Category: US/Midday Session Brief

Forex Signals US Session Brief May 11 – USD and Cryptocurrency Pullback Ending?

Posted on by Skerdian Meta

Yesterday’s US CPI report exposed what everyone was thinking, that the uptrend in the USD needs a refreshing. So, the Dollar is in a pullback period now. It started on Wednesday and is continuing. Cryptocurrencies are on the slide again and are threatening the support. Let’s have a deeper look at what’s been going on today. 

 

The USD Retrace Extends

After several weeks of trending up without a decent pullback and without countering much resistance, it was time the USD made a meaningful retracement. If a currency gains 500-600 pips in a few weeks, you should be ready for a violent pullback. That’s what’s happening now.

EUR/USD is about 100 pips higher from the lows and is still climbing higher. The picture on the daily and weekly charts show this pair turning bullish. Although, I see this move as a retrace and not a reversal. Therefore, I am following the price action to see where we might open a long-term sell forex signal. The obvious levels are 1.20, 1.21 and 1.22. Though, we will have to decide when this pair gets up there.

GBP/USD is more than 100 pips higher from the lows yesterday. If you remember, this forex pair lost around 150 pips yesterday after the Bank of England BOE failed to convince the market that they are still hawkish. They tried not to scare the markets, which would have sparked a bigger selloff in GBP pairs.

GBP/USD lost considerable value yesterday, but today this pair is more than 100 pips higher. This sort of price action tells us that the weakness is on the USD side this time. If the Buck is pulling back against the GBP, then the USD is in retrace mode.

Commodity currencies are making the most of it. They had suffered considerably during the USD uptrend of the last few weeks. Now, they are making their way up, particularly the CAD which is being encouraged by increasing Oil prices. Although, I still see this as a good opportunity to sell the rallies. We sold NZD/USD a while ago.

 

Cryptocurrencies Threaten the Support

Cryptocurrencies have been retracing lower in the last few days. I covered them on Wednesday and I pointed out two moving averages which were providing support on this pullback lower. The chart setup looked like it was going to turn bullish soon. The 100 simple MA (green) held the decline and the daily candlestick closed as a hammer, which is a reversing signal, particularly after a pullback.

Naturally, I thought that the pullback was over and the uptrend was about to resume again. Looking at the daily Bitcoin chart today, the reversal pattern from two days ago has been ignored and sellers are trying to break the support area.

The support area comes at $8,600, the low for nearly a month now. Although, the 100 simple MA (red) is not broken yet. The price is still trading around that moving average. If today’s daily candlestick closes above it, then it is likely that it resists as support and a reverse higher might follow. Otherwise, if it gets broken today, then the slide might stretch further. The stochastic indicator is oversold indicating that the pullback lower is complete. Let’s wait until the end of the day though, to see what Bitcoin wants to do.

The 100 SMA is fighting for its life

Trades

Bearish GBP/USD

  1. The trend is massively bearish
  2. The resistance area is holding
  3. The 50 SMA (yellow) is providing resistance above

 

We already sold this pair at the 50 SMA

This forex pair has turned bearish on the larger timeframe chart, but today it has been pulling back up. Although, it seems like the pullback might have reached the limits. The resistance area around 1.3580-1.36 is holding. The 50 SMA, which has been the main resistance indicator during the downtrend, is again doing its job. I am thinking of going short on this pair right now, or pretty soon.

 

In Conclusion

The uptrend in the USD has stopped for a breath of fresh air. The forex market is refreshing as the USD pulls back, but this pullback might have come to an end. Later on, we have Mario Draghi speaking and the release of Canadian employment in addition to the US consumer sentiment. These events might change the situation, so let’s keep posted.

Forex Signals US Session Brief May 10 – Tone Setting US Inflation

Posted on by Skerdian Meta

The US CPI (consumer price index) report is being released a day after the PPI (producer price index) report. The PPI report was worse than expected so the market is interested to see whether inflation is picking up or if it is making a turnaround. The USD has been retracing lower today, which has opened up several trading opportunities. Let’s see what the situation is out there and what trades we can take.

 

US CPI Inflation Up Next, Buckle Up for Some Nice Action

Yesterday, we had a chance to see the US PPI (producer price inflation) report and it wasn’t good. Its decline to 0.1% from 0.3% previously. Today, we will see the main inflation report. The CPI (consumer price index) which is the main inflation measurement will be released shortly.

