USD/CAD Daily Forecast – Test Of Support At 1.2200

USD/CAD Video 06.05.21.

U.S. Dollar Is Under Strong Pressure Against Canadian Dollar

USD/CAD is currently trying to settle below the support at 1.2200 while the U.S. dollar is losing ground against a broad basket of currencies.

The U.S. Dollar Index is currently testing the support at the 91 level. If the U.S. Dollar Index declines below this level, it will move towards the support at 90.70 which will be bearish for USD/CAD.

Today, U.S. reported that Initial Jobless Claims decreased from 590,000 (revised from 553,000) to 498,000 while Continuing Jobless Claims increased from 3.65 million (revised from 3.66 million) to 3.69 million.

Tomorrow, foreign exchange market traders will have a chance to take a look at additional employment data from U.S. and Canada. In the U.S., Non Farm Payrolls report is expected to show that U.S. economy added 978,000 jobs in April. Unemployment Rate report is projected to indicate that Unemployment Rate declined from 6% to 5.8%.

In Canada, Employment Change report is expected to show that Canadian economy lost 175,000 jobs in April. Unemployment Rate is expected to increase from 7.5% to 7.8%.

Technical Analysis

usd cad may 6 2021

USD to CAD managed to settle below the support at 1.2250 and gained strong downside momentum. Currently, USD to CAD is testing the next support level which is located at 1.2200. RSI moved into the oversold territory, but USD to CAD may gain additional downside momentum in case the right catalysts emerge.

If USD to CAD settles below the support at 1.2200, it will move towards the next support level at 1.2170. A successful test of the support at 1.2170 will open the way to the test of the support at 1.2130.

On the upside, USD to CAD needs to stay above 1.2200 to have a chance to develop upside momentum in the near term. The next resistance level for USD to CAD is located at 1.2250.

If USD to CAD gets above this level, it will move towards the resistance at 1.2280. A move above this level will open the way to the test of the resistance at 1.2310.

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

S&P 500 Price Forecast – Stock Market Continues Sideways Behavior

The S&P 500 initially tried to rally during the course of the trading session on Thursday but then gave back the gains to start falling again. Quite frankly, there are lot of mixed messages out there when it comes to the economy in the stock market went forward, but at the end of the day we are still very much in an uptrend and it is worth paying attention to. The 4100 level underneath should offer support, as it has over the last couple weeks. That being said, there is even more support underneath at the 50 day EMA and of course the 4000 level. With that being said, I think that if we get some type of selling pressure, then we will get long again based upon some type of bounce.

S&P 500 Video 07.05.21

To the upside, I see the 4200 level as a major barrier that needs to be overcome with some type of catalyst. We are in the midst of earnings season and it has gone fairly well but quite frankly the market had already priced all that in. Because of this, I think that we will continue to see a “buy on the dips” type of mentality, as we continue to find plenty of narratives out there to push this market higher. Central banks around the world will continue to flood the markets with liquidity, thereby having people push money into stock markets yet again. I see no scenario in which a willing to start shorting this market anytime soon.

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

Silver Price Forecast – Silver Markets Continue Bullish Pressure

Silver markets initially drifted a little bit lower during the trading session on Thursday but then broke higher to reach towards the $27.35 level. The market certainly looks as if it is on its way to the $28 level, but it is obvious that the market has a lot of noise involved in it. After all, the silver markets do tend to be very choppy to say the least, so it does make quite a bit of sense that we would continue to see volatility. With that being the case, the market is likely to continue seeing short-term pullbacks as potential buying opportunities and of value.

SILVER Video 07.05.21

Underneath, we have the 50 day EMA sitting at the $26 level, and that could of course attract a lot of support and buyers get involved. If we break down below the $26 level, it could open up a move down to the 200 day EMA underneath. We are in an uptrend, there is nothing on this chart that tells us that we should be looking for buying opportunities only, and a break above the $28 level would open up the possibility of a move to the $30 level. All things been equal, I do think that we get there and perhaps even higher as we continue to play the “reflation trade.” Silver has a major industrial component built into it, so it certainly makes a bit of sense that we would be looking at a “buy on the dips” type of scenario. I have no interest whatsoever in shorting this market, as we have such bullish pressure and of course a huge fundamental driver of price.

