The Euro continues consolidating

The EUR/USD is currently consolidating in a relatively tight range just above the 1.1600 level as shown on the daily chart. The pair may be waiting for the NFP numbers to be released this Friday before taking a more clear direction. Today’s FED announcement caused a lot of volatility, but the EUR/USD did not take a clear trend. The MACD indicator is showing us that the bearish trend has come back, but the pair may go in any direction. To the downside, the most relevant support is at the 200 day EMA, around the 1.1500 zone. Below the 1.1500 level, the 1.1400 or the 1.1300 levels may also act as supports. To the upside, the closest resistance is at the 1.1700 level, but the 55 day EMA could also act as resistance. In order for the EUR/USD to go back to its bullish trend, the price must break above the 1.2100 level in the long run.

Gold bounces from the 200 day EMA

Gold was retracing to the downside from the 1300 zone to break below the 55 day EMA (purple line) until it reached the 200 day EMA (blue line) around the 1266 level. Gold had already bounced once from the 200 day EMA at the beginning of October and on this second visit to the moving average it bounce again to the upside. We could possibly see the formation of a double bottom pattern around the 200 day EMA, which is a bullish reversal pattern. But in order for the double bottom pattern to be confirmed, the price of gold must break above the 1300 level, which is its signal line. For now, gold may stay consolidated, stuck between the 200 day EMA and the 55 day EMA around the 1285 level. On the other hand, if the price manages to break below the 200 day EMA, then gold would have the road clear to fall all the way to the 1204 zone.

Summary of the futures market

In the United States, trading futures began in the mid-19th century with the establishment of central grain markets where farmers could sell their products either for immediate delivery, also called the spot or cash market, or for forward delivery. These forward contracts were private contracts between buyers and sellers and became the forerunner of today’s exchange-traded futures contracts. Both forward contracts and futures contracts are legal agreements to buy or sell an asset on a specific date or during a specific month. Where forward contracts are negotiated directly between a buyer and a seller and settlement terms may vary from contract to contract, a futures contract is facilitated through a futures exchange and is standardized according to quality, quantity, delivery time and place. The only remaining variable is price, which is discovered through an auction-like process that occurs on the Exchange trading floor. Conventionally, traders are divided into two main categories, hedgers and speculators.

Hedgers use the futures market to manage price risk. Speculators on the other hand accept that risk in an attempt to profit from favorable price movement. While futures help hedgers manage their exposure to price risk, the market would not be possible without the participation of speculators. They provide the bulk of market liquidity, which allows the hedger to enter and exit the market in an efficient manner. Speculators may be full-time professional traders or individuals who occasionally trade. Some hold positions for months, while others rarely hold onto a trade more than a few seconds. Regardless of their approach, each market participant plays an important role in making the futures market an efficient place to conduct business.

The Forex Market through ActivTrades

The Foreign exchange market (also known as Forex, currency market or FX market) is, by far, the largest financial market in the world. It includes trading between large banks, central banks, currency speculators, multinational corporations, governments, and other financial markets and institutions. The average daily trade in the global Forex and related markets is currently over US$ 3 trillion. Lots of traders are starting to trade Forex due to the Forex market advantages. Here are the most important Forex market advantages:

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The Most Profitable Traders

They are experienced – Probably the most horrifying and worst myth shot out to anyone considering trading for a living is that you will compound millions in an extremely short amount of time. The only true way to make every day profitable comes through experience, and countless hours learning is crucial to longevity of success.

They trade to make money, not to be right – They understand the strengths and possible pitfalls of what it is they do for a living, and use that knowledge to curb their emotional output.

They have an edge and know how to use it – They understand that without it they wouldn’t last long

they have a game plan, and follow it explicitly – Each trade is planned and opportunities are scouted for before any trading takes place. They steer away from the killer of all killers: overtrading.

They manage risk – Regardless of how much conviction they have on a trade, they will still do what they can to avoid the potential of any losses and understand rule #1 about trading: anything can happen.

They think about the trade, not the money behind it - Focusing on money can destroy your means to objectively assess the trade itself.

Consolidation on orange juice

The price of the orange juice contract for November has gotten into a consolidation as shown on the weekly chart, around the 154.73 level where we can also find the 200 week EMA and the 55 week EMA. On the consolidation a pennant or triangle has been formed and due to the fact that the MACD indicator is still showing a bullish trend, it is possible to see the price breaking to the upside. In order for a bullish breakout to be confirmed, the price must overcome the 164.55 level. If there is a real breakout of the 164.55 level, then the price of orange juice would have the road clear all the way to the 189.00 zone, level which already acted as resistance in the past. To the downside, the most important support levels are at the 140.00 level or the low at the 125.00 level.

Pullback on copper could have been over

The price action on copper has been caused by the economic indicators in China. The rally that the commodity had to the 317.84 level, the pullback to the 55 day EMA, and the following rise to the 325.86 level have been the result of a variety of fundamental data out of the Asian Giant. Whatever happens in China directly affects the price of copper due to the fact that China is the main consumer of commodities and the industrial metal. From the last peak that copper reached at the 325.86 level, there was a bearish pullback that took it to the 317.84 zone, which acted as a support and that it was resistance in the past. Apparently, the bearish pullback that copper had to the 317.84 zone is over and the price may try to bounce back up, but in order to keep its bullish trend, it must break above the 325.86 level. The angle of inclination of the 55 day EMA (purple line) is telling us that the bullish trend is still in place, but if the copper keeps falling, that same moving average may act as support. The 200 day EMA may also act as support, but at the moment is too far away.