Unlike the PPI report yesterday, the headline number of the CPI report is expected to come at 0.3%. Inflation started picking up in September of last year and we have seen several months with numbers such as 0.4% and 0.5% during this period. That has been one of the factors for the improvement in the sentiment towards the USD, also helping the USD reversal.

Subdued inflation and low wages have been the main reason for the FED remaining dovish. In the last several months though we have seen these two aspects of the economy improve slightly. The FED has become a tad more bullish, hence the reversal in the USD.

Last month, the headline CPI inflation declined to -0.1% which means that prices fell by 0.1%. If we see another negative number today, it will be the second one in a row and that won’t be good for the Dollar. On the other hand, if it comes as expected at 0.3% or even a tad lower at 0.2%, then I expect the sentiment to remain the same for the USD. If we see a positive number at 0.4% or 0.5%, the USD will complete another bullish sequence. The core CPI number is also important. That’s expected to come out at 0.2% as previously. Although, the reaction on the USD will be the same as with the main CPI number if we see any deviations.

 

Trying to Pick A Sell Trade in NZD/USD as the Aussie and the Kiwi Diverge

Commodity currencies such as the NZD, CAD, and AUD move together. When the market sentiment is positive in financial markets, these currencies feel energetic and start breaking resistance levels. When the sentiment is negative, Com Dolls dive lower.

Today, the market sentiment has been positive and the USD is retreating somewhat after trending up for about three weeks. The Canadian Dollar is taking full advantage of the current situation and USD/CAD has lost 200 pips since yesterday. The climb in Oil prices is helping the Loonie a great deal. Donald Trump scrapped the Iran deal, which means that there might be sanctions on exports from Iran. What’s the main export? Oil, of course, as well as carpets. So, Oil prices are making a bullish move and the CAD is reaping the benefits.

AUD/USD is climbing now and has formed a small uptrend since bottoming out just above 0.74 yesterday. The Kiwi, on the other hand, reached some fresh lows overnight. This divergence is bad news for the Kiwi and we just took a trade which we will explain below.

The Year-on-Year CPI (consumer price index) inflation fell from 2.1% to 1.8% in New Zealand. That’s quite a miss and the Reserve Bank of New Zealand (RBNZ) took notice right away. RBNZ Governor Adrian Orr said earlier today that currency intervention is a useful tool for the central bank and a rate cut is a valid option. These are terrible words for the NZD, hence the new lows today. The Aussie and the Kiwi have been pretty bearish recently, but this makes things really bad for the NZD. We are completely bearish on NZD/USD now.

 

Trades

Bearish NZD/USD

  1. The trend is massively bearish
  2. The downtrend picked up pace today after the CPI report
  3. The 20 SMA (grey) is waiting to provide resistance above
  4. Stochastic is overbought

 

We already sold NZD/USD before reaching the moving averages

We just opened a sell forex signal in this pair. The price hasn’t reached the 20 SMA (grey) or the 50 SMA (yellow) above, but this pair looks very weak and I don’t want to miss the bearish reversal that’s about to happen soon. The reverse is beginning so we are good with this trade.

 

In Conclusion

The US PPI report is about to be released and I’m thinking of going long on USD/JPY right now since this pair is finding support at the 50 SMA on the H1 chart. The Bank of England (BOE) is giving their verdict and the GBP has just dived 100 pips, so let’s get this article posted and have a look at what the BOE is talking about.

Forex Signals US Session Brief May 09 – The USD Pulls Back, We Get Active with Signals

Posted on by Skerdian Meta

The strong uptrend continues today for the USD. Right now it is retreating, which is perfectly normal during uptrends. The price action of the last few weeks has shown us that pullbacks, such as this, are great opportunities to buy the USD, so let’s see what we can trade. Bitcoin continues to slide, though it stalled right at the indicator we mentioned yesterday. The uptrend seems poised to resume soon.

 

Looking for Trades in USD Pairs

Earlier today, we posted an update where we highlighted the strong downtrend in EUR/USD. This forex pair broke the 50 SMA on the weekly chart yesterday. This moving average has acted as support and resistance previously, so now that it has been broken to the downside, the 50 SMA (yellow) looks like a good place to look for shorts. That moving average stands at around 1.19, while the price is at 1.1860s at the moment. If EUR/USD retraces up there, that would be a great opportunity to go short on this pair.