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

Crude Oil Price Forecast – Crude Oil Continue to Pressure Upside

WTI Crude Oil

The West Texas Intermediate Crude Oil market has pulled back a bit during the trading session on Thursday, as we sit right at the $65 level. The $65 level of course is a large, round, psychologically significant figure that would attract a certain amount of attention, but part of what has caused the market pull back a bit is that the demand for gasoline in the United States has fallen for the second week in a row. That being said, the ascending triangle that formed previously does suggest that we have more upward pressure going on than down, as we have been in an uptrend anyway. If we do pull back from here it is likely that we would see plenty of support at both the 50 day EMA and the uptrend line that has been part of that ascending triangle.

Crude Oil Video 07.05.21

Brent

Brent markets also look very much the same as you would expect, after forming the same kind of ascending triangle. The $70 level above does offer a certain amount of psychological resistance, so if we can break above there then it is likely that the market would continue to go much higher. A lot of this comes down to the “reopening trade” that a lot of people pay close attention to, so therefore it does make a certain amount of sense that value hunters will be looking to get involved. Once we can clear the $70 level on a daily close, it is very likely that we go much higher, perhaps making a move towards the $72.50 level initially, followed by a move to the $75 level. I have no interest in shorting the market anytime soon.

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

Natural Gas Price Forecast – Natural Gas Markets Sit Sideways

Natural gas markets have gone back and forth during the course of the trading session on Thursday as we continue to look at the $3.00 level as massive resistance. That is an area that has been difficult for some time, and it should continue to be. Quite frankly, I think this is a market that will see a lot of choppy volatility, but it looks as if we are running out of momentum. The market breaking above the $3.00 level still faces a lot of noise based upon historical behavior, and of course psychological resistance.

NATGAS Video 07.05.21

Given enough time, I fully anticipate that this market will start to fall, perhaps trying to drop down to the $2.75 level initially, followed by the gap underneath it has yet to be filled. After all, we are going to be getting warmer temperatures in the northern hemisphere soon, despite the fact that it has been cooler than usual. With that being said, there will be less demand for natural gas, in a market that is already oversupplied. There has been an uptick in foreign demand for liquefied natural gas, but at this point in time it will be enough to change the market dynamics.

Commodities in general have been getting a bid, so natural gas has become overvalued. I think eventually the fundamentals come back into play and we fall apart. With this, I like the idea of selling at the first sign of a breakdown, because we have such a significant and obvious round figure just above the use as a barrier to determine which direction, we are going in. All things been equal, the spring temperatures will start to overtake the market.

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

Gold Price Forecast – Gold Markets Break 200 Day EMA

Gold markets have broken higher during the course of the trading session on Thursday as we have cleared the 200 day EMA and the $1800 level. At this point, the market is likely to continue going higher, perhaps reaching towards the $1850 level, and then after that the $1950 level. This of course is a market that has recently formed a bit of a “double bottom”, and that suggests that it has much further to go. It is interesting, because gold has disappeared from the inflation argument until recently, but now it appears that the traders finally starting to kick in.

Gold Price Predictions Video 07.05.21

To the downside, I see the 50 day EMA as offering support, and most certainly the $1750 level will as well. It is not until we break down below there that I would be concerned, but after the action that we have seen during the day on Thursday, it is very likely that the buyers will continue to push to the upside. The size of the candlestick is somewhat impressive, and therefore it looks like there is serious conviction in this market. If the US dollar continues to fall, that should continue to lift gold in general, and therefore I think that we have a “buy on the dips” type of mentality from short-term traders. Ultimately, this will be a very noisy move to the upside, but it certainly looks as if we have made major changes in attitude during the day, as we have been building up pressure for some time. I have no interest in shorting this market until we close below the $1750 level, something that does not look as likely now.

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

Why Shares Of Moderna Are Down By 5% Today?

Moderna Video 06.05.21.

Moderna Stock Moves Lower As Q1 Revenue Misses Estimates

Shares of Moderna found themselves under pressure after the company released its first-quarter results.

Moderna reported revenue of $1.94 billion and earnings of $2.84 per share, beating analyst estimates on earnings and missing them on revenue. It looks that the market was not ready to tolerate the revenue miss, and it weighed heavily on Moderna stock.

The bar was set high for the company whose shares were up by more than 60% year-to-date before the release of the quarterly report. In addition, shares of  vaccine makers found themselves under pressure after U.S. signaled that it would support a waiver for vaccine IP rights at the WTO.

