Daily Technical Analysis

Forex Market Analysis – GBPUSDU D1 HIDEN BEARISH DIVERGEN

Forex Market Analysis – GBPUSDU D1 HIDEN BEARISH DIVERGEN

GU D1 Hiden bearish divergence (LHHH) we see there’s a pattern Regular Low bearish Divergent (black line). Then proceed with the Hiden bearish Divergent (blue line). we believe to be bearish towards the point fibo 78.6% or 100% considering this second diverging including strong diverging.

Our forecast is reinforced by: a. RVI pointing down b. Doji formed long tail at the point fibo 500th as the dot-resistant Regular bearish Divergent Low identified based on 2 criteria: a. Candle lower first peak of the 2d. This formula is called High from High (HH) b. oscillator indicator (in this case RVI / Relative Vigor Index) shows a second peak in parallel.

It’s called Double top formula (DT). Hiden bearish Divergent identified by 2 criteria: a. first Candle higher peaks than 2d. This formula is called Low from High (LH) b. oscillator indicator (in this case RVI / Relative Vigor Index) shows the primary peak is higher than the 2d. this is called formula High from High (HH). so the combination of both of these criteria we call HHDT for diverging 1st and for the second diverging called LHHH.

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In Other View Point – High risk / reward trade

Fading the correction of the down trend. Huge risk to reward. 11 – 1 . Risking $100 to win 1100 is good risk management. I might get stopped out, but i only need a few of theese to win som serious money.

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Mohammad Riad

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  • GBP/USD Fundamental Analysis: November 30, 2016

    The U.S dollar has softened since Monday while the pound also endures weakness since the week starts as it edged lower because of the end-of-month flows and due to the EU membership payments plus other driving factors.

    Yesterday, the sterling established further strengthening and rebounded towards 1.2400 region and reached beyond 1.2540 level before the cable pair settled down from the 1.2500 area and this increase would be better as the weakening of the dollar continues.

    The instability of the greenbacks is felt globally though other currencies remains exempted dollar’s softening. The sluggish stance is not a result of weak services data or any fundamentals but more about the market’s weariness regarding the new president of the United States who has the habit of expressing his thoughts whenever he wants to. This way the markets are uncertain about what he’s going to declare any moment.

    Furthermore, we are looking forward bank stress test results from the UK. In case that the bank has favorable result we expect for additional strength for the pound which would put the GBP/USD as far as the 1.2500 region. We also await for the ADP Employment data and if the result is less than the expected, the greens will suffer another round of reduction because this report is the main indicator for the NFP on Friday.

  • GBP/USD Fundamental Analysis: December 6, 2016

    The pound remains strong brought by the recent surge that conversely weakened the U.S. dollar. Traders attempting to reach between the 1.27 and 1.2750 range in today’s session. This gives a positive outlook for the pair with U.S. yields declining and greenback remaining weak.
    The published results of the Services PMI gave high numbers at 54.2, even more than the expected value of 55.2. This indicates the continuous growth of Britain’s economy despite leaving the European Union. Concerns regarding Brexit especially the negotiations about Article 50 is still pending on what will E.U. gain from U.K. and what will those Euro leaders offer in return. Britain sees the free market access will continue while Euro leaders are careful with the negotiations as it might be taken advantage by other countries. Once the data will be released since negotiations then the U.K. economy can be finalized.

    There is no major news to be published from U.K. then, the current price trend will continue. Traders could move the rate towards the 1.2800 level if the greenback continues to depreciate. It is quite difficult to reach the 1.30 mark with the downtrend being strong. If the rebound ends, the price could further go down.

  • GBP/USD Fundamental Analysis: December 7, 2016

    The GBP/USD pair mostly consolidated and ranged on both sides of 1.2700 points since there was no major economic news release from the UK which could compel the pair to move, and this is why the currency pair had a muted session yesterday. However, since the Federal Reserve’s meeting is expected to induce volatility in the financial market, especially since the Fed is expected to announce its much-anticipated rate hike in this particular meeting. Market players are also expecting to receive hints with regards to the central bank’s future rate hikes in order to determine the USD’s direction in the short run. However, if the meeting fails to give out hints with regards to the bank’s future moves, then this could induce a weakness in the US dollar.

    Meanwhile, the UK is currently bearing the brunt of the Brexit process, which is expected to last for a couple of years since this will most likely involve heated discussions with leaders from all over the eurozone in order to send out a warning to other EU countries wanting to go in the same direction as the UK.

    For today’s trading session, the UK Manufacturing Production data is set to be released during the European session, and market players are expecting the data to come out as positive. If the data does come out as highly positive, then traders can expect the pair to hit 1.2800 points. Otherwise, the pair could continue consolidating on both sides of the 1.2700 region.

  • GBP/USD Fundamental Analysis: December 9, 2016

    The GBP/USD pair consolidated poorly during yesterday’s trading session after the sterling pound was adversely affected by the recent sharp drop in the value of the euro. The previous trading session initially started on a positive note for the GBP after it managed to regain some of its previous losses, causing the currency pair to hit 1.2700 points during the Tokyo and European trading session. However, the release of the ECB announcement caused the euro to incur massive losses, with the EUR/GBP pair experiencing devaluation. This then triggered the GBP/USD to retreat from 1.2700 and is currently hovering at the 1.2600 region.

