ActivTrades tools: SmartCalculator

In order to be successful in the financial markets as a trader, one must be aware of the risk that it is being taken on every trade. Risk management is a fundamental part of a trading system. That is why ActivTrades has created a SmartCalculator to help its clients and anyone who would like to use it, just by visiting the following link:

https://www.activtrades.com/en/activtrades-smartcalculator

The tool has been created to tweak around with the account size, the size of lots, leverage, entry and exit levels. It is fairly simple and easy to use the SmartCalculator by ActivTrades. Just take a look at it and enjoy the benefits of this amazing tool.

Follow up on the Dollar Index

Yesterday we identified a possible hammer pattern on the Dollar index, daily chart and today such formation was confirmed by the bullish daily candle that has taken the index very close to the 93.00 level. The stochastics indicator has also confirmed the bullish cross above its signal line and it has come out of the overbought zone. Therefore, the Dollar index may continue rallying and it could break above the 93.00 level to enter the consolidation area between the 93.00 and the 94.00 level. The 94.00 could act as a resistance and that is why that in order to see a real trend reversal on the instrument, the index must break above the 55 day EMA (purple line) and above the 95.00 level. At the moment we are still waiting to see if the index is able to break above the 93.00 level, since that zone was a good support in the past and it could change to resistance. 

Possible hammer on the Dollar Index

The Dollar has been under a tremendous pressure due to different factors like hurricane Harvey, the Jackson Hole meeting, and the rising tensions between the United States and North Korea. The bearish momentum has taken the Dollar index to a low at the 91.51 level and the stochastics indicator has fallen below the oversold area at the 20% zone. At the same time, the 55 day EMA (purple line), keeps a good angle of inclination to the downside, indicating that the bearish trend is still strong. However, during this Tuesday’s session the stochastics indicator line has crossed above its signal line, indicating a possible trend correction. Additionally, Tuesday’s daily candle has closed in the shape of a “hammer”. The hammer is a bullish reversal candlestick pattern and if the next candle is positive, then it could be confirming a further correction on the Dollar index. None the less, we must keep in mind that the 93.00 level could act as resistance due to the fact that it was a good support in the past. Above the 93.00 level, the index would be entering a consolidation zone between that level and the 94.00 level, which has acted as a good resistance.

The EUR/USD nears the 1.2000 level

The Euro versus the Dollar continues with its bullish momentum, supported by the lack of information of Friday’s meeting at Jackson Hole, where neither Janet Yellen, nor Mario Draghi said anything about monetary policy. Draghi seems no to be worried about the recent rally on the Euro and that is why the Single Currency has risen even higher. The effects of hurricane Harvey can hurt the US economy in the short term and that has also pressured the Dollar down. The EUR/USD is coming near the 1.2000 zone and that level could act as resistance, but a breakout of that area could take the pair to the 1.2100 level. To the downside, the closest support is at the 1.1900 level in case of a retracement, but a better support could be the 1.1700 level where the price consolidated for a while as shown on the daily chart.

The Stock Market

History of the Stock Market

• ·         The biggest Stock Exchange Is the New York Stock Exchange, but it is not the oldest one.
• ·         The oldest stock exchange is the Amsterdam Stock Exchange.
• ·         The New York Stock Exchange is located on Wall Street.
• ·         The Street was named Wall Street, because of the early wall that was erected to protect Dutch merchants from the natives that still lived on the island of Manhattan.
• ·         The stock market, like any other market where people trade financial instruments.

History of the Dow Jones

• ·         Dow Jones industrial index, created by Charles Dow and Edward Jones.
• ·         30 biggest companies in the United States

The NASDAQ and the NYSE

• ·         National Association of Securities Dealers Automated Quotation System.
• ·         The NYSE is a physical place.

