Funds Dumping Oil and Fuel Products

Saxo Bank publishes two weekly Commitment of Traders reports (COT) covering leveraged fund positions in commodities, bonds and stock index futures. For IMM currency futures and the VIX, we use the broader measure called non-commercial.

This summary highlights futures positions and changes made by speculators such as hedge funds and CTA’s across 24 major commodity futures up until last Tuesday, September 8. The week covered the first major US stock market correction since the March pandemic low. The risk off spread to the other sectors with the dollar rising by 1.2% while the Bloomberg Commodity Index dropped by 3% with heavy losses seen across the energy sector.

Responding to these developments, hedge funds were selective in their approach to the different sectors. A major reduction in bullish bets on crude oil and fuel products was somewhat off-set by the continued buying of several agriculture commodities, most noticeable soybeans, corn and coffee. Overall the net long across 24 major commodity futures was reduced for the first time in 12 weeks by 8% to 1.8 million lots.

Energy

A 13% price drop in the week to September 8 saw funds reduce the combined net-long in Brent and WTI by one-quarter to 390,655 lots, the lowest since April. Short-selling on both contracts jumped with the gross short in WTI reaching 109,683 lots, a level last seen before the historic price crash in late April.

Many speculators react mostly to price developments without too much focus on underlying fundamentals. On that basis, a break below the uptrend from June was required before the price finally moved lower to bring it more in line with weakening fundamentals.

The recovery in global energy demand continues to show signs of stalling. Many countries around the world, especially in Europe and Asia, are now in the midst of a second wave of coronavirus. As a result, the recovery in fuel demand has stalled with work-from-home and the lack of leisure and business travel – both signs that it will take longer than anticipated to get back to the pre-virus level of energy consumption.

Energy

Metals

A quiet week in metals despite stock market weakness and the stronger dollar. Gold bulls added 2% to their net long while silver saw a 5% reduction in response to a near 6% drop in the price. One note of interest was the 41% reduction in the platinum net long to just 6k lots, not far from the April low.

This just before the WPIC in their quarterly outlook changed their 2020 outlook from a surplus to a deficit, citing Covid-19 impact on supply from South Africa and increased investment demand for hard assets.  HG Copper had a quiet week with no change in either the price or the net long which remains elevated near a two-year high.

Precious and industrial metals

Agriculture

The grain sector continued to see strong demand for beans and corn while CBOT wheat longs were scaled back ahead of a monthly report from the U.S. Department of Agriculture on Friday. The combined long in the three major crops reached 231k lots compared with a five-year average short of 143k lots.

The grain sector has seen strong gains during the past month as U.S. weather concerns and strong Chinese demand all having helped create a bullish backdrop. The World Agriculture Supply and Demand Report on Friday confirmed the bullish outlook for corn and not least soybeans which reached the highest level since December 2017, corn finished higher while wheat dropped.

Key U.S. crop futures

Soft commodities were mixed with the ethanol link to crude oil driving a 12% reduction in the sugar long while cocoa and coffee continued to be bought. The Arabica coffee long reached a near four year high at 48,450 lots.

Soft commodities

 

For a look at all of today’s economic events, check out our economic calendar.

Ole Hansen, Head of Commodity Strategy at Saxo Bank.

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This article is provided by Saxo Capital Markets (Australia) Pty. Ltd, part of Saxo Bank Group through RSS feeds on FX Empire

Unchanged Dollar Short During Week of Price Strength

Saxo Bank publishes two weekly Commitment of Traders reports (COT) covering leveraged fund positions in bonds and stock index futures. For IMM currency futures and the VIX, we use the broader measure called non-commercial.

This summary highlights futures positions and changes made by speculators forex, bonds and stocks up until last Tuesday, September 8. The week covered the first major US stock market correction since the March pandemic low. The Nasdaq 100 lost 10% and the S&P 500 5.5% during a week where US megacap stocks took a beating. The risk off spread to the other sectors with the dollar rising by 1.2% while bonds held steady.

Speculators kept an unchanged bearish dollar bet in the week to September 8. This despite broad dollar gains as the US stock market correction reduced the general level of risk appetite. The net short against ten IMM currency futures and the Dollar Index stood at $33.6 billion with the most noticeable changes offsetting each other being buying of GBP and CAD and selling of JPY.

One interesting observation was the lack of reaction to the stronger dollar from speculators holding a near record euro long at 197k lots (€24.5 billion). During the week both long and short positions saw a small reduction which left the overall net unchanged.

Leveraged fund positions in bonds, stocks and VIX

What is the Commitments of Traders report?

The Commitments of Traders (COT) report is issued by the US Commodity Futures Trading Commission (CFTC) every Friday at 15:30 EST with data from the week ending the previous Tuesday. The report breaks down the open interest across major futures markets from bonds, stock index, currencies and commodities. The ICE Futures Europe Exchange issues a similar report, also on Fridays, covering Brent crude oil and gas oil.

In commodities, the open interest is broken into the following categories: Producer/Merchant/Processor/User; Swap Dealers; Managed Money and other.

In financials the categories are Dealer/Intermediary; Asset Manager/Institutional; Managed Money and other.

Our focus is primarily on the behaviour of Managed Money traders such as commodity trading advisors (CTA), commodity pool operators (CPO), and unregistered funds.

They are likely to have tight stops and no underlying exposure that is being hedged. This makes them most reactive to changes in fundamental or technical price developments. It provides views about major trends but also helps to decipher when a reversal is looming.
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For a look at all of today’s economic events, check out our economic calendar.

Ole Hansen, Head of Commodity Strategy at Saxo Bank.

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This article is provided by Saxo Capital Markets (Australia) Pty. Ltd, part of Saxo Bank Group through RSS feeds on FX Empire

BTC Analysis – This Selling is Real or Just More Price Noise?

11,600 to 12,300 continues to hold Bitcoin back

11,600 to 12,300 continues to hold Bitcoin back, BUT at the same time, price has YET to take out any significant support levels. The 11K area continues to hold, and IF compromised, we are then looking at the 10,500 area for the next buying opportunity. It is important to not lose sight of the broader structure which is CLEARLY bullish. In situations like this, smaller magnitude reversal patterns such as the head and shoulder formation carry much less weight.
Also when there is significant selling off of a resistance level, often there is follow through. Meaning. after the initial bearish candle, the following candle often takes out the low and keeps going. At the moment price continues to hesitate ABOVE the 11K support which is a sign that the selling activity is nothing more than noise.
If price reverses again in the low 11Ks, it is more likely to squeeze higher, faster because of all the new shorts that pile in, while over reacting to a single bearish candle that is in the midst of a broader bullish trend. Confirmation of this would unfold when the 12K lower high is taken out. Squeeze momentum can quickly push the 12,300 resistance boundary.

If we are wrong

If we are wrong, and selling momentum increases over the next day or two, then we get stopped out. We measured our risk in advance and once the trade is in play, it is up to the market to do it’s job, or not.  The key take away here is do not be confused by a small magnitude pattern when the broader trend is still intact. If price sets up at the next support, we simply look to buy back in again.
For a look at all of today’s economic events, check out our economic calendar.
This article was written by Marc Principato CMT, Executive Director at Greenbridgeinvesting.com.