    The GBP/USD is expected to consolidate further with a somewhat bearish note as the euro tries to recover from this very significant loss of value. The Federal Reserve will be meeting at the start of next week, and the market currently has rate hike expectations of up to 0.25%. The dollar is then expected to exhibit weakness once the announcement from the Fed is released, and market liquidity is also expected to be relatively low during this particular period.

    For today’s trading session, there are no major economic news releases from the UK, and the GBP/USD would most likely consolidate further along with a bearish stance and will be subject to added downward pressure due to the recent weakness in the value of the EUR.

  • GBP/USD Fundamental Analysis: December 12, 2016

    The GBP/USD pair had a lackluster performance during the entirety of last week’s trading sessions since the sterling pound experienced constant pressure from the much stronger euro. The EUR plummeted last week after the ECB announced its plans to extend its quantitative easing program, and the EUR/GBP lost a significant amount of its value, causing the sterling pound to be affected as well. Prior to this sudden drop in value, the GBP has previously exhibited remarkable resiliency in spite of the confusion caused by the Brexit process. The GBP rose during the first part of last week and was even able to go through 1.2700 points before eventually reaching 1.2800 points before the announcement from the ECB dragged the GBP down.

    The GBP was also subject to added pressure due to delays in the implementation of the Brexit strategies as the Parliament is in the middle of heated debates regarding the implementation of Article 50 on the region. Since the timeline for the Brexit remains uncertain in spite of numerous meetings and debates within the Parliament, the sterling pound is expected to remain under pressure and any form of reversion should be immediately seen as a sell-off opportunity for the currency pair.

    For this week, the market is expecting the release of the CPI data as well as the Claimant count change data from the from the UK. The Bank of England is also expected to make a statement on whether the central bank would be maintaining its current interest rate of 0.25%, and the Fed is also scheduled to make an announcement regarding its interest rate hike, as well as a statement on whether the central bank will be adding up the frequency of its rate hikes next year. Due to the large number of economic data scheduled to be released this week, the market is expected to undergo an especially high level of volatility within the week.

  • GBP/USD Technical Analysis: December 12, 2016

    The Goods Trade Balance and Total Trade Balance established an optimistic data on Friday along with the strengthening of the sterling pound. The British currency procured some ground during the earlier trading session on Friday. Buyers drove the prices towards a higher position and tested the 1.2600 level amid the European session. The upward impetus short-lived consequent to the test, following the GBP’s rollback below the level. As indicated in the 4-hour chart, the cable pair rebounded through the 50-EMA. Moving averages uphold its bullish bias.

    Resistance lies in the 1.2600 are, the support sits at the 1.2500 region. The MACD histogram pierced through the negative range. When the MACD stayed in the negative zone, sellers will obtain more strength. The RSI is within the neutral territory.

    The GBPUSD is expected to weaken upon the break below the 1.2600 level. Likewise, this could lead the prices towards 1.2500.

  • GBP/USD Fundamental Analysis: December 13, 2016

    The GBP traded on a more positive note during Tuesday’s trading session due to the release of the UK inflation data, which came out better than the initial market expectations. The GBP/USD rose in value and was able to reach 1.2723 points before settling at 1.2710 points after increasing by +0.31% or 0.0040 points.

    The inflation data from the UK exhibited a 1.2% increase last November, going well above the market expectation of 1.1%. The report also showed that the main catalysts for inflation in the region were culture, recreation, and clothing. The Core CPI data came in at 1.4%, again exceeding expectations of a 1.3% data release. Due to the positive economic data from the region, analysts are now saying that UK inflation could possibly reach the initial 2% goal during the first few months of 2017. However, this improvement might not be able to have much of an impact to the Bank of England’s impending decision-making this coming Thursday with regards to its adjustments in interest rates. BoE governor Mark Carney has also previously stated that the central bank would be willing to endure inflation overshoots if this would mean an increased economic support.

    Wednesday’s trading session is expected to be somewhat light and muted as the Fed meeting looms close. However, since the GBP/USD had mostly positive reactions with regards to the shadow of the expected Fed rate hike, the present inflation data from the UK should be able to underpin the currency pair.

  • GBP/USD Technical Analysis: December 19, 2016

    The decision of the BoE to remain a constant rates did not surprise the market at all, seeing the rates to exist at 0.25%. The British currency was able to gain strength in spite of the reverse movement of its American counterpart subsequent to rally that took place on Friday.
    Moreover, the sterling had a stronger stance as it bounced off its losses during the trades on Friday. The current rebound are considered as bear’s activity in selling its stock in order to gain despite of the sharp rise last week. Recovery seems weak and even there is a dollar retracement, the greens established a solid position generally.

    The 4-hour chart showed that the price tested the 200-EMA, while the 50-EMA headed towards a lower level, both 100 and 200- day moving averages sustained a bullish pattern. Resistance is seen at the 1.2500 region, support is at the 1.2400 level. The MACD histogram increased which means a weak position for the sellers. RSI stayed in the oversold levels.

    It is best to go short within the 1.2400 handle as its first target. In case that a price consolidation arise below the first target, it is expected that the GBP/USD will moved in the 1.2300 mark. However, a break on top of the 1.25 handle would weaken the U.S dollar. The pound have the tendency to expand its recovery through 1.2550.

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