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11/03/2014: Trading outlook for today

Although markets continue to drift rather benignly, there is a gradual rebound in the dollar that continues to impact on forex pairs today. European indices remain under pressure. Gold and silver are making gains again.

EUR/USD has formed  rolling top and today continues to drift back towards the $1.3775/$1.3825 support band.  This is not a major correction, so far today the trading band is just 41 pips but more of a gradual drift. There is no major US data released today so this increases the potential for a trending day. The current trend is lower.

GBP/USD has spiked around in early European trading, with an early sell-off then finding support with positive UK Manufacturing Production data. The chart still looks open for a retreat back towards $1.6603, but this is a key support area and with the support currently intact the outlook is a difficult call.

USDJPY is now increasingly consolidating following the strength over the past 7 days. Holding up on the 55 day moving average is a positive, but the immediate upside is running out of steam. 102.83 has been tested for the past two days and this could easily be seen again. For now I would look upon dips as opportunities to buy (whilst this support around 102.83 remains intact).

Gold remains strong after the early gains today. As I said in the Morning Report video, using the RSI in a ranging period can be a successful trading tool. Hourly RSI is now 70.6 and this means it is in the territory needed for a crossover sell signal. I would continue to play the range and use this strength as a chance to sell. Wait for the hourly RSI to cross back below 70 as a potential signal.

The DAX remains under pressure having broken last Monday’s low a 9359. I am looking for a rally as a chance to sell now. There is a band of resistance 9359/9437 that can be used as a potential sell-zone.

The FTSE 100 is following the DAX lower and has just breached its equivalent low from last Monday at 6672. I would be looking to use any oversold intraday rally as a chance to sell. The sell-zone for the FTSE is at 6672/6715.

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At Hantec Markets Ltd we provide an execution only service. Any opinions expressed by analyst Richard Perry should not be construed as investment advice or an investment recommendation. This report does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. Forex and CFDs are leveraged products which can result in losses greater than your initial deposit. Therefore you should only speculate with money that you can afford to lose. Please ensure you fully understand the risks involved, seeking independent advice if necessary prior to entering into such transactions.