Dollar Bounces, Gold Slips, while Equities Hold Their Own

In the emerging market space, the liquid and accessible currencies, like the Turkish lira, Mexican peso, and Russian rouble, are down the most. The lira has fallen 1% after intrasession volatility that pushed it to a record low against the euro yesterday. That seems to be the source of the pressure on the lira against the dollar.

The South African rand is among the weakest among emerging market currencies today even though the IMF approved a $4.3 bln loan, the most granted so far to assist in combatting the virus. Despite the correction in the foreign exchange market, equities are mostly firm. In the Asia Pacific region, only a few markets could not sustain gains.

Japan, Taiwan, and Australia were among them. South Korea led the region with a nearly 1.8% gain. Europe’s Dow Jones Stoxx 600 is up almost 0.5% after falling for the past two sessions (~2%). US shares are little changed. US bond yields backed up yesterday, with the 10-year yields popping back above 60 bp. This exerted upward pressures in Asia and Europe. Gold reached $1981 before the profit-taking pushed it to about $1907 from where it is recovering. September WTI is little changed around $41.50 a barrel.

Asia Pacific

China is resorting to local lockdowns to combat the new outbreak in the virus. The 61 cases reported Monday were the most in four months. Separately, New Zealand became the latest country to suspend the extradition treaty with Hong Kong. That means that of the intelligence-sharing Five Eyes, only the US has not done so, though it has threatened to do so.

India has banned almost 50 Chinese apps to largely check the workaround the 59 apps banned last month. Another 250 apps are under review. India has cited threats to user privacy and national security. This is a new front in the confrontation with China. The US and Japan are considering their own bans on some Chinese apps.

The dollar is in a quarter of a yen range on either side of JPY105.45, as it is confined to yesterday’s range. The upside correction does not appear over, and the greenback could test previous support and now resistance near JPY106, where an option for $600 mln expires today (and a $1.8 bln option expires Thursday).

The Australian dollar is little changed as it moves within the $0.7065-$0.7180 range that has confined it for around a week now. It has held above $0.7115 today, but it may be retested. The PBOC set the dollar’s reference rate at CNY6.9895 today, nearly spot on where the models suggested. After falling to a four-day low near CNY6.9870, the dollar recovered back above CNY7.0. China seems intent on not allowing the US to get an advantage by devaluing the dollar, something that President Trump has advocated. A stable dollar-yuan rate in a weak dollar environment means that the yuan falls against the CFETS basket. Against the basket, the yuan is at its lowest level in a little more than a month.

Europe

News from Europe is light and the week’s highlights which include the first look at Q2 GDP (median forecast in the Bloomberg survey is for a 12% quarterly contraction), June unemployment (~7.7% vs. 7.4%), and the first look at July CPI (median forecast is for a 0.5% decline for a 0.2% increase year-over-year) still lie ahead.

Today’s focus is mostly on earnings and bank earnings in particular. European banks are being encouraged to extend the hold off of dividend payout and share buybacks that were first introduced in March. This may be worth around 30 bln euros. The UK is fully aboard too. In terms of loan-loss provisioning, European banks are expected to set aside around the same amount as they did in Q1, which was about 25 bln euros. In comparison, the five largest US banks have added a little more than $60 bln in the first half to cushion sour loans.

Fitch lowered its five-year growth potential for the UK from 1.6% to 0.9%. It also took EMU’s potential to 0.7% from 1.2%. This could weaken the resolve of asset managers, where industry surveys suggest a desire to be overweight European stocks and the euro on ideas of economic and/or earnings outperformance. That said, the number of analyst upgrades has surpassed the number of downgrades in Europe for the first time this year.

The euro reached $1.1780 yesterday. As the momentum stalled in Asia, some light profit-taking has been seen that saw it briefly dip just below $1.17 in early European turnover. Intraday resistance is seen near $1.1740-$1.1750. In the recent move, the session high has often been recorded in North America, and we’ll watch to see if the pattern holds today. The market may turn cautious ahead of tomorrow’s outcome of the FOMC meeting.

Sterling poked above $1.29 yesterday for the first time in four months. It made a marginal new high today (~$1.2905), but it too is consolidating. Support is seen in the $1.2830-$1.2850 area. As the euro was trending higher against the dollar yesterday, it also rose to about CHF1.0840, its highest level here in July. However, today’s consolidation has seen the euro slip back to around CHF1.0775. Look for it to find support above CHF1.0760.

America

The US reports house prices, Conference Board consumer confidence, and the Richmond Fed’s July manufacturing survey. Even in the best of times, these are not the typical market movers. The focus instead is three-fold: corporate earnings (today’s highlights include McDonald’s, Pfizer, and 3M), the negotiation over the fiscal bill, and the start of the FOMC meeting. Canada has not economic reports, while Mexico’s weekly reserve figures are due. It continues to gradually accumulate reserves. They have risen by about 4.5% this year after a 3.5% increase last year.

The Economic Policy Institute estimates that a cut in the $600 a week extra unemployment insurance to $200 a week will reduce aggregate demand and cut the number of jobs that were projected to be created. It expects a loss of about 2.5% growth and 3.4 mln fewer jobs. After this week’s FOMC meeting and the first look at Q2 GDP, the US July employment report is due at the end of next week.

It is one of the most difficult high-frequency economic reports to forecast. Still, the outlook darkened after last week’s increase in weekly initial jobless claims, which covered the week that the non-farm payrolls survey is conducted. Another increase, which is what the median forecast in the Bloomberg survey expects, is only momentarily going to get lost in the excitement around the GDP report.

The relatively light news day allows us to look a little closer at Mexico’s June trade data that was out yesterday. Mexico reported a record trade surplus of $5.5 bln. Yet, it is not good news. Mexico is hemorrhaging. The IGAE May economic activity index, reported at the end of last week, showed a larger than expected 22.73% year-over-year drop. The 2.62% decline in the month was nearly three times larger than economists forecast. With the virus still not under control, the government’s forecast for a 9.6% contraction this year is likely to be overshot. The record trade surplus was a function of a larger decline in imports (-23.2%) than exports (-12.8%).

Auto exports are off more than a third (34.6%) this year, to $47.5 bln. Other manufactured exports are down 3.4% to $113.8 bln. Petroleum exports have fallen by nearly 42% in H1 to $8.0 bln. Agriculture exports edged up by 7.3% to $10.5 bln to surpass oil. The peso’s strength reflects not the macroeconomy but its high real and nominal interest rates in the current environment. Yesterday, the dollar fell below MXN22.00 for the first time this month. The June low was near MXN21.46.

The US dollar initially extended its losses against the Canadian dollar, slipping to CAD1.3330, just ahead of last month’s low (~CAD1.3315) before rebounding to almost CAD1.3400. The upside correction could run a bit further, but resistance in the CAD1.3420-CAD1.3440 area may offer a sufficient cap today. The greenback found support against the Mexican peso near MXN21.90 and bounced back to around MXN22.07. Resistance is seen near MXN22.20. The peso is up about 4.5% this month, but within the region has been bettered by Chile (~+6.75%) and Brazil (~+6.15%). The Colombian peso’s almost 2..2% gain puts it in the top 10 best performing emerging market currencies so far this month.

