"Fort Financial Services"- fundamental and technical analysis.
13.12.2016
Euro
General overview
The euro strengthened amid a dollar weakness and risk-off sentiment in the market. Traders took wait-and-see mode ahead of the Fed meeting on Wednesday.
Current situation
Technically, the pair remained towards the downside on Monday. The price bounced from 1.0525 and rallied towards 1.0600. Buyers broke the level and extended their recovery towards 1.0650. The 4 hours chart showed that the price tested the 100-EMA. Meanwhile, the moving averages maintained their bearish slope. The resistance is at 1.0650, the support comes in at 1.0600.
MACD remained at the same level which confirms the strength of sellers. The RSI indicator entered the neutral territory.
Trading recommendations
If a bearish tone prevails we would be selling the pair when the price drops below 1.0600. Sellers may lead prices towards 1.0500. Meanwhile, the euro may continue with its recovery if its stays above 1.0600.
Pound
General overview
The dollar weakened across the board. Still, the greenback stays at recent highs amid the 100% confidence that the FED will hike the rates.
Current situation
The pound remained weak against the US dollar, but found sufficient support around 1.2600 handle which limited its downside volatility. We believe some buying interest exists around 1.2550 region. Buyers made an attempt to recover and broke the level 1.26 but failed to extend their gains and hovered above the broken level till the NY opening. The price tested the 50-EMA in the 4 hours chart. The price remained between the 50 and the 100 EMAs in the same chart. All moving averages maintained their bullish slope. The resistance lies at 1.2700, the support comes in at 1.2600.
MACD remained at the same level which confirms the strength of sellers. RSI headed upwards.
Trading recommendations
If the price fixates below the support 1.2600, it may continue the downward trend in the short term. The sellers’ potential targets are 1.2500 and 1.2400.
Yen
General overview
The risk-on sentiment amid OPEC oil output deal and the firm expectations of the Fed rate-hike action weighed on the safe-heaven yen on Monday. Even the upbeat Machinery Order in Japan did little to support the national currency.
Current situation
The USD/JPY maintained its bid tone on Monday. The price bounced from 116.00 and returned to the 115.00 handle region. According to the 4 hours chart the price hovered above the moving averages which kept heading higher. The resistance is highlighted at 116.00, the support comes in at 115.00.
The MACD histogram grew which indicates buyers’ strength. The RSI indicator remains within overvalued readings.
Trading recommendations
All eyes are right now at the resistance level 116.00. A cut through here will turn attention to the 117.00 level.
NZD/USD
General overview
The NZD strengthened after Bill English was sworn in as New-Zealand's new Prime Minister. The new assignment eased the political fears in the country. Moreover oil output OPEC deal boosted the investors' sentiment and helped the New Zealand dollar to recover.
Current situation
After posting a session low at 0.7115 the New Zealand dollar grew reversing its early losses. Traders broke the level 0.7150 in early trades and headed towards 0.72 which tested in the NA session. The 4 hours chart showed that the price bounced off the 50 EMA and broke 200 EMA upwards. The 200 and 50 EMAs were neutral while the 100 EMA pointed higher. The resistance is at 0.7200, the support comes in at 0.7150.
MACD traded to the upside. RSI moved towards overbought readings.
Trading recommendations
If the price overcomes 0.72 and fixates above 0.7220 we will neutralize our medium term negative outlook. The NZD may extend its gains to 0.7250. A failure here will put on hold bulls’ plans. In this scenario the price may return to 0.71.
XAU/USD
General overview
Gold stayed around 10-month low as upcoming Fed decision regarding the rate-hike kept on weighing.
Current situation
Gold prices continued to move lower in the yearly trades on Monday. Having posted the session low at 1150 dollars per ounce the price reversed the minor part of its losses. The XAU/USD broke 1160 at the start of the NY session and advanced higher. The price continued developing well below the moving averages in the 4 hours chart. The moving averages maintained their bearish slope. The resistance exists at 1170, the support stands at 1160 dollars per ounce.
MACD entered the negative area. If MACD remains within the negative readings, sellers’ positions will strengthen. The RSI indicator remained within oversold readings.
Trading recommendations
The technical picture presents a bearish tone. We suppose the price will go to 1150 first. Having overcome the first target the yellow metal might advance towards 1140 dollars per ounce.
Brent
General overview
Oil prices grew after OPEC and non-OPEC members reached an agreement to cut oil production on Saturday.
Current situation
Oil prices kept the ongoing rally intact on Monday and posted fresh multi-month highs at 57.24 dollars per barrel. The price faced some downward rejection around 57.50 and rolled back after touching the level. Brent prices moved lower and spent the European hours and the start of the NY session around 56.50. The benchmark hovered above the moving averages in the 4 hours chart. The 200 EMA was neutral while the 50 and the 100 EMAs maintained their bullish slopes. The resistance lies at 57.50, the support comes in at 56.50 dollars per barrel.
The MACD histogram grew which indicates buyers’ strength. The RSI indicator held within overvalued readings.
Trading recommendations
An uptrend will start as soon, as the price fixates above the support level 56.50 dollars per barrel. As the most probable scenario, we consider further moving upwards towards the levels 57.50 and 58.50. However, the benchmark is overbought and we expect some profit taking action which may reduce pace of the rally. Brent oil prices may return to the 54.50 region.
DAX
General overview
European shares traded mixed on Monday amid oil prices rally and the news that Monte dei Paschi bank got the EU approval for restructuring.
Current situation
DAX kept its upbeat tone unchanged flirting with 11200 resistance. An attempt to extend gains in the early trades faded above 11200 when the prices faced a selling pressure and dropped below the level. The benchmark made another attempt to regain the level during the American session. The price continued developing well above the moving averages in the 4 hours chart. The moving averages pointed higher in the mentioned timeframe. The resistance exists at 11200, the support stands at 11100.
MACD remained at the same level which confirms the strength of buyers. The RSI indicator remained within overvalued readings.
Trading recommendations
The technical picture presents a bullish tone, for rise towards 11300 resistance area.
NASDAQ
General overview
DAX recorded fresh highs on Monday while NASDAQ traded lower. Wall Street held still ahead of the Fed meeting this Wednesday.
Current situation
NASDAQ Composited opened lower and surged to 4865 post-Asia open. Sellers met a barrier in the 4865 region which made prices slightly roll back after touching the handle. According to the 4 hours chart the price hovered above the moving averages. The 50 and the 200 EMAs were neutral while the 100 EMA pointed higher. The resistance is at 4900, the support comes in at 4865.
MACD remained at the same level which confirms the strength of buyers. The RSI indicator remained within overvalued readings.
Trading recommendations
The technical picture presents a bullish tone. A close above 4865 will extend gains towards 4900.
*Analytical review is presented by the leading analyst of the broker Fort Financial Services, Alexander Kofman