Market Moving Events

• ·         Economic news, unemployment, inflation, interest rates
• ·         Oil and the middle east, Oil and  the Canadian Dollar
• ·         Oil and oil stock prices

Oil continues oscillating without direction

WTI oil has entered a congestion zone between the 47.00 level and the 48.80 level as shown on the daily chart. We can see that oil has had some positive daily candles and some negative daily candles, while the 200 day and 55 day exponential moving averages are actually flat. When the moving averages become horizontal, that is an indication that the instrument does not have a clear trend. Therefore, the price of WTI oil could come out of the consolidation in any direction. If the price breaks to the downside, below the 47.00 level, then any of the round number levels all the way to the 42.00 level could act as support. In case of a bullish breakout above the 48.80 level, the price would have to break above the 50.00 level, the 51.00 level, and even above the 52.00 level in order for the bullish trend to be confirmed and sustained in the medium term.

The USD/JPY keeps a good support at the 109.00 level

The USD/JPY has tried to bounce from the 109.00 level, but it goes back to that zone which it has not been able to break to the downside either as shown on the daily chart. A few weeks ago we identified the cross of the 55 day EMA below the 200 day EMA, which is known as a “death cross” and it has bearish implications in the mid-term. The angle of inclination of the 55 day EMA (purple line) is showing us that the bearish trend is still strong and the price of the USD/JPY may try to break below the 109.00 level, especially if it continues hammering that same zone. The more the price visits the 109.00 level, the higher the probabilities of seeing a bearish breakdown. Therefore, we must be attentive to a possible breakdown of the 109.00 zone, because it could provide us with an opportunity to go short on the pair. To the upside, the 111.00 level could act as resistance, but above the 111.00 level the next resistance could be the 113.00 zone.

Possible weakness on the AUD/USD

The AUD/USD had been retracing to the downside since mid-July after reaching a peak around the 0.8066 level as shown on the daily chart. After the high at the 0.8066 level, the pair started to drop towards the 55 day EMA (purple line), around the 0.7800 level. During that drop, the stochastics indicator also dropped to the 20% zone to change direction to the upside at the same time that the AUD/USD started breaking above the 0.7900 level. At the moment, the 0.7900 level is acting as support, but the price of the AUD/USD has not been able to reach the 0.8000 level. The stochastics have reached the 80% zone and are trying to change direction to the downside; therefore, the pair may try to go back to its bearish trend. Below the 0.7900 level, the most important support levels are the 0.7800 level or the 0.7700 level, but a more relevant support could be the 200 day EMA (blue line) around the 0.7650 level.

The Euro versus the Pound continues rallying

On the weekly chart of the EUR/GBP we can see that the pair is getting closer to the 0.9200 level and it may try to visit the high at the 0.9236 level, which is the level reached on October 2016. Even though the Pound has gained some ground versus the Dollar, it has dropped versus the Euro due to the difficulties that the British officials are having during the implementation of the Brexit agreement. If the EUR/GBP continues rising, then the zone between the 0.9200 and the 0.9236 levels could become resistance. To the downside, the 0.9000 level could act as support, followed by the 0.8800 level, which has acted as resistance in the past and may change its role to support. But a much better support level could be the 0.8600 level, where we can see the 55 day exponential moving average. 

Gold bounces from the 1300 level

The price of gold accelerated its bullish momentum towards the end of the week while the equities markets retraced to the downside as the risk aversion came back into play after the terrorist attacks on Barcelona, Spain and as the doubts keep mounting on the Trump administration. We have been waiting for a visit of gold to the 1300 level and this Friday the price did reach that level to bounce to the downside. The strong bearish bounce is an indication that there could have been a large profit taking at that zone as shown on the daily chart. Even though the price of gold has bounced to the downside, the bullish short-term trend is still in place. But the price must break above the 1300 level in order for the trend to persist. To the downside, the most relevant support is at the confluence area of the 55 day EMA and the 200 week EMA around the 1256 level.

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Good resistance on the NZD/USD

On the daily chart of the NZD/USD we can see that the pair has been dropping steadily from the high at the 0.7559 level to break below the 55 day EMA (purple line) and below the 0.7300 level to come very close to the 0.7200 level. Since the breakdown below the 0.7300 level, the pair has been trying to break above that zone, but it has not been able to do so. The 55 day EMA is acting as a very good resistance. The bullish momentum seems to be accumulating around the 0.7300 zone and a breakout of that level could accelerate the price to the 0.7400 level or even the 0.7500 level. On the other hand, a bearish bounce from the 0.7300 level could take the NZD/USD to the 0.7200 level or the 200 day EMA. Below the 200 day EMA, its most relevant support is the 0.7100 level.

