Fundamental Analysis in Forex Trading: Factors that Affect Currencies
READING TIME: 11 MINUTES
Estimating future price movements in the currency market is challenging for many. Globally, the foreign exchange market commands the biggest slice of the financial ‘cake’, claiming an eye-watering US$6.6 trillion in global FX market turnover.
Traders will use a...
It’s here. The FINAL full week of the trading year!
While liquidity will begin to thin as we close in on the festive holiday, a number of tier-1 data are in the headlights this week.
Tuesday
Tuesday entertains the minutes from the Reserve Bank of Australia (RBA) and the Bank of Japan (BoJ) Policy Rate announcement, followed by CPI inflation numbers out of...
While bears did indeed make an appearance last week and snap an eight-week winning streak, BTC/USD remains on track to record a third consecutive month in the green (MTD performance: +11.6%). In a market demonstrating uptrends on both the weekly and daily timeframes, the recent surge witnessed the major cryptocurrency reach $45,000, levels not seen since April...
Trend Leans in Favour of Buyers
Following recent weeks reaching an all-time high (ATH) of $2,148 and the subsequent correction, buyers and sellers are seen squaring off a whisker north of support at $1,969 on the weekly timeframe. Although negative divergence has formed from the Relative Strength Index (RSI) and neighbouring resistance calls for action at...
Following November pencilling in its strongest monthly gain since mid-2022, the S&P 500 is poised to line up another gain in December and potentially touch gloves with the all-time high (ATH) of 4,818.
Technical studies out of the monthly timeframe are clear. The index has been entrenched in a dominant uptrend since breaking out in early 2013. Aside from two...
Monthly Timeframe:
Month to date, compared to the US dollar, Europe’s single currency is marginally higher by +0.1%. Overall, though, the currency pair has been in a downward trend since 2008, fashioned through a series of lower lows and lower highs evident on the monthly timeframe. Also apparent from this chart, the pullback from the late September (2022) low...
Week to date, the US Dollar Index, a measure of the US dollar’s value against a basket of six major international currencies, is down 2.0%. The downside move changed gears yesterday following the Fed’s rate decision and updated forecasts, showing that three rate cuts are projected in 2024, with the Fed Funds futures pricing double that at six rate cuts for next...
Monthly timeframe:
(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)
Support at 1.1904/1.2235 and long-term trendline resistance (1.7191) offers durable structure to work with on the monthly timeframe at the moment, with the latter recently receiving price action.
Concerning the primary trend, lower...
Monthly timeframe:
(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)
May’s extension, together with June and July’s follow-through has witnessed supply at 0.7029/0.6664, and intersecting long-term trendline resistance (1.0582), give way in recent trading. Technically, this could liberate buyers to as...
Noting monthly price trading above trendline resistance, albeit within the parapets of supply, and daily price dethroning resistance at 1.1553, the higher timeframes indicate additional bullish sentiment could be in store until reaching a 5-wave completion around 1.1669.
Shorter term, however, has H1 fading supply at 1.1631/1.1614 which recently reclaimed 1.16....
Monthly timeframe:
(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)
Support at 1.1904/1.2235 and long-term trendline resistance (1.7191) offers durable structure to work with on the monthly timeframe, with the latter recently receiving price action.
Concerning the primary trend, lower peaks and...
Monthly timeframe:
(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)
The month of May, as you can see, recovered off worst levels out of demand from 1.0488/1.0912 and closed firm. This prompted an extension in June to highs at 1.1422, adding 1.2% despite also running into opposition at the lower ledge...
Monthly timeframe:
(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)
May’s extension, together with June and July’s follow-through has witnessed supply at 0.7029/0.6664, and intersecting long-term trendline resistance (1.0582), give way in recent trading. Technically, this could liberate buyers to as...
Monthly timeframe:
(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)
Support at 1.1904/1.2235 and long-term trendline resistance (1.7191) offers clear structure to work with on the monthly timeframe, with the latter recently welcoming price action.
Concerning the primary trend, lower peaks and...
AUD/USD:
Monthly timeframe:
(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)
May’s extension, together with June and July’s follow-through has seen supply at 0.7029/0.6664, and intersecting long-term trendline resistance (1.0582), give way in recent trading. Technically, this may liberate buyers...
GBP/USD:
Monthly timeframe:
(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)
Support at 1.1904/1.2235 and long-term trendline resistance (1.7191) offers clear structure to work with on the monthly timeframe, with the latter prompting a notable upper shadow in June.
Concerning the primary trend,...
(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)
Since kicking off 2017, USD/JPY has been carving out a descending triangle pattern between 118.66/104.62.
April and May were pretty uneventful, with June also wrapping up indecisively in the shape of a neutral doji candlestick pattern.
Areas outside...
Monthly timeframe:
(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)
May’s extension, together with June’s follow-through, has supply at 0.7029/0.6664 echoing a vulnerable tone in July, particularly as intersecting long-term trendline resistance (1.0582) demonstrates signs of giving way.
Despite...
