Trading news

The Market 08/09/2014

EUR/USD rebounds somewhat

EUR/USD rebounded somewhat on Friday, after the US employment report showed that hiring slowed in August. The pair moved slightly higher and during the early European morning Monday is trading between the 1.2917 (S1) line and the psychological barrier of 1.30000 (R1). The RSI lies within its oversold territory and could cross above its 30 line any time soon, while the MACD shows signs of bottoming and appears willing to move above its trigger line in the near future. Having that in mind, I would be cautious of further upside correction, but I will maintain my view that the overall picture remains negative. The pair is printing lower highs and lower lows below both the 50- and 200-day moving averages and a clear move below the 1.2900 (S2) support is likely to set the stage for larger downside extensions, perhaps towards the next key support zone of 1.2760 (S3), defined by the lows of March and July 2013.

• Support: 1.2917 (S1), 1.2900 (S2), 1.2760 (S3).

• Resistance: 1.3000 (R1), 1.3100 (R2), 1.3152 (R3).

USD/JPY pulls back

USD/JPY moved lower on Friday, confirming my concerns of a possible pullback. The decline was halted near the support line of 104.75 (S1), marginally above the blue short-term uptrend line. As long as the price is trading above that trend line and above both the moving averages, I consider the upside path to remain intact. However, taking into account that we have negative divergence between the price action and both our momentum indicators, I would take the sidelines until I see the studies supporting the pair. In the bigger picture, I still see a newborn long-term uptrend, since, after the exit of a triangle, the price structure remains higher highs and higher lows above both the 50- and the 200-day moving averages.

• Support: 104.75 (S1), 104.26 (S2), 103.90 (S3).

• Resistance: 105.30 (R1), 105.70 (R2), 106.00 (R3).

GBP/USD gaps down on Scotland worries

GBP/USD opened the European session with a bearish gap, as an opinion poll showed that supporters of Scotland’s independence gained a lead for the first time since the beginning of the referendum campaign. The rate opened below the key barrier of 1.6260 (support turned into resistance), something that makes me believe that we are likely to experience further downside extensions. The MACD lies below both its zero and signal lines, while the RSI lies within its oversold field, but is pointing down. This corroborates my negative view on the rate and I would expect the pair to challenge our support line of 1.6120 (S1) in the close future. In the bigger picture, as long as Cable is printing lower highs and lower lows below the 80-day exponential moving average, the moving average that supported the lows of the price action for a whole year, I consider the overall path to be to the downside.

• Support: 1.6120 (S1), 1.6000 (S2), 1.5870 (S3).

• Resistance: 1.6260 (R1), 1.6350 (R2), 1.6460 (R3).

Gold rebounds from near 1260 again.

Gold moved higher after failing to close below the 1260 (S1) line. This alongside our momentum signs is the reason I would change my view to neutral for now. The RSI just crossed above its 50 line, while the MACD lies above its signal line, pointing up. Also, I see positive divergence between the price action and both the studies. As long as the precious metal is trading within the purple downward sloping channel and below the black line drawn from back at the low of the 30th of December, I consider the downside path to remain intact, but only a clear close below the support of 1260 (S1) could confirm a forthcoming lower low and pull the trigger for another leg down.

• Support: 1260 (S1), 1250 (S2), 1240 (S3).

• Resistance: 1273 (R1), 1280 (R2), 1290 (R3).

WTI remains trendless

WTI continued declining on Friday, but the tumble was halted slightly above our support line of 92.60 (S1). As long as the price is trading between that barrier and the resistance of 96.00 (R1), I will consider the near-term path to be to the sideways and I will maintain my neutral stance. I will repeat that I would like to see a move above 96.70 (R2) to shift my attention to the upside. Such a move would confirm a forthcoming higher high and is likely to target the 98.45 (R3) barrier. On the downside, only a dip below 92.60 (S1) could signal the continuation of the prior downtrend.

• Support: 92.60 (S1), 91.60 (S2), 90.00 (S3).

• Resistance: 96.00 (R1), 96.70 (R2), 98.45 (R3) .