For a look at all of today’s economic events, check out our economic calendar.

The Crypto Daily – Movers and Shakers – June 20th, 2020

Bitcoin rose by 0.63% on Saturday. Partially reversing a 0.90% fall from Friday, Bitcoin ended the day at $9,371.3.

It was a mixed start to the day. Bitcoin rose to an early morning high $9,357.0 before hitting reverse.

Falling short of the major resistance levels, Bitcoin slid to a late morning intraday low $9,178.0.

Bitcoin fell through the first major support level at $9,220.30 before striking a late morning intraday high $9,406.6.

Falling short of the first major resistance level at $9,427.40, Bitcoin fell back to sub-$9,300 levels before finding late support.

Steering clear of the major support levels, Bitcoin bounced back to $9,400 levels before easing back.

The near-term bullish trend remained intact in spite of 3 consecutive days in the red mid-week. Bitcoin continued to hold above the 23.6% FIB of $8,900.

For the bears, Bitcoin would need to slide through the 62% FIB of $6,400 to form a near-term bearish trend.

The Rest of the Pack

Across the rest of the majors, it was a mixed day on Saturday.

Bitcoin Cash ABC (-0.67%), Cardano’s ADA (-0.20%), Monero’s XMR (-0.11%), Stellar’s Lumen (-0.17%), and Tezos (-0.13%) saw red on the day.

It was a relatively bullish day for the rest of the majors, however.

Bitcoin Cash SV (+1.19%), Litecoin (+1.80%), and Tron’s TRX (+1.19%) led the way.

Binance Coin (+0.88%), EOS (+0.46%), Ethereum (+0.06%), and Ripple’s XRP (+0.48%), saw modest gains on the day.

Through the current week, the crypto total market cap fell to a Monday low $245.97bn before rising to a Wednesday high $267.65bn. At the time of writing, the total market cap stood at $260.69bn.

Bitcoin’s dominance rose to a Monday high 66.60% before sliding to a Wednesday low 65.79%. At the time of writing, Bitcoin’s dominance stood at 66.16%.

This Morning

At the time of writing, Bitcoin was up by 0.13% to $9,383.7. A mixed start to the day saw Bitcoin rise to an early morning high $9,394.2 before falling to a low $9,355.4

Bitcoin left the major support and resistance levels untested early on.

Elsewhere, it was a mixed start to the day.

Tezos and Tron’s TRX struggled, with losses of 0.37% and 0.26% respectively.

It was bullish for the rest of the majors, however, with Binance Coin up by 0.50% to lead the way.

BTC/USD 21/06/20 Daily Chart

For the Bitcoin Day Ahead

Bitcoin would need to avoid a fall through the $9,320 pivot to support a run at the first major resistance level at $9,459.27.

Support from the broader market would be needed, however, for Bitcoin to break out from Saturday’s high $9,406.6. Resistance at $9,500 has continued to pin Bitcoin back since 11th June.

Barring a broad-based crypto rally, the first major resistance level at $9,459.27 would likely cap any upside.

In the event of a crypto breakout, Bitcoin could test the second major resistance level at $9,547.23.

Failure to avoid a fall through the $9,320 pivot level could see Bitcoin struggle on the day.

A fall through to sub-$9,300 levels would bring the first major support level at $9,230.67 into play.

Barring another extended crypto sell-off, however, Bitcoin should steer clear of sub-$9,000 levels. The second major support level at $9,090.03 should limit any downside.

The Crypto Daily – Movers and Shakers – June 19th, 2020

Bitcoin fell by 0.77% on Thursday. Following on from a 0.64% decline on Wednesday, Bitcoin ended the day at $9,400.0.

It was a mixed start to the day. Bitcoin recovered from an early dip to strike a late morning intraday high $9,496.9 before hitting reverse.

Falling well short of the first major resistance level at $9,606.27, Bitcoin slid to a late intraday low $9,285.0.

The reversal saw Bitcoin fall through the first major support level at $9,300.27 before finding late support.

Bitcoin broke back through the first major support level to $9,400 levels, limiting the loss on the day.

The near-term bullish trend remained intact in spite of last week’s sell-off, with Bitcoin holding well above the 23.6% FIB of $8,900.

For the bears, Bitcoin would need to slide through the 62% FIB of $6,400 to form a near-term bearish trend.

The Rest of the Pack

Across the rest of the majors, it was a bearish day on Thursday.

Binance Coin (-1.53%), Bitcoin Cash SV (-1.49%), Cardano’s ADA (-1.91%), Litecoin (-1.45%), Ripple’s XRP (-1.68%), and Stellar’s Lumen (-1.47%) lead the way down.

Bitcoin Cash ABC (-1.21%), EOS (-1.19%), Ethereum (-1.09%), and Tron’s TRX (-1.03%) also struggled on the day.

Monero’s XMR and Tezos saw relatively modest losses of 0.17% and 0.51% respectively.

Through the current week, the crypto total market cap fell to a Monday low $246.94bn before rising to a Wednesday high $266.87bn. At the time of writing, the total market cap stood at $260.24bn.

Bitcoin’s dominance rose to a Monday high 66.60% before sliding to a Wednesday low 65.87%. At the time of writing, Bitcoin’s dominance stood at 66.10%.

This Morning

At the time of writing, Bitcoin was down by 0.48% to $9,355.0. A bearish start to the day saw Bitcoin fall from an early morning high $9,400.0 to a low $9,333.4.

Bitcoin left the major support and resistance levels untested early on.

Elsewhere, it was a mixed start to the day on Friday.

Binance Coin was up by 0.33% to buck the trend early on.

It was bearish for the rest of the pack, however, with Cardano’s ADA down by 1.05% to lead the way down.

BTC/USD 19/06/20 Daily Chart

For the Bitcoin Day Ahead

Bitcoin would need to move through the $9,394 pivot to bring the first major resistance level at $9,502.93 into play.

Support from the broader market would be needed, however, for Bitcoin to break out from Thursday’s high $9,496.6. Resistance at $9,500 has continued to pin Bitcoin back since 11th June.

Barring a broad-based crypto rally, the first major resistance level and Thursday’s high $9,496.9 would likely cap any upside.

In the event of a crypto breakout, Bitcoin could test the second major resistance level at $9,595.87.

Failure to move through the $9,394 pivot level could see Bitcoin struggle on the day.

A fall through the morning low $9,333.4 would bring the first major support level at $9,291.03 into play.

Barring another extended crypto sell-off, however, Bitcoin should steer clear of sub-$9,000 levels. The second major support level at $9,182.07 should limit any downside.

Litecoin, Stellar’s Lumen, and Tron’s TRX – Daily Analysis – 30/04/20

Litecoin

Litecoin rallied by 6.68% on Wednesday. Following on from a 2.85% gain on Tuesday, Litecoin ended the day at $48.85.