We just went short on AUD/USD (more details below). GBP/USD seems interesting too. It is trading at the 50 and 100 SMAs on the hourly forex chart. These two moving averages have been providing solid resistance on the way down over the last several weeks, so this opportunity looks great for sellers.

We have had a few forex signals on this pair, selling at the 50 SMA. All of them closed in profit, but GBP/USD hasn’t been making new lows like the rest of forex majors. It has lost nearly ten cents in a month and a decent retrace up is overdue, so, I think we will leave this pair alone for now.

USD/JPY looks very interesting as well, although in a reverse mode. It surged 80 pips higher this morning but it is reversing now. This reverse on the H1 chart is a retrace on the larger time frame charts. As we said in the previous forex update, the pullbacks in this pair today are a great chance to go long, particularly after the uptrend picked up pace today. I’m not sure at what level I will buy, but we just sold EUR/USD, so we have three open signals on major pairs already.

 

The Pullback in Cryptocurrencies Might Be Over. Get Ready to Buy

Yesterday, in the midday brief, I highlighted the pullback in cryptocurrencies. They have been trading in a steady uptrend for about a month. They started retracing lower on Monday after Bitcoin got close to the big round level at $10,000. It failed to move above that major level and started to retrace lower, pulling the other major cryptos down with it. We know that Bitcoin leads this new digital currency market.

We also highlighted the level where the retrace might end for Bitcoin. The 100 simple (green) and smooth (red) MAs had provided support and resistance previously, so it seemed like the target for sellers was either of these moving averages. These moving averages have converged and are pretty close at the moment, indicating that the reverse was going to take place somewhere there, wasn’t it?

It was and it did. The decline stopped right at the 100 smooth moving average (red). The price is reversing back up now, climbing back above $9,000 after having broken below it this morning. Now, the H4 candlestick looks bullish since it is closing as a pin. A pin is a reversing signal, particularly after a retrace like this.

The stochastic indicator is almost oversold. That means that the pullback is almost complete, so it seems like the uptrend will resume again. Want to go long on Bitcoin now?

 

The retrace is over, the upside is about to resume again

 

Trades

Bearish AUD/USD

  1. The trend is massively bearish
  2. The downtrend picked up pace today
  3. The 20 SMA (grey) is providing resistance
  4. The previous H1 candlestick formed an upside-down pin

 

We already sold this pair at the 20 SMA

AUD/USD has made some new lows today, which means that the sellers are in control. Although, we are seeing a pullback at the moment and we decided to take this opportunity. The stochastic indicator is overbought which means that the retrace is complete in this time frame. The pin candlestick is a reversing signal, so we went short. Now comes the part where we just wait.

 

In Conclusion

Trump scrapped the Iran nuclear deal and Oil prices tumbled yesterday, but they have recovered today and the CAD is gaining momentum. The market is a bit confused at the moment but we saw this as an opportunity to open a few forex signals. Now, we are quite exposed, so we will remain on the sidelines and try to nurse our trades.

Putting Our Trust on the 100 SMA for Our Second EUR/CHF Signal

Posted on by Skerdian Meta

As you know from our forex signal alerts (if you are a member), we have an open signal in EUR/CHF which we opened earlier today. We decided to go long above 1.19 which is a big round level. I thought that 1.19 would provide some sort of support since the sellers looked weak down there.

I was hoping for a bounce, but this bounce never came. So, down went the EUR/CHF as safe havens attracted strong bids and triggered the stop loss of our signal. That was a hit we took, but I am thinking of getting back into the market. It is not wise to fight the market, so we’re not trying to.

  

We think that this forex pair has reached the bottom, for now, so the retrace should be over. As you can see from the H4 chart, the stochastic indicator is oversold on the H4 chart and the trend is still massively bullish.

Yes sure, there is the case that the sellers have become active after the failure to break the major level at 1.20. This level is a big one, so it attracts a lot of attention. The buyers have also retreated somewhat, but now that the pullback is over they should start become active soon.

Although, I think I will wait a bit longer because the 30 minute chart looks a bit bearish at the moment. The stochastic is overbought on this chart and the 20 SMA (grey) is providing resistance, so there will be another attack at the bottom, by the looks of it.

