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Christian KÄMMERERHead of German Speaking Markets
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Barbara NICODEMOUMarket Analyst
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Melina DELTASJunior Market Analyst
Tuesday, 21 February 2017 08:08

WTI Still Trading in a Sideways Channel

Published in Commodites & Metals

Oil prices rose on Monday but the gains were limited. The Organization of the Petroleum Exporting Countries (OPEC) and other producers, including Russia, agreed last year to cut output almost 1.8 million barrels per day during the first half of 2017. The West Texas Intermediate crude oil remained unchanged for more than 10 weeks and is developing within a sideways channel with upper band $54.70 and lower band $51.47.

On a long-term basis, WTI is developing within an ascending move since April 2016 and our expectation is a further upside movement, if the price surpasses the referred upper boundary. The price is trading above the three SMAs on the daily chart while over the last week surpassed the 50-SMA. Technical indicators are following a positive path, however, with no clear directional strength. The RSI indicator is sloping slightly higher and MACD oscillator is holding in a neutral area with weak momentum.

WTICrudeDaily210217.png

Monday, 20 February 2017 09:13

Gold Created Douple Top at $1,245

Published in Commodites & Metals

The precious metal remained virtually unchanged over the last two weeks as it rose only 0.12%. On the weekly chart, the 200-SMA provided good resistance obstacle for the bulls as the XAU/USD pair failed for several times to surpass the $1,245 price level.

The gold is moving upwards since December after the pullback from the $1,122 price level. Over the last two weeks, the price created a double top at $1,245, so our expectation is a downward movement if there is a break of the $1,220 support barrier. The next level to watch is the 50-daily SMA which is moving near $1,197 and if the price slips below it, it will challenge the $1,180 support handle. Otherwise, we can see a strong run to the upside, if the yellow metal climbs above the aforementioned double top. Technical indicators are moving lower but are still in the positive path.

XAUUSDDaily200217.png

Monday, 20 February 2017 08:23

Strategic Report, 2017 Newsletter 8

Published in Strategic Report

 

Technical Analysis

1. German DAX30  WEEKLY OUTLOOK

REVIEW

German DAX 30 Index (.DE30Cash) after being in a range between 11,420 and 11,695 for few weeks, it had a failed attempt to surpass the 11,895 strong resistance level. After its try, the German index found support near the 50-SMA, on the daily chart, and now is in the process for the second the second attempt.

OUTLOOK (SCENARIO A / B)

If the bulls manage to push the price above the aforementioned strong resistance level at 11,895, the next target will be the 12,060. Otherwise, if the price slips below the 11,695 barrier, which provided significant support to the pair and the 50-SMA, on the daily, chart, we may see a drop towards the 11,420 support level. The technical indicators are endorsing our bullish scenario, as MACD is rising in the positive territory while RSI is also rising towards the 70 level.

DE30CashDaily20022017m

2. EUR/USD WEEKLY OUTLOOK

REVIEW

Euro ended the week unchanged against the U.S. dollar, as it failed to climb above the 1.0700 strong resistance level, which is a sign of persistent weakness. The EUR/USD pair is trading within the 50 and 100 SMAs on the 4-hour chart, as it awaits a significant event for having a strong rally in either direction..

OUTLOOK (SCENARIO A / B)

The common currency pair is trading near the weekly pivot point near 1.0610, while a break below the 1.0600 psychological level and the 1.0590 support barrier, it will expose the price towards the 1.0540 level which is the first support pivot point. Moreover, the next support zone to hit is at 1.0500 – 1.0520. On the other hand, an aggressive run to the upside above the 1.0680 – 1.0715 resistance zone will the price a push to challenge the 1.0830 resistance obstacle. Despite that, technical indicators seem to be in agreement with the bearish thought, as both entered the negative territory. RSI rebounded on the positive area and now is moving lower while MACD slipped below its trigger and zero lines.

EURUSDH4200217

3. GBP/USD WEEKLY OUTLOOK

REVIEW

Sterling moved lower against all of the major currencies during last week. The GBP/USD pair printed the third consecutive negative week and plunged more than 1%. On a daily timeframe, the pair is trading within a descending triangle since August 28th, 2016 with the strong support level at 1.1985. Also, the price lost its momentum and seems very weak.

