FOREX PRO WEEKLY, November 30 - 04, 2015

Sive Morten

Special Consultant to the FPA
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Fundamentals

The dollar rose across the board on Friday, hitting an eight-month high against a basket of currencies as speculation the Swiss National Bank would follow the European Central Bank in cutting deposit rates further pushed major competitors lower.

Expectations of growing interest rate differentials between the dollar and major European currencies have pushed the dollar index up to near its yearly peak of 100.390, the highest it has been since June 2003.

Most analysts anticipate the Federal Reserve will raise U.S. interest rates next month, strengthening the dollar, while the ECB and SNB are expected to announce further easing.

For the week, the dollar is up more than 1.1 percent against the Swiss franc , having touched a five-year high against the safe-haven currency on Friday. It was the second straight week of 1 percent gains for the dollar against the franc, having risen nearly 1.2 percent last week.

The euro rebounded in afternoon U.S. trading to move back above $1.06 after falling near seven-month lows in overnight trading. It was last down 0.1 percent against the dollar to $1.0596.

The single currency is down 3.7 percent versus the dollar so far this month as markets anticipate the ECB announcing a loosening of monetary policy at its Dec. 3 meeting.

The yuan was again fixed weaker by Chinese authorities and offshore rates fell ahead of the International Monetary Fund decision about whether to include it in the IMF's basket of reserve currencies. Offshore rates hit their weakest in more than two months ahead of the decision due on Monday .

The currency is expected to be added to the basket, but with a lower weighting than previously estimated, due to the relative scarce use of the RMB in financial transactions worldwide.

The 0.28 percent fall in the tightly controlled rate of the renminbi was much less than a more than 5 percent collapse in Shanghai share prices.

"It's significant we didn't see more of a fallout with regard to the Chinese equity market in currencies," said Dean Popplewell, chief currency strategist at Oanda in Toronto. "I suspect with the lack of participation (Friday), opening interest Sunday night/Monday morning will be certainly a lot higher than what we saw today."

Popplewell added that he expected to see trading increase as retail spending figures from the Thanksgiving holiday weekend are released. "But at the moment," he said, "we're still very much caught in holiday mode."

Sterling fell to a three-week low against the dollar on Friday after data confirmed the British economy slowed in the third quarter, bolstering market expectations that the Bank of England will not raise interest rates any time soon.

Despite upbeat growth forecasts from the Office for Budget Responsibility this week that accompanied the finance minister's spending review, Friday's numbers showed the UK economy grew just 0.5 percent from July to September, slowing from 0.7 percent the previous quarter. [nU8N0XW02B]

Sterling fell half a percent on the day to $1.5032 after the data, its lowest in three weeks and just five ticks away from a seven-month low of $1.5027 reached earlier in the month. It recovered some losses later on Friday but still traded down 0.3 percent at $1.5049.

"Broad dollar strength coupled with the drag that trade has had on growth was enough to send sterling lower," said Western Union corporate hedging manager Tobias Davis.

Against the euro, the pound was down 0.2 percent at 70.36 pence .

The pound got some relief earlier in the week after the

"Autumn Statement" by the finance minister, George Osborne, where he eased some spending cuts and dropped an unpopular plan to scrap some benefits for low earners.

That led some to hail the end of "austerity Britain", but Barclays currency strategist Hamish Pepper said the overall picture had not changed much. Fiscal tightening will still pick up next year, and a referendum on Britain's future in Europe may also weigh on growth.

Investors pushed back their expectations for when the BoE will start to raise rates to the end of 2016 after the bank's latest Inflation Report this month, when it warned of the disinflationary effect of a strong currency.

"We're starting to see some of the dovishness from the BoE come through in the currency," said Barclays's Pepper. "Rates markets have already been pricing that and I think we're getting some catch up in FX."

Pepper added that the Office for Budget Responsibility's forecasts for 2.4 percent growth in 2016 and 2.5 percent in 2017 were too bullish. Barclays expects growth to slow to 1.9 percent next year and to 1.6 percent in 2017.


