How Tonight’s U.S. Fed Rate Decision Will Affect You

December 16, 2015 Forex Analysis

The effects of today’s U.S. FOMC Interest Rate Decision will be felt far and wide across the global financial markets. It is expected that for the first time in 9 years, the U.S. Fed will open the door for gradual interest rate increases. If we see the start of a Fed rate liftoff cycle today, the immediate focus will be on when the next rate hike will come. We expect that the Fed will try to tone down the event with some points of cautiousness regarding the health of the U.S. economy. However traders see it, we all have to adjust to a world of higher U.S. borrowing cost.

Traders will now have to adjust expectations of a stronger U.S. dollar world. Once the door is kicked open and the Fed begins the next interest rate cycle, the effects will reach all market participants, from traders to small homeowners. The fact that this event will affect all those who borrow in USD means that commodity prices such as Oil will also continue to be heavily affecting those who are not market traders. Stock markets will also be affected; since in the sort term, the rate hike will be viewed as a boost of confidence which may propel an already robust stock market even higher.

As a broker, we are expecting that our client trading volumes will increase, as our clients will seek out new market opportunities as a result of the changing market conditions created by this historic moment given that the U.S. starts to move past the era of cheap money and into a new ear of growth and prosperity.

I wish all traders good luck and successful trading as we move forward and into the New Year.

Janne Muta

Chief Market Analyst

If you wish to get the latest forex brokers news,you can visit our Top Forex Brokers official website:

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About Janne Muta, HotForex’s Chief Market Analyst

jmuta Janne Muta is a seasoned industry professional with over 16 years experience in the global markets. Originally from Finland, Janne has worked for institutions in both Helsinki and London as an institutional fund manager, global market analyst and FX educator.

Traders and fund managers from around the world have benefited greatly from Janne’s technical analysis methods. The indicators and price action based trading models he has developed, have, after rigorous testing, proven to be invaluable in identifying high probability trades.

“My mission is to help you to become a confident and successful trader”

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 FX and CFDs 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.

GBPUSD Update, Downside Pressure Remains

December 14, 2015 Forex Analysis

GBPUSD, Daily

The GBP is under pressure ahead of this week’s U.S. FOMC interest rate decision that could provide continued uplift for the USD against the GBP. I would expect some GBPUSD choppy trading as we move closer to Wednesday since also on tap we have some key U.K. data that, if disappoints, could support a Bank of England interest rate hike delay, which in turn could provide some further support for GBPUSD short sellers. I would expect the GBPUSD to remain biased to the downside against the USD in the current macro environment with my technical medium term price targets for the GBPUSD at 1.4955 (S1) with a possible test of the April 20th lows near 1.4890 (S2).

Janne Muta

Chief Market Analyst

If you wish to get the latest forex brokers news,you can visit our Top Forex Brokers official website:

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About Janne Muta, HotForex’s Chief Market Analyst

“My mission is to help you to become a confident and successful trader”

USDJPY Rattled by the macro data

December 10, 2015 Forex Analysis

USDJPY, Weekly

USDJPY has dropped below the previous trading range and has since bounce higher from another range near 121.00. Japanese core machinery orders data yesterday showed a jump of 10.7% m/m in October. The market consensus had been for a 1.5% decline, and the data follows a 7.5% m/m gain in September. In y/y terms, orders are up 10.3%. The data are encouraging, and follows a big upward revision in Japan’s Q3 GDP this week, to +1.0% y/y from the -0.8% originally reported, which shows that the country didn’t fall into a technical recession after all. The data has softened the possibility for the BoJ expanding its QQE policy in January, which is the prevailing market expectation.

In the weekly picture USDJPY has broken below a rising trendline and since made a return move to it. Price failed to move above the trendline after which it corrected lower. This creates a third lower high in the weekly picture since June this year and signals that this market is getting bearish. The nearest weekly resistance level is at 122.25 while a weekly high from September at 121.24 acts as the nearest support.

USDJPY, 240 min

The bounce from the 121.24 support suggests that the price could rally to previous support area at 122.60 – 122.80. This area is likely to be a resistance now. This area coincides roughly with the 30 and 50 period moving averages. We will be looking for sell signals should the price rally to this area. My targets are 121.50 (T1) and 120.62 (T2).

Janne Muta

Chief Market Analyst

If you wish to get the latest forex brokers news,you can visit our Top Forex Brokers official website:

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About Janne Muta, HotForex’s Chief Market Analyst

“My mission is to help you to become a confident and successful trader”

GBP is attracting buyers

December 9, 2015 Forex Analysis

AUDGBP, 240 min

The pound has found its feet after underperforming over the last several sessions. UK think tank NIESR helped as it issued, yesterday afternoon in London, an upward revision to its UK GDP estimate for the three months to November, now expecting 0.6% growth versus 0.5% previously. That would mark a tick higher from the official 0.5% growth clip seen in Q3. NIESR is also anticipating the BoE to hike the repo rate by 25 bp in February, which is well ahead of most forecasters and with (as the FT highlights) sterling markets factoring just 11% odds for such a move as soon as February.

