Tuesday, 22 January 2019
FOREX market trading signals
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trading signals
On Tuesday, we are returning to working schedule as markets are back to full form today after US had been on extra holiday. As Americans return to the desks they will probably start playing out the news published on Monday. The main theme of Tuesday session is the risk-off mode and risk liquidation on the background of weak China economic growth and IMF weak outlooks for 2019. With such a sentiment in air, safe-haven currencies outperform and equity indexes are down in the red. The trading calendar is full of important data and information – looking at the day ahead we will get information on GB unemployment, ZEW Index for Germany and Eurozone and numbers on existing home sales in US.
EUR/USD
No important changes so far in the market of the main pair of FX market. EUR/USD keeps on downward consolidation close to the key support level 1.1345-1.1350. For the time being, we don’t see any reversal signals in the market so the scenario with more bearish move is just a priority. What is more important is that the market is heavily oversold which makes more decline extremely difficult. In any case new shorts on current levels is not an option, it is too dangerous.
Trading recommendation – out of the market
GBP/USD
Despite the fact that new plan from GB prime-minister voiced on Monday did not bring more clarity on Brexit issue ( two months before the Brexit but no one knows how it will particularly go) British currency trade rather firm being above the strategical support area 1.2800-1.2840. On the moment it is not clear on how the middle-term GBP/USD development will proceed but while GBP/USD above 1.2840 it is a positive sign.
Trading recommendation – out of the market
Gold
As we expected earlier, American traders, returning to the trading terminals would provide some support for gold market. The normal market volume is what the gold need to play out two main Monday themes- weak China data and feeble IMG outlooks for 2019. Today in European session, the gold quotes rebounded from the support 1277 and headed to the mark 1285. It is an expected development. Now this former 1285 support turned new resistance area. We will know the market intension today if bulls have enough powerto return back into the channel (1285-1295). In any case, the support 1277 proved to be firm and this is likely to attract more longs in the market.
Trading recommendation – longs in area 1277
American dollar index
In the beginning of the week Forex market is experiencing a kind of calm and it seems that this is a calm before the storm. USD dollar index spent the Monday session in a very limited range around strategical mark 96. We talked a lot about the importance of this level and if to speak it short it’s the strategical zone. On Monday USD dollar index failed to settle about this mark. Contrarily we received a type of reversal signal – doji pattern. That might be the first sign that the USD dollar reversal is heading or at least correction as USD dollar is rather oversold.
Trading recommendations sell down from 96 points
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