S&P 500 Analysis for 09.07.2015

September 7, 2015 Forex Analysis

S&P 500, Weekly
As the US and Canada are celebrating the Labour day the markets are likely to be subdued today. We will take this opportunity to visit the US stock market as it has had strong moves since my last report on stock indices. I suggested in my previous report August 12^th (Click here to read) that S&P 500 index future (ES) will move lower after making lower highs and, that it would be the time to enter the short side of the market by selling rallies.

Two weeks ago ES found support at a weekly pivotal low from October last year and rallied strongly after printing a low of 1831. This suggests to me that the price volatility will settle down for the near term. In other words, I don’t believe ES will move below 1813 but that it will fluctuate between it and 2054 resistance over the coming week. MFI and RSI are oversold which hasn’t happened since October 2014. This supports my view that market was over stretched to the downside at 1831. Also, price has moved outside the regression channel and is therefore very much in line with my predictions on May 7^th: stocks are in a topping phase.

S&P 500, Daily
ES jumped higher when buyers stepped in at a pivotal support between 1813 and 1883.25. Price rallied strongly to 1992.75 after which ES has fluctuated sideways above 1900 – 1920 range. The last time market rallied from 1813 support (October 2014) was in a different context. Then market was still trending higher and upward momentum after the 1813 low was considerably stronger. This resulted in price moving into a new closing high by the end of the month. This time there is no such momentum and ES will stay below previous highs. Therefore, price swings between support and resistance levels provide traders with plenty of opportunities.

With the market participants waiting for the FOMC meeting on September 17^th I expect that price will move sideways between the now created low and the resistance levels above. I don’t think it likely that ES would move below 1813 but rather create a lower high above it. Nearest support and resistance levels are at 1883 and 1992.75 while the next significant levels are at 1813 and 2046.

S&P 500, 240 min

Support below 1920 and resistance above 1960 have forced ES to move sideways and this has created a triangular formation of which price has broken out on the downside. This suggests there will be weakness before a move higher can resume. This is supported by the fact that the number of stocks falling in the NYSE is increasing more than the number of stocks rising. In addition, the short term volume statistics indicate weakness in the intraday picture. As there is higher time frame support relatively close by, I am looking for short exits and long entries at and around of 1850 support.

Conclusion

In the long term, the US stock market has broken out of the rising trend channel and entered into a topping phase which is usually fairly volatile. This is obviously good for our traders as there will be increased number or opportunities to catch bigger price swings. I expect the 1813 – 1883 support area will hold and eventually move the market to test 2046 resistance. In short term the support area between 1850 and 1183 is likely to support price while the first significant resistance level is at 1992.75.

Janne Muta

Chief Market Analyst

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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.

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Gold Rally Halted Near Resistance

August 17, 2015 Forex Analysis

Gold Rally Halted Near Resistance

Gold, Weekly

I pointed out in my previous report that the long term picture stays weak and suggests lower prices for gold. However, I noted that in short term we should see 1080 support holding and market testing the 1130 – 1146 resistance area. If price moves to this resistance area we should monitor price action for potential signs of momentum reversal at levels identified in this report.

Market has since moved roughly as expected with the price of gold moving briefly below the 1080 support. This intraday move was quickly rejected and price closed above the support. This was followed by a sideways move and then a rally that almost reached the lower end of my resistance range last week. The long term weekly picture remains bearish with gold trading near previous support areas. The 23.6% Fibonacci level coincides with the 1130.40 low and therefore suggests increased significance of that level. Other resistance levels are approx. at 1142 and 1160.

Gold, Daily

Gold extended a move to the downside and moved outside the bearish regression channel. Then it took its time after forming a pin bar at support and moved sideways. Now gold has rallied into the the upper Bollinger bands near the first significant resistance level at 1130.40. This level also coincides with a price projection based on the triangle width created by the sideways consolidation.

Stochastics is somewhat overbought and rolling over indicating momentum to the downside should be followed by the recent failure to penetrate the Bollinger Bands. However, the support is fairly close at 1100 to 1103. This support area is roughly the higher end of the sideways move. Therefore the downside move from the current levels might not be that strong or long lived.

Gold, 240 min

Price is moving sideways after breaking below an ascending regression channel. A pivotal high candle low at 1120 limits the upside moves while the nearest 4h support is at 1111.50 coinciding with the lower 4h Bollinger Bands. The upper end of the 1100 to 1103 support area is where 50 period simple moving average is at the time of writing. At the same time Stochastics Oscillator quite correctly suggests that price is trading approx. in the midrange of the recent sideways move. The latest complete 4h bar is a pinbar that indicates lower prices but there has been now follow through.

