AUD/NZD Rises Sharply

The AUD/NZD pair rose sharply in the early pre-opening European hours as New Zealand shunned the incumbent National Party in favor of a coalition government with the Labour Party. This rose fears over central bank policy and long term growth.

The New Zealand dollar is down against all other currencies. NZD/USD is down 1.8%, NZD/CHF is down 2.35%, NZD/JPY also above 2% down.

AUD/NZD is trading some 250 pips higher today, rising with 2.31%. The initial reaction is still not over as the pair is still getting sold all over the market. However, the volumes have been decreasing which indicates that the selling wave is coming to an end. A corrective wave might be expected that will bring some stabilizing to the New Zealand dollar.

Chart: AUD/NZD H4

EUR/USD Ahead of Draghi Speech

The EUR/USD is trading somewhat unchanged today gravitating towards 1.1760 in anticipation of the speech by Mario Draghi, the ECB President. The speech will most likely give indications how does the EU stand in terms of stability and future outlook and where the EU economy is headed.

Market sentiment remains bullish for the Euro as technically, the Euro is well positioned and it's stable enough to continue onto its second attempt to conquer the 1.20 level. If we hear positive news from President Draghi, bulls will not hesitate to jump in heavier and push price further up to first bull target at 1.1890. Second bull target is seen at 1.20 and third bull target is seen at the latest high at 1.2092.

On the other hand, a failure to meet market participants' expectations of a positive message, bears might attempt to take control and push it down to last low at 1.1736.

Chart: EUR/USD D1

GBP/USD Recovers

GBP/USD is trading to the upside this week as market participants' expectations improve but yet remain cautious about the forthcoming negotiations with the European Union on the Brexit talks. Some researchers predict a catastrophic scenario for the Sterling if they fail to reach an agreement. A fail indeed remains as an option which could actually push the Sterling some 15 cents lower against the US dollar.

On the other hand, however, traders and investors are on the accelerator anticipating that a consensus will be reached and the UK currency will have its chance to appreciate against the dollar.

Whatever the case, current market momentum is predominantly bullish ever since the beginning of the year climbing from 1.19 in January to its highest high at 1.36574 in September.

Chart: GBP/USD H4

EUR/CAD Bearish

On the daily timeframe where EUR/CAD has been forming bearish market structure printing lower highs and lower lows. Recently price showed a rejection off the 1.4470 area which gave it a push back to the upside.

This has not led to the market structure changing, so we are still watching for an overall lower high. As you can see price has current reached as far as the Ichimoku cloud which aligns closely with the 1.48683 resistance. From this area we have seen two rejection candles followed by indecision.

From here we can see the potential of price heading bearish. The weekly candle has also closed showing selling pressure which is a nice further confluence. Bears' first target would be at the 1.43744 support which price came close to previously, this would also form a new lower low.

Chart: EUR/CAD D1

ActivTrades Introduces a New Add-on: SmartTemplate

ActivTrades has now released a brand new tool called SmartTemplate. What it does is it helps you keep track on your strategy by aiming to provide you with useful and highly effective features.

Some of the features include an indication of positions such as long and short based on chart signals as well as determining the main trend, bullish or bearish. This comes with defined time frame in which one should trade.

The tool aims to help both novice and experienced traders as it is designed to be used as a main tool or as a background tool used for reference.

You can get more information on their webpage HERE. It also comes with a useful handbook.

Japanese Index Higher

The Japanese Index is trading to the upside as market participants are pushing the price to the all-time high. Price is now gravitating towards the 20800 level which is just a few point shy from the history high 20900. Although the price now feels a bit wobbly, bulls are determined to try and overcome the all-time high.

As the Japanese economy is progressing steadily, fundamentally the outlook is in favor of the higher stock market. If we can get above the history high, bears' attempts to turn the trend could prove futile. Until we get there, however, chances for an inflection point still remain.

Overall market trend is predominantly bullish, both fundamentally with good economic development, and technically with good indications that signal for more growth such as price above the 200SMA and a healthy move to the upside accompanied by corrections.

Chart: JPN IDX D1

USD/CHF Edges Lower

The USD/CHF pair is trading to the downside so far this week as the US dollar is posting losses against major competitors. The Swiss Franc is appreciating only slightly as we have not yet seen the full impact by the disappointing US report on Friday.

USD/CHF appears poised to go to the downside, as the US dollar has already lost significant points against the Euro, the Sterling and the Yen. The Swiss Franc is yet to follow in their footsteps on the path of appreciation.

How much exactly, depends on the market. As the move is now in its initial stages, we can expect more bears to pile up and push the price down below 0.9760. Anything below that would indicate that the pair is ready to move lower. Major bear target is seen at the triple bottom at 0.9438.

Unless we get some fresh positive news on the US outlook, market sentiment on the pair remains bearish.

Chart: USD/CHF H4