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Yen breaks 110

al_dcdemo Posted 12 Apr.  in #Trader's blog #Support #Resistance #Oil #USD/JPY #Stocks #Bonds #Risk Off #D1 Chart
USD/JPY broke below 110 in yesterday's risk-off trading. Stocks fell but later recovered, gold soared, but the main driver remains 10-year UST yield, which closed below 2.30% for the first time since November. Oil continues to recover amid geopolitical uncertainty.
The pair extended its decline overnight. The pullbacks have been shallow so far. 110 is also 50.0% retracement of the Trump rally. A possible target is 1.0850 - 1.09 (Channel support, 200 DMA). Area around 110 should now act as a resi…
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Loonie testing the bottom of the wedge

al_dcdemo Posted 7 Sep.  in #Trader's blog #Support #Resistance #Oil #USD/CAD #Wedge #D1 Chart #Resilience
As much as the Canadian dollar was weak last year, it's been incredibly resilient so far this year. Oil remains its biggest driver but recently the currency seems to fall less on oil declines than it rises on oil rallies.
The pair is currently testing the bottom of the wedge pattern that it has been tracing since earlier this year. Area between 1.28 and 1.2750 (August low) marks an important support. 100 DMA is the first stronger resistance.
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Loonie to remain range-bound in September

al_dcdemo Posted 24 Aug. as Analysis on USD/CAD, Target: 1.3075, Date: 3rd of October, 12:00 GMT  in #Technical analysis #Oil #USD/CAD #Wedge #Daily Chart #Weekly Chart #Technical Tools #Blow Off Top #Net Long Positioning
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
Loonie started the year with a sharp rally and topped out near 76.4% retracement of the 2002 - 2007 downtrend. The reversal was even more impressiv…
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al_dcdemo 19 Sep.

UPDATE 6: Week ahead is among the most important ones this year. Even though the market discounts little chance of a Fed hike in September, the meeting will shape expectations for whether we'll get one this year at all. Perhaps even more important will be the decision from the BOJ. This bank has been struggling with deflation and upward pressure on the yen for decades - can they finally put end to that? RBNZ is another central bank that meets this week. No action from them is widely expected, after they cut rates in August.

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al_dcdemo 22 Sep.

UPDATE 7: FOMC kept the federal funds rate steady at yesterday's meeting. This outcome was widely anticipated though there were still a lot of players expecting an early hike.  It was a "hawkish hold" with the committee sending a strong implicit signal that the second hike is not far away, barring any economic shocks. The dollar fell after the decision and extended its losses in today's European session. It then recouped a big part of the losses in the N.A. session which is consistent with a very real prospect of a rate hike in December.

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al_dcdemo 26 Sep.

UPDATE 8: Currencies ended the first day of the week mixed but mostly higher against the U.S. dollar. The winner was the yen which approached the strong 100 level once again. A convincing break below it could send few ripples through the FX market, particularly via crosses such as GBP/JPY, AUD/JPY and NZD/JPY. Canadian dollar was the loser of the day, following through on the weakness after Friday's inflation and retail sales reports. Market focus is now turning to the U.S. elections. It's also the last week of the quarter so we may well witness some larger position squaring flows.

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al_dcdemo 30 Sep.

UPDATE 9: The U.S. dollar ended the month higher against the pound and the Canadian dollar but it closed lower against the euro, the franc, the yen and the antipodean dollars. It was a great month for range traders while trend followers are still waiting for a real breakout (higher TFs). They may not have to wait for too long. Contracting ranges will sooner or later give way, in one or the other direction. Uncertainty around U.S. presidental election and potential for a December FOMC rate hike should keep the dollar supported in the Q4.

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al_dcdemo 3 Oct.

UPDATE 10: Contrary to expectations of many market participants, September turned out to be a mostly sideways month. One reason were certainly central banks, namely the Fed and the BOJ, and lack of action on their part. Oil did have a couple of volatile moves but the pair seems to be less sensitive to it than in earlier part of the year. The market probably already discounted much of the oil price shock. I'm happy with the prediction, particularly the target price while the projected price path was somewhat less accurate.