The 20 SMA is reversing the price back down again

Although I expect this move to be over at the 100 SMA on the H4 chart, which stands at 1.1860-70, by that time, the stochastic will be oversold on the 30-minute chart. I will place a buy order at that area, so I don’t have to watch the charts overnight. By the way, we just went short on GBP/USD again. The chart setup is the exact same as the last time we sold this pair, which was last night.

 

 

 

Forex Signals US Session Brief May 07 – Cryptocurrencies Retrace Lower, the USD Marches Up

Posted on by Skerdian Meta

The US Dollar closed on a great week last Friday, the second one in a row. This is the USD at its best within a year and it is stretching the upside a bit further today. Cryptocurrencies closed last week on a bullish run as well, although we are seeing them make a retrace down, which is more than overdue.

 

USD Bulls Are Having Another Try

Today the UK is off for May Day. Not Theresa May Day, she hasn’t appointed a special day to herself, yet. Nearly half of all forex that is traded daily goes through London desks, so the forex market gets quiet when London is closed. We’ll see how Brexit will affect this in a few years because a lot of cash from mainland Europe goes through London now. That’s why Theresa May’s government has been trying to keep open borders for services, particularly financial services for when Brexit finally happens.

So, the price action has been pretty slow compared to the last two weeks, but one thing is certain, the uptrend is on the USD. The USD closed last week on a really bullish run. It was the second bullish week, which makes the last two weeks one of the best periods for USD bulls. In fact, this is the second decent retrace since January 2017 so the sentiment towards the USD is bullish.

It looks like the USD is reversing after such a strong downtrend that has lasted for about 15 months, but we can’t be sure about that until more major resistance levels are broken. However, the USD is in an uptrend in the smaller time frame charts, such as the H4 and daily chart.

The price action last Friday was pretty bullish. The US Dollar lost around 50 pips after the soft average hourly earnings (wages) in the afternoon since wages are pretty important for the FED at the moment. But, it reversed immediately and ended up gaining nearly 100 pips.

This sort of price action shows that the market is bullish on the USD. Today, the USD bulls are pushing up further, particularly against the Euro and the Yen. So, the uptrend continues for the Buck, although, we decided to open a counter trend trade in AUD/USD. We’ll see how it works out.

Cryptocurrencies Retrace Down, But Is The Pullback Over?

Cryptocurrencies have made a swift reversal after a massive downtrend which lasted from late December 2017 until early April of this year. Major cryptos, including Bitcoin, reached the 50 SMA on the weekly charts where they found solid support and they started their recovery from there.

Since then, Bitcoin has followed a solid uptrend, which has been followed by other altcoins. We have seen cryptocurrency sellers try to reverse the trend and send Bitcoin back down, but such events have been short-lived and the buyers have remained in total control for about a month now.

Today, we are seeing the sellers have another go and they have succeeded to some degree. Bitcoin reversed form below $10,000 and has lost around $700. This could be a reverse since it began near $10,000. Perhaps, the buyers reached their target and the sellers became active in protecting its resistance, so the reverse makes sense.

Or perhaps, this is just another retrace before the next leg up. To me, this seems more like a retrace. The previous candlestick looks like a hammer on the H4 chart, while the 100 SMA (green) is providing support. The stochastic indicator is oversold so the retrace seems complete.

The next logical move now seems to be bullish. This looks like a good opportunity to go long on Bitcoin, although, there’s still some more room on the downside if you look at the daily Bitcoin chart. So, we will observe Bitcoin today to see if the retrace down is really over.

The chart setup points to a reversal soon

 

Trades in Sight

Bearish GBP/USD

  1. The trend is massively bearish
  2. The 50 SMA (yellow) is providing resistance

The 50 SMA has been the ultimate selling indicator in this pair

These two factors are more than enough to pick out a trade right now. The trend has been bearish for three weeks and remains at bearish for now. We have opened a few sell signals here, all of which have been profitable, so down is the way to go for GBP/USD traders.

In Conclusion

The economic data is very light again today, although we do have two FED members speaking later on. They might give us some clues on what the FED thinks about the lower unemployment rate on Friday and the weak wages as well.

Forex Signals US Session Brief May 04 – US Employment Report Is Back in Focus

Posted on by Skerdian Meta

Today’s US employment report is to be released shortly. This report is quite important when it comes to market’s reaction,  but now it has become even more so. We will explain why below. Cryptocurrencies resumed the uptrend yesterday and they are stretching it further today, especially Ethereum.