Conclusion

Even though gold is near the lower end of the long term downward trend channel the proximity of previous support levels (now resistance) suggests that it is hard for the buyers to create a strong rally from here. Price of gold has been a lacklustre performer in the past when the US Fed has been raising rates. This time should be no different unless some external event turns on a need for safe haven buying. Daily time frame rally from a triangle formation failed at the Bollinger Bands where it also reached a price projection target. This suggests the initial thrust to the upside is over as the target has been reached. If the support at 1111.50 breaks we should see gold correcting slightly lower to 1100 – 1103 support area. All in all, the price of gold is in the short term more likely to correct lower than move beyond the 1120 – 1126.30 resistance. Therefore if price moves into this range of resistance I will be looking for sell signals in the lower time frames. Should this take place my targets for the shorts are at 1110 and 1103.

Janne Muta

Chief Market Analyst

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US Stock Markets and MSCI World

August 12, 2015 Forex Analysis

Dow Jones Industrial Average future, Weekly

For the first time since the year 2011 the Dow Jones Industrial index futures are now moving below the 50 week moving average for more than two consecutive weeks. This speaks of a changed market psychology and is in line with my predictions in May. Also, China’s decision to devalue Yuan twice hit the market sentiment from two directions. First of all, it is a sign that China’s economy needs artificial support from a lower exchange rate and secondly now the products imported into China are more expensive and therefore less competitive. For German companies for instance China is an important export market. As a result Dax is trading almost 2.5% in the red today. Also, this move has been interpreted a sign of desperation on behalf of Chinese officials.

On May 7^th I tweeted on MSCI World Index saying that the bull market for stocks is over. I pointed out that MSCI World etf charts (weekly and monthly) indicate that the markets have entered to a volatile topping phase. This phase typically takes place after a long move higher and leads to a severe correction or a period of bear market. Monthly chart showed an increase in volatility and a bearish shooting star candle with the next candle moving well below the shooting star low. The weekly chart showed how this MSCI World index tracking etf had moved outside the up trending regression channel, a clear sign of increased volatility and weakness.

Since my tweet in May, the technical picture in many of the stock indices has continued to degrade. Dow Jones Industrial Average (DJIA) has moved sideways and has been weaker than both Nasdaq and S&P 500 indices. Just lately DJIA created a lower high that eventually led to index breaking below the 50 week moving average. After such a long move higher this is a bearish indication. Many other indices have also given clear bearish warning signs and suggest that for long term investors it is the time to gradually move money from long stock positions to inverse ETFs and into trading the short side opportunities with CFDs. Let’s take a look at what the other indices are signalling on the state of the global stock markets.

S&P 500, Weekly

On July 27th I wrote about S&P 500: Long term picture has turned more bearish with the index making a lower high. The supports however are still in place and should attract buyers at levels not far from the current price action. This will probably lead to rally but due to the overall weakness in different sectors I expect that this rally will lead to another lower high and more sideways ranging before the market can become directional again.

This is indeed what happened market rallied the next day and created yet another lower high. S&P 500 index future (ES) is again at those same levels and is trading close to both the weekly lower Bollinger bands and 50 week moving average. However, the next clear support level is a little lower at 2034.25. After a weak rally from this support area and a lower high in daily chart it might well be that this support will not hold but support is still support until it is penetrated. The next support is at 1973.75. Over the past week money has been flowing away from cyclical stocks into the safe haven of utilities. Utilities are up by over 2.5% in relation to S&P 500 index while Financial stocks are only up by 0.72% on the same basis. Market participants have clearly turned into more risk averse direction although there are no signs of strong risk aversion yet as financial stocks are holding up rather well.

Nasdaq 100 index future, Weekly

Nasdaq has been relatively strong when compared to other US indices. In mid June index was able to push into new highs but this move was quickly faded and Nasdaq fell back below the previous high of 4551. If a market breaks into new highs but cannot then sustain the new levels, it generally means that market participants did not see the move as a sign of strength but rather as an opportunity for profit taking. Index has since fallen almost down to a potential support area between 4344 and 4448. The bottom end of the range coincides with the lower 1.5 stdv Bollinger band while the 50 week moving average is not far away from the level at 4314. I expect that this down move in Nasdaq will reverse inside this support area but then there will be an important resistance are between 4551 and 4638.