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Loonie looks heavy above 1.30

al_dcdemo Posted 5 Aug.  in #Trader's blog #Support #Oil #USD/CAD #Breakout #D1 Chart #GBP/CAD Selling
USD/CAD briefly traded above 1.3250 on July 27th. At that point it looked like it was going to extend the breakout towards 1.35 but it didn't happen. Recently, the Canadian dollar seems to rally more when the oil rises than it sells off when the oil falls.
Recovering oil and GBP/CAD selling were the main USD/CAD drivers in yesterday's trading in which the pair touched below 1.30 for the first time in three weeks. Some decent support is expected in 1.2950 - 1.30 band, which is hosting both 50 DMA…
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USD/CAD to rise towards 1.35 in August

al_dcdemo Posted 27 July as Analysis on USD/CAD, Target: 1.3275, Date: 1st of September, 12:00 GMT  in #Technical analysis #Oil #USD/CAD #Breakout #Daily Chart #Weekly Chart #Technical Tools #Blow Off Top #Net Long Positioning
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
Loonie started the year with a sharp rally and topped out near 76.4% retracement of the 2002 - 2007 downtrend. The reversal was even more impressive…
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al_dcdemo 15 Aug.

UPDATE 5: Another subdued weekly opening as thin summer trading continues. The seven major currency pairs traded in 20-30 pip ranges during the Asian session. Data wise, we have a busy week ahead. U.S. will release inflation report and FOMC meeting minutes. U.K. will report inflation, labour market and retail sales data. Australia and New Zealand will publish labour force reports. We'll get the latest readings on Canadian inflation and retail sales. All in all, this points to a little bit more action than implied by the opening.

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al_dcdemo 17 Aug.

UPDATE 6: Many participants positioned for the U.S. dollar strength ahead of the release of the FOMC meeting minutes, encouraged by yesterday's hawkish comments by the NY Fed president Dudley. The minutes were less hawkish than expected in that only a few members felt that a rate hike was needed. Majority would like to see some more data before taking that decision. The dollar made its customary round-trip, running stops on both extremes, before returning to pre-release levels. The commodity currencies ended the day lower while the rest of the G7 closed near unchanged for the day.

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al_dcdemo 22 Aug.

UPDATE 7: U.S. dollar opened the week with a significant gap in its favour. Weekend comments by the Fed's Stanley Fischer were cited as a contributing factor though it all looks like a simple continuation of the last Friday's reversal. The calendar for the week ahead is relatively light with the main event, a speech by the Fed governor Janet Yellen, coming in at the end of the week. At the moment it seems we'll get a bit of a dollar strength ahead of the event as the market discounts rising (albeit still low) odds of a rate hike by the Fed later this year.

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al_dcdemo 30 Aug.

UPDATE 8: Last Friday's speech by Fed Chair Yellen seems to have, at least temporarily, reversed the U.S. dollar weakening trend. Major currencies have been impacted to various degrees. BOJ's Kuroda comments over the weekend about room for further monetary policy action made the yen the weakest of the currencies followed by the Canadian and the Australian dollars. Cable seems to be the most resilient and is down just marginally on the week, in part probably due to a lack of new sellers as implied by record net and gross short positions in FX futures.

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al_dcdemo 31 Aug.

UPDATE 9: Even though the official end of the summer doldrums is after the Labor Day holiday in the U.S., we've seen increased participation this week. Last Friday's move after Fed's Yellen speech sparked some volatility although she offered nothing particularly new. If anything, I think the market was positioned for a less hawkish (maybe even dovish) speech. September rate hike is however back on the table which makes Friday's NFP report a very important one. We'll get ADP Nonfarm Employment Change in a couple of hours  and the reaction to it may be more than usual.

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Loonie moving sideways

al_dcdemo Updated 15 July  in #Trader's blog #Support #Resistance #Oil #USD/CAD #Boc #Rising Wedge #D1 Chart #Five Cent Range
Loonie has been contained in a five-cent range between 1.27 and 1.32 since early May, though it has spent most of the time in the inner 1.28 - 1.31 range. The range looks like a rising wedge, which is generally a bearish pattern.
The BOC left policy unchanged on Wednesday while the oil seems to be in a correction mode. That seems to keep the pair in balance for now. Some resistance shall be found near 1.31, 1.33 and 1.35 and support at 1.27 and 1.25.
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Aussie supported above 0.75