The Employment Report Is Even More Important Now

The US employment numbers in themselves are somewhat important since they are a leading indicator of any given economy. Although, I have rarely seen the employment figures move markets in the last year, unless there was a major deviation from expectations.

We have seen the same happen with the unemployment rate. The unemployment rate had declined until several months ago, but the market hadn’t really noticed it. The US Dollar has been on a downtrend for the entire year last year. In the last two months, expectations were that there was going to be another decline in the unemployment rate, from 4.1% to 4.0%. But, it hasn’t moved. Today expectations remain the same, although we will see if unemployment will meet the new expectations.

The most important aspect of this report has undoubtedly been earnings. The average hourly earnings, or wages and salaries as I like to call them, have been weak compared to other sectors in the US economy. They have been keeping inflation subdued, so altogether, they have been keeping the FED alert. The FED doesn’t want to hike interest rates too fast, otherwise they might give wages and inflation another hit.

Why are wages now more important than a month ago?

On Wednesday, the FED held their meeting. The market was expecting some hawkish comments, but they decided to wait and see. Until a few months ago, the US economy has picked up and the FED started to get more hawkish. This had an impact on interest rates in December last year and again on March this year.

They also increased their outlook of the economy for the next couple of years. So, we were expecting to see new FED Chairman Powell deliver some hawkish comments. But, the FED left the decision to economic data. They revisited the data and the two missing pieces of the fundamental picture are the wages and inflation, that’s why today’s data is even more important than before.

Cryptocurrencies Continue to Grind Higher

Cryptocurrencies made a reversal last month when they reached the 50 SMA on the weekly chart. The major cryptos have been moving together as a pack with little difference between each other, so the overall picture remains the same for all of them. They were trading on a strong bearish trend for a few months, but the trend started to reverse when they met the 50 SMA, as you can see from the Bitcoin chart below.

Since then, the trend has been pretty straightforward. As you can see, all weekly candlesticks are bullish. I wasn’t sure at first that the trend had changed but five consecutive weeks of gains leave no room for doubt now.

The stochastic indicator is heading up and still has room to grow, so Bitcoin is not overbought yet. If you switch to the H1 or the H4 chart, you can see that the trend stalled last week. Although, yesterday and today the uptrend has resumed. How do you know if the uptrend has resumed?  If the price breaks previous highs, then the bulls are in control, which means the uptrend is back in place.

Bitcoin is trending up now, but it faces one major obstacle. The 20 SMA (grey) has provided solid support throughout last year. Bitcoin never dipped below it but it got broken earlier this year. We are heading towards it now so the chances are that it will now turn into resistance. Will it end this uptrend? No one knows, so we have to watch the price action up there. This is all about the employment report for now, so let’s concentrate on foresights.

The 20 SMA is waiting above

Trades in Sight

Bearish GBP/USD

  1. The trend is massively bearish
  2. The support at 1.3650 has been broken
  3. The 50 SMA is providing solid resistance

The 50 SMA looks good enough for sellers

This forex pair has turned extremely bearish now, so all trades here must be short on GBP/USD, until the trend reverses again – if it does at all. The 50 SMA (yellow) has been pushing the price down, so it looks like a good place to go short from. I’m not touching this forex pair now because the US employment report will be out in a minute, but the bias is strongly bearish.

In Conclusion

The US employment report has just been released and it leaves mixed feelings. Employment is up, the unemployment is down while the wages are down as well. This is confusing to trade on. Let’s post this midday brief quickly and see the report in details guys.

Forex Signals US Session Brief May 02 – One More Piece of Data Before the FED Rate Decision

Posted on by Skerdian Meta

The FED meeting is scheduled for this evening. The FED is expected to keep the interest rates unchanged after hiking them in their last meeting. Nonetheless, there is great potential for some wild market moves today. The last round of US data was published today and was a bit soft, so we’ll see what the FED has to say about the recent economic performance. The USD remains pretty bullish prior to the FOMC meeting today.

ADP-Non Farm Employment Softens Right Before the FED Meeting

The US economic data has now been good for years whilst a usual winter slowdown. Although, during previous months reaching througout the past year, depending on the economic sector, the numbers have improved further. Even wages/earnings and inflation, which have been lagging behind the rest of the economy, are starting to pick up as well.

That has increased the odds of the FED hiking interest rates more than what the consensus forecast has been. It has improved the situation considerably for the US Dollar. Especially over the last couple of weeks, the USD has made a complete turnaround, gaining several hundred pips against all major currencies.

