EURUSD Bullish Outlook - For October 18, 2012 (Daily Strategy) Trend News

The EUR/USD pair stopped yesterday after the rally to 1.3138 strong weekly resistance because around that area it will continue to offer resistance, as you may see on the chart. It is likely to reverse to the level of 1.3010 fractal.

At a fundamental level, if Span finally asks for a bailout, the euro will trigger. Therefore, it is only recommended to buy this pair at the support level or if it is seen a pullback. If you have sales positions we recommend great caution as a new rally to 1.3250 is likely.

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Fundamental Analysis For October 18, 2012 Trend News

A marked optimism about the summit meeting of European leaders which is held on Thursday and Friday in Brussels is giving bullish strength relative to the euro and to a lesser extent the British pound and the Swiss franc.

The single currency failed to break 1.31during the Wednesday's session, while the pound was around 1.62 during early American trading session.

The Australian dollar retook power in the last hours after China announced strong growth in its GDP. The Aussie is very dependent on China’s current situation. This country is the main destination for Australian exports.

As for the yen, it is bearish technically (bullish on charts) against the dollar. There is still the possibility of intervention by the Bank of Japan, which has not yet successful in finding the right action to prevent further strengthening of the yen against the dollar.

Of course, the general weakness of the U.S. currency concealed a stronger yen each day.

During Thursday's session, retail sales will be released in the UK at 4:30 Eastern.

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USD/CAD Intraday Technical Analysis and Trading Recommendations for October 18, 2012 Trend News

After the USD/CAD pair broke below 0.9845 the market went to the downside. It reached the price level of 0.9635 testing the lower limit of the depicted bearish long-term channel which expressed a considerable bullish strength.

The USD/CAD bullish movement managed to break above the upper limit of the depicted long-term channel (0.9725) which was considered to be a bullish signal in the long term with a possible bullish 123 reversal pattern appearing on the DAILY chart targeting 0.9980.

Intraday Price Action towards 0.9730 (61.8% Fibonacci) should be watched for a valid Intraday BUY entry.

Price zone 0.9820 - 0.9850 is an intraday resistance zone. In order to resume the targets for the bullish patterns targeting around 0.9980 there should be a break above the intraday resistance zone.

Fixation below price level of 0.9650 breaking the established bottom around 0.9740 invalidates the bullish scenario for the current situation.

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GBP/USD Intraday Technical Analysis and Trading Recommendations for October 18, 2012 Trend News

The GBP/USD pair reacted strongly towards 1.6300 - 1.6350 zone confirming the bearish retracement scenario expected in the previous weeks.

GBP/USD expressed daily closure below the lower limit of the depicted bullish channel which extended the bearish movement towards 1.5970 which has been providing considerable support for the pair.

The lower limit of the depicted 4H channel provided considerable support pushing the GBP/USD pair to the upper limit of the bearish 4H channel around 1.6125 which has been broken during yesterday's consolidations.

The lower limit of the broken DAILY channel was retested around price zone 1.6160 - 1.6180 yesterday. It triggered a suggested SELL entry with SL located above 1.6215.

The GBP/USD pair needs to be reclosed inside the depicted 4H channel (below 1.6095) in order to resume the expected bearish scenario on the DAILY chart.

Support: 1.6125, 1.6070, 1.6020, and 1.5970.

Resistance: 1.6175, 1.6260, and 1.6315.

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NZD/USD Candelstick Analysis for October, 18 Trend News

Daily



The NZD/USD rate closed with bullish candlestick pattern on Wednesday. At the same time the quotes consolidation under the correctional level of Fibonacci 76.4% - 0.8230 gives us the reason to consider the rate continues its descending movement towards the correctional level of 61.8% - 0.5081. The candlestick formations Counterattack lines and Engulfing Pattern on these sections, while many candlesticks open and close approximately at the same levels, do not influence the market. Giving the consolidation of quotes under the level of correction 61.8% we may expect the rate continues its down move towards the level of correction 50.0% - 0.7963. Consolidation of the quotes above the Fibonacci level 74.6% of Fibonacci gives the pair possibility to resume ascending move towards the correctional level of 100.0% 0 0.8471.

