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EURo to hit 1.225 by February

al_dcdemo Posted 4 Dec. as Analysis on EUR/USD, Target: 1.2175, Date: 1st of February, 12:00 GMT  in #Technical analysis #Consolidation #Daily Chart #EUR/USD #Weekly Chart #Technical Tools #Long Term Trendline #Net Long Positioning #Political Risks
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Support and resistance (S/R). Price levels, trendlines and Fibonacci retracements. Price action, candlestick and chart patterns. Simple moving averages (SMA). Commitments of traders (COT) indicator, which displays speculative positioning in FX futures market, used as a proxy for speculative positioning in spot FX market.
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After trading to the lowest level in fourteen years, EUR/USD consolidated below the long term trendline, drawn off of 1985 and 2000 lows, for five m…
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al_dcdemo 27 Dec.

UPDATE 8: The dollar started this holiday-shortened week on the back foot. Falling U.S. treasury bond yields and rally in commodities have been two drivers. Year-end position squaring could lead to some messy price action into the end of the week.

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al_dcdemo 30 Dec.

UPDATE 9: U.S. dollar ended the year on a softer note. The dollar index posted its lowest monthly close since 2014. Expectations of other major central banks following Fed into hawkish direction are beginning to outweigh the still present monetary policy divergence.

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al_dcdemo 4 Jan.

UPDATE 10: EUR/USD is testing 2017 high (1.2090). A successful break would target 50.0% retracement of the 2014 - 2017 decline (1.2170), and then 2008 low (1.2330). U.S. jobs and wages report tomorrow could provide fuel for a larger move.

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al_dcdemo 12 Jan.

UPDATE 11: European currencies outperformed today. EUR/USD gained about 100 pips and is poised to post a highest weekly close in three years. 1.2165 (50.0% retracement of the 2014 - 2017 decline) is a big area. A break above would open door to 1.23 - 1.2330 (LT trendline support, 2008 low) and put 1.25 (LT trendline resistance) into focus.

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al_dcdemo 26 Jan.

UPDATE 12: As expected, ECB kept policy steady. Draghi didn't try to talk down euro, which gave it another boost higher. Later, U.S. president Trump backtracked on what Mnuchin said a day earlier, saying that ultimately he "wants to see a strong dollar", which prompted a round of profit taking among U.S. dollar bears. EUR/USD already recovered half of that fall and appears ready to retest 1.25.

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EURo to climb further up in December

al_dcdemo Posted 30 Nov. as Analysis on EUR/USD, Target: 1.1950, Date: 2nd of January, 12:00 GMT  in #Technical analysis #Consolidation #Daily Chart #EUR/USD #Weekly Chart #Technical Tools #Long Term Trendline #Net Long Positioning #Political Risks
Technical Tools
Support and resistance (S/R). Price levels, trendlines and Fibonacci retracements. Price action, candlestick and chart patterns. Simple moving averages (SMA). Commitments of traders (COT) indicator, which displays speculative positioning in FX futures market, used as a proxy for speculative positioning in spot FX market.
Weekly Chart
After trading to the lowest level in fourteen years, EUR/USD consolidated below the long term trendline, drawn off of 1985 and 2000 lows, for five m…
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al_dcdemo 19 Dec.

UPDATE 5: EUR/USD rose almost 100 pips yesterday, in what was a lively Monday. The pair is trading near the lower extreme of the 2017 channel. A successful bounce would target 1.2150 and then 1.23. A breakdown would put 1.14 - 1.15 back into focus.

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al_dcdemo 23 Dec.

UPDATE 6: U.S. dollar ended up higher against yen, marginally lower against franc and lower against other major currencies this week. Even though monetary policy divergence is still in force, some of the recent trades have most certainly been made with convergence, which already started this year, in mind.

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al_dcdemo 24 Dec.

UPDATE 7: Next week could easily end up being the least active week of the year. But otherwise subdued periods have often proved quite volatile in recent years. "Expect the unexpected" is one saying that is useful to always keep in mind in trading business.

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al_dcdemo 27 Dec.

UPDATE 8: The dollar started this holiday-shortened week on the back foot. Falling U.S. treasury bond yields and rally in commodities have been two drivers. Year-end position squaring could result to some messy price action into the end of the week.

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al_dcdemo 30 Dec.

