LiteForex analitics. XAG/USD: the price is under pressure

Current trend

Yesterday, silver prices declined slightly, renewing a local minimum since August 16. On Monday, the US markets were closed due to the national holiday, so investors fully concentrated on the European and Asian releases.

Monday’s August EU Manufacturing PMI release remained at the same level of 54.6 points. The corresponding German index fell from 56.1 to 55.9 points. The Japanese indicator remained at the same level of 52.5 points, but the Chinese PMI Caixin in August fell from 50.8 to 50.6 points.

Support and resistance

On the daily chart, Bollinger bands unfold horizontally. The price range is expanding but still remains uncomfortable for the development of downward trend dynamics. MACD indicator decreases, keeping a weak sell signal (the histogram is below the signal line). Stochastic, approaching its lows, reversed horizontally, reflecting the risks of the corrective silver growth in the short and/or ultra-short term.

It is better to wait until the signals are clear and keep current short positions in the short term for some time.

Resistance levels: 14.48, 14.60, 14.79, 14.89, 15.00.
Support levels: 14.40, 14.24, 14.17.

Trading tips

Long positions can be opened after the rebound from the level of 14.40 and breakout of the levels of 14.48–14.50 with the targets at 14.70–14.79 and stop loss 14.35.
Short positions can be opened after the breakdown of the level of 14.40 with the targets at 14.24 or 14.17–14.10 and stop loss 14.45–14.55.

Implementation period: 2–3 days.

LiteForex analitics. EUR/USD: the euro is strengthening

Current trend

EUR showed moderate growth against USD on Wednesday, departing from local lows, updated the day before.

However, the instrument traded mainly with a decrease in the morning. Euro was under pressure by poor economic statistics. In July, EU Retail Sales declined by 0.2% MoM, and grew only by 1.1% YoY (1.3% growth was expected). August EU Services PMI remained at the same level of 54.4 points, and in Germany it fell from 55.2 to 55.0 points over the same period. Investors are focused on the US-Canada negotiations on NAFTA and are waiting for the introduction of new US duties on Chinese goods worth USD 200B.

Today, the pair is trading in both directions, waiting for the appearance of new drivers at the market. The focus will be on the ADP Employment Change report, as well as a block of statistics on Markit Services PMI.

Support and resistance

Bollinger Bands in D1 chart show moderate growth. The price range is narrowing, reflecting ambiguous dynamics of trading in the short term. MACD is reversing upwards preserving a sell signal (located below the signal line). Stochastic is growing, having showed a rebound from the level "20", which can be called a formal margin of oversoldness of EUR.

One should keep existing long positions in the short and ultra-short term.

Resistance levels: 1.1657, 1.1718, 1.1749.
Support levels: 1.1621, 1.1573, 1.1526, 1.1500.

Trading tips

To open long positions one can rely on the breakout of 1.1657 while maintaining "bullish" signals from technical indicators. Take profit — 1.1749 or 1.1780. Stop loss — 1.1610 or 1.1600.

The rebound from 1.1657 as from resistance with the subsequent breakdown of 1.1621 can become a signal to further sales with target at 1.1526 or 1.1500. Stop loss — 1.1670 or 1.1680.

Implementation period: 2-3 days.

LiteForex analitics. USD/CAD: general analysis

Current trend

On Friday, USD strengthened against CAD due to the growth of Nonfarm Payrolls data by 201 thousand, which was higher than the forecast of 191 thousand. The published report dispelled almost all doubts about the rate increase this month. August US average hourly earnings increased by 0.4% MoM and by 2.9% YoY, supporting USD.

Cad is under pressure of August’s growth of unemployment to 6.0% against the forecast of 5.9% and the decrease of employment by 51.6K against the forecast of an increase by 5.0K.

Support and resistance

On the 4-hour chart, the instrument was corrected to the midline of Bollinger bands, the price range narrowed. MACD histogram is in the positive area, preserving the signal to open long positions.

Resistance levels: 1.3207, 1.3225, 1.3286, 1.3382.
Support levels: 1.3158, 1.3127, 1.3102, 1.3043, 1.3006, 1.2935, 1.2886.

Trading tips

Long positions can be opened from the current level with the target at 1.3225 and stop loss 1.3130.
Short positions can be opened from the level of 1.3120 with the target at 1.3050 and stop loss 1.3158.

Implementation period: 1–3 days.

LiteForex analitics. AUD/USD: general review

Current trend

Having reached two-year lows at the end of last week, the instrument moved to growth and is currently trading near the psychological level of 0.7200.

