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Perfect ChoCh : Entry + SetupWith this trading model, I aim to share with the community a particularly significant approach that has revolutionized my way of operating in the markets, especially on shorter timeframes such as 1, 5, and 15 minutes. This model involves defining a clear structure before entering the market, specifically a demand zone already present in the market. A price that reaches this zone through a double structural break (BOS) before rallying and creating an internal break (ChoCh) before returning to the demand zone. Subsequently, the price will surpass the previous high, thereby defining a new demand zone. One will then await the price to reach this zone, and once there, enter the market with the aim of reaching the supply zone depicted on the chart.
Education
by Forex48_TradingAcademy
1
XAU/USD | Bullish trend ready to reach $2060.Gold has shown a reversal in trend, dropping below $2,030 after an initial increase to $2,040. Despite the strength of the US dollar, XAU/USD has maintained positive territory thanks to the decline in US yields and growing tensions in the Middle East. On the daily chart, the pair has modest intraday gains but remains below a 20-period simple moving average (SMA). Longer-term moving averages lack directionality. Technical indicators have slightly improved but remain negative, indicating limited upside prospects. In the short term (4-hour chart), XAU/USD is in a neutral phase, with moving averages lacking directional strength. Technical indicators suggest diminishing short-term buying interest. Support levels are at $2,019.20, $2,010.00, and $2,001.60, while resistance levels are at $2,033.10, $2,040.30, and $2,052.60. The week saw gold open with a higher gap at $2,037.46, but the dollar recovered during the American session. Geopolitical tensions, especially between the US and Iran, have influenced the markets. Investors are awaiting economic data and monetary policy decisions, with a focus on earnings and comments from the ECB attempting to temper expectations of an interest rate cut in April.
OANDA:XAUUSDLong
by Forex48_TradingAcademy
1
NASDAQ | Bearish triangle with a retest at 15,430During the day on January 26th, the index of US technology stocks, likely the Nasdaq 100, recorded a negative performance, closing with a moderately negative percentage change of 0.55%. The day started with difficulties, opening at 17,430 points, approximately near the lowest level of the previous day. Despite this, the index showed reasonable resilience throughout the session but ultimately closed weakly at 17,420 points, near the day's lows. An analysis of the status and trend suggests that in the medium term, the Nasdaq 100 confirms the presence of an upward trend. However, in the short term, it appears that the positive momentum is diminishing at the resistance test identified at 17,510 points, with the first support located at 17,330 points. Expectations are leaning towards a negative extension in the short term, with a target set at 17,230 points.
CME_MINI:NQ1!Short
by Forex48_TradingAcademy
1
AUD/USD Awaits the FED for New HighThe AUD/USD exchange rate is declining towards 0.6550 early on Wednesday due to mixed China's PMI data and weaker-than-expected inflation data in Australia. The CPI confirms that the RBA's interest rate hike cycle is over. Attention now turns to the decision of the United States Federal Reserve. Despite an erratic performance on Tuesday, the AUD/USD erases the gains of the week, weakening daily in tandem with the U.S. dollar. Australia's resilience is noteworthy, despite reports of slower-than-expected stimulus measures from the PBoC. The expected decision of the RBA to maintain the current monetary policy limits the potential upward movement of the exchange rate in the short term. The decrease in inflation in December and labor market tensions support the expectation of unchanged interest rates. The possibility of the Federal Reserve extending its restrictive stance favors further gains for the U.S. dollar, acting as a drag on the AUD/USD. On the H4 chart, the price shows a clear break of a bullish trendline at the level of 0.6580. In my opinion, it could be a false breakout as a perfect bounce is observed on the upper base of the previous bearish trendline at the level of 0.6560. Being close to an order block + Demand, I expect a possible rally and will assess opportunities to enter the market during the day, anticipating the rally after the Fed. If interest rates remain unchanged, the dollar should weaken, and the AUD should strengthen, unless we are facing a manipulated market. Certainly, Powell's statements will be crucial, but I believe there will be no cuts before June. Greetings and have a good trading day.
