Technical analysis of GBP/USD for February 01, 2016

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Overview:

  • Today, the GBP/USD pair has broken resistance at the level of 1.4250 which acts as support now. Thus, the pair has already formed minor support at 1.4250.The strong support is seen at the level of 1.4122 because it represents the weekly support 1. Equally important, the RSI and the moving average (100) are still calling for an uptrend. Therefore, the market indicates a bullish opportunity at the level of 1.4250 in the H1 chart. Also, if the trend is buoyant, then the currency pair strength will be defined as following: GBP is in an uptrend and USD is in a downtrend. Buy above the minor support of 1.4250 with the first target at 1.4312 (this price is coinciding with the ratio of 61.8% Fibonacci), and continue towards 1.4386 (the weekly resistance 1). On the other hand, if the price closes below the minor support, the best location for the stop loss order is seen below 1.4250; hence, the price will fall into the bearish market in order to go further towards the strong support at 1.4122 to test it again. Furthermore, the level of 1.4149 will form a double bottom.

The weekly technical analysis of GBP/USD pair:

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Technical analysis of EUR/USD for February 01, 2016

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Overview:

  • The EUR/USD pair hit the weekly pivot point and resistance 1, because of the series of relatively equal highs and equal lows. But, the pair has dropped down in order to bottom at the point of 1.0810. Hence, the major support was already set at the level of 1.0810. Moreover, the double bottom is also coinciding with the major support this week. Additionally, the RSI is still calling for a strong bullish market as well as the current price is also above the moving average 100. Therefore, it will be advantageous to buy above the support area of 1.0810 with the first target at 1.0878. From this point, if the pair closes above the weekly pivot point of 1.0862, the EUR/USD pair may resume it movement to 1.0935 to test the weekly resistance 1. Stop loss should always be taken into account, accordingly, it will be of beneficial to set the stop loss below the last bottom at 1.0793.

The weekly technical analysis of EUR/USD pair:

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Global macro overview for 01/02/2016

Global macro overview for 01/02/2016:

The PMI Manufacturing data from the eurozone was released this morning and it was mostly in line with analysts’ expectations. The biggest surprise however was the UK PMI which came in better than expected: 52.9 vs. 51.8 and (forecast 52.2). The UK PMI remained above the neutrality level of 50.0 for 34 successive months now. Looking beneath the surface of the headline numbers shows that the prime drivers of the output growth acceleration were the consumer and investment goods sectors. A solid rate of expansion was also signaled by intermediate goods producers. In conclusion: the UK manufacturing sector posted an up tick in its rate of expansion at the beginning of 2016, shrugging off a number of potential headwinds, ranging from global financial market volatility to localized flooding in the North of the country. The domestic market remains the key driver of the economic growth, but after recent easing in the exchange rate, a number of manufacturers are still finding that the strength of the pound against the euro significantly influence the number of orders.

From the technical point of view, the recent downside breakout of the rising wedge was successful with new daily low reached at the level of 1.4147. Currently, the market is testing the lower channel line from the downside and any failure to break back above the level of 1.4317 will result in immediate reversal. The downtrend is still intact.

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Global macro overview for 01/02/2016

Global macro overview for 01/02/2016:

The US fourth quarter gross domestic product increased by 0.7% according to the Commerce Department data released last Friday. This is a sharp slowdown as the third quarter GDP growth rate hit the level of 2%. The main reason behind the drop was lower oil prices which continued to decrease and bad weather (heavy blizzard) over the last months that dented consumer spending on utilities and apparel. Nevertheless, there is no reason to raise concerns about momentum in 2016, because the overall US economic growth was 2.4% in 2015, after a similar growth pace posted in 2014. In conclusion, this GDP figure for the fourth quarter is only a preliminary gauge which will be revised in next two months.

Now let’s take a look at the technical picture of the US dollar index on the daily chart. The violation of the lower channel boundary was quickly recovered as the market rallied higher towards the important technical resistance at the level of 99.98. Nevertheless, the current pattern starts to look like a rising wedge, which means the downside breakout still can not be ruled out as long as the 99.98 resistance holds.