UPDATE 9: U.S. dollar ended the year on a softer note. The dollar index posted its lowest monthly close since 2014. Expectations of other major central banks following Fed into hawkish direction are beginning to outweigh the still present monetary policy divergence.

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EURo to retrace some more in the weeks ahead

al_dcdemo Posted 22 Oct. as Analysis on EUR/USD, Target: 1.1725, Date: 1st of December, 12:00 GMT  in #Technical analysis #Daily Chart #EUR/USD #Correction #Weekly Chart #Technical Tools #Long Term Trendline #Net Long Positioning #Political Risks
Technical Tools
Support and resistance (S/R). Price levels, trendlines and Fibonacci retracements. Price action, candlestick and chart patterns. Simple moving averages (SMA). Commitments of traders (COT) indicator, which displays speculative positioning in FX futures market, used as a proxy for speculative positioning in spot FX market.
Weekly Chart
After trading to the lowest level in fourteen years, EUR/USD consolidated below the long term trendline, drawn off of 1985 and 2000 lows, for five m…
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al_dcdemo 11 Nov.

UPDATE 5: U.S. dollar recorded a losing week as recent gains on tax reform hopes have been pared. U.S. Senate plans to propose delaying corporate tax cut until 2019. U.S. dollar index is closing in on the trendline, drawn off of September and October lows.

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al_dcdemo 17 Nov.

UPDATE 6: U.S. dollar ended the week lower against European currencies and yen, and higher against the commodity bloc. If we look at these currencies from the yield perspective, it was actually a typical risk-off week, albeit with reduced volatility.

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al_dcdemo 20 Nov.

UPDATE 7: Sunday news from Germany about Free Democrats breaking off Merkel's coalition was meet with a 75 pip decline after the open. Late shorts were squeezed in European trading, to just above 1.18, where new round of selling began. 1.17 may not yield easily.

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al_dcdemo 23 Nov.

UPDATE 8: FOMC Minutes highlighted the division among officials on inflation outlook, though majority still think it will ultimately pick up. December hike is virtually a done deal but what comes after that will increasingly hinge on inflation progress. U.S. dollar was sold ahead of and after the release.

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al_dcdemo 29 Nov.

UPDATE 9: Progress on U.S. tax reform, better than expected GDP revision and Janet Yellen with some hawkish comments have all been welcomed by the dollar bulls. Yet the currency struggled to make any significant headway today. Markets have continuously underestimated Fed's resolve to normalize rates in this cycle.

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EURo to move above 1.20 in October

al_dcdemo Posted 23 Sep. as Analysis on EUR/USD, Target: 1.2125, Date: 1st of November, 12:00 GMT  in #Technical analysis #Daily Chart #EUR/USD #Weekly Chart #Technical Tools #Bullish Fundamentals #Long Term Trendline #Net Long Positioning #Capitulation Spike
Technical Tools
Support and resistance (S/R). Price levels, trendlines and Fibonacci retracements. Price action, candlestick and chart patterns. Simple moving averages (SMA). Commitments of traders (COT) indicator, which displays speculative positioning in FX futures market, used as a proxy for speculative positioning in spot FX market.
Weekly Chart
After trading to the lowest level in fourteen years, EUR/USD consolidated below the long term trendline, drawn off of 1985 and 2000 lows, for five m…
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al_dcdemo 12 Oct.

UPDATE 5: As expected, there was nothing shocking in the Minutes of the latest FOMC meeting. Division between those who believe that inflation is low due to transitory factors and those who think it's just a new normal, is nothing new but the market seemed to take this as a mildly dovish sign. U.S. dollar has already been weakening this week and, after a minor whipsaw, prices just continued on the path of least resistance. December hike from the Fed is pretty much priced in at this point. The focus is on inflation and tax reform, for clues as to what comes beyond that.

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al_dcdemo 13 Oct.

UPDATE 6: Earlier today a combo of U.S. inflation and retail sales reports for September was published. Inflation indicators came in somewhat weaker than expected but mostly higher than in August while retail sales were better than expected. Market focus was on inflation and initial reaction was to sell the U.S. dollar. Moves stalled after 50 - 70 pips and later reversed to various extents across dollar pairs as traders digested otherwise solid reports. The dollar is closing the week lower against all major currencies.

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al_dcdemo 21 Oct.

