ZUA'S Business Consultant

26/06/2014

EUR/USD Technical Levels

EUR/USD is still staying below 1.3676 resistance and intraday bias remains neutral. We continue to favor that a short term bottomed is formed at 1.3502 and expect another rise. Above 1.3676 will target 1.3993 resistance and break will extend the medium term up trend. However, below 1.3502 will turn focus to 1.3476 key support. Sustained break of 1.3476 will signal medium term reversal and carry bearish implications.

26/06/2014

XAU/USD Technical Levels

The main range is $1392.00 to $1240.20. The retracement zone formed by this range is $1316.10 to $1334.00. Since June 19, gold has been sitting inside this range as investors decide which way they want to take the market. The bulls believe prices should rise from here given the uncertainty of the global economy. Bearish traders feel equally strong about the overbought market and the lack of inflation.

A downtrending angle from the $1392.00 top comes in at $1321.00 today. Gold has straddled this angle the past two days, closing below it on Tuesday, but above it on Wednesday. This gives gold a slight upside bias today.

The angle appears to be controlling the short-term direction of the market. A sustained move over it today could trigger a rally into $1334.00. A failure to overcome this angle could lead to a break into the nearest uptrending support angle at $1314.00.

If the market is topping out then look for an acceleration to the downside when $1314.00 fails. The daily chart indicates that $1292.30 to $1284.20 is the best target and next support zone.

The tone of the day is likely to be determined by how traders react to the angle at $1321.00.

25/06/2014

02/06/2014

EUR downward potential intact- FXStreet

“Technically, the 4 hours chart shows risk remains to the downside as the pair lost in a couple hours the ground recovered in two days. Despite accelerating below a bearish 20 SMA, indicators stand right above their midlines presenting a more neutral technical stance. Immediate support remains at 1.3570, and once below the slide can extend towards 1.3520/30 price zone.”

“Further falls are not yet seen, not because of the trend, but considering EU CPI, GDP and ECB meeting will come out this week: market will remain a bit more cautious ahead of them but beware positive readings among the first two should do little to boost price as the Central Bank will have the final word.”

“Resistance stands at 1.3630/40, 200 DMA, with price unable to break above it for the last 4 days. If above, next level to watch is 1.3680, 61.8% retracement of this year rally.”

02/06/2014

EUR/USD technical levels

In terms of technical levels, the EUR/USD could find immediate supports at 1.3585 (May 29 low) and 1.3561 (Feb 12 low). On the other hand, resistances are seen at 1.3640 (200-day SMA), 1.3649 (May 30 high) and 1.3668 (May 27 high

02/06/2014

Today’s Prediction on XAU/USD

The gold markets fell during the bulk of the session on Friday, but as you can see found enough support just below the $1250 level to cause the market to turn back around and form a hammer. Although the market appears to be in a very significant downtrend on the longer-term charts, the truth is that we are at the middle of the consolidation area, meaning that a turnaround here could be the first signs of a market that is about to break out to the upside. With that, we feel that this market could be bought on a break above the $1260 level, as it is a break of the top of a hammer. Quite frankly, we could be looking at the beginning of the move out of the consolidation area and too much higher levels area that could be a nice long-term move waiting to happen.

Ultimately, we do like gold given enough time. However, we have to admit that down at the $1200 level is the “trapdoor” that could lead to the markets heading back to the $1000 level. Ultimately, we suspect that the gold markets will breakout to the upside and continue to have the ability to be bought on pullbacks, as the longer-term goals and the so-called “smart money” could be buying gold down here.

The fact that the markets are finding a bit of support here in the middle of this consolidation area leads us to believe that perhaps we are starting to see a little bit of a decision been made. It’s hard to tell the moment, but we believe that this could be a place that people look at in the future and suggests that buying is exactly what they should have done here. Selling isn’t possible for any length of time yet, although a break below the hammer would possibly send this market down to the $1200 level. That’s a nice short-term sale, but at the end of the day we believe that if you are truly patient, you may be able to hold onto a long position for quite some time.

30/05/2014

Goldman: How Far Could EUR/USD Fall Into ECB? It Depends On This....

