[FOREX TIP] USDCHF Weekly Forex Forecast – 30th Jan to 3rd Feb 2017

USDCHF Weekly Forex Forecast – 30th Jan to 3rd Feb 2017

Technical Outlook: USDCHF failed to validate the evolving head and shoulders pattern as price fell lower towards 1.0000. Still, the doji candlestick formed on Thursday and Friday signal initial signs of a short term retracement to the upside. Immediate resistance is seen at 1.0097 which could be tested in the near term, although there is a slight chance that USDCHF could slip towards 0.9934 before bouncing off this support level to test the resistance at 1.0097. Still, selling opportunities are likely to come by near the 1.0097 resistance. The Stochastics oscillator has printed a hidden bearish divergence with a lower low against higher low in price. Therefore, watch out for USDCHF to post a reversal around 0.9934.

Fundamental Outlook: Data from Switzerland this week will see the manufacturing PMI for January. Economists polled expect manufacturing PMI to rise to 56.1 from 56.0 previously. Later in the week, the retail sales figures are expected to show an increase of 0.5%, slower than the previous month’s 0.9%. The lack of any major data points from Switzerland will shift focus to the data from the U.S. starting Wednesday which will include the ISM manufacturing and non-manufacturing PMI and Friday’s payroll numbers.

Previous USDCHF Weely Forex Forecast

USDCHF Weekly Forex Forecast – 30th Jan to 3rd Feb 2017 – Bullish

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[FOREX TIP] USDJPY Weekly Forex Forecast – 30th Jan to 3rd Feb 2017

USDJPY Weekly Forex Forecast – 30th Jan to 3rd Feb 2017

Technical Outlook: USDJPY corrected towards 112.70 as expected and mentioned in last week’s analysis. Price action posted a strong reversal forming a double bottom near the support level at 112.70. A breakout above 115.355 will signal further upside in USDJPY towards 118.00 as the minimum upside on the double bottom bounce. Therefore, look to buy USDJPY above 115.35 on a potential retest to this level to establish support or on a minor dip. Ahead of the breakout above 115.35, look for USDJPY to post a minor correction towards 113.99 – 113.79 which makes for an ideal buying area with stops just below 112.70 targeting 115.35 and 118.00 offering a tight risk/reward set up.

Fundamental Outlook: Last week, data from Japan showed that inflation rose 0.1% in the month of January as forecasted by economists. This rather slow pace of inflation is likely to push the BoJ to turn more hawkish when it meets on Tuesday. No changes are expected from the Bank of Japan at this week’s meeting but expect some dovish statements to come from the central bank officials. USDJPY will also be influence by the U.S. economic data this week which will include the key FOMC meeting which could bring some volatility to the markets.

Previous USDJPY Weekly Forex Forecast

USDJPY Weekly Forex Forecast – 30th Jan to 3rd Feb 2017 – Bullish

 

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[FOREX TIP] EURUSD Weekly Forex Forecast – 30th Jan to 3rd Feb 2017

EURUSD Weekly Forex Forecast – 30th Jan to 3rd Feb 2017

Technical Outlook: EURUSD closed below 1.0700 last week which signals the downside correction towards 1.0600 initially. The price action shows a bearish breakout from the rising wedge/triangle pattern with the final sessions on Friday showing a modest retest to the breakout level of the rising wedge pattern. As long as 1.0700 turns to resistance, EURUSD could remain biased to the downside as price will slide towards 1.0600 to establish support. The bearish divergence to the Stochastics, the median line breakout and the weekly doji close (after five weeks of straight gains) point to the downside in EURUSD this week.

Fundamental Outlook: The markets will be looking to a busy week from Wednesday as fresh economic reports are released for January. The manufacturing and services PMI figures will be coming out in the early part of the week and could give further insights into the economic performance from the Eurozone in the first month of the year. The Eurozone GDP figures will be released this week alongside flash inflation estimates for January. GDP is expected to rise 1.7% on an annualized basis in the region, but focus will be on inflation estimates which could see further increase in consumer prices. The Eurozone’s economic forecasts will also be coming out this week.

Previous EURUSD Weekly Forex Forecast

EURUSD Weekly Forex Forecast – 30th Jan to 3rd Feb 2017

 

 

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[FOREX TIP] AUDUSD Weekly Forex Forecast – 30th Jan to 3rd Feb 2017

AUDUSD Weekly Forex Forecast – 30th Jan to 3rd Feb 2017

The AUDUSD technical pattern is signaling a major reversal unfolding. We can spot a massive bearish divergence between the price and the stochastic indicator. For confirmation, we need a break below 0.7525 but more important a break and a daily close below the 0.7500 big psychological number. To the upside last week high 0.7600 should act as resistance.

