AUD/USD Down

The Australian Dollar has shown high volatility against the US Dollar on Tuesday. During this period, the pair breached the lower boundary of a medium term triangle. A strong bearish sentiment took over the AUD/USD pair on Tuesday due to the US fundamental event.

As the new Fed Chair testimony's text was released, the US dollar began to gain strength against the rest of the players in the financial market. However, the decline for the Aussie was stopped by the weekly support at 0.7778.

Regarding the near future, the exchange rate is likely to regain some of its lost points during the following trading sessions. No major news are scheduled for the pair so we could expect technical trading until the end of the week.

Chart: AUD/USD H4

NZD/USD Downturn Continues

Downside momentum continues to push the Kiwi lower against the US Dollar. The pair has lost almost all gains it accumulated during the past two days.

After reaching the 61.80% Fibonacci retracement level, the currency pair took a dive south and moved past the monthly pivot point at 0.7293. The bearish sentiment might be in play for today's trading session. However, the fall might be stopped by the weekly S1 at 0.7243 where the lower boundary of a channel down is located.

0.7150 is seen as a short-term bear target, while the bull target remains the double top at 0.7433.

Chart: NZD/USD H4

Gold Reaches $1,340

The yellow metal was consolidating in a narrow range against the US Dollar on Friday, as neither bulls nor bears could overcome the 55– and 100-hour SMAs that bounded at the time. A change in sentiment occurred early today when the US Dollar weakened against major currencies.

Gold was not an exception, thus allowing the pair to appreciate a bit up to the 200-hour SMA circa 1,340.00. It is likely that the pair tries to edge higher towards its upper boundary or the weekly resistance near 1,345.00.

However, this scenario would occur if price breached the combined resistance of the 200-hour SMA and the monthly PP at 1,338.50. In terms of support, Gold is expected to gravitate around 1,330.00.

Chart: XAU/USD H4

Gold Consolidates Around $1,330

Following a test of the weekly support at 1,320.70, bulls took over the market and managed to push the yellow metal 0.8% higher within a couple of hours. The pair, however, stopped short of the expected daily high of 1.338.00, as the Asian session introduced some minor downward pressure.

By early Friday, Gold was testing the support of the 55-hour SMA circa 1,326.00. Even though technical indicators flash bullish signals in this session, the pair might fail to breach the massive resistance cluster formed by the 100– and 200-hour SMAs, the 23.60% Fibo and the monthly PP.

Thus, 1,340.00 might be the daily high for today. In terms of support, the rate could halt near the weekly support at 1,320.00 and spend the day fluctuating between this level and the above 1,340.00 area.

Chart: XAU/USD H4

EUR/USD Breaks Short Term Channel

The Euro was trading with low volatility during the first part of ytesterday. Higher volatility was introduced later in the evening when the FOMC released its meeting minutes. The Fed praised the strength of economic growth, while expressing concerns over missed inflation targets.

This statement resulted in an immediate upward pressure on the pair, which was soon overrun by the stronger Greenback. As a result, the session ended with a 56 pip decline in price. Given that the prevailing senior channel was breached mid-session, traders might see a decline in the medium term.

However, in terms of the following session, the Euro is expected to bounce off the short term channel and visit the level of 1.2240 to begin a brief period of recovery. Upside target on the short-term - the 1.2350/1.2400 area.

Chart: EUR/USD H4

Gold Moves Lower

Wednesday's morning session was spent calmly, as the pair was fluctuating between $1,330 and $1,325. This still movement was a result of a change in the day when a strong hourly plunge allowed for a breakout of the 200-hour SMA circa 1,335.00.

Gold has since edged slightly lower; however, it did remain within the bounds of a narrow short-term channel down. Given that technical indicators are still located in the oversold region, a bullish recovery is still expected to occur in the nearest time.

The pair should gain some pips during the following hours; however, the 1,335.00/1,340.00 area is likely to restrict further advance. In terms of support, the yellow metal should not exceed the weekly S1 at 1,320.00. The market might also be steady prior to FOMC meeting minutes published at 1900GMT.