It has broken through level after level, which is why we have recently mentioned it quite often. Although, today it seems like the market is waiting to hear what the FED really thinks of the economy and interest rates. The market is testing the USD bulls at the moment, albeit pushing lightly. EUR/USD has retraced higher from below 1.20 while USD/JPY is trying to break the support of the 20 SMA on the hourly chart.

So, what’s the take for this evening’s FED meeting? 

The market is expecting the FED to sound hawkish today. I also think that the FED might be a bit more hawkish today, considering the recent consolidation of the US economy just as the recent numbers have suggested. But how hawkish?

If they push for more rate hikes than twice or three times announced, the USD should continue to surge. But I doubt that. So, I will concentrate on what they may have to say about wages and inflation. If they mention the improvement in these two aspects of the economy, then that appear to be the signal for a tighter monetary policy, which will be a sign to start buying USD.

If not, then we might see a strong pullback from the USD rally. That would be a good opportunity to start looking into buying USD. Although, that won’t happen so fast, so we will have to postpone this trade until the retrace is complete, probably when EUR/USD retraces to 1.22 or GBP/USD to 1.40.

  

The Swiss Are Embracing Bitcoin Now, What’s Next?

The Swiss are the most conservative people in the world, aren’t they? Their politics, all neutral. In financing, they are like an iron safe, hence the safe haven status of the CHF. They like to screw the forex market from time to time, so traders are always wary of the Swiss National Bank SNB.

Surprisingly, we just saw the Swiss Economic Minister raise his voice today and sound like a young investor from Silicon Valley. He said that the Swiss intend to make Zurich the block-chain capital of the world. What, when?

They have tons of Gold on their currency reserves (Gold is pretty similar since it has no actual value apart from what we give it). According to this guy, a bunch of Swiss Ministers are planning to make Switzerland the Silicon Valley for cryptocurrencies. Well, blimey, they are going from one extreme to the other, so as I said before, Gold, cash, cryptos only hold the value that we give them, so why not?

Cryptocurrencies aren’t really surging on these news. Until late December, cryptocurrencies could change course depending on even smaller news. Today they seem unfazed and that’s a good thing. It shows that the crypto market has come to its’ senses.

Trades in Sight

Bearish Gold

  1. Safe havens are being crushed
  2. Market sentiment is great
  3. The trend is downwards
  4. The 50 SMA is providing resistance

The 50 SMA was a great place to go short on Gold

The Gold price has tumbled lately mainly doe to USD strength. But the improvement in the market sentiment has also contributed to this decline. Today Gold is making the next move down, so we keep a bearish bias on Gold. We’re a bit late because the 50 SMA has done its job perfectly as you can see on the chart above, but I still see more downside potential on Gold.

Conclusion

OK, that was it for the USD retrace. The US Dollar bulls have returned and they’re having their way again. They got used to it after all, just like we got used to book profit on our long USD forex signals. Our signal in AUD/USD just closed and I think we are going to keep it light until the actual FED meeting because the market might take a different turn now as the traders close their positions before the big event.

Forex Signals US Session Brief April 27 – Brexit Is Catching Up with the UK Economy

Posted on by Skerdian Meta

UK politicians and bankers have tried to ignore the Brexit impact on the British economy. But the effects are already showing even though Brexit hasn’t started yet. We thought that cryptocurrenices were about to reverse higher yesterday and that is happening as Bitcoin and Litecoin move higher after the retrace on Wednesday.

 

We Can’t Ignore the Brexit Impact Anymore

Only a week ago, the GBP buyers were ever so confident in the currency. Soft Brexit was underway and GBP/USD was surging like crazy. It seems strange to me that GBP/USD climbed above 1.43 when the economic data was deteriorating and with Brexit behind the door.

But, the Brexiteers in particular, were full of confidence that the UK economy was going to sail through any storm. Well, the GDP report today for Q1 poured cold water on that flame. It came at 0.1% against 0.3% expected, down from 0.5% in the last quarter of 2017. Last quarter was also revised down to 0.4%.

The annualized growth rate stands at 1.2% from 1.4% before this report was released. This is the lowest reading since 2012 when the global economic crisis was at its height. This means that there is no chance that the Bank of England BOE will raise interest rates on next meeting which is in May. If they do, I will eat my hat, that’s my promise. I will literally eat a hat.