4h



On the 4H Chart the NZD/USD rate has fixed above the correctional level of Fibonacci 38.2% - 0.8187 after the bullish engulfing pattern was built. However, the pair paused and the next 4 candlesticks opened and closed at the same level. The consolidation above the level 38.2% Fibonacci makes a rate growth towards the correctional level 23.6% - 0.8251 of Fibonacci possible. The building of bearish candlestick formation may enable the pair to make a swing in favour of USD and fall towards the correctional level of 38.2%. We may observe the rebound from the correctional level 23.6% of Fibonacci and a swing in favour of USD could be seen.

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GOLD Wave Analysis for October 18, 2012 Trend News

GOLD Elliott Wave

Yesterday gold was trading in a sideways move, impulsive wave 5 (coloured blue) of the bigger wave (C) (coloured green) was developing. During the Asian and European sessions we could observe descending movement from 1,752.70 towards the 1,742.16 level. Therefore, during the early New York session this commodity did not manage to hold this level and price retrace back to 1,752.51 level. At the moment gold is trading around 1,747.60 level and we are expecting to see price around 1,728.50 level soon. In accordance with our wave rules and taking into account that the wave 5 should retrace 100% of the wave 4, we can define the potential targets with measuring wave 4, with Take Profit at 1,728.57 (100% of wave 4) and Take Profit 2 at 1,713.34 (161.8% of wave 4). To reduce the risk, we can use invalidation at 1,757.05 level as Stop Loss. Also it is necessary to monitor U.S. Unemployment Claims, Philly Fed Manufacturing Index data that can influence the price.

Support and Resistance

(S3) 1734.1 (S2) 1739.1 (S1) 1745.1 (PP) 1750.1 (R1) 1756.1 (R2) 1761.1 (R3) 1767.1

Trading Forecast

Proceeding from Elliott Wave rules today, the trend is expected to begin the downward movement. That is why short positions at level 1,744.50 with Stop Loss 1,757.05, Take Profit at 1,728.57 and Take Profit 2 at 1,713.34 are recommended.

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USD/CAD Wave Analysis for October 18, 2012 Trend News

USD/CAD Elliott Wave

Since our last analysis the USD/CAD pair was trading in a downward move like we expected, impulsive wave (1) (coloured green) of the bigger wave (3) (coloured orange) is developing. Yesterday, during the Asian and European sessions we could observe descending movement from 0.9870 towards the 0.9837 level. Therefore, during the New York session the USD/CAD pair continued trading in a bearish mood and price reached a new 2 days low at 0.9772 level. Today this currency pair finishes development of the 1 impulsive wave (coloured green) at 0.9763 level and we are expecting to see price around 0.9820 level soon. In accordance with our wave rules and taking into account that the wave 2 should retrace 61.8% of the wave 1, we can define the potential targets with measuring wave 1, with Take Profit at 0.9821 (50% of wave 1) and Take Profit 2 at 0.9835 (61.8% of wave 1). To reduce the risk, we can use support at 0.9744 level as Stop Loss. Also it is necessary to monitor U.S. Unemployment Claims, Philly Fed Manufacturing Index, and CAD Wholesale Sales m/m data that can change the rate of the pair.

Support and Resistance

(S3) 0.9709 (S2) 0.9746 (S1) 0.9770 (PP) 0.9808 (R1) 0.9845 (R2) 0.9869 (R3) 0.9907

Trading Forecast

Proceeding from Elliott Wave rules today, the trend is expected to begin the upward movement. That is why long positions at level 0.9790 with Stop Loss 0.9744, Take Profit 1 at 0.9821 and Take Profit 2 at 0.9835 are recommended.