AUDGBP has fallen to a 0.4765 support after turning lower around 0.4900. In addition to being at support the pair is trading outside the descending regression channel which suggests that the move by the latest down candle has taken the market too far down too fast. In addition the RSI is firmly in the oversold territory. This turns the focus to the area between 0.4791 and 0.4825 and we should be looking for short entry signals should the pair rally there. My targets for a successful short entry are at 0.4721 (T1), 0.4670 (T2).

Janne Muta

Chief Market Analyst

If you wish to get the latest forex brokers news,you can visit our Top Forex Brokers official website:

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About Janne Muta, HotForex’s Chief Market Analyst

“My mission is to help you to become a confident and successful trader”

GBPJPY trading at support

December 8, 2015 Forex Analysis

GBPJPY, 240 min

Sterling has been underperforming today, guided lower by a big miss in the UK RBC retail sales figure, which unexpectedly fell 0.4% y/y in the headline like-for-like measures. However, now the UK October production came in above forecasts in rising 0.1% m/m and 1.7% y/y. That’s above our survey’s median forecasts for 0.0% m/m and 1.2% y/y growth. September data were also revised higher, to 0.0% m/m from -0.2% and to 1.5% y/y from 1.1%. The narrower manufacturing output measure disappointed, however, at -0.4% m/m and -0.1% y/y, though September data were revised higher. The ONS stats office reported that there were expansion “in three of the four main sectors, with mining and quarrying output being the largest contributor.” Mining and quarrying rose by 8.5%, which explains the outperformance of the industrial output measure relative to manufacturing. The forecast-beating headline only had a fleeting and minor positive impact on the pound, which has subsequently fall to intraday lows against both the dollar and the euro.

Technically I like GBP against JPY for a short term long trade from current levels. The GBPJPY pair has broken above two trend lines and is currently trading near a pivotal support and outside the lower Bollinger Bands. Stochastics is oversold while the last 4h candle is currently a narrow range candle that indicates a turnaround in this pair. My target for a quick intraday trade is at 185.45.

Janne Muta

Chief Market Analyst

If you wish to get the latest forex brokers news,you can visit our Top Forex Brokers official website:

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About Janne Muta, HotForex’s Chief Market Analyst

“My mission is to help you to become a confident and successful trader”

EURUSD Surges 300+ Pips on ECB Rate Cut and Extended QE Program

December 4, 2015 Forex Analysis

EURUSD, Daily

The ECB cut the deposit rate by 10 basis points to -0.3% from -0.2%, while leaving the key refinance rate unchanged. European stock markets have sold off in the wake of Draghi’s disappointing measures since the central bank’s cut in the deposit rate was less than anticipated and the widening of QE purchases not as aggressive as the markets would anticipate.

At the time of this writing, the EUR trades above the 1.08 level, up nearly 280 pips for the session; most of the market was caught by surprise as market sentiment had been poised for a downside move. However, the week is far from over as tomorrow’s all important and widely anticipated U.S. Non-Farm payroll report could offer traders even more surprises.

Technically, the EURUSD could possibly return towards resistance area 1.1090. For the moment, traders may seek for higher prices before entering any new short positions.

Janne Muta

Chief Market Analyst

If you wish to get the latest forex brokers news,you can visit our Top Forex Brokers official website:

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About Janne Muta, HotForex’s Chief Market Analyst

“My mission is to help you to become a confident and successful trader”

AUD OUTPERFORMING THE USD, MEASURED MOVE IN PLAY

December 1, 2015 Forex Analysis

AUDUSD, Daily

The AUDUSD moves higher in the wake of the RBA, holding steady rates at 2%, as widely anticipated. The economic outlook according to the board at the RBA , are that the “prospects for an improvement in economic conditions had firmed.” As for the currency, they noted the AUD is “adjusting to significant declines in key commodity prices.” Technically, a measure move from the September lows (0.6940) to October highs (0.7380) looks to be in play, since price continues to extend the advance from the November retrenchment lows (0.7015). If price can hold above the FE 61.8% (daily) near 0.7290, this could open up the possibility for a re test of the October highs (0.7360) with 0.7450 as the extended target.

Janne Muta

Chief Market Analyst

If you wish to get the latest forex brokers news,you can visit our Top Forex Brokers official website:

http://www.topforexbrokerscomparison.com

About Janne Muta, HotForex’s Chief Market Analyst

“My mission is to help you to become a confident and successful trader”

Dovish BoE speak could break a key GBPUSD support

November 27, 2015 Forex Analysis

GBPUSD, Daily

The GBP has under-performed this week after BoE governor Carney said that the low interest rate environment is likely to remain for some time, while his colleague Haldane said that inflation risks were “skewed materially to the downside.” This Dovish BoE speak is seen as a driver for the GBP weakness, as it suggest that the BoE will wait till after the U.S. Fed and ECB rate moves to take effect before making any move. Technically, the GBP has further downside potential towards the 1.4960′s with room for a deeper mover lower near the 1.4890’s-60.

