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EURUSD - Still Short Post ECBEURUSD rose last Thursday following the ECB meeting as the governors were not in agreement that moving forward with more QE is the solution to the Eurozone's economic struggles. However, the currency pair failed to break the key resistance level at 1.112 and has since been dropping helped by stronger than expected US retail sales which came through at 0.4% vs 0.2% forecast. Additionally, USD Michigan consumer sentiment came through at 92 vs 90.8 forecast and we see further downside pressure on EURUSD despite an expected 25bps rate cut at the FED meeting on Wednesday.
Short
by KQMarkets
EUROUSD|BREXIT|TRADE|ECONOMIC GROWTH|PREMIUM[Short Term]ANALYSISEURO|USD: Episode (1 )- Series: Major Currencies and Currency Indices -18th of August 2019 (8-9 Minute Read) 3 Contingencies upon which the timing of this analysis is based on: Brexit (Finally) Happening in the next 6 months , similarly expecting a US/China Trade deal in the same time-frame, and of course later on Trump winning 2020 . I have to reiterate here, that I will never include any personal political opinions in my analysis- he is the current president( and most likely for 2 terms) . My primary job is to evaluate the impact of his administration on the markets. Since that's been said, let's start with the basics . Left chart is the Monthly EURUSD , right chart is the x2 Weekly Chart . While I was analysing the chart patterns and moving averages, the 2 weeks chart gave much better clues than the weekly one. With the 3 named contingencies, a probability model with expected values can be build which obviously can't be performed by an individual investor. Even if these contingencies do not play out the same way this chart is build on, the most value part of this analysis either way, are the pitchforks, MA trendlines and the wave/harmonic pattern labelling (Which EUR/USD will most likely continue to follow). Since most people on this page are traders, firstly I will go in detail on the x2 Weekly chart. Zoomed out x2 Weekly Chart Based on the drawn pitchfork, trading EURUSD in the last couple of months has been extremely easy. Until the deadline of Brexit(this October), I do not see a reason why this trend won't continue down to (Y) or further. The more difficult part to predict is the formation of the second (X). No matter how bad Brexit is to Europe, it will relieve pressure on the Euro. In addition, the current situation is already priced in, so once brexit occurs, after the initial sell-off I wouldn't be surprised if there is a shift of momentum to (X) . The most likely target range for (X) would be in between 1.14 and 1.16 . The longer Brexit is prolonged, the longer the current negative momentum will last. Lastly, 2020 is an election year in the US , and this will be a supplementary factor that might ease of the pressure on the Euro in 2020( Especially if a prospective Democrat runs versus Trump) . On this point, we will have to continue by analysing the monthly chart. Zoomed out, Monthly EURUSD Chart Q: With the current setup; Brexit and US/China Trade deal occuring, what will happen with the Euro ? -Primarily it will follow the drawn Monthly Pitchfork . When it comes to the Butterfly setup , it is just an idea that's the most logical in this buildup. Point (A) in the Butterfly signifies the rejection of the euro bulls attempting to re-enter the previous triangle and break-off from the ichimoku monthly cloud and the 100 Monthly MA(Purple/Orange line) . Furthermore, it can be observed from the Monthly Pitchfork , since the 2nd part of 2018, it is clear that the EURUSD has been trading within the 0.5 and 0.25 bands of the pitchfork. This is quite a long shot, but I am expecting another ichimoku cloud breakout rejection at (C) , followed by an election win from Trump. In this scenario, the EURO will temporarily end up below 1(0.95) against the Dollar at point (Z). Concluding this analysis , I am expecting a continuation of the ECB's dovishness and easing until a good portion of the European Banks collapse . On this point I am quite serious; how in the world does the ECB, expect European banks to be sustainably profitable in the fixed income divisions with such low rates ? The only way is to cut the financing and stop giving out credit, and end up in a typical "Credit Crunch" situation (That throughout history has been the most common cause for recessions) . Once a US/China deal occurs , the ECB would relatively keep being dovish compared to the FED- adding up additional pressure on the Euro . This is a continuation of my argument in my last thoroughly historical analysis of US Monetary policy(Linked as #2 down below). Oh and not to forget- there will be plenty recession uncertainties this autumn and the following spring(VIX Analysis, Linked #1). And let me be clear, NO ONE knows exactly how the markets will behave. (Give me your feedback people, don't be shy! If you disagree, that'll be even better; it'll just make up for a great discussion in the comments) |Step_Ahead_oftheMarket| >>I do not share my ideas for the likes or the views. This channel is only dedicated to well informed research and other noteworthy and interesting market stories.>> However, if you'd like to support me and get informed in the greatest of details, every thumbs up or follow is greatly appreciated ! {Make sure to check out my previous ideas and my series on US( SPX ) Sector including 11 episodes of the major US sectors} 1. PART 1-VIX: Volatility Index 2. PART 2-FRED: FED SuperCycle Interest Rate 3. Series Finale ; Episode 11: US Utilities( XLU ) Full Disclosure : This is just an opinion, you decide what to do with your own money. For any further references or use of my content for private or corporate purposes- contact me through any of my social media channels. Wish that tview had a copy-right option, but it is what it is.