EU has already stated that it was ready to discuss waving COVID-19 vaccines patents, which is a worrisome development for investors. At the same time, it remains to be seen whether any decisions will be made in the near term.

What’s Next For Moderna?

The sell-off in Moderna shares was triggered by IP waiver-related fears and a revenue miss. IP waiver-related fears probably served as the main catalyst for the current sell-off as other vaccine makers like BioNTech and Pfizer also found themselves under pressure.

Currently, analysts expect that Moderna will report earnings of $23.27 per share in 2021 and $16.58 per share in 2022 so the stock is trading at about 9 forward P/E for 2022 which is very cheap in today’s market environment.

However, there is a lot of uncertainty regarding future profits, and recent discussions about waiving IP rights add another layer of uncertainty. At the same time, it looks increasingly likely that at least some part of the vaccine revenue will be recurring as people may need regular shots to protect themselves against COVID-19.

In this light, Moderna shares may soon attract speculative traders and investors who will want to use the current pullback as an opportunity to buy the stock at lower levels.

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

Silver Price Daily Forecast – Resistance At $27.50 In Sight

Silver Video 06.05.21.

Weak Dollar Provides Support To Silver

Silver gained upside momentum and managed to get above the resistance at $27.00 while the U.S. dollar remained under pressure against a broad basket of currencies.

The U.S. Dollar Index failed to settle above the resistance at the 20 EMA at 91.30 and is testing the support at the 91 level. In case the U.S. Dollar Index declines below this level, it will move towards the support at 90.70 which will be bullish for silver and gold price today. Weaker dollar is bullish for precious metals as it makes them cheaper for buyers who have other currencies.

Gold is currently testing the resistance at the $1800 level. In case gold manages to settle above this level, it will head towards the resistance at $1820 which will be bullish for silver.

Gold/silver ratio managed to get below the 67 level and is trying to settle below 66.50. If gold/silver ratio declines below this level, it will move towards the 66 level which will be bullish for silver.

Technical Analysis

silver may 6 2021

Silver managed to get above the resistance at $27.00 and is trying to gain additional upside momentum. If silver settles above this level, it will move towards the resistance at $27.50. RSI remains in the moderate territory, and there is plenty of room to gain additional upside momentum in case the right catalysts emerge.

A successful test of the resistance at $27.50 will push silver towards the next resistance level at $27.75. If silver gets above the resistance at $27.75, it will head towards the next resistance which is located at $28.30.

On the support side, a move below the $27 level will push silver towards the support at $26.65. In case silver declines below this level, it will head towards the support at $26.30.

A successful test of the support at $26.30 will push silver towards the support which is located at the 20 EMA at $26.15. In case silver manages to settle below this level, it will head towards the next support at the 50 EMA at $25.95.

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

American Indices Moving in Opposite Directions

American Indices are currently moving in opposite directions. The tech-heavy NASDAQ index is going down, aiming for the long-term up trendline while the old-school Dow Jones flirts with all-time highs after the price escaped from the pennant formation.

The German Dax is trading inside a flag formation, which is promoting a long-term breakout to the upside.

Gold is aiming higher after a successful bounce from the 1760 USD/oz support.

The USDCAD broke the lower line of the channel down formation, which should be considered an extreme weakness.

The AUDCHF tested the lower line of the symmetric triangle pattern. A breakout to the downside is very probable.

The ZARJPY shot higher after a false bearish breakout from the Head and Shoulders formation.

The EURPLN is aiming higher after a very handsome bullish engulfing pattern on the daily chart.

The USDHUF dropped like a rock after the price created a shooting star on the daily chart, which bounced from a combination of dynamic and horizontal resistances.

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

 

USD/JPY Price Forecast – US Dollar Rallies Heading Towards Jobs Figure

The US dollar initially pulled back slightly during the course of the trading session on Thursday but then turned around to show signs of strength as we reached towards the ¥109.50 level yet again. At this point, it looks as if we are trying to go looking towards the ¥110 level. Keep in mind that Friday is the Non-Farm Payroll announcement, and that of course is going to continue to be influential as to where we go. Ultimately, this is a bullish run and we recently bounced from the 50 day EMA as well as the 38.2% Fibonacci retracement level that of course is a very positive sign.