MSCI World Index, Weekly

June 12th I wrote about MSCI World index etf: Weekly chart reveals that the index etf has made a lower high and has since then moved back to the support at 32.73, which once more bounced IQQW higher. This is very bearish and the peak of the lower high is a clear sell area should the market still manage to rally up there.

We have since seen exactly this happening: price rallied to the previous peak and turned lower right there. This global index tracker etf has been moving sideways in what very much looks like a topping formation after a huge run higher. For three months global stock markets have been in a topping mode as I expected would happen. Unless something extraordinary happens these topping formations tend to lead to sizeable corrections that usually bring the markets down at least the width of the formation. In the case of this MSCI World index etf it would mean almost a 10% correction below the current levels and 16% correction from the highs printed in April. This correction would be more severe in more smaller and volatile stock markets such as South-East Asia or Scandinavia or a high beta markets such as German Dax. Even though two lower highs indicate that the MSCI World etf will eventually break lower it is now close to a supporting level and we need to see the support broken before such a move can take place. The next significant support level is at 30.08.

Conclusion

The most important stock indices globally are showing signs of weakness just as expected. Such behaviour after a long and extended move higher in these markets suggests that institutions are not buying but rather distributing their long positions in stocks. This is a time to gradually move from long term investing to trading stock CFDs as there will be money making opportunities during both the sideways move (topping formation) and eventually in the following correction. Once the correction is over and stocks are at levels that are attractive from both a valuation point of view and technically we can start considering them again. Currently many of the indices are near the lower end of their topping formations. This increases the chances of markets rallying from here and it therefore makes sense to look for rallies to previous peaks or other major resistance levels in order to time the selling (and in case of traders, short entries) correctly.

Janne Muta

Chief Market Analyst

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S&P 500 TRADING NEAR LEVELS THAT SHOULD ATTRACT BUYERS

July 27, 2015 Forex Analysis

S&P 500, Weekly

At the time of writing Asian shares are on decline with Nikkei down by 1.2%, Nifty 0.97% and Hang Seng Composite down by over 3% and according to Bloomberg Shanghai Composite is down by 8% even in the government managed market. The US stock market finished Friday in the red, with S&P500 index losing 1.07%. Apart from the Fed expressing their commitment to raise interest rates market participants have been worried about valuations getting dear. S&P 500 P/E is getting close to 18 and disappointments with Caterpillar, 3M, IBM and Biogen Ideg’s earnings reports added to the worries of this market not being healthy enough to push into new highs. Additionally we had Apple publishing a record high quarterly result but the stock was hammered down by 9% the next trading day. This is not a sign of a bullish market but rather indicates that the willingness and commitment to pay higher prices and keep the uptrend intact is weak. China PMI being negative and a 6.8% drop in the US June New Home Sales report added to the negative sentiment. A look at the sectors reveals weakness in key sectors. All sectors came down last week but Industrials, Semiconductors, Basic Materials and Energy Stocks show signs of technical weakness.

S&P 500 e-mini future (ES) fell down from the resistance as expected and finished Friday’s trading inside the supportive range published in my previous reports. It is now trading near levels that should attract buyers .The price is at weekly pivot and fairly close to the lower Bollinger Bands and a 50 week SMA. Last week’s high was a lower high and suggests technical weakness in this index and price has now opened outside the up trending regression channel after wedging and then breaking out of the wedge.

S&P 500, Daily

ES reached my support range of 2073 – 2080 on Friday’s trading and the low of the day coincided with a 61.8% Fibonacci level. Stochastic oscillator is oversold and price is trading near pivotal support. As we have industrials etf XLI still is some distance away from the support levels I am expecting that ES cannot yet move higher but will either consolidate or correct further before finding serious demand. Financial sector also has space to correct lower and the same applies to Technology as well. This in fact applies to quite a few other sectors too and is likely to drag the US stocks lower before buyers emerge. Support and resistance levels in ES are at 2078 and 2116.50.

S&P 500, 240 min

Price is trading between two intraday support levels at 2064.50 and 2078 while Stochastics is at the oversold threshold. The nearest 4h resistance level is at 2091.50 where a declining trendline coincides with the level. There was a hammer candle on Friday night but no follow through after the candle was formed. Market has been dropping for 4 days so we might get a move against this trend and a test of next resistance level. If ES can create a higher intraday low and hold above 2078 price can move higher towards the next resistance at 2091.50.