Short
by step_ahead_ofthemarket
10
EURCHF - BUY - 12th September 2019Hi Traders, here is my analysis on EURCHF buys. This is based on the consensus for ECB today (in 36 mins of time of writing), which will create a short spike down for potential longs (if goes as planned). Combining this with the technicals, we can see 2 levels that are yet to be filled, on the weekly fib, and a daily fib. Of course, if news comes out the other way, then this analysis is no longer useful. I just wanted to share how I can combine the fundamentals with the technicals.
Long
by Bradmerry
What happens to euro, the price of Brexit and Trump's rebatesYesterday turned out to be busy and volatile. The ECB has eased monetary policy in the Eurozone. ECB cut the deposit rate by 0.1% to -0.50%, announced new purchases of assets (the ECB will buy government bonds at 20 billion euros per month, starting November 1). There was a signal - weak economic data: industrial production in the Eurozone in July fell by 0.4% (analysts expected a decrease of only 0.1%). Not surprisingly the euro fall against this background. Actually, in yesterday’s review, we predicted such a development of events and recommended selling the euro. So those of our readers who follow our recommendations should have made good money on euro sales. The amazing thing started after has gone down by more than 100 basis points. After Mario Draghi said that the probability of a recession is low, the euro went up. Despite this growth, we believe that the euro should be sold. In the end, on one side - facts (lower rates and buyback program expansion, weak economic data), and on the other - the words that everything is not that bad. So today we will sell the euro. First of all, against the yen and the pound. It was possible to earn on gold purchases yesterday. As we predicted, difficulties gold experienced were temporary and yesterday's growth is evidence of this. Gold growth took place from the information that Trump has delayed the use of part of the tariffs, and China has expressed its willingness to buy agricultural products from the United States. But even this could not stop the growth of gold. The same with the euro, Draghi's comments have so far turned the situation upside down. We do believe that the decline in gold value last night is a great opportunity to buy it cheaper. The UK government considered the possible consequences of a no-deal. In general, everything turned out to be not that good: lack of food and fuel, job loss, riots, problems in logistics, the closing of several oil refineries and so on. Once again confirms that the deal is important and needed. So the recommendation to buy the pound remains relevant. Also, data on consumer inflation in the US were published yesterday. They are very important since next Wednesday the Fed will announce its decision on monetary policy parameters. According to published statistics, US consumer inflation in August was 1.7% year-on-year, lower than the Fed’s forecasts and target. This means that the Fed’s hands have been untied to lower rates on Wednesday. For the dollar as a whole, this is a negative signal, so we recommend selling it. And a few words about the oil market. Sales in the past couple of days have been linked to Trump's hints that sanctions on Iran may be partially lifted. Since the oil market is already on the verge of surplus, the appearance of an additional 1-2 million barrels of oil per day will be a sentence for buyers
Short
by Trade24Fx
EUR,USD,JPY Go Nuts After ECB! Fed, BoJ Expectations More DovishIn today's #marketinsights video recording I analyse EURUSD and USDJPY! Euro, dragged lower by the reinstation of the QE programme, was able to reverse post-ECB losses on the back of: - Limited rate cut compared to markets expectations (only 10 basis points) - Draghi's call on governments for fiscal stimulus (supporting EA economies?) - Widening yield differential against the dollar (ECB can't move lower, Fed can) - Expectations that the Fed will cut next week (a weaker dollar) On the other hand, the yen was also negatively affected by ECB's decision to ease. But with an ultraloose policy in the books for quite a number of years now anyway, easing would be worst in Japan rather than in the US. Hence the bullishness in USDJPY! Stavros Tousios Head of Investment Research Orbex This analysis is provided as general market commentary and does not constitute investment advice
by Orbex
What to expect from ECB and what to do with the euro, US inflatiAnnouncement of the ECB decision on monetary policy in the Eurozone is what everybody waiting for. Analysts are expecting lowering rates, a new quantitative easing program (an increase in bond buybacks) and all kinds of support signals from the ECB for the European economy. What are the chances? In our opinion, the chances are high enough. The fact is that the Eurozone economy is sending more and more signals about problems and the upcoming recession. Recall the German GDP growth rate in the second quarter (below zero), negative retail sales in the Eurozone and business activity indices below 50. Everything is decisively in favor of the need for ECB intervention. And although representatives of the Central Bank are supporting fiscal stimulus, it is obvious that the ECB is expected to act. What does the softening of an already ultra-soft monetary policy mean for the euro? It means that the euro will be under pressure and it needs to be sold. Against the yen, against the pound and even against the dollar. At least that is what we plan to do today and possibly in the foreseeable future (the final position will depend on the actual decisions of the ECB). Also, today it is worth paying attention to data on consumer inflation in the United States. Recall that next Wednesday the Fed should decide whether to reduce the rate or not. In this light, inflationary data can either sow doubts or remove them completely. Weak data (low inflation) will make it clear to the Fed that you can safely reduce the rate. In the end, the central bank’s main goal is to control inflation, and then help to ensure economic growth. Accordingly, weak data will be another reason for dollar sales in the foreign exchange market. Trump, meanwhile, continues to escalate, urging the Fed to lower rates to 0%. As for other trading ideas, we traditionally recommend buying gold and selling the Russian ruble. Pound purchases also remain a priority.
