LiteForex Market Analytics

[LiteForexTeam]

USD/CAD: the pair is trading in the downward channel

Current trend

On Thursday, correction in the pair USD/CAD continued. The quotes had tested the upper line of Bollinger bands indicator, but after failing to break it down, the pair fell to the level of 1.1293. Pressure on the USD was caused by the weekly report on initial applications for unemployment benefits, the number of applications amounted to 291 thousand, which was above the forecast. The data on preliminary index of business activity in the manufacturing sector was also negative, as per Markit. The index fell to the level of 54.7 points, which is the worst performance since this January. On the other hand, the Canadian dollar was supported by Canadian retail sales statistics, which increased by 1.8% in September.

Today, market participants are waiting for the release of consumer price index in Canada for October. It is expected that this index will increase and reach the level of 2.1%, which can provide support to the Canadian currency.

Support and resistance

Currently, the pair is rising to the level of 1.1315 (middle line of Bollinger bands); however the trading is carried out in the downward channel. The level of 1.1315 seems the key one and in case of breakdown of this level the price can continue upward movement up to the upper limit of the channel at the level of 1.1345. Otherwise, the price can fall to 1.1270. Technical indicators give mixed signals. Bollinger bands are in the sideways channel. MACD histogram is in the negative zone; its volumes are stable. Stochastic lines are leaving oversold zone, forming a buy signal.

Support levels: 1.1270 and 1.1250.
Resistance levels: 1.1315 and 1.1345.

Trading tips

In the current situation long positions with the target of 1.1345 can be opened if the price consolidates above the level of 1.1315. Short positions can be opened if the price pushes off from the level of 1.1315 and reaches the level of 1.1300. In this case take profit is advisable at the level of 1.1270.



Dmitriy Zolotov
Analyst of LiteForex Investments Limited

[LiteForexTeam]

EUR/USD: general review

Current trend
At the previous trading session European currency has significantly weakened against the American currency. Starting from the morning Euro had been declining. The pressure on the pair was caused by the comments of Mr. Mario Draghi about possibility of the additional incentive measures aimed at the increasing inflation level in Eurozone. Amid this fact Euro lost over 150 points.
Today, investors are waiting for the data on ISM index in Germany (12:00 GMT+2), and business activity index in the US service sector (17:45 GMT+2).

Support and resistance
On the four-hour chart technical indicators show that downward movement will continue. Bollinger bands are diverging, forming a sell signal. MACD histogram is in the negative zone; its volumes are increasing.
Resistance levels: 1.2410, 1.2460, 1.2510 and 1.2570.
Support levels: 1.2380, 1.2360, 1.2300 and 1.2250.

Trading tips
If current trend continues, it is advisable to open sell positions after breakdown of the level of 1.2380 with the nearest target of 1.2360. However, correction movement is also possible. The “bulls” will try to push the pair up to the level of 1.2410, from which buyers will make an attempt to test the level of 1.2460.



Vadim Smarzh
Analyst of LiteForex Investments Limited

[LiteForexTeam]

XAU/USD: increase in demand for the USD will cause significant pressure on the pair

Current trend

Gold continues to trade in the upward channel. At the end of last week the pair had tested the new local highs at the level of 1207.50; however after unsuccessful attempt to break down this level, the pair returned into the range of 1190.00-1200.00.
Today, US revised GDP for Q3 will become known. It is expected that economic growth rate in the USA will slow down. In addition, US consumer confidence index will be published. This index can grow, which will support the national currency.

Support and resistance

In future it is expected that the pair can slightly go up to the upper limit of the channel (1207.50), after that, investors” interest to the American dollar can increase and the pair will go down to the levels of 1182.00 and 1187.00. In the medium-term the pair is likely to go down to the target level of 1162.00.

Support levels: 1202.50, 1207.50, 1.217.90, 1230.20 and 1235.00.
Resistance levels: 1194.00, 1187.00, 1181.90, 1176.50, 1170.00 and 1162.00.

Trading tips

It is recommended to open short positions and a stop-loss slightly above the key resistance level and the local highs of 1207.50. Take profit is advisable at the lower limit of the upward channel of 1182.00.



Dmitry Likhachev
Analyst of LiteForex Investments Limited

[LiteForexTeam]

GBP/USD: the correction but not a change of trend

Current trend

On Tuesday the pair GBP/USD traded in the wide range, shifting to from growth to decline. In the last two weeks the pair has been trying to break down resistance level of 1.5730 for four times.
Today, economic calendar will be eventful with the news from the UK and US, which means that volatility in the pair will be high. In the morning British GDP will become known; and later, US data on the number of initial applications for unemployment benefits in the USA, consumer personal income and spending and construction sector news will be released. If the British GDP will not be revised, it will have a positive effect on the Pound. Many investors believe that the UK is slowly getting out of recession and in the near future economic growth rate in the country will increase.