Chart: XAU/USD H4

USD/JPY Going Up

The US Dollar continues to gain value against its Japanese counterpart for the third consecutive session. The pair breached the 55– and 100-hour moving averages and the upper boundary of a two-week descending channel during the previous 24 hours, thus adding to the overall bullish sentiment.

Given that the pair is moving neatly towards the senior channel, the 108.00 area could be reached later in the week. However, the current steepness is unlikely to hold, as technical indicators point to a possible bearish correction.

This fall is expected to be brief, as the southern side is supported by the 100– and 55-hour SMAs circa 106.40. Meanwhile, bullish gains should be capped near the 107.50 mark where the long-term moving average is located.

Chart: USD/JPY H4

Gold Consolidates

The yellow metal has remained stable against the US Dollar during the following two weeks. Along the way, the price did manage to reach a new 2017/2018 high at 1,360.00. The price has since edged slightly lower and breached the 55-hour SMA.

Technical indicators demonstrate that some slight downside potential still exists in the market. But given that the pair is facing a strong support of the 100-hour SMA and the weekly and monthly PPs, losses should not exceed 1,338.10.

From the upside, Gold is restricted by the 55-hour SMA circa 1,355.00. Banks in the US are closed today; thus, the market is unlikely to introduce significant changes to the pair's positioning. The rate might even consolidate and remain between the 55– and 100-hour SMAs. If bulls are to prevail, gains could be capped at 1,360.00.

Chart: XAU/USD H4

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EUR/USD Stagnant

The EUR/USD is showing almost no sings of activity as low volumes and low volatility are leading the pair into sideways trading. The pair is gravitating towards a range of 1.23 to 1.22 as stock markets around the globe remain uncertain.

The pair is poised for a big move if the US stock market continues its decline to new lows. First bear target for EUR/USD is seen at 1.2050. Second target would be met at 1.19 and major bear target is seen at 1.14.

On the flipside, if we see a renewed optimism in the US stock market, the US dollar will follow suit and make new high against its peers. First bull target is seen at 1.25 and above that we could be in for many surprises.

Chart: EUR/USD H4

Yen Rallies For a Brief Period of Time

The Yen is considered as the safe haven currency if something in the US or EU goes haywire. With the looming US stock market decline investors are searching for a safe haven. As Gold turned out to be not so much of a safe haven during this dip, market participants fled to the Japanese Yen in search of safety.

The Yen registered a few sharp rises against the dollar in the past two weeks. USD/JPY went from 110.48 in early Feb to a low of 108.44 just a few days after. Then the US market appeared to be stabilizing and the USD/JPY appreciated to 109.77 as investors started buying US dollars.

A new low followed this time at 108.05. Now the Yen appears to be caught somewhere in between as it's trading at 108.67. If the US stock market remains uncertain, as it will mostly be, the Yen could see new highs against major competitors.

On the other hand, current market price is a good entry level for a long position with a tight stop somewhere around latest low.

Chart: USD/JPY H4

Gold Loses Ground Along With Indexes

All major indexes in the US, European Union and Asia had a tough week last week as we saw massive selling all over the globe. Gold was not exempt from the depreciation in the macro field as it lost some bits of its shine.

The precious metal went from a high of $1,366 in the end of January to a low of $1,307 on Feb 8. Currently, Gold is trading at $1,321 with low volumes and low volatility. The price appears to have stabilized in the range of $1,325 to $1,310. 

We need to see a break above that range in order to rule out a prospect direction. Almost no news are scheduled for the week except the US Retail Sales on Wednesday and the US PPI on Thursday. Light on events, the weeks appears to be more technical than fundamental.

Technically, Gold could try and ready previous highs around $1,360. Below $1,305 we could expect $1,250 as major bear target.

Chart: XAU/USD H4

S&P At Support

The S&P index posted a new loss on Friday marking the worst week since the financial crisis in 2008. The index went from a high of 2870 to a low of 2531 on Friday evening. The price however was stopped in the low of October last year when the index was on a steady rise.

The price formed a double bottom at the lowest point thus stimulating investors to buy at the support level and immediately the index went up to a close of 2650.

