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DAX prior the ECB Meeting too much dovishness priced in or not? Please watch the video carefully to understand my Counts. There are points where certain scenarios become invalid.
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.
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....
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.
EURCAD - ECB as a catalyst?*Disclaimer - This analysis alone DOES NOT warrant a buy or sell trade immediately. Before you enter any trade in the financial market, it is very important that you have a proper trading plan and risk management approach.
The sharing of this idea is neither necessarily indicative of nor a guarantee of future performance or success.
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
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.
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
Reading the Right Side of the Chart : USDCHF Manipulation ZoneApabila nampak level yang terlalu jelas, maka besar kemungkinan tempat itu akan menjadi zon yang diperhatikan dan apabila zon itu menjadi tempat perhatian maka banyak "orders" akan duduk disana.
When you see obvious levels, you can bet EVERYONE will see it. When everyone sees it, then there will be A LOT of interest at those zones. When there are a lot of interest, begets liquidity for the market to latch onto.
Price had been trading above Monday's high and currently testing the weekly high. Another zone that big players looking at (too simplistic you might argue but think about it, retail traders and other participants look at the obvious and the ones that make sense to them. Picking a weekly high seems arbitrary I agree but it is what is.
I am currently bearish bias "standby mode" at the moment but I would feel better and comfortable if the price trades higher into one of the two levels I marked on the chart.
Please be wary trading this pair though as it is somewhat correlated with EURUSD and this pair (EURUSD) super duper sensitive with the major risk event tomorrow : ECB Rate Decision. Be careful out there guys.
Pound & easing global monetary policyYesterday, quite unexpectedly, a block of economic data on GDP and industrial production, instead of already traditional disappointment, provided an occasion for optimism.
In July UK GDP grew by 0.3% (expected to grow at 0.1%), while industrial production instead of a decline by 0.3% (expert forecasts) went to the positive zone ( + 0.1% ).
Monday following Johnson’s next parliamentary defeat in a few days. His next attempt to initiate an early election failed. come into effect Law against "no-deal" Brexit came into effect.
Not surprisingly, the pound continued to grow against such a background. Our position on the pound is unchanged: we are looking for points for purchases. But with small stops, because the situation with Brexit can develop quite dynamically.
Meanwhile, the markets are preparing for a wave of rate cuts by leading central banks of the world. On Friday, the Bank of China lowered the rate by 0.5% to the lowest level since 2007. In this light, the decision of the ECB on Thursday is becoming more significant and significant. Recall next week the Fed, the Bank of Japan and the Bank of Switzerland will announce their decisions. So the upcoming two weeks promise to be full of news.
Strengthening of the Russian ruble in the foreign exchange market is a good opportunity to begin the formation of a medium-term purchase cycle with USDRUB. Current prices are the starting point of the cycle. The next one is 63.60 and the final one is about 62.50.
And finally, buying gold from current prices seems to be a very good trading opportunity. Recall it is worth buying with stops.
Spitting Thoughts : the ECB Interest Rate, do we understand it?..and when I say we, I mean us retail traders without financial / economy background.
"More hawkish than expected is good for currency"
This is what stated in one of the popular website's economic calendar. How do you define more hawkish when it comes to this specific risk event? Is it just simply the headline number "ECB cut rates to 0.25%"? Is it all about the ECB's president speech afterward? What we know, the interest rate is the major mover for the respective currency in the long term. Meaning, what we understood as it would dictate the bearishness or the bullishness of the currency for the next few months or years.
If you just follow this website's basic interpretation of the risk event, that more hawkish means good for currency, and hence cutting or increasing rates unfortunately being assumed and oversimplified as binary for retail traders to latch onto. If ECB cut rates, it is "bad" for the currency (bearish) and if ECB increases rates, it is "good" for the currency (bullish). At least that is what I was taught.
You look at the chart on Nov 7th, 2013, the ECB cut-rate to 0.25% whilst the consensus (according to what was printed every website that has Economic Calendar) was 0.50%.
The general logic dictates that the Euro should be bearish. That day EURUSD was indeed having a major sell-off but look at what happened after that? EURUSD went up for the next 7 months.
A similar-ish thing happened (the surprise and the decision to cut the interest rate) on the 5th of June 2014 and the 4th September 2014 but the outcomes couldn't be any more different.
The ECB decision in June 2014, the price went up instead of down for the entirety of that trading month, albeit after EURUSD trending down for the last 4 weeks prior to the ECB rate decision. The ECB decision in September 2014, the price finally went according to the general logic that "cut rates = currency bearish", down. However, take a look at the trend at the time. EURUSD was in a bearish trend for the past 2 months prior to the ECB rate decision.
Whilst the headline numbers told us, retail traders, the same thing (surprise number, cut rates), the outcome was different. I believe in FUndamental Analysis and this post is by no means to disregard this side of the analytical spectrum but trading based on this risk event is too complex and above our "pay grade". We can see how it creates a spike? Then the least take away that I hope the readers would get from reading this is to NOT to trade EURUSD on the day of the rate decision. If you were already in a position on that day, CLOSE YOUR TRADE. "I have my stop-loss dude, I am good". Erm Wrong! Your stop loss will not be guaranteed to be filled at the price you are putting. SLIPPAGES happen. There's a signal today for EURUSD, trade it, by all means, just make sure you close it before the risk event.