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EUR/USD: Technical Analysis for October 18, 2012 Trend News

Weekly Pivot Point: 1.2930

Overview:

The EUR/USD pair has broken the resistance level and turned towards the support level near the two-day point of 1.3040. Therefore, the pair has already formed a strong support at 1.3040. Moreover, having failed to close below 1.3040 yesterday, the pair started showing a bullish reaction at this level. It is necessary to mention that these levels coincide with strong levels for bulls on H4 chart; the pair has also formed a strong support at the level of 1.3040. The pair will move upwards, it is convincing; the structure of the upside movement does not look corrective and is indicating a bullish opportunity above 1.3040. This can be a good sign for buy deals above 1.3040 with the first target at 1.3135 initiating an uptrend in order to continue the bullish mood towards the point of 1.3203 and further to 1.3140. If the trend breaks the weekly resistance 2 (1.3133), then the pair will go upwards to these targets. However, it should also be noted that the price is still between 1.3055 and 1.3100, as the last strong resistance level (1.3240) is still able to begin a downtrend at this level. Thus, the market indicates a bearish opportunity at the level 1.3240 on H4 chart with the first target at 1.3180 and continues towards 1.3115.

Weekly Pivot Points:

R3: 1.3242

R2: 1.3133

R1: 1.3042

PP: 1.2933

S1: 1.2842

S2: 1.2733

S3: 1.2642

Observation (s):

If the trend is ascending, then the strength of the currency will be defined as following: EUR is an uptrend and USD is a downtrend.

Most of the traders use the Fibonacci retracement to determine accurately the psychological support and resistance levels.

Stop Loss should NEVER exceed your maximum exposure amounts.

The market has a high volatile as usual if the last day had a huge volatility.



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NZD/USD: Technical Analysis for October 18, 2012 Trend News

Overview:

The NZD/USD pair is expected to continue the movement from the point of 0.8100. Thus, the kiwi shows the signs of strength, following the breakdown of the highest level 0.8100. This fact can be considered as a good signal for BUY deals above this strong support (0.8100) with the first targets at 0.8190 and 0.8230 (it will serve as a strong resistance level and is considered to be appropriate for Take Profit orders). It is necessary to mention that this level will coincide with the weekly resistance 1 (0.8222). However, in case of the reverse movement and if the NZD/USD pair fails to break through the resistance level of 0.8222, the market will show a further decline to the level of 0.8183 (it is the weekly pivot point) indicating a bearish mood in order to retest the weekly support 1 at the level of 0.8129.

Weekly Pivot Points:



R3: 0.8478

R2: 0.8407

R1: 0.8293

PP: 0.8222

S1: 0.8108

S2: 0.8037

S3: 0.7923



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USD/CHF: Technical Analysis for October 18, 2012 Trend News

Forecast:

Strong level (Resistance) will be formed at 0.9280 providing a clear signal for sell deals with the target seen at 0.9150 level. Stop-loss is to be placed above 0.9315.

Strong level (Support) will be formed at 0.9140 providing a clear signal for buy deals with the target seen at 0.9220 level. Stop-loss is to be placed below 0.9110.

Overview:

USD/CHF: It is necessary to consider that the price is still located between points of 0.9220 and 0.9315, i.e. above the strong resistance level of 0.9280. The pair has already formed a strong resistance at this level of 0.9280 and is presently approaching to the further testing. Therefore, the Swissie is expected to go downwards following the structure which does not look corrective and indicating the bearish opportunity below 0.9280 level. Sell deals are recommended below 0.9280 with the first target seen at 0.9200 level. Thus, the downtrend is likely to continue the bearish movement towards 0.9150 level. Moreover, it is crucial that the price has probably formed a strong support at 0.9140. The saturation is likely to take place around 0.9140. Therefore, it is possible that the market will start showing the signs of a bullish behavior. In other words, buy deals are recommended above 0.9140 with the first target seen at 0.9220 level and if the weekly support 1 (0.9280) will be broken successfully, then the pair will go further at 0.9330 level. It should be noted that the support 1 (0.9280) becomes a resistance after it is broken.



Weekly Pivot Points

R3: 0.9547

R2: 0.9489

R1: 0.9412

PP: 0.9354

S1: 0.9277

S2: 0.9219

S3: 0.9142

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