USD/JPY Video 07.05.21

If we can break above the ¥110 level, then it is likely that we go looking towards the ¥111 level, which was the recent high. If we can break there, then we have a much longer term run higher. On the other hand, we could very well go back and forth in this general vicinity and simply grind. All things been equal, I have no interest in shorting this market until we break down below those hammers that caused the bounce in the first place. In general, this is a market that is very strong, but certainly will be waiting to see what the jobs number has to say. I would anticipate quite a bit of volatility during the trading session on Friday, as the market will probably have to readjust its expectations depending on whatever number comes out. There are wide and varied expectations for the figure coming out, so I anticipate more chaos than anything else.

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

GBP/USD Price Forecast – British Pound Has Noisy Day as MPC Announces Tapering

The British pound has gone back and forth during the trading session on Thursday as the Monetary Policy Committee has come and gone, suggesting that tapering is coming in the bond market. That of course is bullish for the British pound, but at the same time we have been locked in a lot of support and resistance in this general vicinity.

GBP/USD Video 07.05.21

When you look at the 50 day EMA, has offered a bit of support as of late, so that is something worth paying attention to. Furthermore, we have the double bottom underneath there that continues to support the market as well. It is not until we break down below there that I think we could start to see the first “cracks in the ice” of the uptrend but if you are a seller, you then need to worry about the 1.35 level underneath which is attracting the 200 day EMA. Underneath there, then obviously the trend is done.

To the upside, the 1.40 level continues to be like a “brick wall for the market” and breaking above there on a daily close would be a massively bullish sign. In the short term, I think we simply go back and forth in the fact that we have the jobs number coming out on Friday certainly makes quite a bit of sense. Ultimately, this is a market that is been very volatile for the session, but it seems to have been little changed. Interesting to see this reaction, but at the end of the day I think people almost immediately turn their attention on the employment situation in America.

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

GBP/JPY Price Forecast – British Pound Very Noisy

The British pound has initially pulled back a bit during the course of the trading session on Thursday but turned around to show signs of strength again as the Bank of England is suggesting that they will be tapering bond purchases, which is a form of monetary policy tightening. This follows the Bank of Canada, as we are starting to see central banks try to get ahead of the reopening trade.

GBP/JPY Video 07.05.21

The Japanese yen continues to get beaten up, and that of course will not be any different here. The ¥150 level underneath is rather significantly supported, not only due to the fact that we have seen a bit of a bounce from there, but we have also seen the 50 day EMA coming into the picture. With that being the case, I think it is only a matter of time before buyers will come back into this market if we reach down towards that area.

On the other hand, it looks much more likely that we are going to go looking towards the ¥153.50 level, and then possibly reaching towards the ¥155 level. This is a market that has been in a very bullish move over the last several months, and now we are simply grinding back and forth in order to try and pick up more momentum while working off froth. Eventually, I anticipate that the buyers will continue to look it dips as value in a market that has been obviously one way for quite some time. I anticipate that the Friday market might be a little bit quiet ahead of the jobs number but if we get a good number out of the United States, we may get more “risk on behavior”, sending this pair higher.

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

EUR/USD Price Forecast -Euro Bounces From Major Figure

The Euro has bounced from the 1.20 level to show signs of strength again during the Thursday session. This front run the jobs number coming out of America so it will be interesting to see how this plays out. I do think that there is a little bit of resistance just above that could cause some issues, but at the end of the day we are in an uptrend and you could even make a little bit of an argument for a bullish flag or on shorter time frames a falling wedge.

EUR/USD Video 07.05.21

It is obvious that the 1.20 level would catch a lot of attention, and of course the 50 day EMA sitting there makes quite a bit of sense as far as support goes as well. With all of that in mind I think that what we are looking at is the possibility of a move back towards the highs that we made a couple of weeks ago. Ultimately, I think that this remains a short-term “buy on the dip” type of market, but if we were to break down below the 50 day EMA, perhaps after the jobs figure, then we will more than likely go looking towards the 200 day EMA underneath.

Remember, this pair does tend to be very choppy and sideways most of the time so although it is grinding higher, you will probably find more value buying the Euro against other currencies. In the short term though, the US dollar is on its back foot and as long as that continues to be the case in general, that will lift this pair and perhaps send it towards the 1.23 handle.