UPDATE 7: U.S. dollar was the winner of the week. Solid inflation report last week and renewed prospects for a successful tax reform have been the fundamental drivers. Technically, 91 appears to have been more than just a short-term lower in the U.S. dollar index, with 95 the next target. 10-year U.S. treasury yield closed the week on its highs, just below the important 2.4% level, of which Bill Gross says is a trend-changing point. Apart from ECB and BOE next week, one of the most important events to watch out for is nomination of the, probably new, Fed Chair.

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al_dcdemo 23 Oct.

UPDATE 8: Euro opened marginally lower today with Catalan crisis still simmering. ECB meet this week and are expected to scale down asset purchase program while extending it through the next six or nine months. A dovish surprise seems more likely than a hawkish one. 50 DMA is acting as a resistance since late September. Potential head and shoulders top with the neckline near 1.17 projects towards 1.13. The neckline is reinforced by 100 DMA ahead of the next stronger support at 1.1615.

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al_dcdemo 27 Oct.

UPDATE 9: Cautious tones from ECB and BOC, weak Australian inflation one side and progress in U.S. politics and much better than expected Advance GDP reading on the other one were among the drivers of major currency pairs this week. BOE is expected to hike next week but it will be a one-off for now. The U.S. dollar was mostly bought up until around the time Europe started heading for the pub. Rumor of Trump leaning toward Powell as the next Fed chair sparked a bout of profit-taking. The dollar ended the week higher against every major currency bar the yen.

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EURo to break 1.20 in September

al_dcdemo Posted 24 Aug. as Analysis on EUR/USD, Target: 1.1925, Date: 2nd of October, 12:00 GMT  in #Technical analysis #Daily Chart #EUR/USD #Weekly Chart #Technical Tools #Bullish Fundamentals #Long Term Trendline #Net Long Positioning #Capitulation Spike
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Support and resistance (S/R). Price levels, trendlines and Fibonacci retracements. Price action, candlestick and chart patterns. Simple moving averages (SMA). Commitments of traders (COT) indicator, which displays speculative positioning in FX futures market, used as a proxy for speculative positioning in spot FX market.
Weekly Chart
After trading to the lowest level in fourteen years, Euro consolidated below the long term trendline, drawn off of 1985 and 2000 lows, for five mont…
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al_dcdemo 9 Sep.

UPDATE 6: Three major central banks met this week. On Tuesday, RBA kept interest rates unchanged but they were upbeat on the economy. On Wednesday, BOC delivered second hawkish hike in the row. Markets expect one more hike from them this year. ECB stood pat on Thursday but will likely announce further tapering of asset purchases in October. Next Thursday, SNB and BOE meet. No change is likely to be expected from SNB while the franc is trading below 1.20 against the euro. BOE will hike rates at some point in the future but that won't be this year.

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al_dcdemo 16 Sep.

UPDATE 7: It was a positive week for the U.S. dollar, which closed higher against most major currencies. By far the best performer was British pound, which rallied on a hawkish shift from the BOE. New Zealand dollar closed marginally higher after some election polls indicated continuation of the status quo. Following weekly close below strong support at 108.10, yen reversed sharply and ended the week above 110.50. Next week's main event is FOMC meeting at which the committee is widely expected to announce balance sheet adjustment plan. Forward guidance on rates will be watched closely too.

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al_dcdemo 20 Sep.

UPDATE 8: Fed remains on track with monetary policy. Balance sheet adjustment will start in October. Most members are expecting another hike this year. Three more hikes are projected for 2018. Neutral rate was downgraded to 2.8% from 3.0%. Market clearly expected something less hawkish from them. The dollar rallied across the board but the rally run out of steam after 100 - 150 pips of gains. Any further gains may not last because, fundamentally, nothing really changed today.

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al_dcdemo 25 Sep.

UPDATE 9: German election concluded largely as expected. Angela Merkel will serve her fourth term as Chancellor, however, her party (CDU) will have to seek coalition partners. In addition, a far-right party (AfD) will be represented in parliament for the first time since WW2. EUR/USD didn't like it and opened with about 50-pip gap lower. The gap was closed by the end of the Asian session but the pair headed back towards the lows as Europe opened for business. 1.18 - 1.185 is the current range support and 1.205 - 1.21 the resistance.

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al_dcdemo 1 Oct.

