing PMI numbers here and these PMI numbers out of the eurozone will
also be important and then we have PMI numbers for the US as well but by far
the non-farm employment numbers here will be the biggest market movers on
Friday so let's go on to the charts now we'll start off with a euro US dollar
here so for the last several weeks here we have seen a euro dollar drop and now
we are coming into these lowered levels here so there's still room for for this
one to move lower so now keep in mind that we have been
dropping for a number of weeks and what that means is that things could slow
down or even reverse now so we need to keep that in mind so here we have a
bearish candle clothes for the week so it's looking still bearish we closed
right into the bottom of the candle so they still pressure to the downside
so with this one my biases to the downside I'm looking for price to come
down into one point 1550 level back into the bottom here and now we are coming
into even prior to that we are coming into some support and resistance areas
right into one point one six 20 level and then 1550 will be the second target
to the downside so in this case we could see price either push up higher like
that and then drop or we can even see pullback all the way into the 1715 level
so we have to be mindful of both of these so this level here 1.1 715 is an
important level so we could see price push up into that level before it drops
again so the bias for euro dollar is to the downside first target 1620 one point
one six twenty second target one point one five fifty level to the downside
euro dollar here your dollar we have seen last week we were looking for our
drops the same thing with the euro as well last week we were looking for a
drop we talked about pull back and it has dropped further so same thing here
as well we had a bearish counter close last week for a pound dollar and we were
looking for a drop so we did get that drop we are into that next level now so
that's a nice bearish candle here so looking for a further drop here as well
so with this one we could let me see where are we so we could see a pull back
into this one point 33 50 level and then a further drop bias is bearish for pound
dollar and first target is one point 30 to 20 and then one point 30 50 will be
the second target to the downside so I am looking for a potential pullback into
13 one point 33 50 and then a drop they do one point 30 to 20 and then further
into one point 30 50 level to the downside so bearish for that with with
Aussie here it's interesting we have seen price a push back
into the support and resistance here and now we are starting to see price price
have troubled with this so we had a bearish counter close here on Friday so
from the weekly perspective we do have that pin on top and as a result of that
we could see price drop from there so pins show rejection so at this point I'm
looking for price to drop here however we could see a retest of that
level so here I would be looking for prize too so we could see price push
back here again do a retest of that and then drop further and if that level
breaks then I will be looking for price to fall once again so a potential pull
back into 0.76 hundred level and if it holds below that and I'm looking for
target here would be 0.75 and then 0.74 20 level that would those will be the
targets to the downside but my bias is bearish on Aussie dollar New Zealand
dollar here this one as well has been trading in this bit of a range here the
whole week price hasn't really gone anywhere so with this one I would be my
bias is bearish as well so it looks like price went and tested the high but has
failed to break the highs it hasn't gone to the other side so we could get
another retest of that level but overall I'm looking for a drop so I'm looking
for retest of potentially 0.69 80 level and then a drop first target is
78 so 0.68 50 level and then if it drops for the second target would be sixty
seven eighty so 0.67 80 will be the second target to the downside bias is
bearish for New Zealand dollar dollar cad here it has it had been trading in
this range for the last couple of weeks now it has broken at that range it's
gone to the upside here so testing that high it looks bullish at the
moment especially with the drop in oil so if you take a look at oil here oil
has dropped a lot over the last couple of days and the reason all dropped or
the last few days I should say the reason oil dropped was because it was
the speculation that was driving oil up because us pulled out of the Iranian the
nuclear world war deal and as a result of them pulling out there was big
concern that we would have shortfall of oil and as a result because of
speculation oil prices went up and even though right now we have lots of oil
there's we have lots of inventories of oil so we don't really have any kind of
shortage at this point however they were talking about shortages like later in
the fourth quarter and down into 2019 that's when the shortages was actually
show up but we saw on Friday I think it was or Thursday something like that so
last week we heard this week last week I should say we had we heard from OPEC and
Russia had a meeting and they said that they would be willing to increase the
production of oil should there be a concern and as a result of them because
before they were not really talking about increasing the production they had
been all this time they've been talking about cutting production and making sure
those corazon are in place and that type of stuff but now they have started