Long
by Forex48_TradingAcademy
1
DXY: Will the Fed Be a Catalyst for Direction in the USD Index?For the past two weeks, the DXY has been trading within a frustratingly narrow range, lacking clear direction. Today's FED press conference may provide some resolution to this stagnant pattern. Leading up to this event, prominent Fed members have cautioned against overly optimistic expectations regarding future rate cuts. They emphasized that the Fed does not intend to reduce the benchmark rate as rapidly as markets had anticipated. Supporting data further reinforced the Fed's stance. December's CPI surpassed expectations, indicating persistent price pressures, although much of this was influenced by base effects that are now mostly behind us. Additionally, January's flash PMI data and Q4 GDP print were strong, albeit slightly lower than the 4.9% growth seen in Q3. Despite this, equity markets rallied, and the unemployment rate now stands well below 4%, suggesting a positive outlook for a 'soft landing' or 'golden path' scenario. If the Fed identifies upside risks to services inflation due to the strong data, it will proceed with caution. However, there's a general expectation that the Fed's statement will adopt a more neutral tone. Technically, as indicated in the posted chart, the DXY is trading within a defined range between the 103.10 zone and the 103.70 zone. A breakout from either of these zones could provide insight into a medium-term direction. In my view, considering the market's overly optimistic anticipation of rate cuts and the upward pressure on prices, we may see a breakthrough above resistance. In such a scenario, a bullish medium-term trend could emerge, potentially driving the index back towards the 107 zone.
TVC:DXYLong
by Mihai_Iacob
2
Gold forecast: Crazy to expect rate cut tomorrow? Gold forecast: Crazy to expect rate cut tomorrow? Mostly yes. Market consensus leans towards the U.S. central bank maintaining current interest rates following the conclusion of its two-day meeting tomorrow. However, the potential impact on the U.S. dollar and gold is likely to hinge on statements from Fed Chair Jerome Powell regarding expectations for a rate cut. While there is an anticipation of a somewhat dovish shift from Fed officials in the market, the robust January data and the positive JOLTS job report this morning present a case for the possibility of a sustained hawkish stance, The JOLTS report revealed that U.S. job openings in December surged to 9.026 million, surpassing the expected 8.750 million and marking the highest figure in three months. XAU/USD was trading in the green for a second consecutive day before the JOLTS report. Gold is currently above a mildly bearish 20 Simple Moving Average for the first time in over two weeks, with longer moving averages situated significantly below the current level. Still, gold has breached its minor downtrend line originating from the early January high raises the possibility of a bullish target towards $2055, presumably reliant on the possibility of a Fed rate cut (or not).
BLACKBULL:XAUUSD
by BlackBull_Markets
XAGUSD | Long Setup with Entry PointXAGUSD presents a bullish structure on the daily chart, where the price has bounced off the 0.705 Fibonacci level after entering the demand zone. I now expect the price to experience further growth towards the liquidity zone at the 24.20 level, as the previous liquidity area has already been filled. It is highly likely that the Federal Reserve will keep interest rates unchanged, potentially weakening the dollar and, consequently, leading to new increases in the week for gold, silver, EUR/USD, and GBP/USD.
OANDA:XAGUSDLong
by Forex48_TradingAcademy
1
USD/CAD remains under pressure with a new target at 1.3220The USD/CAD exchange rate is under selling pressure in the early Asian trading hours on Tuesday. Canada's Gross Domestic Product (GDP) for November, expected to expand by 0.1% compared to the previous month, will be released on Wednesday. The pair remains under pressure as the Federal Open Market Committee (FOMC) meeting on Wednesday approaches, with no expectations of changes in interest rates. Currently, USD/CAD is traded at 1.3510, down 0.01% for the day. The US Core Personal Consumption Expenditures Price Index (PCE) for December increased by 0.2% from the previous month, with an annual increase of 2.9%. On Monday, the Federal Reserve Bank of Dallas Manufacturing Business Index for January was -27.4. The Fed will announce its interest rate decision on Wednesday, with the possibility of a future rate cut. Geopolitical tensions in the Middle East, fueled by potential US military actions, may support the dollar as a safe-haven currency. On the Canadian front, a slight growth of 0.1% in November's GDP is expected. An increase in oil prices may support the commodity-linked Canadian dollar and act as a headwind for USD/CAD. Investors will closely watch the Fed's rate decision and seek trading opportunities around the USD/CAD pair. USD/CAD, having retraced to the 0.5% Fibonacci level on the total extension and the 0.79 level on the partial extension, has rotated well below the reversal zone, and now I expect a descent towards 1.3220.