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

AUD/USD Price Forecast – Continues to Build Up Pressure to the Upside

The Australian dollar initially pulled back during the course of the trading session on Thursday to reach down towards the 50 day EMA. Ultimately, it looks as if the market is trying to build up enough momentum to finally break above the 0.78 handle, which of course is the massive resistance barrier that the market has been fighting for some time. All things been equal, the market breaking above there could open up the possibility of a move to the 0.80 level given enough time. That of course is an area that is important from a longer-term standpoint, as you can see it clearly as resistance on the monthly chart.

AUD/USD Video 07.05.21

Ultimately, if we can break above that 0.80 region of resistance, this market will go much higher. It would then become a “buy-and-hold” situation, but overnight China decided that they were going to end all discussions involving trade with the Australians, so there was a little bit of a selloff that lasted just a short amount of time. Ultimately, the commodity boom should continue to lift the Australian dollar over the longer term, but obviously we have a lot of noise to deal with. The last couple of months have been very difficult, and it appears that we have more of the same ahead of us.

That being said, if we were to turn around and break below the 0.76 level it is likely that we could go looking towards the 0.75 level. If we break down below that handle, then I believe that the Australian dollar probably needs to “reset” closer to the 0.70 level which of course is an area that will attract a lot of attention due to the psychological importance of it.

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

Divergences Could Sink McDonald’s Uptrend

Dow component McDonald’s Corp. (MCD) posted an all-time high above 238 this week, adding to a modest uptick after the company beat Q1 2021 top and bottom line estimates, earning $1.92 per-share on 8.7% revenue growth to $5.12 billion. Global comparative sales rose a healthy 7.5%, underpinned by a 13.6% surge in the United States. Foreign venues reported positive but less impressive growth, highlighting continued restrictions as a result of the pandemic.

Winning the Chicken Wars

The fast food giant noted continued expansion of digital order and delivery segments, even though seating restrictions have been eased or removed in many states. It’s looking for pent-up demand to drive positive net 2021 growth, although it hasn’t been too hard to buy a Big Mac since April 2020. The company also noted victories in the chicken sandwich wars breaking out across the nation, noting their applicants “have exceeded projections especially after 4pm”.

Telsey Advisory Group analyst Bob Derrington raised his target to $260 on Tuesday, noting the company “reported strong 1Q results which included adjusted EPS of $1.92 compared to our $1.76 estimates. McDonald’s global system sales benefited from the strategic embrace of its 3-Ds (Drive-thru, Digital, Delivery), its streamlined menu, quicker drive-thru service and the successful launch of new products across its system. That included the February launch of its new Crispy Chicken sandwich within its U.S. market, which has enjoyed robust sales”.

Wall Street and Technical Outlook

Wall Street consensus now stands at an ‘Overweight’ rating based upon 25 ‘Buy’, 2 ‘Overweight’, and 9 ‘Hold’ recommendations. No analysts are recommending that shareholders close positions and move to the sidelines. Price targets currently range from a low of $225 to a Street-high $282 while the stock is set to open Thursday’s session about $25 below the median $260 target. Additional upside appears likely, given this relatively humble configuration.

McDonald’s topped out above 220 in August 2019 and plunged to a multiyear low during 2020’s pandemic decline. A strong recovery wave reached the prior high in September, yielding a failed breakout, followed by a rounded correction that completed a cup and handle pattern in March. The breakout into May has started slowly, with the stock trading just three or four points above new support, but this classic pattern may support much higher prices in coming months.

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

Disclosure: the author held no positions in aforementioned securities at the time of publication. 

Dogecoin Pulls Back After Strong Rally

Dogecoin Video 06.05.21.

Dogecoin Tests Support At $0.60

Dogecoin lost momentum and made an attempt to settle below the support at $0.60 as traders took some profits after the recent rally.

Dogecoin quickly managed to get from $0.30 to $0.69 in less than two weeks as traders’ interest in the cryptocurrency increased and exchanges started to make it available for trading.

Cryptocurrencies remain very speculative in nature and often experience significant pullbacks so it’s not surprising to see that Dogecoin is moving lower after a strong rally.

Leading cryptocurrencies like Bitcoin and Ethereum have also lost momentum today so the downside move appears to be broad-based although XRP is moving higher.

Technical Analysis

dogecoin may 6 2021

Dogecoin faced resistance at $0.6650 and pulled back closer to the support at $0.60. RSI has pulled back a bit from recent highs, but it remains in the overbought territory.