A mixed start to the day saw Litecoin fall to an early morning intraday low $45.65 before making a move.

Steering clear of the first major support level at $44.13, Litecoin rallied to a late afternoon intraday high $50.19.

Litecoin broke through the first major resistance level at $46.85 and the second major resistance level at $47.89.

A brief pullback saw Litecoin fall back through the second major resistance level before rebounding to $48 levels.

At the time of writing, Litecoin was up by 3.36% to $50.49. A bullish start to the day saw Litecoin rise from an early morning low $48.63 to a high $50.50.

Litecoin left the major support and resistance levels untested early on.

LTC/USD 30/04/20 Daily Chart

For the day ahead

Litecoin would need to avoid sub-$49 levels to support another run at the first major resistance level at $50.81.

Support from the broader market would be needed, however, for Litecoin to breakout out from the morning high $50.50.

Barring an extended crypto rally, the first major resistance level at $50.81 would likely limit any upside on the day.

Failure to avoid sub-$49 levels could see Litecoin struggle later in the day.

A fall through the morning low to sub-$48.20 levels would bring the first major support level at $46.27 into play.

Barring a broad-based crypto sell-off, however, Litecoin should steer clear of sub-$49 levels on the day.

Looking at the Technical Indicators

Major Support Level: $46.27

Major Resistance Level: $50.81

23.6% FIB Retracement Level: $62

38.2% FIB Retracement Level: $78

62% FIB Retracement Level: $104

Stellar’s Lumen

Stellar’s Lumen rallied by 5.04% on Wednesday. Following on from a 1.86% gain on Tuesday, Stellar’s Lumen ended the day at $0.071999.

A mixed start to the day saw fall to an early morning intraday low $0.068109 before striking a late intraday high 0.072823.

Steering clear of the major support levels, Stellar’s Lumen broke through the first major resistance level at $0.071120.

A late pullback saw Stellar’s Lumen ease back to $0.07125 levels before bouncing back.

At the time of writing, Stellar’s Lumen was up by 0.70% to $0.072504. A bullish start to the day saw Stellar’s Lumen rise from an early morning low $0.071586 to a high $0.074387.

Stellar’s Lumen broke through the first major resistance level at $0.073850 early on.

XLM/USD 30/04/20 Daily Chart

For the day ahead

Stellar’s Lumen would need to break back through the first major resistance level to bring $0.075 levels into play.

Support from the broader market would be needed, however, for Stellar’s Lumen to breakout from the morning high $0.074387

Barring an extended crypto rally, resistance at $0.075 would likely leave Stellar’s Lumen short of the second major resistance level $0.07569

Failure to break back through the first major resistance level could see Stellar’s Lumen hit reverse.

A fall through to sub-$0.07100 levels would bring the first major support level at $0.06913 into play.

Barring a broad-based crypto sell-off, however, Stellar’s Lumen should steer clear of sub-$0.070 levels on the day.

Looking at the Technical Indicators

Major Support Level: $0.06913

Major Resistance Level: $0.07385

23.6% FIB Retracement Level: $0.1051

38% FIB Retracement Level: $0.1433

62% FIB Retracement Level: $0.2050

Tron’s TRX

Tron’s TRX rose by 5.43% on Wednesday. Following on from a 5.78% gain on Tuesday, Tron’s TRX ended the day at $0.01610.

A mixed start to the day saw Tron’s TRX fall to an early morning intraday low $0.015075 before making a move.

Steering clear of the first major support level at $0.01455, Tron’s TRX rallied to a late afternoon intraday high $0.016499.

Tron’s TRX broke through the first major resistance level at $0.01583 and the second major resistance level at $0.01636.

A brief pullback to sub-$0.01590 levels saw Tron’s TRX fall back through the second major resistance level.

Finding late support, however, Tron’s TRX bounced back to wrap up the day at $0.01610 levels.

In spite of the rebound, Tron’s TRX failed to break back through the second major resistance level at $0.01636.

At the time of writing, Tron’s TRX was up by 1.60% to $0.016463. A bullish start to the day saw Tron’s TRX rise from an early morning low $0.016146 to a high $0.016669.

Tron’s TRX left the major support and resistance levels untested early on.

TRX/USD 30/04/20 Daily Chart

For the Day Ahead

Tron’s TRX would need to avoid sub-$0.016 levels to support a run at the first major resistance level at $0.01671.

Support from the broader market would be needed, however, for Tron’s TRX to break out from the morning high $0.016669.

Barring a late morning recovery, the first major resistance level at $0.01671 would likely limit any upside.

Failure to avoid sub-$0.016 levels could see Tron’s TRX hit reverse.

A fall back through the morning low to sub-$0.01590 levels would bring the first major support level at $0.01528 into play.

Barring an extended crypto sell-off, however, Tron’s TRX should continue to steer clear of sub-$0.015 levels.

Looking at the Technical Indicators

Major Support Level: $0.01528

Major Resistance Level: $0.01671

23.6% FIB Retracement Level: $0.0322

38.2% FIB Retracement Level: $0.0452

62% FIB Retracement Level: $0.0663

Please let us know what you think in the comments below

Thanks, Bob

Gold Price Futures (GC) Technical Analysis – Secondary Lower Top – First Sign of Short-Sellers

Gold is trading steady to lower late Tuesday in a choppy session with sellers taking direction from firm equity prices and buyers getting some direction from a weaker U.S. Dollar. Fundamentally, traders were moving money out of gold due to the lifting of coronavirus-related restrictions.

Gold investors are paying close attention to what the recovery will look like. Right now the assumption is that a V-shaped recovery will be bearish for gold, while a U or L shape may be more favorable. The shape of the recovery will determine how much gold investors or hedgers will want to hold as a diversifier against risk.

Furthermore, there is the problem with the U.S. Dollar. A scenario where stocks break sharply could drive the U.S. Dollar higher because of safe-haven buying. At the same time, they are likely to sell gold to raise cash to cover losses and to meet margin calls.

If there is a rebound in the number of coronavirus cases or if the curve doesn’t flatten fast enough, we could see a repeat of March. We’ve all seen the playbook so don’t be surprised, just react. If you don’t remember, it started with aggressive dollar-buying. Gold really didn’t start rallying until the central banks and governments started throwing money at the problem.

At 17:29 GMT, June Comex gold is trading $1722.20, down $1.60 or -0.09%.

Daily June Comex Gold

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart, but momentum is trending lower. A trade through $1764.20 will signal a resumption of the uptrend. The main trend will change to down on a trade through $1666.20.

The minor range is $1788.80 to $1666.20. Its 50% level or pivot at $1727.50 is controlling the direction of the market this week.

The short-term range is $1576.00 to $1788.80. Its retracement zone at $1682.40 to $1657.30 is support.

The main range is $1453.00 to $1788.80. Its retracement zone at $1620.90 to $1581.30 is major support.

Short-Term Outlook

Based on the price action and the current price at $1722.20, the direction of the June Comex gold into the close on Tuesday is likely to be determined by trader reaction to the pivot at $1727.50.