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Technical analysis of EUR/JPY for Febuary 1, 2016

General overview for 01/02/2016:

From the Elliott Wave point of view, the current upward move might be completed as there are five impulsive wave seen in the hourly chart. Moreover, a three-wave corrective cycle is visible as well, so any rally upwards that breaks the local high at the level of 132.31 will be labeled as wave three of the main impulsive structure. Nevertheless, an alternative count suggests even more impulsive wave progression to the upside as long as the level of 130.22 is not violated.

Support/Resistance:

133.69 – WR1

132.27 – Local High|Intraday Resistance|

130.76 – Weekly Pivot

130.22 – Intraday Support

129.18 – WS1

Trading recommendations:

Day traders should refrain from trading and wait for another trading setup to occur.

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Technical analysis of USD/CAD for Febuary 1, 2016

General overview for 01/02/2016:

The pair keeps trading inside a narrow range zone, but an upside breakout is coming. The reason for that is diminishing downward momentum and bullish divergence, which might be seen between the price and momentum oscillator. Moreover, there is an uncompleted wave progression to the upside which indicates that wave c purple should reach a local high around the level of 1.4272. Please notice the larger uptrend is still intact in this time frame, but the corrective cycle might get more complex and more time-consuming.

Support/Resistance:

1.4690 – Swing High

1.4553 – WR3

1.4436 – WR2

1.4324 – Technical Resistance

1.4173 – WR1

1.4158 – Intraday Resistance

1.4061 – Weekly Pivot

1.3946 – Intraday Support

1.3798 – WS1

Trading recommendations:

We are still expecting bullish wave c to the upside. So, day traders should consider placing buy orders today if the intraday resistance at the level of 1.4156 is violated. The SL orders should be placed below the level of 1.4028 and TP at the level of 1.4271.

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Technical analysis of Silver for February 01, 2016.

Technical outlook and chart setups:

Silver is trading in the area around $14.35 now. We expect it to face interim Fibonacci resistance. The metal is expected to drop lower towards $14.00 before resuming its previous rally. On the flip side, a push through the levels of $14.50 on the higher side, would open doors to the levels of $15.00/20 as well. It is hence recommended to remain flat for now and look for an opportunity to buy at lower levels on a bullish bounce. Immediate resistance is seen at $14.50/60, while support is at $13.90. Bears are expected to remain in control till prices stay below $14.50 moving forward.

Technical outlook and chart setups:

Remain flat for now and look for an opportunity to buy lower.

Good luck!

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Technical analysis of Gold for February 01, 2015

Technical outlook and chart setups:

Gold is trading around the levels of $1,123.30 now and it is likely to face resistance here.The yellow metal is expected to produce an up garter and complete a corrective drop lower before rallying towards fresh highs. Also as seen on the daily chart, the metal is facing resistance around Fibonacci 50% levels of a drop between the levels of $1,192.00 and $1,046. It is hence recommended to initiate 50% short positions now with risk at $1,129.00. Immediate interim resistance is seen at $1,127.00/28.00, while support is seen at $1,108.50. Bears should remain poised to push lower until prices stay below $1,129.00.

Trading recommendations:

Remain short with stop at $1,129.00.

Good luck!

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Technical analysis of EUR/JPY for February 01, 2016

Technical outlook and chart setups:

The EUR/JPY pair is trading in the area of 131.50/60 right now after reversing from 132.32 last Friday. The pair is seen to hit the trend-line resistance and Fibonacci 0.618 as well s depicted on the daily chart view. It is expected to resume the bearish trend from here until prices stay broadly below 134.50. It is hence recommended to remain short now with risk at 134.50. Immediate resistance is seen at 134.50 followed by 137.00, while support is seen at 129.00 and lower.

Trading recommendations:

Remain short with stop at 134.50.

Good luck!

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Technical analysis of GBP/CHF for February 01, 2016

Technical outlook and chart setups:

The GBP/CHF pair looks to be preparing for a drop lower towards 1.4300 levels, before resuming its rally. The pair is trading around 1.4569 now following hitting a high of 1.4660. Please also note that the pair has pulled back from the Fibonacci 0.382 resistance level (a drop from 1.5570 to 1.4120). It is hence recommended to remain short with risk at the level of 1.4685. Immediate interim resistance is seen at 1.4660, while support is seen at 1.4300 followed by 1.4125. A corrective drop from current levels should be followed by a rally towards 1.5/1.51.

Trading recommendations:

Stay short now with stop at 1.4685, a target is at 1.4300.

Good luck!

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