Analys från DailyFX

GBP/USD Technical Analysis: Cable Ranging in Front of BOE

Published

9 år ago

1 augusti, 2016

DailyFX

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Talking Points:

GBP/USD Technical Strategy: Bigger-picture trend still bearish, near-term range over past two weeks.
GBP/USD is stabilizing above the 1.3000 psychological level, but rips-higher will likely face pressure given the expectation for a cut from the BOE on Thursday.
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In our last article, we looked at the choppiness in the British Pound after the Bank of England kept rates flat at their most recent rate decision. And as we mentioned, markets would likely continue with the expectation for a rate cut at their next meeting in August. And with the BOE on the calendar for Thursday of this week, expectations for a rate cut are fairly aggressive at over 98%. Nonetheless, despite this marked bearishness on the Cable, the pair has remained in a relatively well-formed range over the last two weeks of July.

This raises the possibility that a 25-basis point rate cut from the BOE may already be factored into current price action; and given the fact that Thursday’s meeting also brings fresh Quarterly Inflation Forecasts for the U.K. economy, we’ll likely see more attention paid to the forward-looking projections from the bank rather than a single 25-basis point rate cut.

Traders looking to trade the range ahead of this Thursday’s Bank of England rate decision would likely want to exercise caution as we’re just a little over a month removed from the Brexit referendum that carries quite a few ‘unknowns.’ More proactively, traders could look to gauge the response at Thursday’s rate decision to plot near-term strategy in the Cable. Should a down-side break of support take place, then bearish strategies could become attractive again; but this would likely need to be accompanied with some fairly bearish inflation forecasts for the coming quarters as the British Pound is already sitting near 30+ year lows.

The top-side of the pair could become deceptively attractive should those inflation forecasts show only moderate downgrades for the coming quarters, as an extremely weak US Dollar could continue getting weaker as rate-hike bets out of the U.S. continue to get priced deeper-and-deeper into the future. But for such a strategy, traders would likely want to see resistance in this range around 1.3315 breeched before looking to buy a ‘higher-low.’

Created with Marketscope/Trading Station II; prepared by James Stanley

— Written by James Stanley, Analyst for DailyFX.com

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Analys från DailyFX

EURUSD Weekly Technical Analysis: New Month, More Weakness

Published

8 år ago

30 september, 2017

DailyFX

What’s inside:

EURUSD broke the ‘neckline’ of a bearish ‘head-and-shoulders’ pattern, April trend-line
Resistance in vicinity of 11825/80 likely to keep a lid on further strength
Targeting the low to mid-11600s with more selling

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Coming into last week we pointed out the likelihood of finally seeing a resolution of the range EURUSD had been stuck in for the past few weeks, and one of the outcomes we made note of as a possibility was for the triggering of a ’head-and-shoulders’ pattern. Indeed, we saw a break of the ’neckline’ along with a drop below the April trend-line. This led to decent selling before a minor bounce took shape during the latter part of last week.

Looking ahead to next week the euro is set up for further losses as the path of least resistance has turned lower. Looking to a capper on any further strength there is resistance in the 11825-11880 area (old support becomes new resistance). As long as the euro stays below this area a downward bias will remain firmly intact.

Looking lower towards support eyes will be on the August low at 11662 and the 2016 high of 11616, of which the latter just happens to align almost precisely with the measured move target of the ‘head-and-shoulders’ pattern (determined by subtracting the height of the pattern from the neckline).

Bottom line: Shorts look set to have the upperhand as a fresh month gets underway as long as the euro remains capped by resistance. On weakness, we’ll be watching how the euro responds to a drop into support levels.

For a longer-term outlook on EURUSD, check out the just released Q4 Forecast.

EURUSD: Daily

—Written by Paul Robinson, Market Analyst

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You can follow Paul on Twitter at@PaulRobinonFX.

Analys från DailyFX

Euro Bias Mixed Heading into October, Q4’17

Published

8 år ago

29 september, 2017

DailyFX

Euro Bias Mixed Heading into October, Q4'17

Why and how do we use IG Client Sentiment in trading? See our guide and real-time data.

EURUSD: Retail trader data shows 37.3% of traders are net-long with the ratio of traders short to long at 1.68 to 1. In fact, traders have remained net-short since Apr 18 when EURUSD traded near 1.07831; price has moved 9.6% higher since then. The number of traders net-long is 15.4% lower than yesterday and 16.4% higher from last week, while the number of traders net-short is 0.4% higher than yesterday and 10.5% lower from last week.

We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests EURUSD prices may continue to rise. Positioning is more net-short than yesterday but less net-short from last week. The combination of current sentiment and recent changes gives us a further mixed EURUSD trading bias.

— Written by Christopher Vecchio, CFA, Senior Currency Strategist

To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com

Follow him on Twitter at @CVecchioFX

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Analys från DailyFX

British Pound Reversal Potential Persists Heading into New Quarter

Published

8 år ago

29 september, 2017

DailyFX

British Pound Reversal Potential Persists Heading into New Quarter

Why and how do we use IG Client Sentiment in trading? See our guide and real-time data.

GBPUSD: Retail trader data shows 38.2% of traders are net-long with the ratio of traders short to long at 1.62 to 1. In fact, traders have remained net-short since Sep 05 when GBPUSD traded near 1.29615; price has moved 3.4% higher since then. The number of traders net-long is 0.1% higher than yesterday and 13.4% higher from last week, while the number of traders net-short is 10.6% lower than yesterday and 18.3% lower from last week.

We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests GBPUSD prices may continue to rise. Yet traders are less net-short than yesterday and compared with last week. Recent changes in sentiment warn that the current GBPUSD price trend may soon reverse lower despite the fact traders remain net-short.

— Written by Christopher Vecchio, CFA, Senior Currency Strategist

To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com

Follow him on Twitter at @CVecchioFX

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