Short
by Forex48_TradingAcademy
1
AUDUSD | It's time to go long towards 0.67The AUD/USD aims to maintain a stable situation above the level of 0.6600 in a week filled with events. A reduction in inflation in Australia could bring some relief to the Reserve Bank of Australia (RBA). The US Dollar Index (DXY) has recorded an increase to around 103.64, driven by escalating geopolitical tensions that have increased its appeal as a safe haven. However, yields on US ten-year Treasury bonds have decreased to approximately 4.12%. Investors expect the Federal Reserve to keep interest rates unchanged in the range of 5.25% to 5.50% for the fourth consecutive time. So far, Fed decision-makers have emphasized that premature rate cuts should be avoided until they are confident in a sustainable return of inflation to the 2% target. Premature rate cuts could lead to an overall increase in demand, subsequently putting pressure on prices. In addition to the Fed policy, attention will be focused on economic indicators such as JOLTS Job Openings, ADP Employment Change, and ISM Manufacturing PMI data. Regarding the Australian Dollar, investors are eagerly awaiting inflation data scheduled for Wednesday. Forecasts indicate an 8% increase in price pressures in the last quarter of 2023, compared to the 1.2% growth observed in the July-September quarter. Easing inflationary pressures could provide relief to decision-makers at the Reserve Bank of Australia (RBA). After an upward start on December 6 with the break of some support zones and the formation of an order block at the level of 0.6550, the market reached a peak at the level of 0.6870 before retracing to the order block after about a month and a half. Since then, the price has started forming a substitute structure with a series of H4 candles, and it could proceed to break the FVG just above the resistance level at 0.67. Greetings and happy trading to everyone.
Long
by Forex48_TradingAcademy
1
This week’s two best trading opportunities? First opportunity AUD/USD Australian inflation data released Tuesday evening, might make the AUD/USD the most interesting pair to watch this week. This is because inflation will likely come in higher than 4.0% still. Less than 24 hours later, we then have the US Federal Reserve’s interest rate decision on Wednesday, which will be one of the most watched forex events of the month. The AUD/USD has stayed within a narrow range recently, forming an ascending channel that looks like a bearish flag pattern. For stability, it might want to hold above 0.6600. If it fails, the pair could possibly retest the 2024 low at 0.6524, in line with the 100-day SMA. Second opportunity: EUR/USD Why is the EUR/USD a pair to watch this week? It all comes down to the disagreement circulating in the market about where EU inflation is going to fall this week on Thursday. Some market participants forecast it is falling to 2.2% from the current 2.9%, while others are pegging it to actually increase to 3.1%. These differing opinions open up a few different targets on the charts. The near-term picture is possibly bearish with the EUR/USD developing below all its moving averages and posting a third consecutive lower low and lower high. Although the selling pressure momentum might be waning.
by BlackBull_Markets
AUD/USD eyes retail salesThe Australian dollar is in positive territory on Monday after an uneventful week. In the European session, AUD/USD is trading at 0.6603, up o.41%. The markets are braced for a soft retail sales report on Tuesday, with December's consensus estimate standing at -1.0%. The November report sparkled with a 2% gain, the strongest level since November 2021. The strong gain was driven by Black Friday sales and other discounts and likely came at the expense of the December reading with consumers doing their Christmas shopping early. There could be a surprise to the upside in the retail sales report if consumers took advantage of Boxing Day sales in late December. The Reserve Bank of Australia meets next on February 6 and has repeatedly said that upcoming rate decisions will be data-dependent. This makes Wednesday's quarterly inflation report a critical release that will have a significant impact on the central bank's rate path. In the US, inflation continues to ease while economic growth remains solid, which is the recipe that the Fed hopes will continue. The US economy expanded by 3.3% in the fourth quarter, blowing past the consensus estimate of 2.0%. On Friday, the Fed's preferred inflation gauge, the PCE Price Index, rose 0.2% m/m in December, compared to 0.1% in November. On an annual basis, the index remained steady at 2.6%. The Core PCE Index eased to 2.9%, down from 3.2% in November.  The Fed is in no rush to raise rates, and market fever over a March cut have fallen dramatically. The markets have slashed the odds of a quarter-point cut in March to 48%, down sharply from 72% a month ago, according to CME's FedWatch tool. AUD/USD is testing resistance at 0.6583. There is weak resistance at 0.6613 There is support at 0.6544 and 0.6514
by OANDA
XAUUSD | Fundamental & Technical AnalysisGold continues to fluctuate around $2,020 in the latter half of Friday, holding its position despite a 4.1% retreat in the benchmark 10-year US Treasury bond yield, driven by December PCE inflation data. The gold price remains within a limited range, with the Fed closely monitoring inflation trends, and the PCE outcome will impact its restrictive stance on interest rates. Despite the economic resilience of the United States, gold prices could benefit from a slowdown in inflationary pressures. The probability of a rate cut in March has risen to 50%, but challenges persist for the Fed as the US economy remains robust, with a 3.3% GDP growth in Q4 2023. The Fed is expected to maintain unchanged interest rates, but investors will be attentive to signals regarding potential future cuts. The gold price exhibits an interesting pattern, with a primary bearish channel and a newly formed bullish one. The outlook suggests a potential initial movement following the bearish trend towards the $2000 zone, followed by sustained upward momentum in the new bullish trend. However, it is crucial to consider the option of a short scenario near $2000 and monitor developments following the Fed's announcements. Regards from Nicola, and have a great day, everyone.