Today, guys, again on GBP. Actually it was difficult choice what to look at - either EUR or GBP, but at the same time - there is no big difference among them. I mean our long-term scenarios are valid as on GBP as on EUR. But on GBP it seems that charts a bit brighter. EUR behaves more lazy.

So COT reports shows significant increase in speculative short positions that is accompanied by open interest growth. This is pure bearish combination. At the same time current net short position is far from it's peak. This makes possible further continuation down:
upload_2015-11-28_17-4-48.png



Technicals
Monthly


Here, nothing drastical has happened. Everything is OK. Market continues move down to our targets. This is even easier to understand, if you will take a look at dollar index chart and it's target:
upload_2015-11-28_17-8-23.png


"As usual, we continue to keep our long-term analysis that we’ve made in December 2013 in our Forex Military School Course, where we were learning Elliot Waves technique.

Long Term Forecast on GBP rate


Our long term analysis suggests first appearing of new high on 4th wave at ~1.76 level and then starting of last 5th wave down. First condition was accomplished and we’ve got new high, but it was a bit lower – not 1.76 but 1.72. This was and is all time support/resistance area. Now we stand in final part of our journey. According to our 2013 analysis market should reach lows at 1.35 area. Let’s see what additional information we have right now."


Trend is bearish here, but GBP is not at oversold. Couple of months ago market has reached strong support area – Yearly Pivot support 1 and 5/8 major monthly Fib level. Market gradually was struggling through YPS1 but it seems that first attempt to pass through it has failed.
Our conclusion was - GBP will continue move down, but after some retracement. Right now it seems that downward action restarts. Also we have huge AB-CD pattern that specifies target with more precision. It is not quite 1.35, actually it is 1.3088.

August month has become bearish grabber that suggests taking out of 1.45 lows. So we have pattern on monthly chart that gives us clear direction for considerable time period. September has become also a bearish grabber and take a look October - as well. It means that market gradually was challenged upside action but failed within 3 recent month. November has started with miserable drop, may be it will become grabber as well... Anyway, now we see clear signs that market starts action to challenge 1.4650 support for second time and this time could become successful.

Appearing of these patterns let's us easily specify conditions of validity of bearish scenario. It probably will be valid until market will stay below 1.5930 top.

Since market has not taken out yet 1.4650 lows, theoretically, as opposite action to our bearish scenario we could suggest minor AB-CD upside action. But right now, this perspective is mostly just hypothetical, since Fundamental picture and technical analysis on lower time frames suggest further downward continuation. Mostly all real chances on this perspective, I mean AB-CD have been destroyed by BoE comments and decision. So, right now our next target here is 1.4650 lows.
upload_2015-11-28_17-9-26.png


Weekly
This chart has changed drastically as BoE brings clarity in overall picture. Upward scenario hardly will happen any time soon. Right now as EU as UK are hostages of their own monetary policy compares to Fed one. While Fed gets positive stats and prepares to rate hiking, EU brings dovish comments and increase QE program. So do UK. 2 weeks ago candle has become a bearish grabber, but simultaneously has completed its target.. Trend is bearish here.
Besides of 1.4550 lows, we have two other targets. First one is mostly strategical, and it stands around 1.42 area. It suggests taking out 1.4560 lows and trigger stops that right now are below it. This is butterfly destination point and minor 0.618 extension of large AB-CD pattern
But tactically, we have 1.48 oversold level. Although it does not coincide with any Fib support, this will be important area that could stop market for some time. We do not plot pivots just because Cable has broken MPS1 already. By the way this also tells on appearing new bear trend... Last week was the one of small range and does not impact significantly on overall picture.
upload_2015-11-28_17-19-45.png