Short
by Trade24Fx
EUR/USD prior the ECB Meeting definitely worth a deeper lookToday the ECB Meeting takes place. At 13:45 the Interest Rates will be announced here a cut is expected and already priced into the markets. At 14:30 it should get really interesting here Draghi will hold his last important speech at the ECB, it is expected that this speech will be very dovish kind of a farewell present from Draghi and we have seen that the markets definitely have priced in the outcome of this speech already, but could it actually be that that at this point of time too much has been priced in? We will see shortly....
Long
by JonasBenjaminFriedrich
EURUSD - Remain Flat Ahead of ECB, then Act AccordinglyThe ECB is expected to do 4 things: cut rates by 0.1% to -0.5% (1), with the mitigating measure of tiering (2). Furthermore, the market expects and extension of forward guidance (‘at present or lower…well past the horizon of net asset purchases’) (3); the market expects the reintroduction of QE for 12 months at a pace of 30-40 bln per month (4). The market is expecting a bazooka…but the Shadow ECB council suggested that Draghi will not be able to deliver the full package. Since the market is expecting a bazooka, obviously the sensitive side is the hawkish surprize. DO NOT TRADE AHEAD OF THE DECISION. Wait for the evidence and then act. We will update this chart as appropriate, after the decision.
by Sam_Eder
Dovish ECB Could Finally Make EURUSD Test 1.09000 Level!Have a look at the main chart for the EURUSD Daily TF, where the BLUE horizontal lines represent concrete support and resistance levels taken directly from the Monthly TF. The orange horizontal lines represent the support and resistance taken from daily and weekly TF. The 1.09000 level has not yet been tested on monthly charts, however the price did come close to testing it. Tomorrow's ECB meeting would likely make the price test this elusive level shall the message be dovish! Technically speaking, the daily TF chart shows a neat descending channel and should the daily candle close below 1.1000 level convincingly by end of the day, we could see the price gather pace towards the 1.09000 elusive support. Fundamentally the markets have already priced in a dovish ECB outcome, however keep in mind the EUR is at a consolidation stage and ECB might just ignite the selling pressure and take this pair towards the 1.05 Support in the near future. In short both fundamental and technical picture are highly tilted towards a depreciation in the EURUSD. This just represents my analysis. shall there be any trade entries (possibly tomorrow)i will post them in a new post. cheers
Short
by FX618Analysis
USDJPY - Long - Continued Upward MomentumWe still see USD/JPY moving higher as it continues it's upward momentum and after consolidating above 107 we now believe it can move towards the 108.3 resistance level. This we feel is due to the recovery in global equity markets from the August lows and easing of tensions in the US/China trade war. However, we anticipate downside risks if the ECB are less dovish than expected at tomorrow's meeting and weak US CPI and US retail sales increase the odds of potential FED rate cuts.
Long
by KQMarkets
Euro Triangle Breakout Before ECB...Load up Bears!!!Consolidation triangle has a breakout.... Looking for a simple retest of the 1.1040 area which is a nice retrace of the current move.... Also we finally broke below the moving averages so retesting in that same area of confluence.. Ill be looking to add in this confluence area in addition to my shorts from earlier in the weak (idea attached) Note: Macd is poised to cross Zero threshold so a momentum move is near Positioning for ECB which should be dovish Aiming for the lows 1.097 for TP1 and 1.088 TP2 Happy Huntin' Happy Trappin' BooBii
Short
by rickyboobii