Bearish Scenario

A sustained move under $1727.50 will indicate the presence of sellers. If this move creates enough downside momentum then look for the selling to possibly extend into $1682.40, followed by $1666.20 and $1657.30.

Bullish Scenario

Overcoming $1727.50 late in the session will signal the return of buyers. They may try to retest the pair of main tops at $1764.20 and $1788.80.

Side Notes

The formation of the secondary lower top at $1764.20 should be noted. This usually indicates the presence of short-sellers, not just profit-takers.

Crude Oil Price Update – Trader Reaction to $12.38 Pivot Will Determine Next Short-Term Move

U.S. West Texas Intermediate crude oil futures are trading slightly lower at the mid-session after clawing back all of its earlier losses. Oil turned positive shortly after the regular session opening as reopening of economies outweighed fears about dwindling storage capacity worldwide.

Prices were under pressure for a second session after the United States Oil Fund (USO), said it would sell all of its contracts for June delivery beginning Monday, in favor of longer-term deferred contracts.

At 15:46 GMT, June WTI crude oil is trading $11.63, down $1.30 or -5.38%.

The intraday rally was fueled by short-covering. It would be premature to hit the buy button given the current weak demand situation. According to some estimates, as much as a third of worldwide demand has been sapped, which has sent prices tumbling to record lows.

Daily June WTI Crude Oil

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through $6.50 will signal a resumption of the downtrend. The main trend will change to up on a move through $33.15. This is highly unlikely. It also shows how much work buyers are going to have to do to change the trend.

The minor range is $6.50 to $18.26. Its 50% level or pivot at $1238 is controlling the price action so far this week.

The short-term range is $33.15 to $6.50. Its retracement zone at $19.83 to $22.97 is the next upside target and resistance zone.

Daily Swing Chart Technical Forecast

Based on the early price action and the current price at $11.63, the direction of the June WTI crude oil market the rest of the session on Tuesday is likely to be determined by trader reaction to the pivot at $12.38.

Bullish Scenario

A sustained move over $12.38 will indicate the presence of buyers. If this creates enough upside momentum then look for a possible surge into $18.26 to $19.83.

Bearish Scenario

A sustained move under $12.38 will signal the presence of sellers. If this move generates enough downside momentum then look for a possible retest of the contract low at $6.50.

Side Notes

At 20:30 GMT, traders will get the opportunity to react to the weekly inventories report from the American Petroleum Institute (API). It is expected to show a 12 to 15 million barrel build for the week-ending April 24. The previous week’s report showed a 13.226 million barrel build.

E-mini NASDAQ-100 Index (NQ) Futures Technical Analysis – Watch for Light Volume Ahead of Fed Meeting

June E-mini NASDAQ-100 Index futures advanced on Monday as investors prepared for a busy earnings week while turning a hopeful eye toward several U.S. states that are relaxing shutdown restrictions put in place to curb the spread of the COVID-19 pandemic. The technology-based index has clawed back nearly 70% of the ground it lost since the coronavirus crisis brought the economy to a grinding halt.

On Monday, June E-mini NASDAQ-100 Index futures settled at 8818.25, up 49.25 or +0.56%.

In stock related news, Apple Inc. slipped 0.2% following a report indicating the company was postponing a production ramp up for its flagship iPhone.

Daily June E-mini NASDAQ-100 Index

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through 8966.75 will signal a resumption of the uptrend, while a move through 8342.00 will change the main trend to down.

The minor trend is also up. This is helping to generate upside momentum. A trade through 8498.25 will change the minor trend to down.

The minor range is 8966.75 to 8342.00. Its 50% level or pivot at 8654.25 is support.

The main range is 9780.50 to 6628.75. Its retracement zone at 8576.50 to 8204.50 is major support. This zone is controlling the longer-term direction of the index.

Short-Term Outlook

It was a good start to the week with the index picking up where it left off on Friday with a solid rally from the opening on Sunday night. If this upside momentum continues into Tuesday then 8966.75 should be an easy target.

With the Fed starting a two-day meeting on Tuesday, light volume could prevent a breakout over 8966.75. However, if the Fed delivers more positive news on Wednesday then look for a breakout over this level with 9006.75 the next upside target.

On the downside, support is staggered at 8654.25, 8576.50 and 8498.25.

E-mini S&P 500 Index (ES) Futures Technical Analysis – Should Test 2885.00 – 2930.25 on Tuesday

June E-mini S&P 500 Index futures rallied on Monday as investors celebrated the possibility of reopening the economy after the coronavirus outbreak. The market never struggled during the session, opening strong Sunday night then pushing higher before the cash market opening after the Bank of Japan announced more stimulus measures.

At 21:45 GMT, June E-mini S&P 500 Index futures are trading 2867.50, up 38.00 or +1.34%. The high of the session was 2881.25. This was just shy of the recent top at 2885.00.

The financials sector led the S&P 500 Index higher, climbing more than 3%. Citigroup shares rallied more than 6% while Wells Fargo and Bank of America were each up over 4%.

Daily June E-mini S&P 500 Index

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart, however, momentum is trending higher. The main trend will change to up on a trade through 2885.00. A move through 2717.25 will signal a resumption of the downtrend.

The minor trend is up. This led to the shift in momentum to the upside.

The minor range is 2885.00 to 2717.25. Its 50% level or pivot at 2821.00 is new support.

An additional support cluster comes in at 2785.75 to 2765.50.

Short-Term Outlook

Look for the upside bias to continue as long as the index can hold the pivot at 2821.00. If this move creates enough upside momentum then look for buyers to take out 2885.00, changing the main trend to up. This could trigger an acceleration into the major Fibonacci level at 2930.25.

For longer-term bullish traders, the key to extending the rally will be overtaking 2930.25.

On the downside, a failure at 2821.00 will signal the presence of sellers. This could lead to a pullback into 2785.75 to 2765.50.

Taking out 2765.50 with big selling volume could trigger an acceleration to the downside with the next targets 2717.25 and 2652.50.

Natural Gas Price Fundamental Daily Forecast – Wicked Price Action Ahead of May Futures Expiration

Natural gas futures posted a wicked reversal to the upside on Monday that may have been fueled by massive short-covering ahead of the expiration of the May futures contract on Tuesday.

U.S. weather forecasts were mostly supportive, but lower commercial and industrial demand due to the COVID-19 lockdowns across the country would’ve more than offset any weather related bullishness.

At 19:29 GMT, June natural gas futures are trading $1.918, up $0.023 or +1.21%. This is up from a low of $1.765.

The rebound in the market may have also been fueled by another plunge in crude oil futures, which renewed concerns over lower production. Furthermore, a successful test of a short-term support zone may have also been behind the technical closing price reversal bottom.

May Expiration Volatility

Early in the session, weak near-term fundamentals kept the pressure on the front of the natural gas futures curve. Additionally, the volatile moves in the May futures contract didn’t come as a complete surprise with some analytical firms actually predicting the possibility of erratic movement.

Some “chaotic moves” could be in store prior to the expiration of the May contract, with more risk to the downside than to the upside, according to Bespoke Weather Services.