OANDA:XAUUSDLong
by Forex48_TradingAcademy
1
EURUSD | Before the FED 1.08 & After 1.102The EUR/USD is holding around 1.0850 during the Friday American session, with the US dollar struggling to find demand. Critical support is located at the 50% Fibonacci retracement level of the October to December uptrend. If the cross falls below this level and uses it as resistance, it could find support at 1.0740 before reaching 1.0700. On the upside, immediate resistances are at 1.0830, 1.0865, and 1.0900. Following a negative close on Thursday, the EUR/USD extended its decline, touching the lowest level since mid-December below 1.0850. The short-term technical outlook suggests a buildup of bearish momentum, with potential further losses if the 1.0800 support gives way. The European Central Bank (ECB) kept interest rates unchanged and expressed caution about rate cuts. Despite the initial resilience of the euro, the trend has been influenced by a risk-averse market environment, favoring the US dollar. Other data indicates that the US GDP growth exceeded analysts' estimates, further strengthening the dollar. The euro appears to have moved out of the 1.09-1.10 consolidation zone, with the possibility of a return to 1.08 before a potential recovery towards 1.10. A chart illustrates the possible movement and key zones. Wishing everyone a great weekend from Nicola.
Long
by Forex48_TradingAcademy
1
Gold price juggles ahead of Fed’s preferred inflation gaugeDaily Digest Market Movers: Gold price remains inside the woods as the upside was capped amid uncertainty ahead of the United States core PCE price index data for December. While the downside is being supported because of geopolitical tensions and the chance of rate-cuts by the Federal Reserve this year. The Fed’s preferred inflation gauge is forecast to rise by 0.2% against the former reading of 0.1%. The annual underlying inflation data is set to slow to 3% versus 3.2% in November. The US economy expanded at a robust pace of 3.3% in the final quarter of 2023 while market participants projected a slower growth rate of 2.0%. This has uplifted the economic outlook, which could keep price pressures elevated. US Treasury Secretary Janet Yellen said surprisingly strong economic growth came from higher productivity and robust consumer spending without escalating inflation risks. A stubborn core PCE price index report could combine with an optimistic economic outlook to propel upside risks to price pressures. This would allow Fed policymakers to continue to maintain a hawkish interest rate stance for the first six months of 2024. After the release of the Fed’s preferred inflation gauge, market participants will shift their focus towards the Fed’s first monetary policy of 2024, which will be announced next week. The Fed is widely anticipated to keep interest rates unchanged in the range of 5.25-5.50% for the fourth time in a row. Investors will keenly focus on the timing of when the Fed will start reducing interest rates. The CME Fedwatch tool is showing that the chances in favour of a 25-basis point (bp) rate cut in March are at 48%. This indicates that traders are seeing the Fed reducing interest rates from May. Till now, Fed policymakers have been considering expectations of rate-cuts from March as “premature” due to resilient US economic prospects and stubborn inflationary pressures. Fed policymakers have been warning that rate cuts at this stage would be premature, which could lead to a surge in overall demand and dampen efforts made to bring down core inflation to its current 3.9% level. The US Dollar Index (DXY) holds onto recovery inspired by upbeat US Q4 GDP data but struggles to print a fresh high near 104.00.