Conclusion

Long term picture in S&P 500 index has turned more bearish with the index making a lower high. The supports however are still in place and should attract buyers at levels not far from the current price action. This will probably lead to rally but due to the overall weakness in different sectors I expect that this rally will lead to another lower high and more sideways ranging before the market can become directional again.

Intraday chart shows some signs of buying in a form of a hammer in the 4h chart. This was probably short covering before the weekend and this morning the quiet market has been ranging sideways with low liquidity. After moving lower for four days it would not be a surprise to see a move higher but we need to see how traders will react once the US market opens and some serious volume comes in. Look for momentum reversal signals at support levels.

Janne Muta

Chief Market Analyst

If you wish to get the latest forex brokers news,you can visit our TopForex 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”

S&P 500 TURNED LOWER AS EXPECTED

July 23, 2015 Forex Analysis

S&P 500 e-mini future (ES) turned lower soon after hitting my projection level at 2122 and is currently trading at 2102.75. This move lower was triggered by substantial overnight losses in Apple and Microsoft shares after IBM had lost ground significantly in the earlier trading session.

Apple posted record quarterly profit but was strongly sold off. Apple shares tanked nearly 9% in after-hours at one stage trade iPhone shipments missed forecasts and forecast revenues shy of the $51.1 bln targeted, wiping of some $50 bln in market cap. Apple shares cut those losses back to -6%. The absorption of Nokia also tarnished Microsoft’s results to the tune of a $7.5 bln write-off and 5.1% revenue decline for a $3.2 bln net loss, knocking its shares over 4% lower after-hours. Yahoo also missed and sank 2.2%.

I have been suggesting in the last two reports on ES that this market will rally the above resistance and will hit significant supply between 2111.25 and 2134. This has now taken place and for the benefit of those that have shorted the index in the resistance or will be selling the rallies we need to focus on the likely moves from here. In the July 16th report I said that the supply inside the resistance area should bring the ES down to 2073 – 2080 range and there is no need to deviate from this view.

Stochastics are rolling over from the overbought zone indicating further move down. This is likely as the next support can be found at 2078 level. The 50% Fibonacci level coincides with this area at 2080, therefore I expect market to find support in 2073 – 2080 range. There is some intraday resistance at 2009 to 2010 that might provide a short selling opportunity for those not engaged at the short side yet. The next intraday resistance is at 2119.25. Look for momentum reversal signals to confirm the validity of these levels.

Janne Muta

Chief Market Analyst

If you wish to get the latest forex brokers news,you can visit our TopForex 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”

Weak Gold Reacted Lower As China Bought Less Gold Than Expected

July 20, 2015 Forex Analysis

Gold, Weekly

Gold traded slightly below a major support level at 1130.40 on Friday and then moved even lower in Globex session at 2:30 am London time this morning. Price of Gold is down by 1.58% at the time of writing after Gold futures market was hit hard when it was at its weakest. Gold was trading at 1125 at the time when suddenly trading volumes increased by over 100% relative to average volumes over the past few hours. This aggressive selling during the hours when the market is at its thinnest took Gold down to a next major support level at 1080.

I warned about Gold’s long term weakness in my two previous reports. In June 8^th report I pointed out that price action in Gold since the US Dollar index (DXY) started topping has not supported the Relative Strength idea. A market that has true relative strength bounces sharply higher when factors constraining its move higher are removed. This never happened in Gold even though the restraining factor of DXY strength was removed for a while. In my June 22^nd report I pointed out several bearish indications in the long term technical picture: lower highs, a lower pointing 50 period SMA together with downward sloping trend channel and the fact that lack of momentum is indicating lack of serious long interest in this market.

This morning’s move took Gold down to a historical support from 2010 and very close to the lower end of the price channel. This bounced the price sharply higher while nearest resistance level is relatively close at 1130.40. The 23.6 Fibonacci retracement level at 1135.60 coincides with this resistance. The next resistance area is approx. at 1142.

Gold, Daily

News that China has been much more moderate buyer in gold than it was thought to be contributed to the fall. For the first time in six years China unveiled how much gold it had accumulated since 2009. While markets had assumed that the Chinese government had been buying gold at a rate of approximately 40 tonnes per month the real number was just slightly above 8 tonnes. This added to the bearishness as one big buyer was much less active than was suggested by the analysts.