Despite the low level of consumer confidence in Australia, AUD strengthened after the US offered to begin a new round of negotiations on trade tariffs with the PRC.

In addition, USD was under pressure from yesterday’s negative data on US inflation. In August, the Consumer Price Index fell from 2.9% YoY to 2.7% YoY (minimum since April), and the Base Consumer Price Index rose from 2.4% to 2.2% (the worst indicator since May). Market participants feared that poor inflation data, along with pressure from President Trump's administration and trade tensions, could force FOMC members to hold only one interest rate increase instead of the two planned ones.

Today, the publication of data on retail sales in the US is expected at 14:30 (GMT+2), as well as the data on industrial production (15:15 (GMT+2)).

Support and resistance

On the H4 chart, the instrument is traded in the upper part of Bollinger Bands, trying to consolidate above the psychological level of 0.7200. The indicator is directed upwards and the price range has widened, which indicates the continuation of the uptrend. MACD histogram is in the positive zone, keeping a strong buy signal. Stochastic does not give clear signal for entering the market.

Resistance levels: 0.7234, 0.7266, 0.7308, 0.7345, 0.7987.
Support levels: 0.7195, 0.7146, 0.7110, 0.7076.

Trading tips

Long positions may be opened from the current level with target at 0.7250 and stop loss at 0.7180. Implementation period: 1 day.

Short positions could be opened below 0.7175 with targets at 0.7105, 0.7075 and stop loss at 0.7205. Implementation period: 1-2 days.

LiteForex analitics. Brent Crude Oil: general review

Current trend

This week, Brent Crude oil shows ambiguous dynamics.

The pressure was exerted by the decision of US President Donald Trump on the introduction of 10% of duties on Chinese goods totaling USD 200 billion from September 24 (from January 1, tariffs may increase to 25%). The expansion of production in the US also influence quotes negatively: according to the Baker Hughes, the number of active oil rigs increased from 860 to 867 units. According to the EIA report, in October, production at seven largest shale deposits in the United States will reach 7.6 million barrels per day. Today, the instrument rose sharply to 78.80 after the Bloomberg publication, which states that Saudi Arabia considers prices above USD 80 per barrel to be "quite acceptable". This means that in the short term the country will not try to compensate the supply shortage.

Today, investors are waiting for the weekly API report on the US crude oil reserves. If the trend to reduction continues (the last time the volume of oil reserves fell by 8.636 million barrels), then quotes can get additional support.

Support and resistance

Now the price has risen above 78.12 (Murrey [6/8]) and can go up to the area of 79.68 (Murrey [7/8]) and 80.00. Reverse consolidation of the instrument below 78.12 may lead to a correction to 76.56 (Murrey [5/8]) and 75.00 (Murrey [4/8]).

Technical indicators show decline: Stochastic has reversed downwards, and MACD histogram is reducing in the positive zone.

Support levels: 78.12, 76.56, 75.00.
Resistance levels: 79.68, 80.00, 81.25.

Trading tips

Sell positions may be opened below 78.12 with the target at 76.56 and stop loss at 78.60.
Buy positions may be opened from 78.90 with targets at 79.68, 80.00 and stop loss at 78.40.

Implementation time: 3-5 days.

LiteForex analitics. YM: general analysis

Current trend

The Dow Jones index has been growing for the third trading session in a row. The price has updated the historical maximum at the level of 26703.1 after the news on the introduction of 10% of trade taxes on Chinese goods, although before that the US president had spoken about the value of 25%. The second positive factor was macroeconomic statistics. Initial Jobless Claims continue to be low, which indicates a strong economic growth in the country.

Today, Markit PMI statistic will be published. Next week, the Fed will hold a meeting. Many market participants expect that the interest rate will be increased by 25 basis points. Thus, USD will most likely begin to strengthen, and a correction in the stock market is possible.

Support and resistance

Stochastic is around 98 points and reflects a possibility of a correction.
Resistance levels: 26953.1, 27343.8.
Support levels: 26646.8, 26562.5.

Trading tips

Short positions can be opened after the breakdown of the level of 26646.8 with the target at 26562.5 and stop loss 26724.0.

LiteForex analitics. WTI Crude Oil: the prices rise

Current trend

Yesterday, oil prices increased significantly, renewing the highs since July 11.