UPDATE 10: It seems that U.S. dollar finally found some traction. A rise in bond yields after more hawkish than expected Fed last week is one part of the story. The other is that despite all difficulties in passing new healthcare bill, U.S. tax reform may prove to be a success for Administration. In any case, market got ahead of itself on the convergence trade and what we are seeing now is probably just a healthy retracement and not an outright reversal. Another supportive factor for the dollar is that any weakness in September data will be dismissed due to hurricane impact.

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EURo to extend gains in August

al_dcdemo Posted 24 July as Analysis on EUR/USD, Target: 1.1825, Date: 1st of September, 12:00 GMT  in #Technical analysis #Daily Chart #EUR/USD #Weekly Chart #Technical Tools #Neutral Fundamentals #Long Term Trendline #Net Long Positioning #Capitulation Spike
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Support and resistance (S/R). Price levels, trendlines and Fibonacci retracements. Price action, candlestick and chart patterns. Simple moving averages (SMA). Commitments of traders (COT) indicator, which displays speculative positioning in FX futures market, used as a proxy for speculative positioning in spot FX market.
Weekly Chart
After trading to the lowest level in fourteen years, Euro consolidated below the long term trendline, drawn off of 1985 and 2000 lows, for five mont…
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al_dcdemo 19 Aug.

UPDATE 6: This week was to some extent a reversal of last week's risk-off moves. Canadian and Australian dollars were beneficiaries with yen and franc recording just marginal losses. It was not a good week for European currencies. Pound was the loser of the week while euro remains to be buoyed by dip buyers. Next week will be a quiet one data-wise. All eyes will be on Jackson Hole Symposium at the end of the week, which will feature speeches by Yellen and Draghi. Rumours go that the ECB president will avoid talking monetary policy. That should increase volatility if he does say something.

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al_dcdemo 24 Aug.

UPDATE 7: Price action has been pretty sedate so far this week with most major currencies sitting near the middle of their weekly ranges. Euro and Canadian dollar are the only two that are marginally better than the U.S. dollar. There's been a little bit more action in the New Zealand dollar but selling stalled ahead of the strong support at 0.72. Tomorrow could prove to be the most lively day of the week with German Ifo Business Climate, U.S. (Core) Durable Goods Orders and Day 2 of the Jackson Hole Symposium which will bring Fed Chair Yellen and ECB President Draghi speeches.

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al_dcdemo 26 Aug.

UPDATE 8: Speeches by Yellen and Draghi at Jackson Hole Symposium met expectations. Yellen didn't even talk about monetary policy while Draghi avoided giving any new information on what ECB may do in autumn. Lack of hawkish clues from Yellen were enough to send the U.S. dollar lower across the board and then later some upbeat comments from Draghi (even though he warned about inflation not yet being self-sustained) propelled the euro to a new two-year high. Yen, pound and Australian dollar were flat on the week while New Zealand dollar was the laggard.

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al_dcdemo 31 Aug.

UPDATE 9: U.S. dollar index broke to the lowest level since 2015 on Monday before staging a sharp pullback. That coincided with euro breaking above 1.20 and 2012 low (1.2040) and franc below 0.95. Yen was once again contained by the strong support at 108. Kiwi is out of favour ahead of N.Z. general election. Canadian dollar sold off hard yesterday but already recouped all losses and some after exceptional Q2 GDP figures. Australian dollar has been the least volatile of the bunch but with some impressive reversals. NFP report tomorrow will be a nice finale to this exciting week.

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al_dcdemo 1 Sep.

UPDATE 10: U.S. jobs & wages report for August fell short of expectations on most metrics. August is historically weak with regard to NFP figure but Wednesday's strong ADP figure gave U.S. dollar bulls some hope that this time was different. It wasn't and the immediate reaction was to sell the dollar. The report itself was not great but was solid enough and subsequent price action seemed to agree. The dollar ended the week higher against euro, franc, yen and New Zealand dollar, and lower against pound, Canadian dollar and Australian dollar.