The GBP/USD reaches the 200 day EMA

The 200 period exponential moving average usually acts as a good support or resistance zone, especially on the higher timeframes. On the daily chart of the GBP/USD we can see one more time how the 200 day EMA has acted as a support where the pair is trying to stall its drop. The weakness on the Pound comes after the disappointing inflation data out of the UK. It is possible for the 200 day EMA to act as a support from where the price may try to go and visit the 55 day EMA, purple line, again. The GBP/USD may stay oscillating between the 200 day EMA and the 55 day EMA, but a breakout above the 1.3000 level may take it to the 1.3100 level or the 1.3200 level. To the downside, a breakdown below the 200 day EMA may cause a breakdown of the 1.2800 level and the pair may go and visit the 1.2700 or the 1.2600 level.

Will the drop continue on crude oil?

The rally on the US Dollar and the weak demand numbers out of China has caused the price of crude oil to drop 2.5% during today´s trading session. On the daily chart of WTI oil, September’s contract, we can see that the price has broken below the 48.00 level and below the 200 day EMA. At the moment, the price is trying to break below the 55 day EMA, but it has not confirm such a breakout. None the less, WTI oil may try to continue falling and maybe visit the 47.00 level. To the downside, any of the round number levels could act as support, but the most relevant levels are the 44.00 and the 42.00. To the upside, above the 48.00 level we can see a congestion area up to the 50.00 level, if the price goes back to that zone it may consolidate again. In order for the price of WTI oil to go back to its bullish trend, it would have to break above the 51.00 level and the 52.00 level.

Possible “hammer” on the USD/JPY

The USD/JPY tried to break below the 109.00 level, but closes above that level, forming what it appears to be a hammer formation. The hammer is a bullish reversal candlestick pattern that may be confirmed if the next daily candle closes to the upside, indicating a possible trend reversal on the USD/JPY. In order for the trend reversal to confirm, the pair must break above the trendline that we see over the chart. In case of a bullish pullback, the zone where the 55 day EMA and the 200 day EMA are coinciding, which is the 111.32 level, may act as resistance. The MACD indicator will have to also show a trend reversal in order for the pair to go higher. On the other hand, if the 55 day EMA (purple line) crosses below the 200 day EMA (blue line), then a “death cross” pattern may develop and the pair may continue falling in the midterm. What this means is that the USD/JPY still has a chance of continuing below the 109.00 level with its bearish trend.

Gold just keeps rising

Gold continues rising as the stock markets keep their bearish momentum around the globe. In the United States, the Dow Jones, the S&P500 and the Nasdaq had one of their worst trading sessions since May. Gold rises 0.12% and reaches the 1287 Dollars per ounce, getting closer to the 1290 Dollars as shown on the daily chart. Tensions between North Korea and the United States keep mounting, pressuring the equities markets to the downside, while the Dollar tries to go back to its bearish trend, supporting the prices of gold due to their inverse correlation. In case gold continues rallying, then the 1290 level could act as resistance, but a better resistance could be the zone between the 1295 level and the 1300 level as mentioned on previous posts. In case of a pullback, the 1274 level could act as support since it had already acted as resistance in the past. Below the 1274 level, its next support level could be the 200 week EMA around the 1254 level.

Excellent rally on gold

Risk aversion has caused a flight to safety and that is why we have seen strong rallies on gold and other safe haven assets. The precious metal has broken above the high on the 1274 level as shown on the daily chart and it is getting closer to the high at the 1281 level. The rally may continue even above those levels if risk continues to rise in the international financial markets or if the US Dollar goes back to its bearish trend due to the inverse relationship that there is between the greenback and gold. Above the 1281 level, the next resistances could be the high at the 1295 level, but a better resistance zone could be the 1300 level. To the downside, the 200 week EMA at the 1254 level could act as support and below that level the 200 day EMA at the 1244 level could also act as support. Another possible scenario that may develop is a consolidation between the 1274 level and the 1281 level.