After trending lower in a regression channel the price of gold has now made an extended move to the downside. The levels near the long term channel bottom attracted some serious buying as gold has rallied over three percent from today’s low. The nearest significant resistance level is at 1130.40 while next resistance is at 1146. The 1130.40 resistance coincides with the channel low. The 1080 level at today’s low is obviously the nearest support level in the daily time frame.

Gold, 240 min

As price has moved so quickly lower there isn’t much to comment in terms of technical analysis. Also, the four hour picture is not significantly different from the daily chart. Price has rallied from a support and is now trading close to the mid-range of the previous candle. The lower 2 stdv Bollinger Band has limited the move higher and the price of gold has reacted slightly lower from the band over the last two hours. The nearest 4h resistance level is at 1129.60 while the support level is at 1080.

Conclusion

The long term weakness that was visible in price action has now materialized in a form of a sharp move lower through weekly support levels at 1130 and 1141.70. These broken supports together with a former daily support at 1146 are now a likely resistance area. Long term picture stays weak and suggests lower prices for gold but in short term we should see 1080 support holding and market testing the 1130 – 1146 resistance area. If price moves to this resistance area we should monitor price action for potential signs of momentum reversal at levels identified in this report. Obviously price move can turn inside this range and not at the exact levels but the principle stays the same: we should see price action based confirmation before considering short positions.

Janne Muta

Chief Market Analyst

If you wish to get the latest forex brokers news,you can visit our TopForex 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”

DOWNTRENDING AUDCAD HAS RALLIED TO RESISTANCE AREA

July 17, 2015 Forex Analysis

AUDCAD, Weekly

AUDCAD has been moving lower in a wide trend channel after failing to penetrate at parity in the beginning of the year. Downtrend is clearly taking place as we have lower highs and lower lows but at the same time we need to acknowledge that this movement is taking place close to a longer term range low. AUDCAD has been ranging from 0.9205 in 2013 to 1.0349 in 2014 and the move we’ve seen since April this year has been taking place at lower end of this range. Therefore the longer term downside potential is limited and this pair could break out from the downtrend before breaking below the long term range bottom. This view is supported by the fact that the latest reaction low did not touch the channel low.

This week the pair has rallied strongly from lower Bollinger Bands and a support area near 0.9331. AUDCAD is now approaching top of downward sloping price channel which suggests that the short term upside is getting limited. This area also coincides with a weekly resistance level at 0.9664 and a 38.2% Fibonacci level at 0.9648. This resistance also lines up with a level that used to support price on closing basis in February this year. The nearest weekly support level is at the latest low at 0.9376 while the next significant weekly support level is at 0.9331.

AUDCAD, Daily

Price has been rallying higher for four consecutive days and is currently trading at July 1^st. pivotal candle low. Several technical factors coincide around the current price level: channel top, upper Bollinger Bands and a pivot high from July 1^st. These factors together suggest that price could turn lower from here. Additionally, Stochastics Oscillator is trading above the overbought threshold adding to the indication that this down trending market is quite overbought and therefore vulnerable at the current levels.

Price action today shows some signs of weakness as the pair is trading near opening price after a rally higher was rejected. However, it is still too early make conclusions based on today’s candle as trading action over the rest of the day is likely to change the form of this price bar significantly.

The next significant daily support level coincides with 50% Fibonacci retracement level at 0.9515 while the nearest significant daily resistance level is at 0.9664.

AUDCAD, 240 min

The pair built a small base between July 6^th and 14^th and has since rallied almost the distance equivalent to the base width. The pair is at the time of writing AUDCAD is still finding support from a minor support level at 0.9584 and tries to rally higher. However, Stochastics is overbought and shows signs of slowing momentum as it is very close to moving below its signal line.

Conclusion

AUDCAD has been ranging from 0.9205 in 2013 to 1.0349 in 2014 and the move we’ve seen since April this year has been taking place at lower end of this range. Therefore the longer term downside potential is limited and this pair could break out from the downtrend rather than breaking below the long term range low. This view is supported by the fact that the latest reaction low did not touch the channel low.

However, as long as we have a down trending market at a resistance, it makes sense to look for shorting opportunities. In short term, the pair is trading at resistance while still inside a downward trend channel. This suggests a move lower from current levels is more likely than a breakout from the channel. Look for momentum reversal signals between 0.9594 and 0.9664. If short trade signals take place and are successful then my targets are T1: 0.9515 and T2: 0.9475.