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USD/CHF to recover in July

al_dcdemo Posted 20 June as Analysis on USD/CHF, Target: 0.9825, Date: 1st of August, 12:00 GMT  in #Technical analysis #Daily Chart #USD/CHF #Weekly Chart #Technical Tools #Long Term Trendline #Net Short Positioning #Monetary Policy Divergence #Flag Like Formation
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Support and resistance (S/R). Price levels, trendlines and Fibonacci retracements. Price action, candlestick and chart patterns. Simple moving averages (SMA). Commitments of traders (COT) indicator, which displays speculative positioning in FX futures market, used as a proxy for speculative positioning in spot FX market.
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Swissie found strong demand near the intersection of the long term trendline that capped rallies in 2003, 2005, 2006, 2008, 2010 and 2015, and the t…
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al_dcdemo 15 July

UPDATE 5: It was a worst week for the U.S. dollar in a while. It started with the BOC decision on Wednesday after which Canadian dollar surged about 200 pips. The next day, Aussie and Kiwi played catch-up and rose about 100 pips respectively. Eagerly anticipated U.S. inflation and retail sales reports came in weaker than expected yesterday and exacerbated dollar losses across the board. Cable sliced through 1.30 to 1.3115, the highest in ten months. Euro had tough time holding above 1.14 but ended the week near the high, poised for a break higher. Exciting week ahead.

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al_dcdemo 23 July

UPDATE 6: U.S. dollar ended another week of underperformance, falling against all major currencies bar the British pound. Euro confirmed break above 1.145 to trade to the highest since mid 2015. Mirroring its cousin, Swiss franc closed the week below 0.95. Yen was bought down to 111. Canadian dollar extended its rally to approach 1.25. Australian dollar broke above 38.2% retracement of the 2014 - 2016 downswing. New Zealand dollar closed the week near 0.745, just below the 50.0% retracement of the 2014 - 2015 decline. Momentum suggests further losses for the dollar in the week ahead.

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al_dcdemo 24 July

UPDATE 7: A mixed start to the week saw yen, pound, Canadian dollar and Australian dollar extend gains while euro, franc and New Zealand dollar are lagging. Data-wise, it's a quiet one until Wednesday when Australia publishes inflation data, U.K. releases preliminary GDP and FOMC concludes its meeting. U.S. reports durable goods orders on Thursday and GDP on Friday. Unless FOMC pulls a surprise, neither of these events has the potential change the current macroeconomic landscape. U.S. politics seems a more likely source from where some kind of a twist could come.

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al_dcdemo 27 July

UPDATE 8: Yesterday's reaction to the latest FOMC statement was quite strong for a meeting without press conference. The statement didn't reveal anything new but clearly the market was expecting something more hawkish. The committee indicated that it will begin with balance sheet adjustment "relatively soon". The language on inflation, however, has deteriorated a bit and that was probably the main reason the market sold the dollar. While balance sheet adjustment is now virtually a done deal, we may see further hikes in federal funds rate only if inflation picks up.

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al_dcdemo 31 July

UPDATE 9: Last week was an interesting one. Major currencies traded to fresh highs against the U.S. dollar. The single exception was Swiss franc which sold off strongly against all those currencies, including the dollar. Two cent and a half surge from sub 0.95 to above 0.97 might well have had SNB backing. There's nothing on the calendar for the week ahead that has the potential to reverse the current U.S. dollar weakness. Perhaps a concerted dovish effort from RBA and BOE could put a dent into this trend but probably not for too long.

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EURo to consolidate in July

al_dcdemo Posted 19 June as Analysis on EUR/USD, Target: 1.1125, Date: 1st of August, 12:00 GMT  in #Technical analysis #Daily Chart #EUR/USD #Weekly Chart #Technical Tools #Neutral Fundamentals #Long Term Trendline #Net Long Positioning #Breakaway Gap
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Support and resistance (S/R). Price levels, trendlines and Fibonacci retracements. Price action, candlestick and chart patterns. Simple moving averages (SMA). Commitments of traders (COT) indicator, which displays speculative positioning in FX futures market, used as a proxy for speculative positioning in spot FX market.
Weekly Chart
The pair convincingly broke below the long term trendline drawn off of 1985 and 2000 lows in Q4 2016. In the process, the pair extended the 1.05 - 1…
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al_dcdemo 15 July

UPDATE 6: It was a worst week for the U.S. dollar in a while. It started with the BOC decision on Wednesday after which Canadian dollar surged about 200 pips. The next day, Aussie and Kiwi played catch-up and rose about 100 pips respectively. Eagerly anticipated U.S. inflation and retail sales reports came in weaker than expected yesterday and exacerbated dollar losses across the board. Cable sliced through 1.30 to 1.3115, the highest in ten months. Euro had tough time holding above 1.14 but ended the week near the high, poised for a break higher. Exciting week ahead.

