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U.S. Dollar Strengthened Against Euro And Pound – Now What?

Dear Traders,

The euro came down from its most recent high at 1.1720 while Tuesday’s decline in the EUR/USD was mainly due to a strengthening U.S. dollar. We now turn our focus to a day trading range between 1.1685-1.1630 and keep tabs on price breakouts either above or below that range in order to evaluate profitable trading chances in the near-term. If the euro is able to overcome the 1.1715-hurdle again, we expect accelerated bullish momentum towards 1.1820. As for the bears, the 1.1510/00-level remains of crucial importance in terms of a profitable breakout level.

The only piece of economic data today will be U.S. Durable Goods Orders at 12:30 UTC.

The British pound depreciated against the greenback and tested the 1.32-support level. As long as 1.32 holds we turn our focus to a break above the 1.33-handle. Below 1.3190 however, the pound may suffer further losses towards 1.3150 and 1.3070.

Bank of England governor Mark Carney is scheduled to speak about the Financial Stability Report today at 8:30 UTC although he is not expected to drift too far from the subject. Thus, the impact on the pound could be less significant.

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Pound Surges On BoE Rate Hike Speculation

Dear Traders,

The Bank of England delivered a hawkish twist at yesterday’s BoE meeting and the British pound responded with a short squeeze towards 1.3270. The MPC voted 6-3 to hold rates steady, but the fact that there were three dissents voting in favor of an immediate rate hike leaves room for speculation about a rate increase in August. Thus, odds for a rate hike at the next BoE decision in August have increased to 45 percent from 33 percent, which in turn pushed the pound sterling towards higher price levels.

Following yesterday’s short squeeze, we may now see some consolidated movement between 1.33-1.32. If the pound is, however, able to overtake the 1.33-handle we expect a higher resistance at 1.34. Traders should generally expect more strength in the pound as we approach the BoE August meeting.

As for the U.S. dollar, the last trading session was dominated by intense selling pressure with prices rebounding off an 11-month high. We will keep tabs on the technical picture but will also take into account volatile fundamental themes such as escalating trade tensions between the US and China which are continuing to roil the markets in the near-term.

The euro benefited from the selling pressure in the greenback and recovered some losses after sellers got shy as the euro approached the 1.15-boundary.

Technically speaking, we still see the EUR/USD confined to a sideways trading range between 1.17 – 1.15.  As long as this range holds, the outlook remains neutral. For the bias to slightly shift in favor of the bulls, we would need to see a sustained break above 1.1730 with higher resistances coming in at 1.1850 and 1.19.

Have a beautiful weekend.

 

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We wish you good trades and many pips!

Any and all liability of the author is excluded.

Copyright © All Rights Reserved 2018 Maimar-FX.

www.maimar.co

 

Risk Aversion Leads To EUR And GBP Sell-Off

Dear Traders,

The fragility of the European Union is back in the spotlight and there seems to be nothing that could stop the euro from falling. The euro broke below crucial support levels against the U.S. dollar and fell to the weakest level in ten months. Whether the euro will extend its tailspin towards 1.1420 or even 1.1350 remains to be seen and hinges on the risk aversion in the market. As soon as risk aversion gives way to a greater risk appetite, the euro may find the strength to recover some of its losses.

The same applied to the British pound, which fell victim to increased risk aversion in the market and dropped towards $1.32. As long as the cable remains below 1.33 we focus on a lower target at 1.3180/70. On the topside, we see a current resistance at 1.3350. For sterling bears, Tuesday has been a very profitable trading day with our short signal providing twice a good profit.

The focus now turns to U.S. data such as the GDP report, scheduled for release today at 12:30 UTC. Greater attention, however, will be paid to the U.S. NFP report Friday. Today’s ADP Employment Change (12:15 UTC) could provide a foretaste of what to expect on Friday.

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We wish you good trades and many pips!

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EUR And GBP: Bearish Bias Persists

Dear Traders,

The euro traded within a 50-pip range between 1.1750 and 1.17 but despite that limited price range we were able to book a good profit with our daily long signal. Looking ahead, there are no major economic reports out of the eurozone in the next days, which is why we keep tabs on the technical picture in the EUR/USD. As long as the euro remains below 1.1790 and 1.1830, we favor a bearish stance in this pair.

The pound sterling rose to a high of 1.3422 after U.K. retail sales came in better-than-expected. However, that report was not enough to trigger a sustained recovery in the pound given that rate hike expectations are unchanged. Thus, the risk remains tilted to the downside.

With the GBP/USD trading below 1.34 and more importantly below 1.3430, the cable maintains its bearish bias, suggesting that sterling prices may continue to fall. We will wait for price breaks below 1.3360 and 1.3340 to anticipate further losses. Lower targets are seen at 1.33 and 1.3270.

Today, traders will watch the U.K. GDP report at 8:30 UTC and U.S. Durable Goods Orders at 12:30 UTC.

We wish you a beautiful weekend or long-weekend for those who have a holiday on Monday.

Daily Forex Signals:

Additional daily and long-term entries are available for subscribers.