In a recent note, Goldman Sachs argued that next week’s ECB meeting (June 5) could see EUR/USD fall to 1.33 (see details here), especially if – on top of the 15bp deposit cut and credit easing, the ECB starts to sound more worried about deflation risk.

This week, GS revisited this issue to give its final thoughts on the ECB possible actions next week and their likely impact on EUR/USD. Mainly, GS outlines 2 different scenarios for the ECB: 'talks like it means it', and 'sheep in wolf’s clothing'.

ECB: 'talks like it means it'

"Put simply, EUR/USD remains high because the market doesn’t believe that the ECB will do “whatever it takes” to fight low inflation in the same way that it confronted break-up risk. If next week the ECB 'talks like it means it', this will be more important than any actual easing and would help break the market psychology that the EUR can only go up,"GS clarifies.

"The clearest way it could do this – in addition to the easing measures we expect for next week – is by revising down the inflation forecast for outlying years, which we think would be the clearest signal that deflation risk is now on the front-burner at the ECB," GS argues.

ECB: 'sheep in wolf's clothing'

"If instead we get a 'sheep in wolf’s clothing', a term Huw Pill uses to describe a reluctant cut in the deposit rate, the case for EUR downside would be weaker, in particular if the 2015/16 inflation forecasts remain unchanged, which could signal 'more of the same'," GS warns.

Case for EUR downside intact into ECB; Next week data a cataylst

"For the Euro to move meaningfully lower, the ECB will need to change its tone more forcefully, a shift the data should support. After all, our economists expect the flash HICP reading to fall one-tenth to 0.6% year-over-year in May, which will require a marked pick-up in sequential (month-on-month) inflation to bring inflation even to 0.8% this year," GS projects.

Conclusion: Just do it

"In short, the talking points are ready for the taking, the ECB just needs to use them," GS concludes.

30/05/2014

"In currency markets, while t he move was relatively muted, the USD has broadly weakened. For clients selling USD and buying GBP or EUR current rates may represent good levels, as we remain close to 6 week lows vs. the pound and 14 weeks vs. the Euro."

30/05/2014

Today’s Prediction on XAU/USD

The gold markets try to fall during the session on Thursday, breaking down below the $1260 level again. However, we did find enough support below in order to push the market back up, which formed a hammer. That hammer suggests that we are in fact going to continue to bounce from here, thereby sending the market even higher. The $1280 level above should be resistance, but we feel that the market will in fact head to the level. If we can get above there, it would be very bullish for the gold markets as we should reenter the previous consolidation area and possibly go as high as the $1320 level in the short term.

Gold markets have been rather beat up lately, as we broke down below the $1260 area. This area has been pretty significant as far as resistance in the past, especially around the beginning of the year. That being the case, we believe that the market will more than likely find plenty of buying orders down here, and we also have to recognize that a lot of selling pressure would have had to have been exerted to break the market down below the $1280 level. Because of this, we believe that perhaps the momentum to the downside may struggle here.

Even if we broke down below the bottom of this hammer, this is the 2nd supportive candle in a row on the daily chart and therefore we would be very hesitant to start selling a market that looks ready to bounce at this point. If we did decide we want to sell the gold markets, we would like to do it from a much higher level. In the meantime though, it does look like the market probably will bounce right about $25 before hitting major resistance. Because of this, we are short-term positive on this market, and would be buying on a break of the top of the hammer for the session on Thursday as it would show a capitulation by the sellers, at least in the near-term trading.

29/05/2014

Today’s Prediction on XAU/USD

Gold markets did below the $1260 level during the session on Wednesday which of course is very bearish. However, we could not hang onto those losses and as a result we think we’re going to find buyers in this general vicinity, which should send the market back up. This is probably more of an anti-dollar play than anything else at the moment as the US dollar has climbed during the session. Ultimately though, there’s too much in the way of noise below to be overly excited about selling. On top of that, there’s a significant amount of potential resistance at the $1280 level as well now, so we are more comfortable sitting on the sidelines. If you’re looking to make a move in the precious metals market, perhaps looking at silver might be the way to go.