However, “the market is thinner, meaning it can more easily be pushed around, so we’d still advise caution,” the firm said. “Either way, the data still suggests that it is difficult to really be bullish at the front of this curve until we see clearer signs that the economy is coming back and balances tighten significantly.”

“Winter can remain supported, as that is where the lower production story can take precedence. Is it possible that cuts in production come sooner? Absolutely, and if that happens, the story at the front of the curve can change, but we do not see that yet.”

EBW Analytics Group Sees More Downside Pressure

EBW Analytics Group analysts said they expect the May contract to slide in its last two days of trading, extending Friday’s 6.9-cent sell-off. The firm attributed the recent price weakness to two main drivers, Natural Gas Intelligence (NGI) reported.

First is “the steep decline in weather-driven demand for gas expected over the next two weeks,’ which should result in the first reported triple-digit storage injection from the Energy Information Administration (EIA) next week, the EBW analysts said. The other factor is “collapsing natural gas prices in Europe and Asia, which threaten to shut the door” on U.S. liquefied natural gas exports this summer.

This sets the stage for May to head lower before rolling off the board Tuesday, according to the firm.

“The June contract is also expected to slide this week, potentially ending the week at or below Friday’s close for May,” the EBW analysts said. “The bleeding may temporarily slow by next week, though, as large amounts of oil production start to be shut in and reduce supplies of associated gas.”

Short-Term Outlook

Expect more volatility on Tuesday with the markets showing sensitivity to the May expiration and the crude oil market. Any rallies are not likely to be fueled by a change in demand, but rather production or supply issues.

EUR/USD Mid-Session Technical Analysis for April 27, 2020

The Euro is trading higher against the U.S. Dollar at the mid-session on Monday. Some investors were squaring short Euro positions ahead of Thursday’s European Central Bank monetary policy and interest rates decisions. Others were selling U.S. Dollars as traders turned more positive and less averse to risk amid an easing in coronavirus lockdowns around the world.

At 14:00 GMT, the EUR/USD is trading 1.0845, up 0.0021 or +0.20%.

Daily EUR/USD

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. However, momentum shifted to the upside after the confirmation of Friday’s closing price reversal bottom.

A trade through 1.0727 will negate the closing price reversal bottom and signal a resumption of the downtrend.

The main trend will change to up on a trade through the last main top at 1.0991.

The minor trend is also down. Taking out 1.0885 and 1.0897 will change the minor trend to up. This will reaffirm the shift in momentum.

The main range is 1.0636 to 1.1147. Its retracement zone at 1.0831 to 1.0892 is resistance. The EUR/USD is currently trading inside this zone. It is also controlling the near-term direction of the Forex pair.

Daily Swing Chart Technical Forecast

Based on the early price action and the current price at 1.0845, the direction of the EUR/USD the rest of the session on Monday is likely to be determined by trader reaction to the Fibonacci level at 1.0831.

Bullish Scenario

A sustained move over 1.0831 will indicate the presence of buyers. If this move creates enough upside momentum then look for a rally into a series of levels at 1.0885, 1.0892 and 1.0897. The latter is a potential trigger point for an acceleration to the upside with 1.0991 the next likely target over the near-term.

Bearish Scenario

A sustained move under 1.0831 will signal the presence of sellers. This could trigger an intraday break into a minor pivot at 1.0794. If this fails then look for the selling to possibly extend into 1.0727.

The IMF Delivers a Reality Check. Will Italy and Spain Deliver Brussels Another?

Through the early part of the European session today, we saw the majors give up gains from Tuesday.

A run of 5 consecutive days for the CAC40 and EuroStoxx600 had come off the back of fresh optimism.

This optimism was not from hopes of a less severe impact of COVID-19 on the economy but on countries reopening for business.

Once more, however, the markets and governments appear to be ignoring China’s model.

This time around, with China now dealing with returnees infected with COVID-19. This coincides with a number of U.S States looking to loosen confinement measures.

For the EU, the likes of Spain, Italy, Germany, and France will also be looking to get their economies up and running.

It is perhaps not too surprising when considering the IFM’s latest economic forecasts for the current year.

The Forecasts and the Markets

The fixation on the COVID-19 numbers ahead of the IMF‘s forecasts was evident in the markets. Even the worst economic indicators on record had not been enough to stall the global equity market rebound.

Just as investors were preparing for the earnings season, the IMF delivered its reality check.

If investors were thinking that the global financial crisis was bad, the IFM figures are preparing the markets for far worse…

The global economy contracted by 0.1% during the global financial crisis. For 2020, the IMF has forecast that the economy will contract by 3%. To make matters worse, the U.S is forecast to contract by 6%, and the Euro area by a whopping 7.5%.

Somewhat surprisingly, it has taken the IMF to remind the markets of what lies ahead. It’s not just the current spread of the virus that must be considered but also the longer-term economic impact.

It goes without saying that, the greater the contraction the less likely a V-curve rebound will be.

For that very reason, the IMF poured cold water on those projecting a V-shaped economic rebound in the U.S.

Service sector economies are certainly at the mercy of the virus and the lockdown measures taken by governments. But manufacturing and export economies are unlikely to be better off. A marked surge in unemployment, by levels never seen before, means that demand for just about everything will take time to recover.

So, when factoring the growth outlook, unemployment and the fact that borders will remain closed for some time to come, some pullback is due.

Fiscal and Monetary Policy Support

When considering the measures taken by governments and central banks to combat the effects of COVID-19, the EUR should be on a much less steady footing.

EU Finance Ministers managed to agree to a €500bn package for member states. Throw in the forecasted 7.5% contraction for 2020 and that support looks particularly small. Even more so when you consider the support delivered by the FED and the U.S administration.

On the face of it, it’s not too surprising to see the Dollar on the move and for the European equity markets to see red.

It remains to be seen whether this is the beginning of the big correction, however. Much will depend on what is in store from a monetary and fiscal policy perspective.

For Italy and Spain, forecasted contractions of 9.1% and 8.0% respectively will once again raise the possibility of a break from the EU.

Years of austerity followed by an economic meltdown will have voters demanding more support from Brussels. A failure to deliver will undoubtedly lead to the talk of a breakaway once more.

At the time of writing, the EUR was down by 0.66% to $1.09070. After having visited $1.14 levels in March, is the EUR facing the prospect of a return to sub-$1.06 levels?

Any chatter from Spain, Italy and possibly from Germany on the viability of the EU project and we may even see parity against the Dollar…

The worse economic meltdown since the Great Depression certainly warrants more than the March sell-off. After all, that sell-off came well before the markets had any sense of what economic mayhem COVID-19 has created…

EUR/USD 15/04/20 Daily Chart

Silver Daily Forecast – Silver Moves Higher as Investors Show Optimism

Silver has posted slight gains in the Friday session. Currently, silver is trading at $12.61, up $0.51 or 4.28% on the day.