Daily
Right now market stands with our expectations and brings no surprises by far. As we've discussed on Friday - Cable shows another leg down and returns back to 1.50 lows, first butterfly target. Last time this level was accompanied by oversold and Fib support. This pushed it higher, but right now Fib level has been broken already and GBP is not at oversold.
This lets us hope on soon bearish breakout of this level. and downward continuation. I'm not sure that we could count on reaching next butterfly target right no coming week, may be market will need a bit more time. But we probably should reach the border of the wedge pattern.
Also - although we do not have any other Fib supports here, on daily chart - 1.4910 is major monthly level and it coincides with wedge border and with 1.618 butterfly extension. Last time it was penetrated for 300 pips, but for monthly chart this is acceptable. So, probably it is weak right now but it is still valid. You should understand it not as strict 1.4910, but mostly as support area. That could hold market for some time.
gbp_d_30_11_15.png


Hourly
So, on hourly chart market has broken our flag pattern down. Also it has reached 1.27 extension of butterfly. Theoretically here we could hope on possible upside retracement to re-test broken flag and touch WPP. But I'm afraid that this attempt to re-test already has happened by minor bounce right after 1.27 target been hit.

Taking in consideration fast drop, GBP probably will proceed to next destination point at 1.50. This will be by the way target of daily butterfly as well. So, may be after it will be hit, Cable will show retracement. Still I hope that you already hold bearish position, because there were multiple chances to do it and we've talked about it almost in every daily update.
gbp_1h_30_11_15.png

Conclusion:
So, no big shifts in our long-term strategy. Our bearish long-term view has got confirmation from recent statistics and BoE decision. Fundamental analysis suggests that hardly situation will improve significantly in near term, thus, GBP mostly will gravitate to downside action, especially due opposite policy on USD by Fed. This let's us create target steps on a way down. On coming week it will be 1.50 probably

In short-term picture it seems that Cable has finished retracement and hardly it will start another one before it will hit 1.50 area and clear stops around it. Potentially GBP could reach 1.49 area on coming week.

The technical portion of Sive's analysis owes a great deal to Joe DiNapoli's methods, and uses a number of Joe's proprietary indicators. Please note that Sive's analysis is his own view of the market and is not endorsed by Joe DiNapoli or any related companies.
 
Good morning,

Reuters reports today - dollar stepped back on Tuesday after nearing a 13-year high against a basket of currencies as traders bought back the euro, long depressed by expectations of aggressive policy easing from the European Central Bank.

The dollar index slipped 0.2 percent to 100.00 after having climbed to as high as 100.31 on Monday, within a whisker of the March peak of 100.390. A break there would take it to highs not seen since April 2003.

The euro rose 0.2 percent to $1.0585 from a 7 1/2-month low of $1.05575 touched on Monday, as hefty option-related bids at $1.05 kept traders from selling down the currency further.
Last month, the euro suffered a 4.0 percent drop - its worst in eight months.


"The market is in a chicken race to sell the euro. Everyone is selling the euro while looking for a timing to buy it back," said Masatoshi Omata, senior manager of market trading at Resona Bank.
Selling the euro against the dollar has been one of the most crowded trades since ECB President Mario Draghi signalled in October that the central bank will unleash another stimulus at its policy meeting this Thursday.


That makes a sharp contrast to the Federal Reserve, which has signalled a strong inclination to raise U.S. rates this month.

The dollar also slipped 0.3 percent against the yen to 122.70 yen , with some traders pointing to a media report that Japan's giant public pension fund started currency hedging as helping the yen.
Antipodean currencies also outperformed the greenback, with the Australian dollar rising 0.7 percent to the A$0.7284 .


The currency maintained firmness after the Reserve Bank of Australia (RBA) kept interest rates on hold as expected and dropped no fresh hint of easing.

The New Zealand dollar jumped to a one-month high of $0.6647 .
Two manufacturing surveys from China highlighted continued sluggishness in the world's second-largest economy which will likely prompt more stimulus but signalled no alarming weakness.


The Caixin/Markit China Manufacturing Purchasing Managers' Index(PMI) edged up to 48.6 in November, contracting for the n9th straight month but beating market expectations of 48.3, fuelling hopes that the economy may be slowly levelling out.