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al_dcdemo 23 July

UPDATE 7: U.S. dollar ended another week of underperformance, falling against all major currencies bar the British pound. Euro confirmed break above 1.145 to trade to the highest since mid 2015. Mirroring its cousin, Swiss franc closed the week below 0.95. Yen was bought down to 111. Canadian dollar extended its rally to approach 1.25. Australian dollar broke above 38.2% retracement of the 2014 - 2016 downswing. New Zealand dollar closed the week near 0.745, just below the 50.0% retracement of the 2014 - 2015 decline. Momentum suggests further losses for the dollar in the week ahead.

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al_dcdemo 24 July

UPDATE 8: A mixed start to the week saw yen, pound, Canadian dollar and Australian dollar extend gains while euro, franc and New Zealand dollar are lagging. Data-wise, it's a quiet one until Wednesday when Australia publishes inflation data, U.K. releases preliminary GDP and FOMC concludes its meeting. U.S. reports durable goods orders on Thursday and GDP on Friday. Unless FOMC pulls a surprise, neither of these events has the potential change the current macroeconomic landscape. U.S. politics seems a more likely source from where some kind of a twist could come.

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al_dcdemo 27 July

UPDATE 9: Yesterday's reaction to the latest FOMC statement was quite strong for a meeting without press conference. The statement didn't reveal anything new but clearly the market was expecting something more hawkish. The committee indicated that it will begin with balance sheet adjustment "relatively soon". The language on inflation, however, has deteriorated a bit and that was probably the main reason the market sold the dollar. While balance sheet adjustment is now virtually a done deal, we may see further hikes in federal funds rate only if inflation picks up.

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al_dcdemo 31 July

UPDATE 10: Last week was an interesting one. Major currencies traded to fresh highs against the U.S. dollar. The single exception was Swiss franc which sold off strongly against all those currencies, including the dollar. Two cent and a half surge from sub 0.95 to above 0.97 might well have had SNB backing. There's nothing on the calendar for the week ahead that has the potential to reverse the current U.S. dollar weakness. Perhaps a concerted dovish effort from RBA and BOE could put a dent into this trend but probably not for too long.

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Swissie could snap back to parity level

al_dcdemo Posted 23 May as Analysis on USD/CHF, Target: 0.9925, Date: 3rd of July, 12:00 GMT  in #Technical analysis #Daily Chart #USD/CHF #Weekly Chart #Technical Tools #Long Term Trendline #Net Short Positioning #Monetary Policy Divergence #Flag Like Formation
Technical Tools
Support and resistance (S/R). Price levels, trendlines and Fibonacci retracements. Price action, candlestick and chart patterns. Simple moving averages (SMA). Commitments of traders (COT) indicator, which displays speculative positioning in FX futures market, used as a proxy for speculative positioning in spot FX market.
Weekly Chart
Swissie found strong demand near the intersection of the long term trendline that capped rallies in 2003, 2005, 2006, 2008, 2010 and 2015, and the t…
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al_dcdemo 10 June

UPDATE 5: It was a mixed week for the U.S. dollar. The world's reserve currency finally got some traction against European currencies. Dovish ECB and U.K. voters, going against PM May's and indeed market expectations, contributed fundamental background for the technical weakness to play out. The dollar was flat against the yen and the Canadian dollar but it fell short compared to the Antipodean currencies. Next week brings four major central bank meetings, namely Fed, SNB, BOE and BOJ. The Fed is widely expected to hike interest rate corridor by further 25 basis points.

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al_dcdemo 14 June

UPDATE 6: Swiss franc is one of the best performing major currencies this year. Euro strength and U.S. dollar weakness are both supporting this. SNB meets tomorrow and no change is expected from them for at least as long as ECB keeps rates on the floor. USD/CHF encountered some demand ahead of 0.96 before pulling from the lows. If that goes, 0.95 area looks stronger and might be backed by SNB. 0.97 - 0.975 is the initial resistance. 0.98 - 0.985 is another one.

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al_dcdemo 15 June

UPDATE 7: Fed's FOMC was unexpectedly hawkish yesterday. They hiked federal funds rate by 25 basis points, as anticipated, and outlined strategy for reducing their balance sheet. FOMC chair Yellen told reporters that the balance sheet adjustment could begin "relatively soon". Just a couple of hours before the FOMC decision, both inflation and retail sales reports came in weak and markets sold U.S. dollar on speculation that the FOMC will postpone hiking until data improves. The dollar recovered and followed through today.