Markets Rebound After Rate Cuts, Stimulus

Global markets have moved higher on Friday, as governments and central banks have intervened with massive stimulus packages in order to stabilize the volatile financial markets. On Wednesday, President Trump signed into law a massive stimulus package that had been quickly approved by Congress. The package, worth close to a trillion dollars includes direct payments, deferred payments and tax breaks. The move is aimed at shoring up the U.S. economy, which analysts fear could be headed towards a recession.

Major central banks have mobilized to combat the financial turmoil caused by COVID-19 outbreak. The Federal Reserve has slashed interest rates to near zero and also announced a huge bond-buying campaign. Across the pond, the ECB announced a 750 billion euro asset purchase package. The Pandemic Emergency Purchase Program (PEPP) will last until the end of 2020. On Thursday, the Bank of England trimmed rates from 0.25% to 0.10%, a record low. This move comes just one week after an emergency rate cut of 50 basis points. The bank will also buy an extra 200 billion pounds in government and corporate bonds. These massive bond purchases by the central banks are aimed at improving economic conditions, which have badly deteriorated due to the outbreak, especially with crippling travel restrictions through much of the world.

The cautious optimism in the financial markets has helped boost silver, although the metal is down 14.8 percent this week. For now, silver is keeping its head above the critical $12 level, which has been tested during the week.

 

Silver Technical Analysis

The crucial 12.00 level remains an immediate resistance line. Above, there is resistance at 13.00. If that level is broken, the market will next be looking at 15.00. On the downside, if silver drops into the mid-11 range, we could be headed much lower, as the next major support level is at the symbolic 10.00 level.

Silver 1-Day Chart

Crude Oil Daily Forecast – Is this the Time to Buy Crude?

Crude has posted gains in the Friday session. Currently, U.S. crude oil is trading at $27.59, up $2.24 or 8.51% on the day. Brent crude oil is trading at $31.97, up $2.57 or 8.67%.

Crude Tests $20 – To Buy or Not to Buy?

We are seeing a pause in the massive sell-off of crude, which hit $20 a barrel earlier in the week. Despite this upward price retracement, traders should bear in mind that the current trend remains downward and overall sentiment is pessimistic. This means that the floor could be still lower. At the same time, oil prices have crashed and fell this week to 18-year lows, which certainly represents a buying opportunity. Traders may wish to show some caution and not go “full in” to such volatile markets, but these prices can certainly be considered a bargain.

Oil Rebounds on Trump Remarks

Crude prices have moved higher on Friday after U.S President Trump said on Thursday that he was prepared to get involved in the Saudi Arabia-Russia price war “at the appropriate time”. Trump did not offer any specifics, but investors were heartened that Trump’s remarks (warning?) could help end the price war, which has contributed to plunging oil prices. Earlier this week, U.S. crude fell as low at $20.27, its lowest level since 2002.

The U.S. is unhappy with plummeting oil prices, which has severely hurt U.S. shale oil production, which makes up 1/3 of onshore oil production in the continental U.S. Still, analysts aren’t expecting Russia or Saudi Arabia to lose face anytime soon and be the first to blink. Saudi Arabia is incensed that Russia torpedoed its move to slash production and has responded with deep price cuts and an increase in production. However, Russian President Putin is unlikely to bend to the Saudis, as long as the Russian economy is not hit too hard by falling prices.

Technical Analysis

With crude showing some sustained upward movement, a number of resistance lines have fallen. Currently, there is resistance at 29.85. If crude breaks through this line, it has room to move as high as 32.80, which is the next major resistance line. On the downside, there is support at support 26.80, followed by 24.20.

U.S. Crude 1-Day Chart

European Equities: Futures Point to a Slide as the Markets React to China Stats and the FED’s Rate Slash

Economic Calendar:

Monday, 16th March

Italian CPI (MoM) (Feb) Final

Tuesday, 17th March

German ZEW Current Conditions (Mar)

German ZEW Economic Sentiment (Mar)

Eurozone ZEW Economic Sentiment (Mar)

Eurozone Wage Growth (YoY) (Q4)

Wednesday, 18th March

Eurozone Core CPI (YoY) (Feb) Final

Eurozone CPI (YoY) (Feb) Final

Eurozone CPI (MoM) (Feb)

Eurozone Trade Balance (Jan)

Friday, 20th March

German PPI (MoM) (Feb)

The Majors

It was a relatively bullish end to the week for the European majors that enjoyed a much-needed relief rally after 4-days in the red.

The CAC40 and EuroStoxx600 led the way with gains of 1.83% and 1.43% respectively, while the DAX30 rose by just 0.77%.

It could have been a far better day, with the DAX30 up by 9% on the day before sliding back, as coronavirus news continued to weigh.

Following the WHO’s reclassification of the virus as a pandemic, Europe quickly became the epicenter last week. Talk of fiscal and monetary policy support may have been positive takeaways, but a widening shut down across the region was the major negative…

The Stats

It was a relatively busy day on the Eurozone economic calendar on Friday. Key stats included finalized February inflation figures out of Germany, France, and Spain.

The numbers had a muted impact on the majors, however, with no data major shocks for the markets to consider.

Late in the session, a fall in U.S consumer sentiment in March didn’t help… The Michigan Consumer Sentiment Index fell from 101.0 to 95.9 in March, according to prelim figures.

The Market Movers

For the DAX: it was a particularly bullish day for the auto sector. BMW and Continental led the way, with gains of 7.29% and 6.00% respectively. Daimler and Volkswagen saw more modest gains of 5.45% and 4.43% respectively.

It was also a bullish day for the banks, with Commerzbank and Deutsche Bank rallying by 3.78% and 8.42% respectively.

Deutsche Lufthansa rallied by 10.14%, with the upside coming in spite of travel restrictions and border shutdowns.

From the CAC, it was a relatively bullish day for the banks. Credit Agricole and Soc Gen rallied by 4.06% and 10.30% respectively. BNP Paribas saw a more modest gain of 2.35% on the day.

The auto sector also found much-needed support, with Peugeot and Renault gaining 2.90% and 2.29%% respectively.

Air France-KLM managed to reverse Thursday’s 12.69% slide, with a 12.69% gain on Friday.

On the VIX Index

The VIX saw its 2nd day in the red out of 7, with a 23.37% slide on Friday. Partially reversing a 40.02% surge from Thursday, the VIX ended the day at 57.8.

A bullish end to the week saw the U.S equity markets recoup most of Thursday’s losses as investors responded to the U.S administration’s decision to call a national emergency. Added measures to contain the spread of the virus also provided support on the day, detracting investor focus from the actual spread across the U.S.

Thursday had seen the markets pummelled in response to the administration’s apparent ineptitudes in handling the virus.

On Friday, the S&P500 rallied by 9.29%, which left the VIX in the red but at elevated levels that had not been since 2008.

VIX 16/03/29 Daily Chart

The Day Ahead

It’s a relatively quiet day ahead on the Eurozone economic calendar. Finalized February inflation figures are due out of Italy later this morning.

With the markets having plenty to consider following the coronavirus news updates from the weekend, the numbers will have a muted impact on the majors.

Over the course of the day, expect governments and central banks to attempt to ease the market panic.