The reading of the official factory PMI shrank to a three-year low.

Outside of the G10 currencies, the Chinese yuan eased 0.2 percent after the International Monetary Fund admitted the Chinese currency to its benchmark Special Drawing Rights basket.

The yuan , also known as the renminbi, will have a 10.92 percent share after a review of the weightings formula for the SDR, which also cut the euro's share by more than 6 percentage points

The weightage assigned to the renminbi, while slightly higher than that of the yen and sterling, underwhelms somewhat market expectations and the IMF staff estimate of 14–16 percent," said Andy Ji, Asian currency strategist at Commonwealth Bank.

So, guys, no big changes have come yet on market, since traders wait for big statistics on coming week. Yesterday our expectations were fulfilled - GBP has hit 1.50 butterfly 1.27 target and now stands in upside action. On EUR we see the same action.
On daily chart of EUR our picture is the same - we do not expect any drastic reversals until market will hit 1.618 target at 1.0450. Actually, we do not sure that any reveral will happen, even when EUR will reach it, but touching of the target is a key element for possible different behavior...
It means that market could show minor upside retracements on intraday charts, but they will be hardly visible on daily chart:

eur_d_01_12_15.png

On 4-hour chart market continues to stand inside wedge pattern:
eur_4h_01_12_15.png

In short-term perspective, we probably are interested in hourly picture. Market right now stands in upside retracement, and most probable destination is combination of WPP, 50% FIb level and upper border of the wedge pattern. But not the one that on 4-hour chart - hourly wedge is inside one, smalller pattern that is based on last part of big 4-hour wedge.
That's being said - upside retracement to 1.06-1.0620 area seems possible today:
eur_1h_01_12_15.png
 
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Good morning,

Todays Reuters comments - The U.S. dollar edged back toward multi-month highs on Wednesday, taking back some ground lost when bulls got cold feet after data showed U.S. manufacturing contracted in November for the first time in three years.

The dollar index inched up about 0.1 percent to 99.894, after skidding below an 8-1/2-month high of 100.310 set on Monday - a high within a few ticks of its 12-year peak of 100.390 set in March.

The index, which tracks the U.S. unit against a basket of rival currencies, rallied 3.3 percent last month on expectations that the Federal Reserve is gearing up to hike U.S. interest rates at its Dec. 15-16 policy review.

But on Tuesday, the closely watched ISM survey prompted investors to trim some of their bullish dollar positions. The national factory index fell to 48.6 as the sector buckled under the weight of a strong greenback and deep spending cuts by energy firms.

Investors awaited the key nonfarm payrolls report on Friday, which is expected to show that employers added 200,000 jobs in November, according to economists polled by Reuters. A solid report would cement expectations that the Fed is on track to increase interest rates this month.

Against the yen, the dollar inched up to 123.03 yen moving back toward Monday's high of 123.34. It has been mired in consolidation mode against its Japanese peer since hitting a three-month high of 123.77 in mid-November.

"Japanese importers have demand for dollars, so any good figure, then 124, here we come," said Kaneo Ogino, director at foreign exchange research firm Global-info Co in Tokyo.

Tempering dollar sentiment, Chicago Fed President Charles Evans emphasized the need for the U.S. central bank to spell out a gradual pace of rate hikes, and reminded investors not to forget the timing of future increases.

"We have been cautious about extending USD long positions ahead of the Fed, wary that the USD could give back ground if the Fed stresses caution and FX headwinds in their press conference," analysts at BNP Paribas wrote in a note to clients.

The embattled euro edged down 0.1 percent to $1.0617 , with Monday's 7-1/2-month trough of $1.0557 in sight ahead of the European Central Bank's policy review on Thursday, at which investors widely expect the bank to unveil fresh stimulus measures.

Among the best performers on Tuesday were the Australian and New Zealand dollars. Both Antipodean currencies rallied more than 1 percent against their U.S. counterpart overnight.