With the opening of trading investors are expected to create heavy volatility in both directions. Experts advice that the correction is not over yet as we are still waiting for the big drop to happen.

This correction can take as much as a couple of weeks more or even a year. The truth is no one really knows.

Chart: S&P500, H4

Will The US Stock Market Decline Continue?

The Dow Jones has lost some 4% from its highest point since Friday going from 26700 to a low of 23500. Point wise we saw the worst decline in four years. Currently, the index seems to have recovered quite a bit to a current market price of 24737.

According to prominent money managers such as Carl Icahn and Paul Tudor Jones, the market is still majorly overvalued and the sell off could suddenly turn violent. With the rising job reports and low interest rates, the Fed may be forced to move aggressively and hike at least three times this year.

This prognosis caused fear and doubt in investors who caused the initial sell off on Friday immediately after the NFP and jobs report.

One thing is certain, with volatility picking up we could be in a field of dreams in 2018 with good opportunities in stocks, currencies and commodities (cryptocurrency as well.).

 Chart: US30, H4

Silver Down

Silver is trading to the downside after upbeat US data on Friday. The US jobs report stated 200K new jobs created which sent the precious metals South. Currently, Silver is trading at 16.28 from latest high of 17.70.

The main trend on the short term is bearish as we are in the what could turn out to be an awakening to a US stock market depreciation. Although we are still at the initial stages, many experts consider this to be the beginning of the financial earthquake.

Silver and Gold have been regarded as a safe haven for centuries now and this time it will not be different. In case of a deepening of the US stock market downturn we could see a quick run to precious metals as an investors' attempt to hedge against a potential recession in the US stock market.

Chart: XAG/USD H4

CFTC and SEC Met To Discuss Cryptocurrency

Yesterday the CFTC and the SEC met in order to discuss the future of cryptocurrency. The meeting was held in a way that was positive for the future of cryptocurrencies. Here are some major points that were made during the hearing held by CFTC Chairman J. Christopher Giancarlo and SEC Chairman Jay Clayton.

The CFTC and the SEC are looking forward to the development of cryptocurrency and the underlying tech, the blockchain. They are optimistic about the opportunity to support projects for the benefit of society New investing opportunity for the people who want to support a new industry.

The regulators promised to work up ways that will enable them to monitor the field for scam ICOs. The sentiment was predominantly positive and the effect on the whole cryptocurrency market was very good. The market cap went up in value with more than 80B, while most of the coins are showing a double digit percentage growth for the past 24h.

Highlight of the hearing: CFTC Chairman Giancarlo went on to explain what HODL is.

EUR/AUD Moving Up

The EUR/AUD monthly timeframe chart showed a break out to the upside in the later part of 2017.

We have highlighted the monthly candle close of January 2018, which shows a strong month of buying pressure. You can see price came down to around the 1.51630 area and then pushed back bullish closing above the open price.

Price has been stuck within a choppy area since 2014. It could be that 2018 is the year that price within EUR/AUD shows some nice trending activity. Currently price is showing further upside movement. A further bullish candle close for February above the 1.55100 resistance, would be a strong signal for further bullish movement.

If the uptrend continues this year, we may see price reach as high as 1.80. Otherwise, on the downturn, price could try and reach levels around 1.15.

Chart: EUR/AUD M1

Gold Major Resistance

There are only twelve monthly candle closes a year and they are important to take note of. The monthly timeframe is the timeframe that market experts start their top down analysis from. The higher the timeframe, the more revealing the chart is.

The chart is Gold XAU/USD monthly timeframe - from the monthly timeframe we are able to see that price is trapped between an ascending trendline and the 1350.00 resistance area.

Back in 2014 we saw price break to the downside of the 1350.00 area and the EMA's crossed to the downside. Price is now back at this area and our EMA's have just crossed bullish.

January's candle has closed bullish just below the 1350.00 resistance. This is the 3rd time since 2016. A break and a monthly close above the 1350.00 resistance area within 2018 would show the potential of a bull run for gold.

Chart: XAU/USD M1

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