We saw the FED slash rates to zero ahead of the Asian open this morning, while also delivering $700bn in QE, with the RBNZ also cutting rates.

The reality is, however, that containment measures came in too late and the EU has become the epicenter.

With the 1st quarter coming to a rapid end, economic woes will spill into the 2nd quarter, which will test risk sentiment at the start of the week.

If economic data from China from this morning is anything to go by, the impact could be quite catastrophic. Industrial production in China slumped by 13.5% in February, year-on-year. In January production had risen by 6.9%. While the numbers were particularly dire, economists had forecast a 1.5% increase, which was way off the mark.

In the futures markets, at the time of writing, the DAX was down by 288 points, with the Dow down by 1,041 points.

EUR/USD Bearish Freefall Drops 200 Pips and Reaches 1.09

Dear traders, the EUR/USD is showing massive bearish momentum. The expected downtrend is now unfolding in 5 waves (orange). Can price action even break the bottom of wave 3 (blue) at 1.0881?

4 hour chart

EUR/USD euro US dollar 4 hour chart

Our EUR/USD wave analysis was expecting a bearish wave 4-5 (green) pattern within a wave C (blue). The bearish breakout indeed confirmed our bearish view. However, the momentum is much stronger than expected. Price could be building a larger bearish wave 3 (rather than a wave C) if it’s able to break below the 100% Fib of wave 2 vs 1 at 1.0881.Also, Ultima EA had massive wins with the +/- 7 shorts on the EUR/USD. The winning streak is sending the account sky high.

1 hour chart

EUR/USD euro US dollar 1 hour chart

The EUR/USD made a pullback pattern after Friday’s NFP event. This has been labelled as wave 1-2 (dark red). Yesterday price was able to break the support line (dotted blue) for a new lower low, again. The bearish impulse remains strong, so the price swing has been labelled as a wave 3 (dark red). The current pullback could be a wave 4 (dark red) as long as price action stays below the 61.8% Fibonacci retracement level of wave 4 vs 3. A bearish breakout could confirm a move lower towards the Fib targets.

Good trading,

Chris Svorcik

The analysis has been done with the help of SWAT method (simple wave analysis and trading)

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The Crypto Daily – Movers and Shakers -06/12/19

Bitcoin rallied by 2.77% on Thursday. Reversing a 1.33% decline from Wednesday, Bitcoin ended the day at $7,440.0.

A mixed start to the day saw Bitcoin fall to an early morning intraday low $7,191.0 before finding support.

Steering well clear of the first major support level at $6,948.2, Bitcoin rose to an early afternoon intraday high $7,530.9.

In spite of the breakout from $7,400 levels, Bitcoin came up short of the first major resistance level at $7,709.2.

A pullback through the afternoon saw Bitcoin slide through to sub-$7,400 levels before finding support.

The near-term bearish trend, formed at late June’s swing hi $13,764.0, remained firmly intact.

For the bulls, Bitcoin would need to break out from $11,000 levels to form a near-term bullish trend.

The Rest of the Pack

Across the rest of the top 10 cryptos, it was a mixed day for the majors.

Ripple’s XRP and Binance Coin led the way, rallying by 3.53% and by 3.43% respectively.

Bitcoin Cash ABC (+2.49%), EOS (+2.24%), Ethereum (+1.84%), and Stellar’s Lumen (+1.40%) also saw solid gains.

Bitcoin Cash SV and Litecoin trailed the pack. While Litecoin rose by 0.31%, Bitcoin Cash SV fell by 0.17% to buck the trend on the day.

Through the current week, the crypto total market cap slid from $203bn levels on Monday to a Wednesday low $195.19bn before hitting a Thursday high $203.71bn. At the time of writing, the total market cap stood at $201.32bn.

Bitcoin’s dominance hit 67% levels before easing back, supported by the strong gains on the day. 24-hour trading volumes returned to $70bn levels before easing back.

This Morning

At the time of writing, Bitcoin was down by 0.72% to $7,386.3. A bearish start to the day saw Bitcoin fall from an early morning high $7,440.0 to a low $7,378.8.

Bitcoin left the major support and resistance levels untested early on.

Elsewhere, it was a bearish start to the day for the majors.

With the rest of the pack in the red, Binance Coin led the way, with a 0.70% loss.

Bitcoin Cash ABC (-0.55%), Bitcoin Cash SV (-0.34%), EOS (-0.66%), Ethereum (-0.57%), and Litecoin (-0.33%) weren’t far behind.

Ripple’s XRP and Stellar’s Lumen saw limited losses early on, with the both down by 0.06%.

BTC/USD 06/12/19 Daily Chart

For the Bitcoin Day Ahead

Bitcoin would need to move back through to $7,390 levels to support a run at the first major resistance level at $7,583.6.

Support from the broader market would be needed, however, for Bitcoin to break out from this morning’s high $7,440.0.

Barring a broad-based crypto rebound on the day, resistance at $7,500 would likely pin Bitcoin back.

In the event of a rebound, Thursday’s high $7,530.9 and first major resistance level would likely limit any gains.

Failure to move back through to $7,390 levels could see Bitcoin struggle on the day.

A fall back through to sub-$7,300 levels would bring the first major support level at $7,243.7 into play.

Barring a crypto meltdown, however, Bitcoin should steer clear of the second major support level at $7,047.7.

GBP/USD Daily Forecast – Sterling Falls Into a Range

UK CPI Lowest in Nearly Two Years

The consumer price index in the United Kingdom was reported to rise by 1.5% in the year to October which was the lowest reading since December 2016. It was the third consecutive reading where CPI fell short of the analyst estimate.

Despite the shortfall in the reading, GBP/USD is little changed on the day. The exchange rate has been consolidating for the past two sessions and from a slightly broader perspective, the pair has mostly traded in a range for the past month or so.

The pair shows resilience considering that the dollar has recovered notably. Since the start of the month, the US dollar index (DXY) has been rallying while retracements have been quite shallow. The index is up just over 1% since the start of November and trades at levels not seen since the middle of October. Further, the greenback has advanced against all of its major counterparts in the month thus far.

Economic data later in the session could move the exchange rate out of its range as the latest US CPI figures will be released. Although typically, this release does not accompany a lot of volatility. Unless of course there is a significant deviation from the expectation.

Technical Analysis

There is a significant upside hurdle in play for GBP/USD. It stems from the 20-day moving average and the 50 moving average on a 4-hour chart. It should be noted that the exchange rate has not seen much selling pressure despite this resistance confluence coming into play.

GBPUSD 4-Hour Chart

I think it’s worthwhile keeping a close eye on the dollar here as DXY is trading in oversold territory on the smaller time frames. A pullback in the dollar could provide the fuel for an upside break in GBP/USD.

But while the exchange rate holds below moving average resistance, the path of least resistance remains to the downside. Near-term support is seen at 1.2800 which is a level that held the pair higher in late October.

Bottom Line

  • GBP/USD has fallen into a narrow range.
  • The 50 moving average on a 4-hour chart and 20-day moving average is capping the upside in the pair.
  • US CPI figures will be released later in the US session today.