With momentum already on its side, as well as the Reserve Bank of Australia's decision to skip a chance on Tuesday to cut interest rates or talk down the currency afresh, the Aussie was further aided by data showing the economy grew 0.9 percent in the third quarter. That reinforced views that interest rates will not be cut in the near term.

The Australian dollar climbed as far as a seven-week high of $0.7345 early in the session, having surged a full cent on Tuesday. It was last at $0.7315, having risen 1.6 percent in three sessions.

The kiwi came just shy of 67 U.S. cents on Tuesday, its highest since early November, buoyed by rising global dairy prices. It was last down about 0.2 percent at $0.6662.

In contrast, investors dumped the Canadian dollar after the country's economic activity in September fell by a worse-than-expected 0.5 percent, driven by the decline in the oil and gas industry after a temporary production disruption.

So, guys, it might be curious, but today we will take a look at NZD. Our long-term setup still works and some chances has happened that demands update our view. If you do not remember what the core of our trading here - find our recent updates on NZD. Mostly analysis is based on reaching very strong support on monthly chart. As a result kiwi could jump as far as to 0.72 area.
In shorter-term perspective, our DRPO "Sell" Pattern has been completed right at the target - 5/8 major Fib support. This was also retracement after reversal swing. So, as retracement is completed, now we should get expansion. Nearest target for expansion is 0.618 AB-CD level @ 0.6770. This will be our short-term target.
nzd_d_02_12_15.png

Trend is bullish here, market stands above all pivots. Our major task is to get long position, but with minimum risk.
Now take a look how market response on reaching 5/8 Fib support @0.64. It has formed H&S pattern and completed it:
nzd_4h_02_12_15.png

Also it stands at 5/8 Fib resistance (not shown here). That's being said some minor drop is possible. And we will be interested in most recent upward action. This is a good thrust up:
nzd_1h_02_12_15.png

And we should watch for DiNapoli directional patterns. Since chances on strong drop here are minimal, if market indeed is bullish, then, we hope that we could get B&B "Buy" here. This will be cornerstone in our short-term strategy. The point is B&B will give us high probability of no loss. Since minimum target of B&B assumes upside bounce, that should let us to place stop at breakeven and take part in bigger game on daily chart.
If we will get DRPO "Sell" Instead, well, joining of daily trade will become more difficult, but we could trade DRPO directly and this is also nice pattern...
 
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Good morning,

Reuters reports today The euro hovered near a 7-1/2-month low against the dollar on Thursday as investors braced for the European Central Bank to roll out more stimulus and as the U.S. currency scaled new heights on the prospect of a Federal Reserve rate hike.

The divergence in monetary policy between the two currencies was highlighted anew on Wednesday when Federal Reserve Chair Janet Yellen hinted at a rate hike later this month.

Her hawkish comments sent the euro to $1.05500, its lowest level against the greenback since mid-April, though short-covering ahead of the ECB's policy announcement helped to push the single currency back to $1.05930 .

"The euro looks capped. It is hard to go long on the euro. We can see some buyback but I wouldn't think it's wise to think too much about short-covering. It's best to be back to basics," said Bart Wakabayashi, head of foreign exchange for State Street Global Markets.

The ECB is expected to deliver a cocktail of measures that could include a deposit rate cut as well as extension and expansion of its asset-buying programme.

The two-year German notes yield slipped to a record low of minus 0.434 percent on Wednesday, having slipped almost 20 basis points after ECB chief Mario Draghi indicated at last policy meeting in late October that an easing is likely at its next policy review.

While the ECB's policy is expected to keep a tab on the common currency, some market players think that there is a chance of short-covering in the near term as selling the euro has been such an obvious strategy for investors.

"The market has been discussing this for more than a month so I would think any easing steps it may take today are already priced in and the euro could rise," said Masafumi Yamamoto, chief currency strategist at Mizuho Securities.

The euro has dropped 7.2 percent since the ECB's previous policy meeting.

The dollar was a natural destination for any investors escaping the euro given that the Fed has been dropping a hint of a December rate hike for some time.