al_dcdemo Posted 12 July  in #Trader's blog #Support #Resistance #Oil #AUD/USD #Gold #Risk Sentiment #D1 Chart
The path of least resistance is to the upside for the Australian dollar, which looks supported above 0.75. Some weakness in gold and oil is offset by better risk sentiment across the globe.
Next target for the pair is 100 MMA (0.77) and then 2011 - 2016 support/resistance line (0.7750). The mentioned 0.75 level is backed by 100 DMA (0.7460), 50 DMA (0.7375) and 200 DMA (0.73).
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Loonie still in a range

al_dcdemo Posted 6 July  in #Trader's blog #Oil #USD/CAD #Decline #Risk Off #D1 Chart #Snap Back
After falling in five consecutive days, from 1.31 last Tuesday to 1.2825 on Monday, USD/CAD snapped more than half of the decline yesterday.
Nearly 5% fall in oil amid more general risk-off environment saw the pair rising back above 1.30. That puts 1.32 back into view and possibly 1.35 on a successful breakout.
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USD/CAD to remain range-bound in July

al_dcdemo Posted 25 June as Analysis on USD/CAD, Target: 1.2925, Date: 1st of August, 12:00 GMT  in #Technical analysis #Oil #USD/CAD #Daily Chart #Weekly Chart #Technical Tools #Brexit #Blow Off Top #Net Long Positioning
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
Loonie started the year with a sharp rally and topped out near 76.4% retracement of the 2002 - 2007 downtrend. The reversal was even more impressiv…
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al_dcdemo 11 July

UPDATE 5: June's NFP report suggested that the figure for May was just a fluke and that the U.S. jobs market is still strong. Having said that, its performance graduated somewhat over the past year which is in line with diminishing slack in the market. Immediate reaction was to buy the dollar but, after few whipsaws, prices mostly settled near pre-release levels, with a slight risk-on bias. Talking about risk-on, S&P 500 futures posted an all time high overnight, barely two weeks after Brexit.

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al_dcdemo 15 July

UPDATE 6: Loonie has been contained in a five-cent range between 1.27 and 1.32 since early May, though it has spent most of the time in the inner 1.28 - 1.31 range. The range looks like a rising wedge, which is generally a bearish pattern. The BOC left policy unchanged on Wednesday while the oil seems to be in a correction mode. That seems to keep the pair in balance for now. Some resistance shall be found near 1.31, 1.33 and 1.35 and support at 1.27 and 1.25.

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al_dcdemo 26 July

UPDATE 7: Loonie broke above two-month consolidation pattern which spans roughly between 1.2675 and 1.3175. The breakout was accompanied by weakness in oil and came few days after 50 DMA crossed above 100 DMA for the first time in a year. 1.33 - 1.3325 (200 DMA, 38.2% retracement of the January - May downswing) will be the first real test and then 1.3450 - 1.35 (September 2015 high, 00's). 1.31 - 1.3150 shall now hold as a support.

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al_dcdemo 30 July

UPDATE 8: One could argue that the FOMC missed a perfect window to hike the federal funds rate. Brexit disruption proved to be minuscule, labour market bounced, inflation expectations recovered, data improved recently and stocks are trading at or near all time highs. Advance GDP came in much weaker than expected on Friday but will likely be revised towards 2.5% in the following two revisions. It seems that "gradually and cautiously" means one 0.25% hike per year at the most. That means no hike in September with December a much more probable date.

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al_dcdemo 31 July

UPDATE 9: Currencies staged an impressive reversal against the U.S. dollar last week after a combo of dovish Fed and much weaker than expected Advance GDP print. The yen was the biggest beneficiary as it gained about 400 pips on the week, helped by a lack of stimulus actions from the BOJ. Commodity currencies rallied with the New Zealand dollar a star performer and the Canadian dollar a bit of a laggard. The euro and the franc also rallied strongly with the pound quite behind but still well in the green. Price action points to further losses for the dollar in the week ahead.

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Loonie may retest 1.30 in the days ahead

al_dcdemo Updated 13 June  in #Trader's blog #Support #Resistance #Oil #USD/CAD #Labour Market Report #D1 Chart
It may be too early to say but it seems like toppy action in oil may lead to a period of consolidation or a deeper correction. Inability of the Canadian dollar to rally on much better than expected labour market report is also telling.
The pair found support at the 38.2% retracement of the 2011 - 2016 rally last week and posted a reversal pattern on Friday. The immediate resistance is 1.28 (2015 support/resistance line) before 1.2870 (50 DMA) and 1.30.
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