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We wish you good trades and many pips!

Any and all liability of the author is excluded.

Copyright © All Rights Reserved 2018 Maimar-FX.

www.maimar.co

 

 

 

Pound Drops On Decreased BoE Rate Hike Odds

Dear Traders,

Thursday has proved to be a high volatile trading day which became most visible in the pound’s price action following the BoE Super Thursday rate decision. While we have focused on a potential short squeeze in the GBP/USD, provided that the Bank of England would have maintained its hawkishness, the opposite scenario happened. The BoE went dovish and disappointed sterling bulls that had hoped for a bullish reversal from the pound’s lows. BoE policy makers decreased their near-term hawkish monetary policy expectations and noted that inflation may have peaked. Inflation and GDP forecasts were lowered. BoE Governor Mark Carney was back to the previous ‘slower and gradual’ rate hike path instead of warning that rate hikes could happen faster than expected.

Consequently, rate hike bets for an August rise fell to 42 percent from 62 percent. The most likely meeting for when a rate hike would occur is probably the November meeting, with a current priced-in probability of 64 percent.

As for the U.S. dollar, U.S. inflation numbers disappointed but, looking at the price action in the EUR/USD and GBP/USD, the greenback refrained from showing any signs of weakness shortly after the numbers were released. However, even though inflation numbers came in weaker-than-expected, the Fed is likely to maintain its current rate hike path.

GBP/USD: The cable bounced off the rising trendline refraining from a climb above 1.3620 and finally headed for a break below the 1.35-support. At the end of the day however, the pound was more or less unchanged against the dollar with any larger swings lacking.

We will now focus on a trading range between 1.3630 and 1.3440. Any breakouts above or below these levels can spur momentum to the respective direction.

EUR/USD: The Euro tested the area around 1.1950 and euro bulls should keep an eye on a potential run for 1.20 now. As long as the euro remains above 1.1880 we favor the upward momentum.

ECB President Draghi will speak in Florence today at 13:15 UTC.

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We wish you good trades and many pips!

Any and all liability of the author is excluded.

Copyright © All Rights Reserved 2018 Maimar-FX.

www.maimar.co

 

USD Continues Advance Against EUR

Dear Traders,

The U.S. dollar continued to climb higher after U.S. President Trump announced that the USA was pulling out of the Iran nuclear deal. His decision sparked concern that it could increase geopolitical tensions between the USA and its international allies.

EUR/USD

Looking at the 4-hour chart we see that the recent downward channel is still intact suggesting that a bottom might not be in place yet. Thus, the euro may continue its tailspin towards the 1.1770/50 area. A lower support zone runs from 1.1660-1.17. The previous 1.19-support could now turn into a short-term resistance.

Let’s be surprised.

 

GBP/USD

The key support level around 1.35 has proved to withstand the downward pressure in the pound ahead of tomorrow’s BoE meeting. Sterling bulls hope for a hawkish hold at the Bank of England’s Super Thursday but we recommend traders to prepare for both scenarios, bullish and bearish. We shall come back to the specific breakout scenarios tomorrow.

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Additional daily and long-term entries are available for subscribers.

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We wish you good trades and many pips!

Any and all liability of the author is excluded.

Copyright © All Rights Reserved 2018 Maimar-FX.

www.maimar.co

FOMC To Provide An Excuse For Profit-Taking On Dollar Long Positions?

Dear Traders,

The U.S. dollar showed no signs of weakness and extended its gains versus other major peers Tuesday. Thus, short traders in the EUR/USD and GBP/USD were once again able to book a good profit.

Having just warned in our analysis from Monday that signs could point to a bearish breakout, that break below crucial key levels in both of our major currency pairs came faster than we had expected. Despite the oversold situation in many major pairs and the need for consolidation, the U.S. dollar continued its bullish bias for the 9th trading day pushing its counterparts even lower. While the greenback’s linear rise is surprising, many traders wonder how long this dollar move will last. However, we continue to warn traders of profit-taking and potential pullbacks.

The market focus will now turn to the Federal Reserve meeting and FOMC rate decision today at 18:00 UTC.  The expectation for any change in monetary policy is very low at this meeting with no updated forecasts and no press conference from Fed Chairman Powell. However, the meeting should be a runway for another rate hike in June and if Fed policy makers don’t commit to rate increase next month the dollar will quickly fall as market participants are positioned for hawkishness from the Fed.

Investors will closely watch for whether the Fed makes more explicit its intention to raise rates three more times this year, for a total of four hikes in 2018.

In a nutshell, while the policy statement is expected to tilt to the hawkish side, there is a risk of disappointment. Dollar bulls may thus take the opportunity to take profit on dollar long positions.

Before coming to the FOMC decision, we will watch the ADP Employment Change at 12:15 UTC.

EUR/USD

The euro fluctuates around the 1.20-level while still being in oversold territory. We now expect the pair to trade between 1.2050 on the upper side and 1.1950 on the lower side.

GBP/USD

Given the strong bear candles in the daily chart we expect the risk to remain tilted to the downside with a lower target being at 1.3530/1.35. However, the cable is deeply oversold, which is why we prepare for pullbacks towards 1.37 and 1.3730.