The instrument is supported by the results of the meeting of OPEC and partner countries in Algeria. Contrary to market expectations, the cartel did not decide to increase oil production to compensate for the supply deficit that could follow after the introduction of US sanctions against Iran. Moreover, next year OPEC predicts a serious decline in oil prices, and in this case, production may fall again. Now the market is waiting for a new meeting of the cartel and partner countries, which will take place in Abu Dhabi in December. By this time, the scale of the supply deficit after leaving the Iranian market will become clear, and decisions can be made on its compensation.

On Tuesday, investors will focus on API Weekly Crude Oil Stock release. EIA Crude Oil Stocks change will be published on Wednesday.

Support and resistance

On the daily chart, Bollinger bands are growing steadily. The price range is actively expanding, but not as fast as the "bullish" dynamic develops. MACD indicator is growing, keeping a strong buy signal (the histogram is above the signal line). Stochastic is directed upwards but is approaching its highs, which indicates that the instrument is overbought in the short term.

It is better to keep current long positions until the situation becomes clear.

Resistance levels: 72.49, 73.00, 73.74.
Support levels: 71.80, 71.00, 70.00, 69.07, 68.60.

Trading tips

Long positions can be opened after the breakout of the level of 72.49 or 73.00 with the target at 73.74 or 74.30 and stop loss 72.30–72.00. Implementation period: 1–2 days.

Short positions can be opened after the downwards reversal of the price reverses near the current levels with the target at 70.00 and stop loss 72.50. Implementation period: 2–3 days.

LiteForex analitics. USD/CAD: general review

Current trend

Despite the strength of the US currency in late summer and early autumn, the Canadian dollar is dominating the pair for three months.

One should note a wide range of movement of the instrument, which indicates an ambiguous situation between two currencies. The “Canadian” received the main impulse for growth after the increase in the key rate in July, after which it only grew against all the main competitors. The policy of the Bank of Canada is aimed at further raising of the rates, which will help to keep inflation at the target level. The next meeting of the regulator is scheduled for the end of October. At the end of September, the pair moved upwards, but after reaching the key resistance level of 1.3060, which was the upper border of the descending range, sharply headed down due to the release of strong data on the economic growth of Canada in July. This impulse still controls the movement of the instrument: in less than two days, the pair has gone through almost 300 points.

At the end of the week, major releases will be published, namely, data on the US and Canadian labor markets, including Nonfarm Payrolls in the United States.

Support and resistance

In the short term, the current momentum may extend to 1.2745, the first strong support level. In the future, a correctional movement up to the levels of 1.2825, 1.2860, 1.1285 is expected. In the medium term, the downward trend will continue, as confirmed by all technical indicators: MACD shows a sharp decrease in the volume of long positions, Bollinger Bands reversed down; on W1 chart, the pair broke the lower border of the long-term uptrend and the Kijun Sen, Tenkan Sen lines of the Ichimoku indicator from the top down.

Support levels: 1.2780, 1.2745, 1.2700, 1.2640, 1.2585, 1.2555, 1.2530.
Resistance levels: 1.2825, 1.2860, 1.2885, 1.2910, 1.2975, 1.3000, 1.3060.

Trading tips

Deferred short positions may be opened from the levels of 1.2960, 1.2910, 1.2880 with the target at 1.2550 and stop loss at 1.3110.

LiteForex analitics. XAG/USD: silver prices grow

Current trend

Yesterday, silver rose, updating the highs since August 28. The instrument was supported by rather harsh statements by the representative of the ruling party of Italy, Claudio Borghi, that most of the problems in the country could be solved by having their own currency. However, at the end of the trading session, the instrument lost most of its gains after the speech of Fed Chairman Jerome Powell, who confirmed the previous policy to a gradual tightening of monetary policy.

A large block of statistics on business activity in Europe and the United States will be published today, as well as a number of speeches by Fed representatives, such as Lael Brainard and Loretta Mester. In addition, traders are waiting for ADP Employment Change release, since on Friday there will be a September report on the US labor market.

Support and resistance

On the daily chart, Bollinger bands are growing moderately. The price range is expanding, but not as fast as the "bullish" trend develops. MACD is growing, maintaining a strong buy signal (the histogram is above the signal line), and is trying to consolidate above the zero line. Stochastic reversed horizontally, reacting to the active instrument correction.

The current readings of the indicators do not contradict the further development of the “bullish” trend in the short and/or ultra-short term.

Resistance Levels: 14.79, 14.86, 15.00.
Support levels: 14.67, 14.60, 14.51, 14.41, 14.25.

Trading tips

Long positions can be opened after the breakout of the level of 14.79 with the target at 15.00. Stop loss is 14.67. Implementation period: 1–2 days.
Short positions can be opened after the breakdown of the levels of 14.67 or 14.60 with the targets at 14.41–14.35. Stop loss is 14.70–14.80. Implementation period: 2–3 days.