EUR/USD prior the ECB Meeting this Thursday I am thinking Euro/Dollar could finish a bigger corrective structure, however during the ECB meeting I am also expecting another move to the downside. After the meeting is done there could be bigger long swing playing out since I am assuming that most of the ECB rate cut on Thursday has been already priced in.
EURUSD - Short - Pre ECB Thursday We still see EURUSD moving lower towards 1.09 but first it would have to break the resistance level at $1.102. We are confident it can do this as the dollar sustained gains over the week against the euro despite a weak non farm payroll number, coming in at 130K vs 160K expected. Furthermore, the ECB meeting on Thursday where the ECB is expected to cut rates from -0.4% to -0.5% and introduce additional stimulus could lead to further downside pressure for EURUSD.
Dax short-term long trade cause the trend channel is still intacOANDA:DE30EUR
This trend channel is still intact and will probably be till ECB meeting this week. Trade accordingly.
EUR/USD short term rallyAfter printing a new low near 1.0925, the Euro found enough buyers to recover above the 1.10 level and is now trading near the first resistance at 1.1040 which is the 23.6% Fibo retracement of the latest decline.
Also, looking at the recent candles, the recovery doesn't seem to have ended but is also facing critical resistance near 1.1060 and a potential big stimulus package from the ECB, expected to be announced during its monetary policy on the 12th of September.
It is worth noting the descending channel the pair is trading in, a potential support/resistance area to trade in.
Good luck.
EURUSD - Short - Payrolls FridayEURUSD has bounced towards 1.10 as it failed to challenge 1.09 yesterday following it's recent downtrend. Yesterday's ISM manufacturing came in at 49.1 vs 51.3 expected so we now await payrolls and average hourly earnings data on Friday. We do not see major upside potential for the currency pair and still see prices heading below 1.09 in the near term.
EURCHF SHORT Swing Trade Executed! Price Aiming For 1.0600Please have a look at the link below for the full analysis behind this SWING TRADE setup.
INSTANT ENTRY AT AROUND: 1.10100 level
STOP LOSS: 1.14200
TAKE PROFIT: 1.0600
RR: 1:1
TYPE: SHORT TRADE
Shall there be any updates to the details i will notify in this tread.
EURCAD Weekly Trendline Violated! Price Likely To Target 1.43500Have a look at the main weekly TF for EURCAD. The horizontal lines represents support and resistance levels taken from the monthly TF. The July's monthly candle closed below 1.47000 support and additionally the August's Candle formed a strong doji rejecting and closing below the 1.47000 support. This is a strong indication that the price would likely gather pace towards the next support present at 1.43500. Furthermore, the Longterm trendline on weekly and monthly charts was violated, Further suggesting a decline is on the cards!
The chart above is Monthly TF charts of EURCAD indicating the LONG-TERM Trendline violation and monthly candle breaching and closing below the support.
Fundamentally the EUR is bound for further incoming weakness as the ECB is struggling to hit their inflation target and the new incoming president has already suggested the rates could further go into negative territory in order to support the growth.
I am already SHORTING the EURCHF, which has slight correlation to this pair and furthermore i am already SHORT on the USDCAD. Due to these factors and i am not willing to take this trade because it would increase my risk exposure and violate rules of trading. For those of you who would like to take this pair SHORT, you could do this at your own risk with the target of 1.43500 and RR of 1:1. This trade in my view is a high probability trade with many confluence factors in favor of us. cheers
Fite for Brexit: getting ready for hot SeptemberBe concern working with the pound. Boris Johnson's decision to shut down parliament for five weeks in order ... controversial plan to suspend the UK's parliament for five weeks. The Queen has approved an order to prorogue the UK Parliament. Boris Johnson seriously set his sights on leaving without a deal. Of course, there is a chance that this is just his attempt to strengthen his position in negotiations with the EU, well knowing Johnson’s temperament, we no longer exclude the most radical scenarios.
The first week of September may be decisive for Brexit: time the opposition has to pass a law that does not allow an exit without a deal. Among other options - a vote of no confidence in the government, the dissolution of the Parliament and early elections. So, it will not be boring, pound volatility in September are guaranteed. For intraday trading, this is an opportunity to make money trading with pound pairs. So we will continue to monitor the development of events and will keep our readers informed of what is happening.
Yesterday's US GDP data came out in line with forecasts: + 2.0% y / y. This means that the data has been revised downward. Statistics on the US labor market will be published, in particular, data on the NFP will be published next weak, a serious driver for a powerful dollar movement is not expected.
Extremely weak figures were published on consumer inflation in Germany. In general, the concerns about one of the best Eurozone economy raises. Based on this, yesterday’s comments by the future head of the ECB, Michel Lagarde, that the ECB has tools to deal with the recession and should be prepared to use them if it is necessary.
Against this background, we will continue to recommend avoiding buying euros against anything. But sales of it still seems to be a good trading idea.
As for the trade war. The markets did not understand whether Trump was called from China or not. New tariffs for goods from China come into force on Monday. And this means that the trade war is not over. However, in September, the Chinese delegation should arrive in Washington so the chance to stop still exists. We will continue to look for points for buying gold and the Japanese yen on the intraday basis. Moreover, safe-haven assets today are something that worth to buy.