The Brexiteers continue their epic denial though. The UK government’s spokesman just popped up saying that the GDP report was disappointing but the economy continues to grow after the Brexit referendum and the fundamentals are strong. Hello, Brexit hasn’t started yet and the economy is already trembling.

The decline in GBP/USD can’t seem to stop at anything or any level. A bit more than a week ago GBP/USD was near 1.44, now it is trading 600 pips lower and by the look of it, the downside is just beginning.

 

 

The Reverse in Cryptocurrencies Materializes

The reverse that we predicted yesterday in the midday brief for cryptocurrencies is really happening today. The 200 SMA (purple) held its ground for Bitcoin on the H4 chart. The 100 SMA comes at the same levels on the daily chart and it provided support for most of major cryptos.

Back to the H4 chart, you can see that the sellers gave up just above this moving average. The price formed a few doji and hammer candlesticks which are reversing signals. The stochastic indicator was also oversold, which looked like the pullback lower was done.

Now, the reverse is underway and the uptrend has resumed. Bitcoin is around $700 above the lows but if the buyers want to keep the uptrend going, they have to push above this week’s highs.

We can see a similar story in Ethereum and Litecoin, so the crypto market is moving as a whole again. I don’t know if we will see the leaves we saw last December in Altcoins, but this uptrend looks steady, so it is likely to stretch further.

 

 

The bullish chart setup that we posted yesterday materialized

 

Trades in Sight

Bearish NZD/USD

 

  1. The trend is strongly bearish
  2. The retrace up is complete
  3. The 50 SMA (yellow) is providing resistance

 

You can’t go against such a strong downtrend

 

This is exactly the same chart setup as the one we posted yesterday. We went short on NZD/USD at the 50 SMA yesterday and it proved to be the right decision as we booked profit in the afternoon with this pair sliding down. So, we are thinking of doing the same today.

 

In Conclusion

The UK GDP report was terrible this morning and it sent the GBP tumbling nearly 200 pips lower. But now we have the US GDP report which will be released shortly and that might give the forex market another shake, so let’s concentrate on that one now.

Forex Signals US Session Brief April 26 – Yields Can’t Help the USD Anymore

Posted on by Skerdian Meta

The U.S. dollar has enjoyed some great times this week. I’d say this has been one of the best weeks since January 2017 and most of it was an attribute to the rising U.S. yields. However, yields have done their part now so the USD bulls should find other reasons to buy the Buck now.

 

Is This the End of the Bullish Run for the USD?

The U.S. dollar has made some decent gains in the last week or so. The EUR/USD was trading around 1.24 about a week ago, while now it is trading at 1.2180s. So, the support level at 1.22 has been broken. This level should turn into resistance now and I would suggest it as a place to look for short positions on this pair, but the European Central Bank meeting is underway, which might spoil the charts.

The 10-year treasury yields have been rising recently which has helped the USD cause, pushing it higher without any decent retrace during this period. When U.S. Treasury yields rise, investors start buying them instead of other bonds since the return on investment (ROI) increases. So, the cash gets transferred into the USD and as a result, the Buck moves higher. This is what we have seen this week.

The 10-year treasuries have risen from around 2.80% to above 3%, although they have retreated back below 3% now. I don’t expect them to continue much higher now so the U.S. dollar will have to find another reason to keep the uptrend going.

Bitcoin Finds Support After A Bearish Day

 

Yesterday was a really bad day for cryptocurrencies. They had been on a bullish run for more than two weeks which seemed like the beginning of an uptrend after trending down for three months. But, as you can see from the H4 bitcoin chart, this crypto closed yesterday with considerable losses.

We highlighted the 100-smooth moving average on the daily chart yesterday. That moving average is holding on pretty well. It has formerly acted as resistance and it looks like it has turned into support now.

The picture on the H4 chart, though, still looks bullish. On this timeframe, it is the 200-SMA (purple) which is providing support. It has rejected the price twice today and now it seems like bitcoin is reversing up. The stochastic indicator is oversold and turning north at the moment.

Besides that, the previous H4 candlestick has formed a doji, which is a reversing signal. So, the picture on this timeframe chart looks increasingly bullish now.