talking about increasing production so when they increase production there is
no concern for oil shortages and as a result of that oil has dropped it has
dropped sharply this week that's a big bearish engulfing candle so kind of like
this right so and we had a big candle here it could continue lower now that's
the concern because if oil drops Canadian dollar will drop as well which
means dollar cad will go up so that's the interrelationship between oil and
Canadian dollar so let's take a look here so we have we have bearish
engulfing candle clothes in oil and we have a bullish candle close
in dollar catso they are they are opposite they move in opposite direction
to each other so with this one here the bias is bullish we are in two resistance
here so keep that in mind we had trouble our price had trouble at
this level previously but now that we are closing like this my bias is bullish
now we do need to see the price close on the other side of this 1.30 level but
once it does the next target is 1.30 140 and then it could move higher into 1.30
to 80 level here so those are the two targets to the upside but we do need to
see a break above here and once price breaks and holes above I'm looking for
price to move higher 1.30 130 is the first target 1.30 to 80 as the second
target to the upside this one here euro pound hasn't really done much it's just
traded in this range so if you take a look here last couple of weeks it's just
been trading in this range we do see there's a bit of a downtrend line here
so we have seen or we've seen this dropping a bit last couple of days last
three days it's just been very very neutral so we could see a drop like this
retest of the trendline and then a drop to the downside so the
bias for this one here from weekly perspective still stays to the downside
we have seen a pullback here we do need to see a break of this 8720 level once
it does the bias is to the downside and the next target here would be 86 20
level to the downside so very very small sideways moves in Euro Pound nothing
substantial here just looking for draw back into this next support and
resistance level here so bias is bearish which means euro is likely to drop more
than British Pound so if you're looking to trade those against the other
currencies just keep that in mind Swiss franc here Swiss franc and
Japanese yen like I talked about their safe haven currency
is usually we haven't seen your Swiss move a lot but over the last few days it
has just because of the uncertainty over the nuclear war deal and then also in
regards to the Koreas right the u.s. u.s. or President Trump put out a letter
last week saying there will be no submit and as a result of that we have seen
Swiss franc go up and Japanese yen go up which means the crosses drop when that
happens and that's why over the last two weeks we have seen some really big drops
in in these Swiss franc currencies our pears and then nothing much was
happening here and now we're seeing this huge drop so bias is bearish for this
but do keep in mind when we get huge drops like this market can pull back
because these are sentiment driven makes we sorry because their sentiment driven
moves when sentiment changes and it can change pretty rapidly so let's see if
North Korea and South Korea are willing to talk again and u.s. meets with Korea
as well that will be positive for the markets and we could see a reversal of
these moves so also keep your eye on the sentiment see what kind of news is
coming out or comments are coming out because that will drive these moves over
although just from barely front just from technical perspective not
considering sentiment this is bearish and I would look for a pullback into
1.15 80 level and I'm looking for a draw up to the next level at 1.1 450 level to
the downside so my bias is bearish on euro Swiss same thing here with pounds
this was all we were bearish on this but with the market being the way it is
being driven by sentiment it has dropped a fair bit and I'm looking for a further
drop that's very bearish candle it closes right into the bottom here hasn't
legging there's no not even a tiny little bit of pen
on the bottom not even like this but like I said when the market sentiment
changes this can reverse on a dime so just keep that in mind but right now
this candle here looks like this candle right so I'm expecting a further drop
biases to the downside 1.28 50 will be the target to the downside but like I
said this could pull back because it is a big drop we could see a pullback like
that and then a drop further down so just keep that in mind
biases to the downside and the targets would be the first target would be 1.30
20 level second target would be one point 28 50 level to the downside so
bearish for palm swiss dollar Swiss here has been moving down as well last week
we were looking for a drop we got that drop so now we could see a pullback in
299 20 so bias is bearish for dollar Swiss here bias is bearish I'm looking
for pullback either in 299 20 area or we could get a higher pull back into 99 50
and then a further drop into 98 50 level to the downside so bearish bias for this
second target to the downside will be 0.98 hundred so again bearish bias pound
cat here this one is interesting because Canadian dollar has pulled back so we
did see a drop here now as long we could see a retest of this 1.73 80 level and
then a further drop so I think that that is likely now if the price breaks up to
