Daily Technical Forex Forecast 05.04.2017

EUR/USD

EUR/USD continues to trade in a small local consolidation just below its resistance level of 1.0695, which is the cornerstone of the euro trading. It is worth noting that the price correction on Tuesday was on a reduced level, which can be interpreted as a technical “pullback” of the price after a fairly long and rapid fall of this currency pair.

It is also necessary to note the presence of a downtrend during which the price has fallen on large volume, which increases the likelihood of the further fall of the EUR / USD currency pair. Thus, it is advisable to open short positions. It is worth entering the market after the end of the correction and the beginning of the price fall, preferably on increased volume. Stop loss should be placed just above the level of 1.0750. As an alternative, you can put a stop loss just above the resistance level, but this is a riskier option because of the possible test of this mark. The target is 1.0550.

GBP/USD

Despite further fall of the price; the pound is still trading in the global consolidation. We should highlight that there are no new volumetric levels because total volume on the market for the pound has been being pretty small for last 2 days.

Overall the situation is complicated for trading now, so I advise you to stay out of the market for this instrument and wait for appearance of volume and creation of new levels which can be used in trading.

Anyway, if you still want to trade this instrument, consider only short positions.

USD/JPY

We need to highlight the corrections of USD/JPY on Tuesday that gives us a possibility to open short positions and enter the market by a profitable price. It is worth noting that this correction was on small-medium level, so it should be assumed as a technical rollback.

Short positions can be opened after further correction of the price, a test of the resistance level 110.95 – 111.08 and the resuming of the fall on increased volume. A stop loss should be set at the level 111.40. A potential of the deal is around 120 pips.

USD/CAD

USD/CAD had broken out the resistance level, but this move was on small volume, therefore we saw a correction of the price which almost “ate” the breakout movement. Moreover, the oil price is growing and supporting the Canadian dollar. So now we have 2 strong currencies, which makes trading of USD/CAD a pretty difficult task.

From the chart above we can see that globally the price remained trading in the consolidation, so my advice for today is to stay out of the market.

AUD/USD

The Australian dollar continued falling down after the breakdown of the support level 0.7610 and now is looking to go south further. So that we should consider opening only short positions. We can enter the market after a smooth correction of the price, approximately, to the level 0.7583 and then open short positions. A stop loss should be placed above the level 0.7625. The target is 0.7500.

XAU/USD

Gold tested the level of resistance 1260.00 on Tuesday, but failed to break it out. We need to highlight that after the test the price went down sharply and on quite large volume.

So now we need to wait for the resuming of the gold growth and see a confident and strong breakout of this level on large volume with further fixation of the price above it. Only in such case we can consider opening long positions. A stop loss should be placed below the breakout volumetric bar. A potential of the deal is around 150 pips.

The sentiment: the mood of the market remains the same and confirms our main deals for the euro, the yen and gold. The scenario for AUD/USD is also confirmed. The pound has 50/50 situation. Despite an additional signal for buying USD/CAD, but now the situation is difficult.

The bottom line: EUR/USD, USD/JPY and AUD/USD are in priority.

Important! At 19.00 GMT, the FOMC meeting minutes will be published, so before this news it is better to either close deals on currency pairs with contains the US dollar, or replace stop losses to the break even to protect against the unpredictable reaction of the market.

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