Daily Forex forecast analysis 04-12-2017 – we analyzed the upcoming currency pairs and events of the day that could impact the Forex market, These analysis are published here each day.
Forex Forecast Analysis 04-12-2017 include information on EURUSD, USDCHF, GBPUSD, USDJPY & AUDUSD
So far, the bullish momentum has not been as strong as we expected around the ascending trend line and we suspect a breakout lower should occur in the short term. The last two days could not produce solid gains and we believe it was just a consolidation before the selling pressure resumes. Will be interesting to watch how the price would react around the trend line as we believe that would set the tone for the rest of the day.
Technically speaking, the price is located around the trend line at the time of writing. An hourly impulsive close below it could mean the price would retest 1.0580 area, while a breakout below it would open further room towards this week low around 1.0567. Next, 1.0530 is follows and we expect a stronger reaction from the buyers.
On the upside, the bulls would need to push the price above 1.0609 in order to open further room towards 1.0628 and yesterday high. If the bullish trend extends further, 1.0665 and 1.0690 could be potential targets.
- Some inflation figures are due to being released from Spain, at 06:00 and 07:00am GMT. The possibility of increased volatility because of them is low.
- From US, Import Price Index and Export Price Index figures are due at 00:30pm GMT.
The market entered in a bearish consolidation phase since the beginning of the week, trading below our long term descending trend line. So far, we see lower lows and lower highs continuing to unfold but the problem is the sellers are not able to cover too much ground. Still, the bias is bullish as long as the price is above, 1.0036. A daily close below it would be needed to shift our bullish views.
We believe a breakout above 1.0092 area is necessary to open further room towards 1.0103 and this week high. Above, 1.0139 could follow as resistance zone.
On the downside, if the market structure does not change and the bears are able to generate new lower lows, we might see the price break below yesterday low and reach 1.0050 area. Below it, 1.0036 follows and as we mentioned we expect the market to accelerate downwards if a breakout below it occurs.
There are no important headlines due to being released from Switzerland
The last two days have been positive for cable, gaining more than one hundred pips. At this point in time, we expect a retest of the top triangle line, but a breakout above is not excluded. Today we also have significant economic figures from UK and that could support an upside break or a new leg down, depending on the actual figures. As long as the price is inside the triangle we expect a new leg down towards the bottom of it.
Looking at this point, the price should reach 1.2498 resistance area soon and in case of a breakout above it, the top line of the triangle located near, would come into play. A breakout and close outside the formation would open further room towards 1.2556 area.
If the triangle pattern continues to hold, we might expect renewed selling interest, 1.2448 being our first support area. Below it, 1.2419 and 1.2375, where the current bullish leg up started, would follow.
- From UK, we have Claimant Court Change, Claimant Court Rate, Unemployment Rate and Average Earnings due at 08:30am GMT.
The market broke below 110.27-110.10 support area yesterday and managed to reach and break again below 109.69. So far, it seems like the downside trend will extend, but we would recommend to expect a push back in order to get an optimal price. As long as no bullish impulsive move will move towards and break higher above 110.10-110.27, we believe there is room for more slides.
Having said that, our next support area is located around 108.70 and we expect the price to reach in the short or medium term. The bulls have not been able to generate strong impulsive moves and as long that does happen, keeping a bearish bias would be appropriate.
On the upside, the buyers should first be able to move the price above 109.69 area in order to open further room towards 110.10-110.27 area. A breakout pullback setup could happen at that point, getting sellers back into the market, but if that does not happen, there could be room for an extension higher towards 110.75.
Very choppy environment around 0.7492 area. So far both sides of the market managed to generate strong short impulsive move and so far we can’t say whether the price would extend further. A step by step approach would be appropriate as we uncertainty is high over the outcome. If the buyers manage to drive the price above yesterday high, further gains to the upside could follow and on the other hand, if the sellers manage to drive the market below 0.7477 , we could see further slides.
Also, a daily close below the level would confirm that there is little profit taking and the sellers are managing the hold the ground at that point. Below 0.7477, 0.7448 and 0.7381 follow as our resistance areas.
On the upside, a breakout above yesterday highs would expose 0.7516 and a close above it would open further room towards 0.7531 and 0.7545.