The Chinese manufacturing activity is a proxy risk event that can drive up the AUDUSD volatility. On Wednesday, the NBS Manufacturing PMI is expected to inch lower to 51.2 while on Friday the Caixin Manufacturing PMI is also expected to come down from 51.9 to 51.7 signaling an economic slowdown in the world’s second largest economy which can negatively impact the AUD/USD.

The Australian Trade Balance which posted the first trade surplus in years is also scheduled to be release on Wednesday, but since much of it was attributed to the rise in commodity prices we can expect a down tick in Trade Balance which can be bearish for AUD/USD.

Previous AUDUSD Weekly Forex Forecast

AUDUSD Weekly Forex Forecast – 23rd to 27th Jan 2017 – Bearish

 

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[FOREX TIP] USDCAD Weekly Forex Forecast – 30th Jan to 3rd Feb 2017

USDCAD Weekly Forex Forecast – 30th Jan to 3rd Feb 2017

Both the fundamental and technical suggest that the line of least resistance for the USDCAD remains to the upside. Last week’s sell-off structure still looks corrective in nature and as long as we trade above 1.3030 and more importantly above the 1.3000 big psychological number the bullish case should prevail.

The stochastic indicator suggests that the first day of the week should be slow until it reset itself. We don’t have much resistance to the upside until 1.3300 which is why we favor more the upside. The Canadian economic calendar will bring the GDP figures which will give traders more insights into how the Canadian economy performed during the last month of 2016. Based on the market consensus we should expect a pick up in the Canadian economy and see a 0.3% growth. The Fed interest rate decision is without a doubt the main risk event of the week. The market consensus only sees the Fed beginning raising rates from the second half of the year.

Previous USDCAD Weekly Forex Forecast

USDCAD Weekly Forex Forecast – 30th Jan to 3rd Feb 2017 – Bullish

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[FOREX TIP] GBPUSD Weekly Forex Forecast – 30th Jan to 3rd Feb 2017

The GBPUSD two-week rally has made a strong case for the bullish case and the prospects of a full-scale reversal or at least a deeper retracement. The weekly close above the 1.2500 big psychological number is indicative of more GBPUSD strength. However, we can still see a downside break and a retest of 1.2432 support level before more strength to be seen.

GBPUSD Weekly Forex Forecast – 30th Jan to 3rd Feb 2017

The stochastic indicator has also turned down and is in oversold territory which suggest the current retracement has gone too far. To the upside, we have 1.2763 last week high which can act as resistance but more likely if challenged that level can give up quite easily given the recent GBPUSD strength.

The UK economic calendar looks busy as on Thursday we have the BOE interest rate decision. Despite the recent UK economic growth and no signs of a slowdown post-Brexit the BOE is unlikely to hike rates this year. The ongoing Brexit process will also be a big theme for GBPUSD volatility. Last week the UK government published a bill to start the UK exit from the EU which gives the Britain parliament only five days to debate the bill. Traders should pay closer attention any news on this subject as it can be the catalyst for some spikes in the GBP/USD exchange rate.

Previous GBPUSD Weekly Forex Forecast

GBPUSD Weekly Forex Forecast – 30th Jan to 3rd Feb 2017 – Bearish

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[FOREX TIP] Monthly Forex News Events for EURUSD – Feb 2017

Monthly Forex News Events for EURUSD – Feb 2017

The first month of the new year has brought EURUSD to a new multi-year low which was quickly bought and since then EURUSD exchange rate has been positive. The lackluster December NFP report of only 156k new job added, coupled with extreme dollar bullish bets which acted as a contrarian catalyst has fueled the EURUSD recovery. On the other side of the FX spectrum, the ECB president Mario Draghi has softened his dovish tone which has helped the EURUSD recovery.

On the other hand, the Fed Chairwoman Janet Yellen has warned that a delay in the tightening cycle can hamper economic growth. It seems the Fed, at least for the time being, is still on track to gradually hike rates which is the reason why current EURUSD rally can be in jeopardy. Going forward, we’re going to analyze and disseminate the major news event in the upcoming month that can be the catalyst for higher EURUSD volatility.

“Don’t risk significant money in front of key reports, since that is gambling not trading.” Paul Tudor Jones

February 2017 EURUSD Potential Risk Events

February 2017 seems a quiet month in terms of major risk events and other than the usual economic and Central Bank announcements there is nothing much to worried about. However, we need to pay closer attention to the Trump’s economic plans now that he is sworn in as the 45^th US president. Each of his words will be measured on a different scale as those words, now can easily be turned into real action that can affect the economy and potentially strengthened the US Dollar.

