- October 9, 2019
- Posted by: cabana-admin
- Category: Market Insights
Overview:- By analyzing the daily technical chart we can see that after the tug of war bears got the charge and headed towards south side. Yesterday we have seen a bearish marabuzo candlestick which is providing us bearish signal, the yesterday’s downfall has cleared the picture and created the chances of further downfall 1.2000.
As we have mentioned earlier also that the pair is trading and sustaining between the narrow ranges of 1.2200 to 1.2400 level which indicates that breakout on either side will give us new buy or sell signal. If bulls able to give close above 1.2400 level then it will open the way towards the 1.2580 and 1.2700 is the extreme level which can be tested by bulls on contrary if bulls trades and sustain below the 1.2200 level then it will open the way towards 1.2000 level and furthermore, however there is high chances that we may see downside momentum.
Fundamental Analysis:- This week the FOMC meeting is awaited and US china Trades talks are there in the end of the week. US and China trades are set to start again this week. However, there are already reports that China is not about to renegotiate on any of the demands that have been holding up progress. For the week ahead, besides trade talks, we have a number of other key events for the US, including FED governor Powell, speaking the FOMC minutes and US consumer price index. So this week is going to be very crucial for the upcoming trend.
During the weekend, a second whistle-blower in the case of US President Trump’s dealing with Ukraine has come forward. He’s said to have first-hand knowledge of the allegation listed by the previous one. Could trigger some risk-off at the weekly opening.US Nonfarm Payroll report came in mixed, consistent with economic expansion. Wall Street rallied with the news, on mounting hopes the US Federal Reserve will cut rates one more time before year-end.
Technical Analysis:- Pair is moving below the minor EMA lines (9,14 and 50) and candles are also providing us bearish signal. This week’s closing matters a lot. The bearish crossover on MACD indicator is still intact and providing us bearish signal RSI has turned down to below 50 level which is showing weakness in the pair. The primary trend is still bearish and secondary trend is also flashing sell signal after a correction.
What next:- If bears take the charge and settles below 1.2200 level then we may see further weakness in the pair and if pair give positive closing i.e. above 1.2400 and cover all the losses then we may see further buying till 1.2580 level first and furthermore. The positional traders are advised to sell the pair to follow the primary momentum. The 1.2420 level is immediate resistance level followed by 1.2520 whereas 1.2115 level is strong key support level followed by 1.2000 level.
Trade idea:- Based on chart and studies above we can suggest that sell the pair below 1.2240-50 target is 1.2100 and 1.2000 sl is 1.2450 level.