Support and resistance

Today, it is expected that projected growth will give way to the decline in price with the target level of 1.5600 (local lows and key support level). On Thursday and Friday high volatility is not expected, as it will be a public holiday in the USA.

Support levels: 1.5700, 1.5670, 1.5630, 1.5600, 1.5550, 1.5500 and 1.5400.
Resistance levels: 1.5730, 1.5750, 1.5790, 1.5875, 1.5910, 1.5950 and 1.6000.

Trading tips

In the current situation it makes sense to open short positions with stop-loss above the level of 1.5790 and take profit at 1.5600.



Dmitry Likhachev
Analyst of LiteForex Investments Limited

[LiteForexTeam]

EUR/USD: attention will be focused on European labor market data

Current trend

On Thursday the pair EUR/USD had reached the upper limit of the channel at resistance level of 1.2530. After that the price pushed off from this level and went down. Positive data on the key European indices had not supported Euro, while the demand for the USD has increased significantly. Today, downward movement continues; investors strongly sell European currency and poor performance of French economy puts additional pressure on Euro.
Today, the data on European labor market will be known, as well as consumer price index in Eurozone for November. If negative forecast turns out to be correct, the price of the pair EUR/USD can fall to the level of 1.2360.

Support and resistance

The data on labor market in Eurozone can significantly increase volatility in the pair. If the index remains at the previous high level of 11.5%, it will have a negative impact on European currency; while the decline in consumer price index can drop the pair to the key support levels of 1.2400 and 1.2360. In cease of breakdown of the level of 1.2360, the price can fall to the level of 1.2300.

Support levels: 1.2400, 1.2360, 1.2300, 1.2260 and 1.2150.
Resistance levels: 1.2450, 1.2500, 1.2570, 1.2600, 1.2630, 1.2660, 1.2740 and 1.2770.

Trading tips

In the current situation it makes sense to open short positions with stop-loss above the level of 1.2600 and the target of 1.2360; in the medium-term the price is likely to fall further down to the level of 1.2300 (1.2150).



Dmitry Likhachev
Analyst of LiteForex Investments Limited

[LiteForexTeam]

XAU/USD: general review

Current trend
At the morning trading session the price of XAU/USD has dropped dramatically. The decline was caused by the outcome of referendum, which was hold in Switzerland last Sunday. There were three questions on the agenda: to ban sales of gold by Swiss National Bank; to oblige the regulator to keep gold; to bind the bank to keep at least 20% of total assets in gold. The result of Swiss people voting showed that 77% of population opposed the idea.
The price of the precious metal is still under pressure from the increasing American dollar. Economic growth rate in the US may soon result in the increase in the interest rates, which will have a negative impact on the price of gold.
At the moment the pair XAU/USD has slightly recovered losses, correcting to the level of 1182.00 (Fibonacci retracement of 61.8% from 1207.55-1142.58).

Support and resistance
Resistance levels: 1176.80 (middle line of Bollinger bands), 1182.00 (Fibonacci retracement of 61.8%), 1190.95 (Fibonacci retracement of 76.4%), 1207.55 (highs of 21 November).
Support levels: 1165.05 (lows of 28 November), 1142.58 (Asian session lows), 1131.28 (lows of 7 November).

Trading tips
It is advisable to open short positions below the level of 1165.00 with the target of 1155.00. Buy positions can be opened after breakdown of the level of 1182.00 with the target of 1190.00.



Andrey Cherkas
Analyst of LiteForex Investments Limited

[LiteForexTeam]

GBP/USD: general review

Current trend

Yesterday, the GBP has significantly strengthened against the USD in the upward correction, which followed after long-term decline. The Pound was supported by positive UK macro-economic statistics. It became known that business activity index in the manufacturing sector has reached the level of 53.5 points, which was above the forecast. However, the pair rose only to the level of 1.5760, as the “bulls failed to break down this level.
Today, market participants are waiting for the speech of the head of the US Fed Janet Yellen (16:25 GMT+2) and the data on construction spending in the USA for November ( 18:00 GMT+2).

Support and resistance

On the four-hour chart technical indicators demonstrate relative calm in the market. Bollinger bands are slightly diverging, indicating the absence of major players in the market. MACD histogram has gradually entered the positive zone and is moving along the zero line.

Support levels: 1.5680, 1.5650, 1.5630, 1.5590 and 1.5540.
Resistance levels: 1.5740, 1.5775, 1.5800 and 1.5826.