OANDA:XAUUSD
by dc_analytics
EURUSD | Long Trade on Daily and M15 ChartsThe future of the EUR/USD is uncertain, with the possibility of further declines if the support level of 1.0821 is breached. In case of a descent, it could test the 100-day moving average at 1.0774 and then touch the December 2023 low of 1.0723. The negative outlook would intensify if it surpasses the key 200-day moving average at 1.0843. On the positive side, the pair needs to surpass the weekly high of 1.0998 to open the door for a possible visit to the December peak of 1.1139. In the short term, the pair seems to be consolidating near 1.0820. Technical indicators such as the MACD and RSI suggest downward pressure, with the RSI falling below the 40 level. Events such as the ECB press conference and German economic data influence the sentiment of the EUR/USD, with the lack of surprises leading to a decline on Thursday. Contrasting economic prospects between Europe and the United States, along with positive signals from the U.S. GDP, have contributed to supporting the dollar. The Federal Reserve appears inclined to delay an interest rate cut until at least May, according to market probabilities. The release of PCE-measured inflation on Friday could further influence interest rate expectations. In summary, the current context suggests uncertainty in the future movements of the EUR/USD, with economic factors and decisions from the ECB and the Federal Reserve having a significant impact on the currency pair's outlook. Therefore, I consider it safer to evaluate a trade on the daily chart, where I observe a neater chart setup. I have identified a demand zone where the price could retrace to rotate and provide a long entry confirmation at the 15-minute chart, with a target set at the level of 1.1142, where we have a significant liquidity zone yet to be filled. Greetings and happy trading to all.
Short
by Forex48_TradingAcademy
1
USDCAD Sell Setup Towards 1.33 with Explanation!The USD/CAD pair is trading laterally near 1.3440 after a sharp descent from the psychological resistance of 1.3500 in the early hours of the European session. The Canadian Dollar (CAD) showed limited activity on Monday to start the trading week with subdued momentum across the major currency landscape before a sudden decline against the US Dollar (USD). CAD traders will closely watch Wednesday's interest rate decision from the Bank of Canada (BoC), and markets brace for an eventful Friday to conclude the week with a fresh release of the US Personal Consumption Expenditures (PCE) price index. The latest figures for Canada's New Housing Price Index are expected in the early hours of Tuesday's US session, but their impact is anticipated to be limited. The Canadian Dollar lacked significant momentum on Monday before extending short-term losses against most of its counterparts. Markets are proceeding cautiously to start the new trading week but remain near the high side after US stocks reached record prices last Friday. The Bank of Canada is widely expected to keep rates steady at 5%, and investors will be watching the subsequent press conference. According to a Reuters survey, 22 out of 34 economists consulted predict that the first BoC rate cut will occur in June, while the remaining 12 indicate April. In December, derivatives markets predicted a 60% probability of the first BoC rate cut in March. This week will see interest rate decisions from three central banks, but market sentiment is likely to depend on central bank press conferences and statements, with hopes of global rate cuts widely disappointed in recent weeks. Furthermore, geopolitical concerns are keeping crude oil bids high, but accumulations in refined products are becoming hard to ignore as global fossil fuel demand prospects begin to fade. The upcoming OPEC meeting will be interesting to assess the potential strength of Brent and consequently the Canadian Dollar, which, according to the bearish channel depicted on the chart, could decline towards 1.33 after a rebound that appears to be concluding these days around the reversal level of 1.3480. Wishing everyone successful trading, greetings from Nicola.