 

 

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We wish you good trades and many pips!

Any and all liability of the author is excluded.

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Quiet Trading On May 1st?

Dear Traders,

We welcome you to the trading month of May. May 1st is a public holiday in many countries with many major markets shut for holidays. Trading in the Forex market could therefore be quieter than usual but that doesn’t necessarily mean that there will be no profitable movements. Let us be surprised.

Yesterday we saw the U.S. dollar continuing its rally against the euro and British pound with the GBP/USD touching a fresh low at 1.3712, slightly above the crucial 1.37-boundary. Following the recent declines and with both EUR/USD and GBP/USD hovering around key technical levels now, traders should expect some short covering around crucial support levels. In other words, prepare for consolidated movements around 1.20 in the EUR/USD and 1.37 in the GBP/USD.

EUR/USD: The euro was able to hold above 1.2050 and it will now hinge on the appetite for USD whether the euro falls towards 1.1990 or stabilizes above 1.2150.

GBP/USD: The cable rejected the 1.3710-level and consolidated between 1.38 and 1.37. Whether we will see some extended market moves above or below that zone remains to be seen. Above 1.38, we expect a next resistance to come in at around 1.3840 whereas on the bottom side, a next lower target could be at 1.3650.

Sterling traders will watch the U.K. PMI Manufacturing at 8:30 UTC today.

Furthermore, we have the ISM Manufacturing Index due for release at 14:00 UTC.

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We wish you good trades and many pips!

Any and all liability of the author is excluded.

Copyright © All Rights Reserved 2018 Maimar-FX.

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USD Rally Appears Overstretched

Dear Traders,

The U.S. dollar resumed its advance on Monday but we are continuing to be on the lookout for reversals since the dollar’s rally could be somewhat overstretched in many major currency pairs.

The euro extended its slide to a low of 1.2184 but the breakout below 1.22 appears unsustainable, at least as long as the euro remains above 1.22. We now keep tabs on the 1.2240/50-level which could act as a short-term resistance in the EUR/USD. A higher resistance is seen at 1.2330. On the bottom side, we expect a lower support around the 1.2160/55-level that could limit losses. We bear in mind that the pair is in oversold territory which is why traders should prepare for pullbacks.

Short traders of the GBP/USD have been able to gain a good profit in recent days. Commentary made by BoE Governor Carney has sent the pound into a tailspin as he prompted speculation that a rate hike in May is not sure. Consequently, rate hike odds have dropped from 85 percent to below 50 percent following Carney’s remarks.

The GBP/USD traded with a heavy bearish bias and dropped towards 1.39. Given the oversold situation, we still expect some pullback sending the pound back towards a test of 1.4015 and 1.4050. A lower support is, however, seen at around 1.3875.

Daily Forex Signals:

Additional daily and long-term entries are available for subscribers.

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We wish you good trades and many pips!

Any and all liability of the author is excluded.

Copyright © All Rights Reserved 2018 Maimar-FX.

www.maimar.co

 

Pound Slumps On Disappointing Inflation Data

Dear Traders,

The biggest story in the Forex market on Wednesday was the sharp drop of the British pound. The pound extended its losses towards 1.4170 following the release of disappointing U.K. inflation data. Inflation fell to 2.5 percent, the lowest level in a year and investors fear that the lower reading could encourage Bank of England policy makers to postpone an imminent rate hike in May. Consequently, expectations for a rate hike next month dropped to a 65 percent probability, down from 87 percent.

GBP/USD

From a technical perspective, we saw the pound rushing through a previous support-area between 1.4250 and 1.4220 which turned into a current resistance now. A lower support now comes in at around 1.4145. However, traders should bear in mind that the overall uptrend is still intact and with the next BoE meeting (and a potential rate hike) still three weeks away, buyers may take the opportunity to buy pounds at lower levels.

We will keep tabs on a price range between 1.4250 and 1.4140 now. If the pound breaks out of that range we might see momentum accelerating to the respective direction. A lower support is seen at 1.4090, whereas for the bullish bias to resume it would need a renewed break above 1.4315.

The U.K. Retail Sales report is due for release today at 8:30 UTC.

In contrast to the high volatility in the GBP/USD, we have seen a lackluster price development in the EUR/USD. The pair is still range-bound and this long period of range (three months already) has discouraged many traders from trading the EUR/USD. However, there have been some profitable trading opportunities but larger swings tend to be rare at the moment.

We are still looking for an upside break of the 1.24-barrier and if that breakout happens our patience could pay off. Based on the recent uptrend channel we expect a higher bullish target to come in at around 1.2470. Bears in the EUR/USD should, however, wait for a significant break below 1.23.

Daily Forex Signals:

Additional daily and long-term entries are available for subscribers.

View our daily signal alerts http://www.maimar.co/category/daily-signals/

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We wish you good trades and many pips!

Any and all liability of the author is excluded.

Copyright © All Rights Reserved 2018 Maimar-FX.

www.maimar.co