EUR/USD: Euro is regaining losses
Current trend
This week the currency pair EUR/USD has traded in the ascending channel, regaining slowly after the decision of the ECB to lower interest rate to 0.25%. This measure has led to significant weakening in European currency; however the decline in inflation in Europe encourages recovery of Euro. Consumer price index in Eurozone for October will become known today; according to the forecast the index will fall to 7%, which can trigger new surge of growth in the pair EUR/USD.
Support and resistance
At the moment the pair is trading near the lower limit of the ascending channel. It is expected that the price will go up to resistance levels of 1.3485 and 1.3530 in the near future. However, it is also possible that the price can reach the lower limit of the channel at the level of 1.3435 (moving average of “Bollinger bands” indicator) and from this level it will reverse upward.
On the four-hour chart technical indicators give mixed signals. Bollinger bands are directed upward. MACD histogram has moved to the overbought zone. Stochastic lines can cross each other in the near future and reverse downward, forming a sell signal.
Trading tips
In the current situation it is advisable to place long positions with profit taking near 1.3530.
Dmitriy Zolotov
Analyst of LiteForex Group of Companies
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GBP/USD: the USD lacks upward momentum
Current trend
On Wednesday and Thursday the British currency regained more than 200 points against the USD and returned to the level of 1.6100. Growth was prompted by favourable data on the British labour market. Unemployment rate fell by 0.1% as well as the number of applications for unemployment benefits. Even yesterday’s negative statistics on retail sales was not able to hinder the rise in the pair for long.
American news releases will be of interest today: industrial production output and price index for imports and wholesale inventories will become known.
Support and resistance
Due to the lack of important British news the pair can slightly correct downward to support level of 1.6000. A lot will depend on the USD: if US statistics does not support the national currency, the pair GBP/USD will soar up to resistance levels of 1.6200 and 1.6260. In the medium-term the Pound will go down.
Support levels: 1.6000, 1.5920, 1.5880 and 1.5750.
Resistance levels: 1.6200, 1.6260 and 1.6300.
Trading tips
In the current situation it is recommended to place pending sell orders from the levels of 1.6200 and 1.6260 with profit taking at the level of 1.5750.
Dmitry Likhachev
Analyst of LiteForex Group of Companies
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XAG/USD: technical analysis
XAG/USD, H4
This week the price of silver continues to decline, reaching the lows since August on Wednesday at the level of 20.42. Trend reversal is possible due to the fact that the metal is oversold. On the four-hour chart Bollinger bands are directed downward and started to narrow. The pair XAG/USD is trading near the moving average of the indicator (20.80), which is the key resistance level. If the price fails to overcome this level, the pair will push off from this level and go down to 29.45 (bottom line of “Bollinger bands” indicator). Otherwise, the pair can reach the level of 21.20 (top line of the indicator).
MACD histogram is in the oversold zone, its volumes are decreasing. Stochastic lines are directed downward.
XAG/USD, D1
On the daily chart silver is traded in the downward channel. The pair has reached the lower limit of the channel at the level of 20.45 and may start upward movement. “Bollinger bands” demonstrate divergence confirming downtrend. The price chart has recently broken the lower moving average suggesting probability of the rise up to the level of 21.70 (medium moving average).
MACD histogram is in the oversold zone, its volumes are increasing. Both lines of Stochastic can leave oversold zone soon and form a strong buy signal.
Key levels
Support levels: 20.45 and 20.10.
Resistance levels: 21.20, 21.70, 22.00 and 22.50.
Trading tips
Based in the technical indicators we would recommend to open short positions with profit taking near 20.45. Long positions can be also opened from this level with the target of 21.70.
Dmitriy Zolotov
Analyst of LiteForex Group of Companies
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