the upside here breaks above a 1.73 80 we are likely to see the price go
higher and the reason for that is what's going on with oil and dollar cad so if
dollar cad goes up this is likely to go up as well just because Canadian dollar
may be dropping with oil if oil continues to drop so that would be the
concern so I will look for a pullback and
1.73 80 level if it holds above then I'm looking for price to go higher into 1.75
80 if it holds below 1.73 80 then I'm looking for price to drop further and
I'm looking for a retest of the lower here into 1.71 20 level to the downside
so right now the bias for me would be neutral because we need to see what's
going on from sentiment perspective and from oil so in this case the both of
these options are available depending on how market reacts all right so this one
is Euro CAD
so same thing here we have a large pin to the downside just like this one right
see what happened price moved higher so I would look for a retest of potentially
into one point 50/50 level but this this pin here suggests that price could move
higher so looking for price to go into 1.52
20 level and potentially even higher into one point 5300 level so I'm looking
for price to drop first and then move up further so something like this so that
would be my bias for euro CAD looking for a pullback drop and then a further
move to the outside so bullish for Euro CAD you're on New Zealand here euro New
Zealand looks bearish New Zealand dollar has been weaker amongst all the
different euro sorry commodity currencies so bearish bias here looking
for it to drop further into one point 66 80 so these these are the commodity
currency some of them are they are driven by market sentiment right now so
just be careful with this one and with my biases to the downside 1.66
80 here for euro New Zealand Pound New Zealand here biases bearish as well
looking for a further drop into one point 89 30 level here but we do have
support into 1.91 80 level so if the price does not break
below this it can go back into the range because this has been range bound for
quite some time and right now we are pushing into the into the bottom but we
pushed into the bottom of the range back here as well but then price went all the
way up higher here so it is a range bound at the moment so my bias is range
bound and so basically neutral but if it breaks here I am looking for price to
drop further into the next support and resistance level which is at one point
8880 so
that will be the next one to the downside if it doesn't break the low
here then I'm looking for price to go back into the range alright so let's do
your Z quickly here your Aussie huge move to the downside
now keep an eye on what Australian dollar does because when Canadian dollar
tends to are all the commodity currencies tend to move in a similar
direction so so keep that in mind because if Canadian dollar starts to
drop Australian and New Zealand dollar may feel the impact as well but
Australian dollar is usually driven by gold so let's go take a quick peek at
gold here what's gold doing Gold had dropped we had talked about if price
breaks below this talking about googled dropping here so it did it has pulled
back now so it's into this resistance once again so what could happen here
because gold had gone up we kind of kept the Australian dollar supported but we
could see this type of a move to the downside so this here could just be a
pullback in gold so if a gold goes up Australian dollar goes tends to go up as
well they they are correlated positively correlated but if it holds below so for
gold if it holds below this support resistance level at 1306 it could drop
because that's just how our technicals tend to work we see a drop who you see a
pull back and we see a drop right so keep that in mind so for me this one the
level here 13:06 will be very very important because if it goes on the
other side then I'll be looking for price to move to the next level which is
a 13 25 or even higher into 13 35 however if it doesn't break 13:06 then I
would be looking for a drop and the target would be 12 63 to the downside so
keep that in mind for gold and as gold moves Australian dollar will move with
it as well so we were looking at Euro Ozzy from
technical perspective here biases to the downside we could get a pullback into
one point 5500 or even higher into 55 20 and then a further drop here first
target would be 1.53 80 and then below that looking for one
point 50 to 50 level to the downside so bias here for Euro Ozzy is bearish found
Ozzy here this is bearish as well we are into support so if price does not break
the support like I mentioned before that could mean that it could go back all the
way see how price had pulled back here it
could do the same it could pull back into the high of the candle and we could
see a reversal this week but if it breaks the bottom here then I'm looking
for price to drop further into 1.73 50 level to the downside so the commodity
currencies they are a little bit iffy at the moment we could see move like that
so I would watch out for this pullback here but from technical perspective
weekly candle here I'm looking for price to drop all right yen crosses yen has
dropped a lot I was looking for this to drop on this day I just hadn't expected
this big a drop so now we have so this is the move and these moves tend to be
sentiment driven moves right they don't tend to happen just on their own but
just to point out it's just interesting I was looking at this chart look at this