The downside move could be interrupted provided the key 1.5025 support holds, meaning it could support a potential price bounce for a lower top below 1.5335. The current strategy calls for selling into any signs of strength for an initial 1.4960 target, with stops near 1.5335.

Janne Muta

Chief Market Analyst

If you wish to get the latest forex brokers news,you can visit our Top Forex Brokers official website:

http://www.topforexbrokerscomparison.com

About Janne Muta, HotForex’s Chief Market Analyst

“My mission is to help you to become a confident and successful trader”

EURUSD AT 7 MONTH LOW ON ECB EASING SPECULATION

November 26, 2015November 26, 2015 Forex Analysis

EURUSD, Daily (Updated)

EURUSD touched fresh 7-month lows of 1.0565, before rallying back over 1.0600, with pre-holiday short covering in play. The EUR, though, is still a bearish market, and with the inevitable interest differential widening becoming more apparent, the USD will continue to grind higher against the EUR over time, until we see a shift in the ECB policy. The next EURUSD downside target (S2) in at 1.0520, representing the April low. Continued downward pressure on the EUR is also supported by speculation of further ECB easing as early as next week’s ECB meeting, following a Reuters report saying central bankers are discussing two tiered charges on banks’ deposits and further bond buying.

Janne Muta

Chief Market Analyst

If you wish to get the latest forex brokers news,you can visit our Top Forex Brokers official website:

http://www.topforexbrokerscomparison.com

About Janne Muta, HotForex’s Chief Market Analyst

“My mission is to help you to become a confident and successful trader”

Intraday volatility in oil at support after Saudi comments

November 23, 2015 Forex Analysis

Crude Oil, Weekly

San Francisco Fed president Williams: said over the weekend that there is a “strong case” for a December rate hike. This sparked a dollar rally and some commodity volatility this morning. Today the Washington Post said that Saudi Arabia’s government is willing to cooperate with other producers to maintain stable prices. Therefore it’s not surprising that Nymex crude has had a mixed trading day today. Crude oil had a gap opening higher (we’ve been talking about Crude being at support!) in start of the futures trading. Then oil slid lower before bouncing higher again. Commodity currencies underperformed, with USDCAD whipsawing up and down with the oil market.

In the weekly picture crude oil has been forming a vast bullish wedge formation. This price action is taking place near multi-year low that took place in 2009. Current price action is taking place at lower Bollinger Bands and near a 37.75 support from August this year. Stochastics are oversold and the last week’s bar was a narrow range candle with open and closing prices near each other. Such candles signal that supply and demand are in a relative balance. Nearest resistance level is at 42.58 while the nearest support level is at 37.75.

Crude Oil, Daily

In the latest Live Analysis Webinar we focused on the fact that Crude oil was trading at a pivotal support (37.75 – 40.50) while the USDCAD has been trading near this year’s highs. This combination suggests that both markets are near potential turning points. Today’s opening gap to the upside together with OPEC’s comments supports the view while the bullish pin bar (a hammer) from Friday suggests the same. Stochastics, RSI and Money Flow Index are edging up from oversold levels. Today’s price advance was turned as the pivotal resistance at 42.58 invited sellers to push the price down yet again. Support area: is a pivotal candle support at 37.75 – 40.51 while resistance levels are at 42.58, 45.90 and 48.32.

Crude Oil, 240 min

The 42.65 proved to be too much for the oil bulls to handle and today’s rally was quickly rejected. The last 4h candle from Friday is bullish but today’s failure to challenge the resistance takes some of its edge away. Price is not trending lower anymore in this timeframe and there is some attempt to change direction from the support.

Conclusion

In the latest Live Analysis Webinar we identified the 37.75 to 40.50 area as potential support and 42.60 as a resistance. These S&R areas have proven to be highly valuable as Crude Oil has been bouncing between the levels. This is a good example of how fundamental information impacts the market and the technical levels as still very valid and valuable. The increased volatility with an opening gap suggest that market participants put two and two together and are looking for a turnaround in oil. However, the sideways move in the weekly chart is fairly near and could cause sideways action between it and the below support range. Saudi comments suggest oil market is near levels where the turnaround can actually take place.

Janne Muta

Chief Market Analyst

If you wish to get the latest forex brokers news,you can visit our Top Forex Brokers official website:

http://www.topforexbrokerscomparison.com

About Janne Muta, HotForex’s Chief Market Analyst

“My mission is to help you to become a confident and successful trader”