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Forex Trading Tips - Week ahead of Mar 03, 2014


EURUSD

1. EUR/USD dropped Wednesday before moving higher to close the week

2. MACD continues bullish momentum
3. Key resistance at 1.3825

EUR/USD moved lower for the first half of the week, pulling back from overbought state of last week. Then, the tone shifted during the second half, as strong economic data drove it up to the new high of 2014, above 1.3800. The MACD continues to show bullish momentum, while the early week pullback took the Slow Stochastics out of overbought zone. For the coming week, economic data will play a major role in how the pair trades, but technically, the trend remains to the topside. The bias remains bullish as long as it holds above the 20-day EMA (now at 1.3660), but the key long-term resistance is at 1.3825-35 zone. This is the height hit twice in Nov and Dec 2014, before drifting down. 


GBPUSD


1. GBP/USD held on to the long term support of 1.6600

2. MACD still shows slight bullish momentum
3. Bias remains to the topside above key support at 1.6600

GBP/USD held above key support at 1.6600 last week, keeping the longer-term bullish trend intact heading into the next week. The consolidation helped the 20-day EMA time to catch up with prices. The secondary indicators are still generally constructive, with the MACD still holding above its signal line, and the Slow Stochastics neither overbought nor oversold. The technical bias remains to the topside as long as key support at 1.6600 if held.


Commodities


Brent’s premium over WTI has plunged, reaching just over $6 by Friday morning. The stronger-than-expected demand for US oil is partly responsible for the tightening of the spread. The latest weather forecasts suggest the polar vortex is set to make a return to parts of the US. The freezing conditions are expected to cause demand for heating to increase once more. This is likely to keep WTI prices elevated.


Further sharp falls in Brent prices are unlikely in the near-term, at least from a fundamental point of view. On the technical front, Brent ran into a significant resistance around $110.70Subsequently, it has broken numerous support levels such as $109.70 and $108.75 – these levels could turn into resistance in the near future. The 50-day moving average support is at $108.40. The 200-day SMA is at $108.15, while the 50% retracement of the last upswing comes in slightly lower at around $108.00. Thus there is strong support around the $108.00-108.50 range. A closing break below this area would therefore be a bearish development. 




- By our Forex Order Management team. You can use the 'Forex Order Manager' along with any manual or  automated forex trading systems to maximize your benefits.