The dollar's index against a basket of six major currencies rose overnight to as high as 100.510, its highest level since April 2003, and last stood at 100.12.

Yellen also is due to testify on the economic outlook before a joint Congressional committee on Thursday.

Yellen said on Wednesday she was "looking forward" to a U.S. interest rate hike, expressing confidence in the U.S. economy and warning against waiting too long to raise rates.

The dollar also rose to 123.68 yen , a two-week high, on Wednesday, and last stood at 123.43, up 0.2 percent on the day.

Data showing U.S. private employers added a larger-than-expected 217,000 jobs in November also boded well for Friday's job data, easing concerns sparked by a soft U.S. manufacturing data on Tuesday.

Elsewhere, the Canadian dollar rose as much as 0.4 percent to 1.3293 to the dollar after oil prices jumped on report that Saudi Arabia will propose a deal to balance oil markets.


Well, our yesterday setup on NZD has worked perfect. B&B right now stands in progress, so, if you've taken long position, not it is a time to move stop on breakeven. If we will get lucky -we will join bullish setup of higher scale. If not - it will not be a tragedy, since trade is already riskless...
Today we're entering in 2-session trading peak, due today's ECB meeting and NFP release tomorrow. Speaking on NFP, we have situation as on last month. Yesterday ADP report shows 217K surplus in private sector. At the same time Reuters poll tells that investors expect NFP ~200K. This could happen only if government sector will show contraction of employees, but this is hardly possible. Hence, chances on superb NFP are greater than on poor ones. I do not call you to trade NFP release (personally I never trade data releases), but this is just logical conclusions. It seems that we could get NFP around 300 K. It means that drop on markets across the board could accelerate.

On daily EUR picture changes slowly. Currently market confirms our view, that hardly any break will happen until EUR will hit 1.0450 target. Based on ADP numbers there is a great odd that it will happen within 2 sessions:
eur_d_03_12_15.png


Last time we've said that EUR will test WPP at 1.06-1.0620 but breakout is hardly possible and this has happened. On 4-hour chart, EUR 3 times has tested this area but failed to break it. This confirms market weakness:
eur_4h_03_12_15.png


So, if you somehow do not have short position on EUR, you could focus on most recent swing on hourly chart, may be there will be chance for taking position on some minor retracement up:
eur_1h_03_12_15.png


And let's keep watching for ECB... It probably will make our day...
 
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Good morning,

A perceived lack of ambition in the European Central Bank's latest stimulus efforts left financial markets with a niggling worry on Thursday that even 'Super Mario' Draghi might not be able to drag euro zone inflation back up to target.

A bare minimum 0.1 percent cut to its deposit rate and a 6-month extension in its government bond purchase programme tipped European shares into their biggest fall in three months and sent the euro on its biggest surge since March.

The most telling reaction was in the bond market.

German and other euro zone government bond yields made their biggest jump in months and for shorter term two-year German bonds it was the sharpest rise since March 2011.

For those thinking more broadly, the euro zone five-year, five-year breakeven forward rate -- an inflation expectations gauge often cited by the ECB -- fell to 1.75 percent after the meeting, having been around 1.81 percent beforehand. .

It was effectively an assessment from investors that 2 percent inflation in the euro zone, the single needle in the ECB's compass, as it often used to say, will remain off the map for the foreseeable future.

"If the economy disappoints and the potency of central banks disappoint, it will be a cocktail that the market is not ready for," said Didier St Georges, managing director of fund manager Carmignac.

Deflation fears were compounded by the euro's sudden leap above $1.09 and its surge against sterling and the Scandinavian currencies, all of which potentially make imported goods cheaper and hurts euro zone exporters.

The first reading of euro zone November inflation this week had shown prices rising a barely visible 0.1 percent. A revision on Thursday of the ECB's own forecasts to 1 percent in 2016 and 1.6 percent in 2017 baffled investors even more.

"Everyone was expecting Draghi to be the white knight for Europe once again and he hasn't really shown up," said Aberdeen Asset Management Investment Manager Patrick O'Donnell.