 

 

The 200-SMA is doing a great job providing support

 

Trades in Sight

Bearish NZD/USD

 

  1. The trend is strongly bearish.
  2. The retrace up is complete.
  3. The 50-SMA (yellow) is providing resistance.

 

You can’t go against such a strong downtrend

 

The NZD/USD has been on a really strong bearish trend for quite some time and this week the downtrend has picked up considerable pace. Today, though, the price is retracing higher but the stochastic is overbought now and the 50-SMA is providing resistance. Should we go short right now?

 

In Conclusion

The round of U.S. economic data has been released. It looks good at first glance apart from core durable goods orders. Mario Draghi is holding his speech at the ECB headquarters, so there’s plenty going on at the moment. Let’s wrap up this midday brief here and get on with trading.

Forex Signals US Session Brief April 23 – Bitcoin Turns Bullish, GBP/USD Turns Bearish

Posted on by Skerdian Meta

Bitcoin started making a retrace higher last week, but it stalled below the 100 SMA. Now it has moved above it which means that the trend is really turning bullish. The GBP on the other hand, looks like is building itself up for a big tumble. That’s what I can tell from weekly and monthly charts, although let’s dig in deeper to see how valid these opinions are.

The UK flag doesn’t look so proud now

 

Several Major Bearish Signs in GBP/USD

GBP/USD has been on a solid uptrend for more than a year. During this time it has claimed nearly 25 cents which translates into 2,500 pips. That’s huge considering that Brexit is still happening. It’s for this reason that we must look at the bigger timeframe chart to see the bigger trend, so we’re analyzing the weekly and monthly charts.

These two timeframe charts show that the bullish run might have come to an end. The weekly chart presents up with three major bearish signals. The first one is the 100 SMA (red). The price hasn’t really respected this moving average lately so we can’t count on it as a support or resistance level.

What it shows is whether this pair is on a bullish mode or a bearish one. Right now the price has dived below that moving average so the sentiment in GBP/USD is bearish.

The bearish engulfing candlestick looks erm, bearish

Another bearish sign is the divergence in the stochastic indicator. The highs have been higher this time compared to January, but stochastic is lower. This is a bearish divergence and it points down, obviously.

The biggest bearish sign in my book though is the bearish engulfing candlestick. Last week’s candlestick was a big bearish one which dwarfed the two previous bullish candlesticks. That opens the door for further declines in the coming weeks.

The 50 SMA did a great job this time

Switching to the monthly chart, we see that this pair reached the 50 SMA (yellow). It did so last week when the price climbed above 1.43, but that moving average didn’t let go. It provided solid resistance on that attempt and now the candlestick looks like an upside down pin, which is a reversing signal after the uptrend. We moved the stop loss of our long term sell forex signal above that moving average last week, hoping it would reverse GBP/USD, which it did, so it was a good decision.

 

 

Bitcoin Finally Makes the Break

 

Cryptocurrencies made a jump about two weeks ago and started to for a bullish trend, but I was sceptical to consider it as a bullish move because the larger trend which started in December last year was still bearish.

Despite that, after the initial jump the upside started to lose steam and the 50 SMA (yellow) and the 100 SMA (red) were looming above our heads in Bitocin, which is the leader of the cryptocurrency market. So, the uptrend was not so sure, it might have been just a retrace before the next move higher.

But, cryptos made another jump last Friday and now it looks increasingly as the trend might be really changing. The 50 and 100 SMAs were broken and the 100 SMA is acting as support now.

If you switch to the daily Ethereum chart, you can see the same thing. The 100 SMA has been providing some decent support on the way down, so I was afraid it was going to turn into some strong resistance now. But thankfully, the buyers managed to push above it, which makes the bullish bias more credible.

 

The 100 SMA has now turned into support

 

Trades in Sight

Bullish USD/CAD

 

  1. The trend is strongly bullish
  2. Commodity currencies are on a bearish roll
  3. The 20 SMA is providing support

 

The uptrend has picked up pace

I was trying to open a buy forex signal in USD/CAD but I missed the opportunity just now. I was waiting for the price to reach the 20 SMA (grey) which provided support early this morning, but the price reversed about 10 pips above it, so we missed that opportunity. Although, I will still try to buy at that moving average if USD/CAD retraces back there again today since the market sentiment is really bullish for this pair.

In Conclusion

Commodity prices continue to decline today as the US Treasury continues with sanctions on RUSAL, the Russian aluminium giant. The commodity Dollars continue to suffer as a result, so we keep the bearish bias for AUD/USD and NZD/USD and the bullish bias for USD/CAD.