The GBP/USD breaks below the 1.3000 level

The GBP/USD keeps its bearish retracement due to weakness on the Pound and a comeback on the US Dollar. The Pound drops after the weak consumer spending data in the United Kingdom, which falls for a third month in a row. Investors and traders have doubts about the UK economy, while in the US the jobs openings reading came out better than expected, supporting the Dollar and the NFP numbers from last Friday. On the daily chart of the GBP/USD we can see that the pair has fallen below the 1.3000 level and reaches the 55 day exponential moving average (purple line) where it is trying to stall momentarily. In case of a bullish bounce, the 1.3100 level or the 1.3200 level could act as resistance, but for now the fundamental data is pointing to a possible bearish continuation. If the pair continues dropping, then the 1.2900 level could act as support, along with the 200 day EMA (blue line) or the 1.2800 level.

Breakdown of the 0.7400 level on the NZD/USD

The NZD/USD managed to find a good support zone at the 0.7400 level as shown on the daily chart and the pair formed what it appears to be a head and shoulders pattern. The 0.7400 level has acted as its neckline, but the pair breaks below that zone during today’s session. The US Dollar has been gaining strength versus its main counterparts after the NFP numbers out of the US came out better than expected. Therefore, the NZD/USD may try to continue falling. In case of a bearish continuation, the pair may find some support around the 55 day exponential moving average (purple line), which is currently just above the 0.7300 level. In case of a breakdown below the 0.7300 level, the NZD/USD may find a better support at the 0.7200 level, which has already acted as a good support in the past. The 200 day EMA (blue line) may also act as a support. To the upside, the most important resistance levels are the 0.7500 zone and the high at the 0.7559 level.

NFP numbers support a bullish close on the Dollar

Today we had the Non-Farm Payrolls (NFP) numbers out of the US, which came out better than expected, causing an amazing comeback on the Dollar Index. The US economy was expected to have created 182K new jobs during the month of July, but the reading came out at 209K new jobs. The unemployment rate dropped from 4.4% to 4.3% and the average hourly earnings rose by 0.3%. The data was more than excellent and it was exactly what the Dollar needed to change its direction versus its main counterparts. On the daily chart of the Dollar Index we can see that the instrument broke above the 93.00 level and it may try to continue rising towards the 94.00 level. The stochastics indicator is trying to come out of the oversold zone at the 20% level and if it does, then there could be a trend reversal on the index. The 94.00 level could act as a resistance, followed by the 95.00 or the 55 day EMA (purple line). To the downside, the 92.00 level could still act as a support in case of a bearish continuation on the Dollar Index.

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What level could be the next resistance on the EUR/USD?

The EUR/USD seems unstoppable. The pair has reached the 1.1900 zone and keeps its bullish trend as shown on the weekly chart. The EUR/USD has broken above the 55 week EMA around the 1.0900 level and above the 200 week EMA around the 1.1600 level. From this point there are no more relevant resistance on sight, but any of the round number levels like the 1.1900 or the 1.2000 levels could act as resistance. The 1.2000 level has a high probability of acting as resistance due to the fact that it is a psychological level. The higher an instrument rises, the higher the probabilities of it correcting to the downside. Therefore, we could see a pullback on the EUR/USD at any moment. The possibility of the European Central Bank adjusting its monetary policy has kept the Euro rising, but the day that the rumors become real, we could see a retracement on the Single Currency on the back of a profit taking spree.

Gold visits the 76.4% Fibo

The weakness on the US Dollar has supported the rally on gold taking the precious metal to the 76.4% Fibonacci retracement of the drop that it had from the 1295 level on June 6^th to the 1204 level on July 10^th as shown on the daily chart. The price of gold has tried to stall its rally at some of the most relevant resistance levels like the 200 day EMA at the 1243 level, the 200 week EMA at the 1254 level, and the 61.8% Fibo at the 1261 level. At the moment, the 76.4% Fibo at the 1274 level could act as resistance, but the lower shadow of the current daily candle is showing us that the bulls are still in control of the market. Therefore, the price of gold could possibly break above the 76.4% Fibo and maybe try to reach the high at the 1295 level or the 1300 round number level. To the downside, the most important support could be the 200 week EMA at the 1254 level.