Short
by Forex48_TradingAcademy
7
EURUSD is ready for the ECB with target 1.07!The EUR/USD exchange rate is advancing significantly after two consecutive days of retracement, although a convincing break of the 1.0900 barrier remains elusive at the moment. The prospects for the pair are expected to turn bearish if it sustains a convincing breach of the crucial 200-day moving average, currently at 1.0844. On the upside, the weekly level of 1.0998 (January 11) must be surpassed to open the door to a possible visit to the December high of 1.1139 (December 28). Based on the 4-hour chart, the pair seems to have returned to a consolidation phase. The unexpected and intense dollar sell-off has allowed the EUR/USD to shake off some of its recent weakness and refocus on the upside, surpassing the 1.0900 threshold to print new multi-day highs. The USD Index (DXY) has succumbed to the prevailing risk-friendly environment and dropped below the 103.00 region despite the rise in U.S. yields along the curve, while speculations continued to indicate decreasing bets on a Fed rate cut in March, favoring a rate reduction in May instead. Also contributing to the renewed buying interest in the pair, advanced PMI readings in Germany and the Eurozone came in on the strong side for January, highlighting a revival of economic activity in the region and suggesting the possibility of a soft landing for the regional economy. With the upcoming ECB event in mind, it is important to emphasize that market participants have already priced in about 120 basis points of rate cuts for the current year. However, there is a growing debate among market participants and decision-makers at the ECB regarding when the central bank will decide to implement a policy rate reduction for the region. Additionally, President Lagarde has hinted at the possibility of a potential move during the summer. Tomorrow will be a truly interesting day, with no cuts expected, and the euro-dollar heading towards 1.07 as indicated by the chart. Greetings and happy trading to everyone from Nicola.
Short
by Forex48_TradingAcademy
3
Gold: Explanation of the Bearish Channel with a Target of 1981!Gold faced bearish pressures and reversed its trend during Wednesday's American session, dropping below $2,020. Positive PMI data from the United States contributed to the rebound in the yield of the 10-year US Treasury bond, negatively impacting XAU/USD. The latter could, therefore, become vulnerable to an acceleration of the decline towards the intermediate support of $1,988 before potentially descending to the 100-day Simple Moving Average (SMA), currently around the $1,972 zone. The next target would be the 200-day SMA, near the region of $1,964-$1,963. However, a possible continuation of buying could neutralize the short-term bearish outlook and trigger a short-covering rally. Consequently, the price of gold could rise to the $2,077 zone, aiming to reclaim the psychological threshold of $2,100. The precious metal, however, remains confined within a familiar trading range that has persisted in recent days, situated below the supply zone of $2,040-$2,042. Meanwhile, geopolitical tensions in the Middle East show no signs of easing and continue to act favorably for gold as a safe-haven asset. Furthermore, the decline in US Treasury bond yields weakens the US dollar, providing additional support for the commodity denominated in US dollars. On the H4 chart, the decline of gold from the peak of 2088 to the potential minimum in the coming weeks around 1980 is highlighted. Currently in a bearish channel, the price, after creating a new supply area, could retrace to it, creating a spike at the 0.62 Fibonacci level. I believe this could be interpreted as a confirmation signal for a short entry. I will await appropriate confirmations and keep everyone informed of the situation. Greetings and happy trading to all.
OANDA:XAUUSDShort
by Forex48_TradingAcademy
1
USD/CAD eyes Bank of CanadaThe Canadian dollar is showing limited movement on Wednesday. In the North American session, USD/CAD is trading at 1.3436, down 0.19%. The Bank of Canada will announce its first rate decision of 2024 later today. The BoC has maintained the cash rate at 5.0% for three straight times and barring further acceleration in inflation, the rate-tightening cycle is over. The key question is the timing of a rate cut. The BoC would love to chop rates and kick-start the weak economy, but a rate cut appears unlikely unless inflation moves closer to the 2% target. We've seen the Federal Reserve grapple with the "last mile" of the inflation battle, as inflation remains stubborn in the range of 3-4%, higher than the 2% target. The BoC has managed to push inflation down from a high of 8.1% in mid-2022 but rose slightly in December to 3.4%. Inflation is currently driven by services and housing costs, which are unlikely to fall considerably in the near term. This means that further rate hikes may not be effective in pushing inflation lower. The BoC has little reason to raise rates, but it is reluctant to start cutting rates while inflation remains well above the target and wage growth is still high. That leaves BoC policymakers with a strong reason to continue holding rates and remaining cautious until inflation moves closer to the 2% target. When can we expect the BoC to hit the rate-cut button? Two of Canada's major banks, RBC and BMO, expect a rate cut in mid-2024, while TD Bank is projecting an initial rate cut in the spring. USD/CAD is testing support at 1.3451. Below, there is support at 1.3360 There is resistance at 1.3520 and 1.3611