In case Dogecoin manages to settle below the support at $0.60, it will head towards the next support level which has emerged at $0.5750. A successful test of the support at $0.5750 will open the way to the test of the support at $0.5350. If Dogecoin declines below this level, it will head towards the support at $0.45. There are no important levels between $0.45 and $0.5350 so this move may be fast.

On the upside, Dogecoin needs to settle above the resistance at $0.6650 to have a chance to develop upside momentum in the near term. The next resistance level is located near the recent highs at $0.70. If Dogecoin manages to settle above this level, it will gain additional upside momentum and head to new highs.

At this point, today’s trading action looks like a normal pullback after the major upside move. However, cryptocurrencies are very dependent on momentum so Dogecoin needs to quickly get closer to recent highs to continue its upside move. If Dogecoin fails to get more upside momentum in the next few days, the risks of a significant pullback will increase.

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

PayPal Top Earnings Forecasts, Bets on Crypto

PayPal Holdings, Inc. (PYPL) shares rocketed over 4% higher in Wednesday’s extended-hours trading session after the company delivered a stellar quarterly earnings report.

The San Jose digital payments giant reported an adjusted first quarter (Q1) profit of $1.22 per share, blowing pasts Wall Street’s expectation of $1.01 a share. Moreover, the bottom line grew 85% from a year earlier. Revenues for the period came in at $6.03 billion, up from year-ago sales of $4.62 billion. Volume and user metrics also impressed, with the company processing $285 billion in the quarter and adding 14.5 million net new active accounts.

Looking ahead, management forecasts Q2 EPS of $1.12 on revenues of $6.25 billion. Analysts had expected earnings of $1.10 on sales of $6.16 billion. The company sees cryptocurrency continuing to drive growth in upcoming quarters. “We’ve got a tremendous amount of really great results going on tactically with our crypto efforts,” CEO Dan Schulman told investors, per CNBC. PayPal initially introduced leading cryptocurrencies to its platform last October and has progressively added more integration with digital assets over the past six months.

Through Wednesday’s close, PayPal stock has a market capitalization nearing $300 billion and trades nearly 100% higher over the last 12 months. YTD, the shares have added 5.64%, which trails the S&P 500’s gain of 11% over the same period.

Wall Street View

Late last month, Rosenblatt Securities analyst Sean Horgan raised his price target on the stock to $350 from $320 and maintained his ‘Buy’ recommendation. Horgan sees the payments giant continuing to benefit from higher levels of consumer spending, fueled by record levels of government stimulus.

Elsewhere, the stock racks up mostly favorable brokerage coverage. It receives 36 ‘Buy’ ratings, 5 ‘Overweight’ ratings, and 6 ‘Hold’ ratings. Just one analyst recommends selling the shares. Wall Street has a 12-month price median price target on the stock at $314.55. This represents 27% of upside from yesterday’s $247.40 close.

Technical Outlook and Trading Tactics

PayPal shares have recently retraced to a multi-month uptrend line extending back to the March 2020 pandemic-induced low. Although the price broke below this closely-watched indicator in Wednesday’s session, pre-market trading indicates a move back above it after the company’s solid earnings report.

Providing the stock closes above the trendline, active traders should anticipate a retest of the YTD high at $309.14. Protect capital with a stop-loss order placed under today’s low.

For a look at today’s earnings schedule, check out our earnings calendar.

EUR/USD Daily Forecast – Test Of Resistance At 1.2020

EUR/USD Video 06.05.21.

Euro Tries To Gain More Ground Against U.S. Dollar

EUR/USD is currently trying to get back above the resistance at the 20 EMA at 1.2020 while the U.S. dollar is mostly flat against a broad basket of currencies.

The U.S. Dollar Index did not manage to settle above the resistance at the 20 EMA at 91.30 but stays close to this level. The nearest support level for the U.S. Dollar Index is located at the 91 level. If the U.S. Dollar Index gets to the test of this level, EUR/USD will get more support.

Today, foreign exchange market traders will have a chance to take a look at Euro Area Retail Sales data for March. Analysts expect that Retail Sales increased by 1.5% month-over-month in March after growing by 3% in February. On a year-over-year basis, Retail Sales are projected to increase by 9.6% as Retail Sales were under significant pressure in March 2020.