• Wednesday, February 1, 2017 – The first day of the new month will bring the FOMC statement and the Fed’s interest rate decision. There are no real expectations that the Fed will raise rates during the first half of the year especially under a Trump presidency that vows massive infrastructure investments. However, for the time being, we can expect the same hawkish rhetoric from the Fed which can boost the greenback even if they keep the monetary policy unchanged.
• Friday, February 3, 2017 – Usually, the first week of each month brings the Non-Farm Payrolls Report one of the most awaited figures especially for Forex traders. The market consensus is for a flat reading of 4.7% Unemployment rate. After modest 156k new jobs added during the last month of 2016, the market consensus is for 165k jobs added during the first month of the new year which can still be enough to push up the greenback.
• Friday, February 3, 2017 – The Malt informal EU summit which will gather the EU heads of states is a major risk event as major topics like the immigration crisis, Brexit, and the EU economic problems will be on the top of the list.
• Tuesday, February 14, 2017 – The German Preliminary GDP figures is a big risk event for the EURUSD exchange rate. The German GDP grew strongly to an impressive 1.9%, the strongest rate in five years. Having a weaker euro currency has definitely helped Europe’s engine of growth which relies heavily on exports.
• Wednesday, February 15, 2017 – The US CPI inflation figures is another big risk event because inflation is part of the Fed assessment on deciding whether to hike rates or not. The US CPI inflation rose 0.3% in December while the annualized rate grows to 2.1%. With the pickup in the energy sector coupled with the broad based dollar strength, we can expect to see inflation during the first month of 2017 on the same levels we saw at the end of last year.
• Wednesday, February 15, 2017 – The US Retail sales posted another strong month in December due to the holiday season. After a 0.6% growth in retail sales, we can expect a much slower January, as usually the first month of the year has a strong seasonal pattern that suggest a slowdown in retail sales.
• Wednesday, February 22, 2017 – The FOMC Meeting Minutes which gives more insights from the previous Fed rate decision is a good opportunity for traders to learn more about the Fed’s monetary policy outlook. This details of the FOMC Meeting Minutes can drive the dollar sentiment and as we have seen from previous reports the rate hike forecast are at best an educated guess. It’s hard to believe that the Fed will deliver 3 rates hikes in 2017 and as soon as the investors will realize this reality we’ll see dollar long positions being liquidated.
• Tuesday, February 28, 2017 – The US GDP figures is the first opportunity for investors to see how the economy has performed during the first month of the new year. The US economy grows at a slower pace in the last quarter of 2016 but Trump’s economic plans and infrastructure spending can boost growth which means that the risk remains to the downside.

 

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[FOREX TIP] Weekly Forex News Events for EURUSD – 30th Jan to 3rd Feb 2017

Weekly Forex News Events for EURUSD – 30th Jan to 3rd Feb 2017

EURUSD had a quiet week. However, it will not be as quiet next week as it was in the last week. We are going to have a new month next week. Some high impact news events have been scheduled to take place. Thus, the pair might get volatile next week.

Let us have a look next week’s high impact news events.

Tuesday- 31^st January 15.00 GMT

• CB consumer confidence

This news event has a tendency to produce spike and wipe off intraday stop losses.

Wednesday- 1^st February 13.15 GMT

• ADP Nonfarm employment change

Wednesday- 1^st February 15.00 GMT

• ISM manufacturing PMI

Wednesday- 1^st February 15.30 GMT

• Crude oil inventories

Wednesday- 1^st February 19.00 GMT

• FOMC statement

This is going to be a very volatile day. All of these news events can create huge volatility, but FOMC is the one that does it most. Traders should be very careful to take entries on EURUSD next week before these news events.

Thursday- 2^nd February 13.30 GMT

• Unemployment claims

It normally is a massive news event. However, EURUSD has the tendency to go with the trend that is established from the previous day’s FOMC statement. Nevertheless, intra-day traders should avoid taking entries before this news event as well.

Friday- 3^rd February 13.30 GMT

• Average hourly earnings m/m
• Nonfarm employment change
• Unemployment rate

EURUSD traders wait for this day, which is the first Friday of a month. These 3 news events not only create volatility, but also determine the trend for the rest of a month. Impacts are always massive, thus intra-day traders have the option only to watch the market move on this day. This month’s forecast is 156K. Last month’s actual claim was 156K as well. This means one way or the other EURUSD pair is going to be very volatile on that day.

 

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