OUTLOOK (SCENARIO A / B)

Going to a short-term chart, the cable is developing within a narrow range at 1.2385 – 1.2580 which tested both sides several times but failed to end a day below or above this area. On Friday’s session, the price reached our recommended target at 1.2440 (see technical analysis here: http://bit.ly/2kP48By) and slipped lower at the lower band of the consolidation area. If the price jumps above the 1.2440 resistance level, it will move towards the 50 and 100 SMAs which are near the 1.2500 critical level. If GBP/USD breaks below 1.2350, the door is wide open for a drop to 1.2250. The RSI indicator is sloping upwards and stochastic oscillator rebounded on the oversold area and is trading higher. The MACD oscillator is endorsing the bearish attitude as it is moving below its trigger and zero lines.

GBPUSDH4200217

4. USD/JPY WEEKLY OUTLOOK

REVIEW

The U.S. dollar traded lower, this past week, against the Japanese yen and remained steady versus all of the other major currencies except for sterling. There is no fundamental explanation for the reversal in the greenback while the USD/JPY pair is developing within the 50 and 100 SMAs on the daily chart.

OUTLOOK (SCENARIO A / B)

From the technical point of view, the pair following the bounce off the 50-daily SMA which overlaps with the 114.95 resistance level, recorded three negative days in a row and hit the 112.60 support barrier which is near with the 100-daily SMA. Currently, the price is moving higher but it will find strong obstacles the three SMAs near 113.30, on the 4-hour chart. If the currency pair surpasses the aforementioned levels, it would open the way for a test of the 200-SMA near 114.00 or furthermore for a retest of the 50-daily SMA near 114.60. Technical indicators are biased higher. The RSI indicator is approaching the 50 level whilst the stochastic oscillator is moving towards the overbought area.

USDJPYH4200217

5.  AUD/USD WEEKLY OUTLOOK

REVIEW

The Aussie ended the week marginally lower versus the greenback but is in progress to create the second positive month in a row. The AUD/USD pair surged more than 6% since January and recorded a fresh three-month high at 0.7730 on last Thursday’s session.

OUTLOOK (SCENARIO A / B)

After the slightly lower move, the commodity pair started a green day and is approaching the 0.7730 resistance barrier. In addition, the price can challenge the 0.7780 key level while the moving averages are indicating bullish signal as an upward crossover of the 50 to 100 SMAs has been observed. An alternative scenario is a penetration of the 0.7605 support handle which will drive the pair towards the 0.7510 obstacle. The RSI indicator confirms the upward movement as its moving slightly higher above the 50 level.

AUDUSDDaily200217

6. WTI Crude Oil Weekly Outlook

REVIEW

Oil prices rose early on Monday but the gains were limited. The Organization of the Petroleum Exporting Countries (OPEC) and other producers, including Russia, agreed last year to cut output almost 1.8 million barrels per day during the first half of 2017. The West Texas Intermediate crude oil remained unchanged for more than 10 weeks and is developing within a sideways channel with upper band $54.70 and lower band $51.47.

OUTLOOK (SCENARIO A / B)

On a long-term basis, WTI is developing within an ascending move since April 2016 and our expectation is a further upside movement, if the price surpasses the referred upper boundary. The price is trading above the three SMAs on the daily chart while over the last week surpassed the 50-SMA. Technical indicators are following a positive path, however, with no clear directional strength. The RSI indicator is sloping slightly higher and MACD oscillator is holding in a neutral area with weak momentum.

WTICrudeDaily200217

7. XAU/USD WEEKLY OUTLOOK

REVIEW

The precious metal remained virtually unchanged over the last two weeks as it rose only 0.12%. On the weekly chart, the 200-SMA provided good resistance obstacle for the bulls as the XAU/USD pair failed for several times to surpass the $1,245 price level.

OUTLOOK (SCENARIO A / B)

The gold is moving upwards since December after the pullback from the $1,122 price level. Over the last two weeks, the price created a double top at $1,245, so our expectation is a downward movement if there is a break of the $1,220 support barrier. The next level to watch is the 50-daily SMA which is moving near $1,197 and if the price slips below it, it will challenge the $1,180 support handle. Otherwise, we can see a strong run to the upside, if the yellow metal climbs above the aforementioned double top. Technical indicators are moving lower but are still in the positive path.

XAUUSDDaily200217

FX Weekly Market Preview

Weekly Outlook: Feb 20 - 24; FOMC Minutes, E.U. CPI & U.K. GDP Ahead

The highlights of the week ahead are firstly the FOMC minutes that will be published on Wednesday at 19:00 GMT, and second the inflation reports from Eurozone and Canada, as well as the U.K.’s GDP growth, also on Wednesday. Meanwhile, significant attention will be paid on Tuesday, the Markit PMI day for several countries, including U.S., Euro area as a whole and Germany.