Meanwhile, the U.S. will release Initial Jobless Claims and Continuing Jobless Claims reports. Initial Jobless Claims are expected to decline from 553,000 to 540,000 while Continuing Jobless Claims are projected to decrease from 3.66 million to 3.62 million.

Yesterday’s ADP Employment Change report was a bit worse than the analyst consensus but it still highlighted rapid employment growth, and the upcoming employment reports are also expected to show that the situation in the job market continues to improve.

Technical Analysis

eur usd may 6 2021

EUR/USD is testing the resistance at the 20 EMA at 1.2020. In case this test is successful, EUR/USD will move towards the next resistance level at 1.2040.

A move above the resistance at 1.2040 will push EUR/USD towards the next resistance at 1.2060. In case EUR/USD manages to settle above this level, it will head towards the resistance which is located at 1.2090.

On the support side, the nearest support level for EUR/USD is located at the 50 EMA at 1.1990. This support level has been tested several times in recent trading sessions and proved its strength.

In case EUR/USD declines below the support at 1.1990, it will move towards the next support level at 1.1965. A successful test of the support at 1.1965 will push EUR/USD towards the support at 1.1925.

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

GBP/USD Daily Forecast – Resistance At 1.3900 Remains A Major Obstacle On The Way Up

GBP/USD Video 06.05.21.

British Pound Is Mostly Flat Against U.S. Dollar

GBP/USD continues to test the resistance at 1.3900 while the U.S. dollar is mostly flat against a broad basket of currencies.

The U.S. Dollar Index remains near the resistance at the 20 EMA at 91.30. In case the U.S. Dollar Index manages to settle above this level, it will head towards the next resistance at the 50 EMA at 91.45 which will be bearish for GBP/USD.

Today, foreign exchange market traders will focus on the Bank of England Interest Rate Decision. The rate is projected to stay unchanged at 0.1% so traders will pay attention to the Bank’s commentary.

Traders will also have a chance to take a look at the final reading of UK Services PMI report for April. Analysts expect that Services PMI increased from 56.3 in March to 60.1 in April.

In the U.S., traders will focus on Initial Jobless Claims and Continuing Jobless Claims reports. Initial Jobless Claims report is projected to show that 540,000 Americans filed for unemployment benefits in a week. Continuing Jobless Claims are projected to decline from 3.66 million to 3.62 million.

Technical Analysis

gbp usd may 6 2021

GBP/USD continues its attempts to settle above the resistance at 1.3900. If GBP/USD manages to settle above this level, it will get to another test of the resistance at 1.3920.

A successful test of the resistance at 1.3920 will push GBP/USD towards the next resistance at 1.3950. If GBP/USD settles above this level, it will head towards the resistance at 1.3980. A move above this level will open the way to the test of the resistance at 1.4000.

On the support side, the nearest support level for GBP/USD is located at the 20 EMA at 1.3875. If GBP/USD manages to settle below the support at the 20 EMA, it will move towards the 50 EMA at 1.3850. A successful test of this level will push GBP/USD towards the support at 1.3800. No significant levels were formed between 1.3800 and the 50 EMA so this move may be fast.

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Bitcoin: Still No Advantage, Waiting For Better Prices.

In my previous video, I highlighted a number of price scenarios and one of them were a higher low established off of the 52K area. We almost got that one, except that price, refuses to break 53K. For shorter time frame strategies like day trading, these sharp single candle moves offer excellent opportunities, but for swing trades, the risk is too high.

Here is what I mean: If we go long at 58K, proportional risk for a swing trade is now around 53K which means I have to risk at LEAST 5K points. In order to justify this, Bitcoin needs to push to 63K in the next leg just to reach a 1:1 reward/risk ratio. The probability of that scenario is much lower compared to if I bought around 50K, risked only 3K points, and required a retrace back to the middle of the range (55 to 58K area). The probability of a retrace back to the middle of the range is much greater than of the range low.

Since we trade rules for our swing trade strategy, we have no choice but to wait this out. Bitcoin either tests the range low again, (between 52K and 50K) and provides a setup, or we don’t assume any new risk. Waiting for the right level and setup is much more effective when it comes to returns over time compared to taking numerous low-probability trades. Many traders and investors don’t realize, over time, the losing trades cost way more than the few random wins from chasing action.

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