by OANDA
USDJPY Short Idea towards 144.50 with explanation!The Japanese Yen benefits from the hawkish stance of the Bank of Japan (BoJ) on Tuesday, although it lacks follow-through. The reduced bets on an imminent interest rate cut by the Federal Reserve (Fed) provide support for the US Dollar and the USD/JPY pair. The 147 area could act as a crucial point, and if decisively breached, it might trigger aggressive technical selling, dragging the USD/JPY pair towards the 144.00 level towards the next liquidity zone. On the flip side, the round figure of 148.00, followed by the 148.15-20 region, now seems to act as an immediate hurdle before the recent weeks' high around the 148.80 zone touched on Friday. Investors seem convinced that the Bank of Japan (BoJ) will show little willingness to end negative interest rates or make changes to the Yield Curve Control (YCC) policy at the end of a two-day meeting on Tuesday. This, along with a generally positive tone in equity markets, weakens the safe-haven JPY. Additionally, decreasing odds of a rapid interest rate cut by the Federal Reserve (Fed) act as a tailwind for the US Dollar (USD) and help the USD/JPY pair attract some buying near the 147.75-147.70 area. Furthermore, persistent concerns about slowing economic growth in China and the risk of a further escalation of geopolitical tensions in the Middle East might limit any optimistic movement in the markets. In the market, I have defined a hypothetical short scenario on the H4 timeframe, aiming to wait for further downside below the 147 level before considering a possible retracement to the 0.70 Fibonacci level. Only then will I enter the market to evaluate a short entry if the right confirmations persist on the M15 timeframe, with a target of 144.50, which is the first swing zone with excellent liquidity for the price to recover. Greetings and happy trading to all.
Short
by Forex48_TradingAcademy
1
EUR/USD: It's Time to Evaluate a Short Trade!Good morning traders, EUR/USD has firmly maintained its downward trend and retreated to multi-week lows in the 1.0820 zone amidst increasing pre-ECB weakness. Looking at the 4-hour chart, the pair seems to have broken below the consolidative phase. That said, the first support level will be around 1.0821 before 1.0723. On the bullish side, attempts should look for a test of the 200-SMA at 1.0920, followed by the 100-SMA at 1.0930 and then 1.0998. The continuation of the strong dollar buying bias has kept risk appetite in check, pushing the US Dollar Index (DXY) to a new yearly high around 103.80, also aided by higher US yields, especially in the belly and the long end of the curve, and the current risk-off environment. In light of the upcoming ECB event, it is interesting to note that market participants have already priced in around 120 bps in rate cuts for the ongoing year, and there is a growing debate between market participants and ECB decision-makers regarding the timing of the central bank's decision to initiate a reduction in the region's policy rate. Despite inflation surpassing the target set by the European Central Bank, policymakers in Europe seem inclined to maintain a cautious approach, even though weak economic fundamentals in the region limit the potential for the European currency to strengthen. The situation looks heated for the dollar; the market today broke a double demand zone at H4, and now it could retrace to the 62 Fibonacci level in the supply zone at 1.0884 before seeking liquidity at a swing low around 1.0750. In case of a retracement, it will be crucial to evaluate an entry, possibly towards the end of the London session, perhaps following a bearish structural change to confirm our view. Greetings to everyone and happy trading.
Short
by Forex48_TradingAcademy
1
AUDUSD is ready for a reversal with target 0.631The AUD/USD indicates a slight uptick, trading around 0.6580 on Tuesday after registering losses in the previous session. The improvement in NAB's Business Confidence may have contributed to supporting the Australian Dollar. The evident resumption of the downward trend around the Australian dollar led the AUS/USD to leave behind a two-day recovery, remaining under pressure in the sub-0.6600 zone at the beginning of a new trading week. So far, dollar dynamics, coupled with the still-lacking convincing signs of an economic recovery in post-pandemic China, are expected to continue dictating the mood around the spot and keeping its price action subdued, all in combination with an anticipated steady hand by the RBA in its February meeting. Returning to the RBA, it is widely expected to leave its official cash rate unchanged at 4.35% next month. The downtick in inflation figures recorded in December, along with further cooling of the (still tight) labor market, have underpinned that consensus among market participants for the time being. That said, the near-term outlook for the AUD remains tilted to the dovish side, a view that could gain further traction if the Federal Reserve continues to push back bets for an interest rate cut in the next few months. On the daily chart, I have highlighted a possible short scenario likely to unfold if confirmation is received around the 0.66-0.6650 level, with a final target of 0.63 and the recapture of all sell-side liquidity. Greetings and have a good day of trading to everyone.
Short
by Forex48_TradingAcademy
3