Monday is a public holiday in the U.S. due to President’s day, while in Euro area, only few not market-maker data is coming out, thus trading will be thin. Early in the morning, German producer price index for January will be released. In the U.K., the CBI industrial trends survey for the manufacturing orders in February will be released while afternoon, Eurozone’s estimate for consumer confidence in February is expected to slip lower to -4.85 from -4.70 before. Overnight, the Reserve Bank of Australia will release its last meeting’s minutes.

Tuesday is a Markit PMI day. The Markit economics will release February’s first estimates for flash manufacturing and services PMIs for U.S., Eurozone as a whole, Germany and France. In Euro area, the services sector is expected to show a small improvement to 53.8 from 53.7 before, while the manufacturing sector is expected to snap five consecutive increases by falling marginally to 55.0 from 55.2 in January. In the U.S., manufacturing sector is forecasted to rise to 54.8 versus 55.0 before, which was the highest in reading since 22 months. No forecast is available for the U.S. services PMI.

In the U.K., the public sector net borrowing for January is coming out. In Australia, after the release of the CB leading indicator for December, during the European night, RBA’s Governor Philip Lowe will give a speech and will probably affect the Aussie. The Westpac leading index for January is also coming out.

On Wednesday, early in the European morning, U.K.’s index of services for the three months to December is expected, while at the same time in Germany the IFO survey is expected to release its results for February. All of the three IFO indicators, expectations, current assessment and business climate for Germany, will probably show a slight weakness compared with the month before. Half an hour later, attention will be on U.K.’s GDP figure for the fourth quarter. The estimate for the economic growth is expected to be the same as the previous quarter, at 2.2% year-over-year and 0.6% month-over-month.

Eurozone’s final inflation rate, on annual basis, is expected to meet initial estimate of 1.8% in January. However, the consumer prices on a monthly basis, are expected to plunge 0.8% in January from a rise of 0.5% before. ECB will also release the targeted Long-Term Refinancing Operations (LTRO).

In the U.S., the existing home sales for January will be published, however, the main focus will be on the FOMC minutes, coming out at 19:00 GMT. At Fed Chair Yellen’s two-day testimony, the central bank continued to send hawkish signals for the economy. If the meeting minutes agree with the rate hike prospect, we will see the odds of a rate hike in the next months rising sharply.

On Thursday, early in the morning, the German GDP for the last quarter of 2016 is coming out. The market expects the German economy to keep the same pace of growth with the initial estimations (1.2% year-over-year and 0.4% quarter-over-quarter). In the U.S., the weekly jobless claims are coming out as usual while later on, the housing price index for December will be released. Fed’s Dennis P. Lockhart has a speech at 13:35 GMT.

On Friday, the economic calendar is muted of European economic news. The Canadian inflation rate for January will be released and afterwards, the attention turns to U.S. The Michigan consumer sentiment index for February is coming out as well as the new home sales for January.

UKGDP22022017

EUinflation22022017

 

Friday, 17 February 2017 12:57

U.S. Cotton Extends Declines Below $75.00

Published in Commodites & Metals

U.S. Cotton futures with delivery in March 2017 keeps declining for the third consecutive day after breaking down of the uptrend line connecting the bottoms from the end of December, 2016 and the mid of January, 2017 and reaching the price of $74.30.  We expect that during the next days the price of the commodity to continue falling until the support level at $72.80. On the other hand, if the bulls come back on the stage and cotton rises above $76.40, the next target will be the key level at $77.30 (the high formed on February 02, 2017).

A look at the technical indicators confirms the expectation for the decline. The price is below 50 and 100 EMA on the 4-hour chart. MACD is keeping declining below zero line. RSI is sloping down, crossing below 30 level and entering into the “oversold” zone.

USCotto_H7H4.17.02.2017.png

Monday, 13 February 2017 12:43

U.S. Cotton $77.00 In Focus

Published in Commodites & Metals

USCottoH7.13.02.2017.png

Monday, 13 February 2017 09:58

XAU/USD Slipped Below 50.0% Fibo Level

Published in Commodites & Metals

The yellow metal jumped more than 1.1% over last week’s session and found an obstacle on the $1,245 resistance barrier which coincides with the 50.0% Fibonacci retracement level of the downward significant move with high at $1,375 on 6th of July 2016 until the low at $1,122 on 15th of December 2016.

The XAU/USD pair is moving upwards since December and if the price surpasses the aforementioned fibo level, it would open the way for the 200-SMA near the $1,260 on the daily chart. The 50-daily SMA is sloping upwards and is approaching the 100-daily SMA while technical indicators are endorsing the upward movement. The RSI indicator is moving higher and is following a positive path while MACD is moving above zero line near its trigger line.

XAUUSDDaily130217.png

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