For Denmark, struggling to hold its currency peg, there was relief for its central bank, which met just after the ECB decision

The Swiss National Bank, which has deeply negative interest rates after a long battle to check intense upward pressuure on the franc's value, meets next week [ID:nL8N13R3YH].

For ECB watchers, though, the question was whether Draghi and his colleagues were just holding some ammunition back in case the euro zone economy takes another turn for the worse, or whether his options were now wearing thin.

The Italian ECB head had said a range of measures had been discussed and it was prepared to go further if the need arose next year.

"Financial conditions will start raising downside risks to the ECB projections if today's market reaction were to continue in the next days," said UniCredit chief euro zone economist Marco Valli.

"It is worth keeping a close eye on this, because the likelihood of additional easing will largely depend on how financial conditions evolve from here."



So, guys, as ECB has announced extremely dovish messures with rate exceptional decreasing and prolongation of QE program to 2017 have increased demand for EUR as carry trade currency. Probably this could explain explosive rally yesterday.

It means that current rally takes mostly technical reasons and after it will fade out we should be ready for continuation of bearish trend on EUR. Also, we will try to sell it...

From technical point of view EUR has done perfectly. As we've said - market hardly will turn to any drastic action prior it will hit 1.618 AB-CD extension target around 1.0450. This has happened. Market mostly has completed it (missed for 35 pips or so) and only after that has turned to rally.

Actually guys, we've got exceptional chance to trade today. Pattern as bright as it should be, although it will be treated by most traders as risky. Take a look by yourself:
On daily chart market has reached rock hard resistance - 2 Fib levels, OB and MPR1. This is, guys, perfect B&B "Sell" Setup:
eur_d_04_12_15.png


We also have reasons to suggest that NFP should be good. And this significantly increases chances that B&B will be completed even today. All that we need is just a pattern on intraday charts, that could trigger. And it looks like that we have it - DRPO "Sell" on hourly chart:
eur_1h_04_12_15.png


Minimum target for B&B is 5/8 Fib support @ 1.0680. But I will not be surprised if recent rally will be totally erased today.... If most traders will decide to stay aside today, because it is "too risky" and "unclear", we will try to use this situation because it is rather clear for us... Let's hope that we will succeed. But final choice of cause is up to you (as usual ).
 
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Hi Sive,
Thank you for this excellent report re the GBP. A wish fulfilled, just what i needed.
Thank you Father Christmas Sive for giving this gift early and may i wish you a most Beautiful Christmas and the ALL the very Best for yourself and yours for 2016. :)
 
Good Day Commander in pips,
Pls. from your experience kindly give one or 2 behaviour often display by GBP/USD. e.g you often said EUR/USD like 50%fib level and Gold like retesting its previous breakout price level.what about GBP/USD ??????????????
thanks as usual Commander.
 
Good Day Commander in pips,
Pls. from your experience kindly give one or 2 behaviour often display by GBP/USD. e.g you often said EUR/USD like 50%fib level and Gold like retesting its previous breakout price level.what about GBP/USD ??????????????
thanks as usual Commander.

LOL, Ochils. Personally I do not know such sort of patterns for GBP... :)
 
Hi Beekay,
Reaction appears depending on "expectation - fact" relation. Say, if market expects rate decreasing but CB holds it - it will lead to currency appreciation, at least in short-term, etc.
Also there is such issue as "opposite" reaction. For example, CB rises rate, but currency drops. This could happen, when rate hike was priced in already and there is no perspective of rate hiking cycle ahead. Something of that sort we could get when Fed will rise rate...

Sive, hope all is well with you.

The above quote was your reply to me in October. Was yesterday a prime example of what you meant with the "rate hike priced in already"?

With the cut in deposit rate, it would make sense that EUR/USD would fall? Obviously, the fact that the key lending rate remained unchanged didn't help but did the market already price in the decision and perhaps even the Fed Decision in the upcoming 2 weeks since there is already high anticipation of a rate hike?
 
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