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al_dcdemo 21 June

UPDATE 8: After trading to as low as 0.96 in the beginning of May, USD/CHF has been slowly but steadily recouping losses. At the last week's meeting, SNB reiterated their mantras that the Franc is overvalued and that they will continue with ultra-easy monetary policy. That shall keep the pair supported as long as EUR/USD is in correction mode. 0.98 - 0.9825 (March low, 2011 - 2016 trendline, 50 DMA) is the next target. 0.97 - 0.9725 is likely to see some stronger demand come in.

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al_dcdemo 24 June

UPDATE 9: The currency markets were relatively sedate this week. Major pairs traded in 100-pip ranges with the exception of Cable whose range exceeded 200 pips. With no big events on the agenda until September, it's possible that we'll be seeing somewhat slower activity throughout the summer. That said, there's always opportunity in at least some pairs and timeframes, and we must always expect the unexpected. Central bank speakers will continue to dominate in the week ahead and markets will be positioning for their next moves in the coming weeks.

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EURo to pull back after some further gains

al_dcdemo Posted 22 May as Analysis on EUR/USD, Target: 1.1075, Date: 3rd of July, 12:00 GMT  in #Technical analysis #Daily Chart #EUR/USD #Weekly Chart #Technical Tools #Long Term Trendline #Net Long Positioning #Improved Fundamentals #Breakaway Gap
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Support and resistance (S/R). Price levels, trendlines and Fibonacci retracements. Price action, candlestick and chart patterns. Simple moving averages (SMA). Commitments of traders (COT) indicator, which displays speculative positioning in FX futures market, used as a proxy for speculative positioning in spot FX market.
Weekly Chart
The pair convincingly broke below the long term trendline drawn off of 1985 and 2000 lows in Q4 2016. In the process, the pair extended the 1.05 - 1…
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al_dcdemo 12 June

UPDATE 6: ECB acted as expected last week and removed phrase "or lower" from the line "interest rates to remain at present or lower levels for an extended period of time". The bank remains cautious as they lowered growth and inflation forecasts for the year. The market expected a little bit more hawkishness from them and subsequently sold off. Dip buyers have been quick to step in however and push the pair back above 1.12. 1.11 - 1.115 should hold if this rally is to continue. 1.13 is the next target.

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al_dcdemo 15 June

UPDATE 7: Fed's FOMC was surprisingly hawkish yesterday. They hiked federal funds rate by 25 basis points, as expected, and outlined strategy for reducing their balance sheet. FOMC chair Yellen told reporters that the balance sheet adjustment could begin "relatively soon". Just a couple of hours before the FOMC decision, both inflation and retail sales reports came in weak and markets sold U.S. dollar on speculation that the FOMC will postpone hiking until data improves. The dollar recovered and followed through today.

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al_dcdemo 20 June

UPDATE 8: Euro traded to a new seven-month high last week after weak U.S. inflation and retail sales data. The spike was reversed few hours later on hawkish FOMC decision. PMI data at the end of the week will be closely watched by market participants. The pair has been trading sideways for about a month. December - May channel top, late May low and 1.11 big figure level combine to a strong support area, followed by 1.10 - 1.1050 (early May high, 50 DMA). 1.13 remains a formidable upside barrier.

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al_dcdemo 24 June

UPDATE 9: Currency markets were relatively sedate this week. Major pairs traded in 100-pip ranges with the exception of Cable whose range exceeded 200 pips. With no big events on the agenda until September, it's possible that we'll be seeing somewhat slower activity throughout the summer. That said, there's always opportunity in at least some pairs and timeframes, and we must always expect the unexpected. Central bank speakers will continue to dominate in the week ahead and markets will be positioning for their next moves in the coming weeks.

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al_dcdemo 28 June

UPDATE 10: ECB president Mario Draghi yesterday said: "While there are still factors that are weighing on the path of inflation, at present they are mainly temporary factors that typically the central bank can look through". That's hawkish from him and Euro bulls needed no excuse to took the pair 150 pips higher by the end of the day. The pair finally broke above U.S. election high (1.13) and extended gains to the highest level in a year. Pre-Brexit high (1.1430) is the next target and then last year's high near 1.1615. Broken 1.13 level should now offer some decent support.

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