Janne Muta

Chief Market Analyst

If you wish to get the latest forex brokers news,you can visit our TopForex 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”

S&P 500 IN POTENTIAL TURNAROUND AREA

July 16, 2015 Forex Analysis

S&P 500, Weekly

Yesterday Fed Chair Yellen largely mirrored the recent FOMC statement and her own speech last week expressing cautious optimism about the expected rebound in U.S. growth, amid frustration about the continued low level of inflation. She cited global risks to this mostly healthy appraisal, and reiterated that it is not the lift-off but the policy path and pace of tightening that really matters. She expects a gradual tightening pace that still keeps policy accommodative.

Yellen’s speech didn’t move the markets that much yesterday. In fact, Nasdaq Composite (-0.12%), Dow Jones Industrial Average (-0.02%) and S&P 500 (-0.07%) finished the day almost unchanged but slightly in the red. Financial sector, up by 0.84%, was rising strongly while Utilities gained 0.49% in absolute terms. Technology remained unchanged after hitting a resistance level the day before. Semiconductor sector ended the day down by 0.50% after a period of weakness. Even though semiconductor sector etf (SMH) is now at support and could therefore have a technical rally, the preceding weakness in semiconductor stocks is not a sign of a healthy market. Weakness in the technology sector etf (XLK) suggests the same. S&P 500 e-mini future (ES) has since yesterday’s close moved to the resistance area (2111.50 – 2134) I pointed out in my previous report.

S&P 500, Daily

Yesterday investors reacted positively after Bank of America (+3.21%), PNC (+0.84%) and US Bancorp (+3.76%) reported earnings. While US Bancorp’s earnings were in line with expectations the others exceeded them. Big US companies reporting today include ADV Micro Device, Charles Schwab, Citigroup, Ebay Inc., Goldman Sachs and Google.

ES has now advanced to the 2111.25 resistance level as expected. Market is overbought as per Stochastics Oscillator, while RSI and MFI are still below their overbought thresholds. ES is trading at descending trendline and close to the upper daily Bollinger Bands. Therefore, market is near to a potential turn around level but based on the recent price action it seems likely that it will push further in to the resistance area. Support and resistance levels: 2078 and 2134.

S&P 500, 240 min

ES has been trading higher as expected but is now at resistance. The width of the short term bottom indicates that the market will move to a bit higher. Resistance at 2122 coincides with the projection and is a pivotal high June 22^nd. Stochastics has diverged from price indicating that momentum is slowing down and potential turning point is getting close. The next important support level is at 2078, while the weekly high from May at 2134 is the most important resistance level after 2122. In very short term, the nearest supporting pivotal level is at 2107.75 (short red line).

Conclusion

Yellen’s determination to raise rates is not supportive for the stock market that has been used to easy and cheap money. This together with the fact that US stock market is trading at very high levels with high valuations means that market participants aren’t eager to take the stocks into new highs. Price rallied over the last two days but now it’s trading at resistance. Area between 2111.50 and 2134 is an important weekly resistance. Market is likely counter substantial supply inside this range. This should bring ES back down to 2073 – 2080 range.

Janne Muta

Chief Market Analyst

If you wish to get the latest forex brokers news,you can visit our TopForex 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”

THE NEW CURRENCY MOVERS CHARTS TOOL NOW AVAILABLE IN TRADERS’ BOARD

July 15, 2015 Forex Analysis

The New Traders’ Board Page And Currency Movers Charts Tool

An all new Traders’ Board page is now public at Hotforex.com. We launched a new tool called Currency Movers Charts to serve You better. It displays both overnight and five day percentage changes in the major currencies against the other majors. Now you can, with just a glance, see how money is flowing between different currencies in Forex markets. With this tool you can identify the currency that’s currently attracting money at and over the last five days’ period while Currency Movers Charts also reveals which currency money is flowing out from.

EURNZD, 240 min

At the time of writing EUR is attracting money from other currencies while NZD and JPY have been losing some. The strongest performer intraday is EURNZD. In longer term picture the pair is trading at historical resistance created by a pivot in early 2014. Momentum is slowing down and should lead to a reversal. In intraday timeframe however the pair has rallied from a 4h support level and is currently trading just below a 50 period SMA but is moving higher from the downsloping trend channel top. The pair has some space above before it hits resistance at the previous day’s high at 1.6535.