LiteForex analitics. EUR/USD: transition to the lateral trend

Current trend

The euro continues to decline against the dollar within the broad long-term trend.

Over the past two weeks, the instrument has lost more than 350 points, breaking strong support levels of 1.1515, 1.1500 on its way. Now the pair has fixed within the lateral consolidation after a serious decline and in anticipation of the release of key releases on the US labor market.

Today, data on unemployment and Nonfarm Payrolls will be published. The unemployment will possibly decline, while at the same time, consensus forecasts indicate a reduction in the number of people employed in non-agricultural sectors of the economy.

Support and resistance

Most likely, one will see an increase in volatility after releases but there will be no significant change in the rate. In the medium term, the pair will descend to the levels of 1.1430, 1.1400, after which the rising wave will be formed with targets at 1.1600, 1.1665.

Technical indicators show the possibility of moving to broad lateral consolidation. MACD indicates a decrease in volumes on D1 chart, and the signal line is approaching zero one; Bollinger Bands on D1 and W1 charts are directed horizontally.

Support levels: 1.1500, 1.1430, 1.1400, 1.1370, 1.1300, 1.1250, 1.1210, 1.1170.
Resistance levels: 1.1515, 1.1550, 1.1575, 1.1600, 1.1665, 1.1690, 1.1715, 1.1730.

Trading tips

In this situation, short positions may be opened from the current level with the target at 1.1370; pending short positions may be opened from 1.1550, 1.1600, 1.1665 with the target at 1.1370 and stop loss at 1.1700, 1.1760.

LiteForex analitics. XAG/USD: technical analysis

XAG/USD, D1

On the daily chart, the instrument is trading on the middle MA of the Bollinger Bands. The price remains below its moving averages that are directed down. The RSI is falling, having formed a “double top” reverse pattern. The Composite is testing its longer MA, having formed a Bearish divergence with the price.

XAG/USD, H4

On the 4-hour chart, the instrument is trading in the lower Bollinger band. The price remains on the level with its moving averages that are horizontal. The RSI is growing towards its longer MA. The Composite is breaking out its longer MA.

Key levels

Support levels: 14.25 (local lows), 13.95 (local lows), 13.72 (January 2016 lows).
Resistance levels: 14.77 (local highs), 14.95 (local highs), 15.24 (local highs).

Trading tips

After a short-term correction the fall can continue.
Short positions can be opened from the level of 14.25 with targets at 13.95, 13.72 and stop-loss at 14.38. Validity – 3-5 days.
Long positions can be opened from the level of 14.95 with the target at 15.24 and stop-loss at 14.77. Validity – 3-5 days.

LiteForex analitics. EUR/USD: the pair is growing

Current trend

Yesterday, the EUR/USD pair rose within the correction after the “bearish” start of the week, which led to a renewal of the lows since August 20. EUR was supported by USD correction due to a decline in the 10-year government bonds’ yield. Data on Industrial Production from France and Italy affected the instrument positively, too. Thus, August Industrial Production in France rose by 0.3% MoM, which is noticeably worse than the dynamics of last month (0.8% MoM), but still better than analysts' forecasts (+0.1% MoM). The corresponding index in Italy rose by 1.7% MoM against a decrease of 1.6% MoM last month. Experts expected the growth only by +0.8% MoM.

This morning, the pair continues to grow. Investors are waiting for new drivers: ECB meeting report and a block of US September macroeconomic statistics on consumer inflation.

Support and resistance

On the daily chart, Bollinger bands are actively falling. The price range narrows, reflecting a sharp change in the trade direction in the short term. MACD reversed upwards, forming a buy signal (the histogram is above the signal line). Stochastic is growing, rapidly approaching its highs, which reflects that EUR will become overbought soon.

It is better to keep current long positions until the situation is clear.

Resistance Levels: 1.1580, 1.1615, 1.1657, 1.1700, 1.1732.
Support levels: 1.1547, 1.1522, 1.1500, 1.1460, 1.1430.

Trading tips

Long positions can be opened after the breakout of the level of 1.1580 with the target at 1.1657 or 1.1700. Stop loss is 1.1540.
Short positions can be opened after the rebound from the level of 1.1580 and the breakdown of the level of 1.1547 with the targets at 1.1500 or 1.1475–1.1460. Stop loss 1.1580–1.1590.

Implementation period: 2–3 days.