pin bar here and then drop pin bar well this is not the best pin bar but we had
nice pin bar drop we had a nice pin bar here drop so I really like the pin bars
pin bar here and drop anyways that was just an observer observation right on
this chart but from weekly perspective here we're looking quite bearish we are
coming up into support here though so that's something to watch out for from
here we could get a pullback because that's quite a quite a drop here so we
could get a pullback into 46 80 or 140 700 level even oops yeah
that's okay okay so we could get a pullback into 140 690 so 140 700 and
then a further move to the downside because we are into support I would be I
would be a little bit careful with this see how we had nice strong camber close
into support and then it reversed completely so Japanese yen crosses can
do that right now especially if we start to see positive sentiment being created
because North Korea and South Korea are talking and the US and careers are
talking that can create positive sentiment in the market which means it
could push the wall street up and equities could go up and then you know
the safe haven flows go out of safe haven currencies into more riskier
assets which means gold could drop and like I said Japanese yen and Swiss franc
could drop so just just be mindful of that this week but from technical
perspective dislikes those this looks bearish but this is a scenario that I
would be concerned about same thing here price had dropped but then we went up
because mark market sentiment changed right so that's that's the concern as I
point out but from technical perspective this looks bearish into support which
means we could get a pullback and then a further drop into 1 40 to 50 level to
the downside euro yen similar story we had a nice pin bar on the daily big drop
and then price has been dropping since then so this is a huge drop here now
again the same thing we are right into support here and if the price we could
see price pull back especially if the sentiment changes here so I would be
looking for a pullback into 128 ad level and then we can see a drop so bias is
bearish but I am again okay being careful of sentiment we have to be
mindful of that and I would look for a pullback into 120 880 and then a further
drop so bias is bearish for euro yen same thing for dollar
as well we have a bearish candle close here railroad reversals so I'd be
looking for a pullback into this area and then drop further into one of 880
levels so looking for pullback into 110 and then a drop into 108 80 and then
potentially further into 1 or 800 now again the concern will be if everybody
is nice to each other they're playing nice and they start talking which means
these this could reverse and go up so kind of like this see we had a bearish
bias here and then price just turned around and went all the way up so the
sentiment driven same thing here the sentiment driven moves can unwind fairly
rapidly so just keep that in mind but from technical perspective this is
bearish target would be 1 or 800 Aussie yen similar story here as well we have
seen a big drop here and rzn hasn't produced as big a drop because gold went
up keeping the Australian dollar stronger but overall we do have a nice
looking a bearish pinbar here which means it could drop further so just
based on the technical of my bias would be to the downside but again I would be
mindful of this 80 to 20 level here because if it doesn't break the high
sorry doesn't break the low then it could just reverse right here right so
we need to see a break of the low and then a further drop here so in this case
the target here would be 80 point 5 0 level and this 82 20 level will be very
important because we could see a pullback here but right now it does look
bearish and my bias would be to the downside just based on the technicals ok
we'll wrap it up for these two here cadion huge bearish candle close so
especially if the oil keeps dropping this one could drop further here so it
is a bearish engulfing candle we are into support so that could be
problematic I'm looking for a pullback into 85 20 level and
then looking for a further drop so 82 8250 will be the target to the downside
looking for pull back into 85 20 and then looking for a further drop for CAD
yen so bias is bearish this one here New Zealand yen we are
into support price hasn't dropped below this level in several months so actually
since October of 2016 we have not broken this level last time we tested it in
February but then as we can see even though we had a bearish calendar close
here right into support price pushed up so this is just a general team that is
occurring in Japanese yen right now we see a candle close here then pulls back
because of sentiment so if it doesn't break the low it can go back up so keep
that in mind but just based on this biases bearish and looking for 74 point
a be level as the next target and then in terms of pullback I would be looking
for a pullback into 76 30 level here so the move like that that's the kind of
move I am anticipating for New Zealand yen and if it drops further second
target would be seventy three point eighty level to the downside so bias is
a bearish on this one here as well any questions that's all I have
all right so we will wrap it up that's all for today you guys have a wonderful
weekend and to my friends where it's a long weekend enjoy your long weekend and
I will see you all next week you're welcome
yeah welcome everyone bye for now
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