Trading tips

In case of the upward movement, buy positions can be opened after steady breakdown of the level of 1.5740, after which the “bulls” will try to exceed the level of 1.5775. Sell positions are advisable after consolidation of the price below the level of 1.5680. The “bears” will try to drop the price below the level of 1.5650.



Vadim Smarzh
Analyst of LiteForex Investments Limited

[LiteForexTeam]

NZD/USD: decline in price of dairy products causes the fall of NZD

Current trend

The quotes of the currency pair NZD/USD have been declining for the third consecutive day due to several reasons. Firstly, a statement that there comes a time to raise interest rates, made by the deputy chairman of the US Fed Mr. Stanley Fischer, has triggered the rise in demand for the USD. Secondly, prices of milk and dairy products continue to fall. Over the past two weeks the prices fell by 1.1% at the auction “Global Dairy Trade”, which added pressure on the NZD. Finally, the data which was released today, showed that Australian GDP has dramatically decreased, amounting only to 2.7%

Support and resistance

Technically, the pair has been trading in the sideways channel of 0.7915-0.7775 for two weeks. At the moment the price is testing the bottom limit of the channel and breakout of this level will enable the decline to the levels of 0.7745 and 0.7715. Technical indicators in general, confirm the decline in quotes. Bollinger bands are turning downwards. MACD histogram is in the negative zone; its volumes are increasing. Stochastic lines are moving sideways.

Support levels: 0.7775, 0.7745 and 0.7715.
Resistance levels: 0.7800, 0.7835, 0.7870 and 0.7915.

Trading tips

In the current situation it makes sense to open short positions below the level of 0.7775 with the target of 0.7715. Long positions with the target of 0.7835 can be opened if the price goes back to the level of 0.7800.



Dmitriy Zolotov
Analyst of LiteForex Investments Limited

[LiteForexTeam]

EUR/USD: general review

Current trend

The Euro is still trading in a downtrend and the pair has reached an important support level of 1.2300. If this level is soon broken down, the decline may reach the level of 1.2200. The single European currency is affected by macroeconomic data, for example, the Composite Purchasing Managers Index dropped to 51,1 points in November. According to some preliminary economic forecasts, a decreasing demand on the part of Russia and China may result in recession and production cut in Europe.
Another factor affecting the Euro rate is the slowing inflation rate. The eurozone’s Consumer price index equalled as little as 0,3% in November. As a result, the European Central Bank decided to relaunch economy through lending to the real sector, so an increase in interest rates should not be expected in the nearest future.
On the contrary, the US economy is reaching the pre-crisis level, which makes a dollar into an attractive investment tool. Falling energy prices are also allowing the dollar to gain strength.
The ECB's interest rates will be published tomorrow, but the surge of trading volatility is not implied in the absence of any changes. At the same time, US initial jobless claims may consolidate considerably the dollar if the positive outlook is confirmed.

Support and resistance

The nearest resistance level is 1.2329 (0/8 Murray). The nearest support level is 1.2299 (1/8 Murray).

Trading tips

Go short after the level of 1.2290 is broken and place protective orders near the level of 1.2325 with the target at 1.2250.



Dmitriy Agurbash
Analyst of LiteForex Investments Limited

[LiteForexTeam]

AUD/USD: decline continues

Current trend

This week the pair AUD/USD has been trading in the downward channel. Slight rise at the beginning of the week, triggered by positive business activity index in the Australian manufacturing sector for November, has shifted to the decline at the level of 0.8310 (the lows since 2010). The strongest pressure on the Australian currency was caused by poor data on GDP for Q3. This index amounted only to 0.3%, which was against expectations.

Currently, the pair is trading in the narrow range of 0.8410-0.8355, as market participants are waiting for the data on American labor market. It is expected that the number of jobs outside agricultural sector will increase, which may result in strengthening in the USD and the decline in quotes to 0.8300 and 0.8250. Otherwise, correction to the level of 0.8480 may take place.

Support and resistance

Technical indicators give mixed signals, which show market uncertainty in advance of the important news release. Bollinger bands are turning downwards. MACD histogram is in the negative zone; its volumes are decreasing. Stochastic lines have also directed downwards.

Support levels: 0.8355 and 0.8250.
Resistance levels: 0.8410 and 0.8480.

Trading tips

In the current situation it makes sense to open short positions with the target of 0.8250 after breakdown of the level of 0.8355. Long positions with the take profit of 0.8480 can be opened if the price consolidates above the level of 0.8410.



Dmitriy Zolotov
Analyst of LiteForex Investments Limited