AUDJPY, 240 min

AUDJPY is also interesting as it was the best performer earlier this morning. Over the last few days the pair has risen to a gap caused by the Greek drama couple of weeks ago. This could lead to a correction lower but because the pair is trading relatively close to 2015 weekly lows the downside is likely to be limited. Additionally, last week’s candle was a pinbar suggesting institutional buying between 89.00 and 91.20. Therefore, retracements back to 90.40 – 90.80 could provide us with low risk entries to this market. Look for momentum reversal signals to confirm the idea.

Five Day % Change

Another way of using Currency Movers Charts is identify strongly moving currencies over a period of time . GBP has been strong over the last five days with the biggest gains against the JPY. At the same time JPY has been the currency that has lost most against the other currencies over the same period. This indicates that market psychology has changed and participants have been moving away from safe havens into more riskier assets. This gives us insights on how markets feel about the future and how market participants have been positioning themselves.

GBPAUD, Weekly

GBP strength has been very evident lately but the GBPAUD has had a real bull run. The pair has been rising for 11 consecutive weeks. The fact that this has taken the pair to a historical resistance at 2.0948 and regression channel high gives us a reason to look for reversal signals as the pair might have moved too far and is getting close to a point were it will correct lower. Look for signs of momentum reversal in daily time frame. Weekly high from February (at 2.0028) is a likely long term target for shorts after the sell signals appear.

Janne Muta

Chief Market Analyst

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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”

S&P 500 Tries To Rally After Wedge Breakout

July 14, 2015 Forex Analysis

S&P 500, Weekly

US stock market corrected lower as expected and then found support in the region of lower Bollinger Bands and 50 period SMA. This move brought Stochastics to levels where it has turned higher from in the past. Last week’s candle was a rejection candle that suggests institutional buying in area of the lower Bollinger Bands. This week’s move above the last week’s high confirms the idea and suggests higher prices. However, there are resistance levels fairly nearby. The first one was hit yesterday as market closed the gap formed in the end of June. The next resistance level in the weekly picture is the low of a pivotal high from May at 2111.50.

Over the last month US stock market has been favouring safety stocks such as Utilities over the more risky financial stocks. Utilities are up by 1.71% when the baseline is the S&P 500 while the Financials have fared 0.23% worse than index. Other sectors with safe haven status, Consumer Staples and Health Care, are up 3.67% and 2.08% respectively. The indication here is that market participants have been careful and risk averse. This is likely to lead to a faltering of this rally at 2111.50 – 2134.00 resistance area and to a market that is range bound between the aforementioned resistance and the latest pivotal candle.

S&P 500, Daily

The earnings season has started in the US with some big names publishing their earnings today. Johnson & Johnson, JP Morgan Chase, Wells Fargo & Co and Yum! Brands are reporting today. The fact that season has just started should mean that we have plenty of volatility ahead in the individual stocks and should the results vary strongly from the expectations volatility would be likely to spill over to index as well.

S&P 500 index e-mini future (ES) has rallied to a spot where several technical factors coincide. The 50 period SMA, price gap and 61.8% Fibonacci retracement level all coincide at the current level. Usually a cluster of technical factors at certain level adds to the relevance and importance of the level but with a support nearby this level isn’t likely to attract strong short selling. This is evident by the sideways move we’ve seen today. The next important resistance level is at 2111.25 while the nearest daily support is at 2078 where the base high and 38.2% Fibonacci level roughly coincide.

S&P 500, 240 min

Stochastics, RSI and Money Flow index are all firmly in the overbought territory while price is trading near a level that used to support price at 2099. Nearest support level is at 2075. Width of the short term bottoming formation points to the next resistance level at 2122. Stochastics is overbought and suggests that the advance might slow down before the move can continue. Sideways move in a smaller time frame (e.g. 60 min) would indicate that the move higher will take place.

Conlclusion

Long term picture in S&P 500 index is somewhere between neutral to the slightly bearish. Market is still technically in an uptrend but is showing signs of weakness: bearish wedge and a breakout from the wedge. I still don’t expect ES to move into new highs but rather see it testing the 2111.50 – 2140 resistance area and then moving sideways between the latest pivotal candle and the aforementioned resistance area. My short term ES target for the current rally is at 2110. Trades should be always opened at pullbacks and should there not be any it’s better to wait for one rather than trade at low probability spots. Look for longs at supports and shorts at resistance levels.

Janne Muta

Chief Market Analyst

If you wish to get the latest forex brokers news,you can visit our TopForex 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”