Thread: NordFX - ECN/STP, MT4, SR, Multiterminal broker

18.05.2015 07:10 GMT

Euro Reached Its Target Level

Last Friday European markets closed in the red whereas Russian and US markets posted a rise.

In Europe, the British FTSE 100 fell 0.18 percent to 6,960.49 points, the German DAX dropped 0.98 percent down to 11,447.03 points, and the French CAC 40 shed 0.71 percent down to 4,993.82 points.

In Russia, due to corporate reports and strengthening of the ruble, the MICEX index grew 0.8 percent to 1,691.05 points, and the RTS index gained 0.86 percent going up to 1,063.94 points.

In the USA, the Dow Jones added 0.11 percent making 18,272.56 points, the S&P 500 grew 0.08 up to 2,122.73 points while the NASDAQ fell 0.05 percent to 5,048.29 points.

The NYMEX price of WTI oil futures for June dropped by $0.19 and got to $59.69 a barrel. On London’s ICE, the June future for oil of mark Brent went up by $0.11 and made $66.81 a barrel.

On the global currency market, EUR/USD has almost reached the earlier mentioned target of 1.1470 (just short of a couple of points). Now the pair is facing quite a big obstacle – the long-term MA on the daily chart and horizontal resistance at 1.1476. The pair may experience a considerable correction here and even roll back to 1.12.

Anna Gorenkova
NordFX Analyst
18 May (1).JPG

19.05.2015 08:20 GMT

EUR/USD Reached 1.12 Rate

Yesterday world financial markets closed mixed. In Europe as such, the British FTSE 100 grew 0.12 percent to 6,968.87 points, the German DAX advanced 1.29 percent up to 11,594.28 points, and the French CAC 40 gained 0.37 percent up to 5,012.31 points.

On the Russian floors, the MICEX index fell 0.76 percent to 1,678.55 points whereas the RTS index posted a slight rise of 0.07 percent making 1,075.47 points.

In the USA, the Dow Jones grew 0.14 percent to 18,298.88 points, the S&P 500 added 0.3 percent reaching 2,129.20 points, and the NASDAQ picked up 0.6 percent getting to 5,078.44 points.

On the NYMEX, the cost of June futures for WTI oil went down by $0.26 and made $59.43 a barrel. On London’s ICE, the price of Brent oil futures for June was down by $0.54 and reached $66.27 a barrel.

Yesterday on the Forex market, EUR/USD started to pull back from the daily MA and reached 1.12 today.

Anna Gorenkova
NordFX Analyst

Generalized Forex Forecast for 25-29 May 2015

First, a few words about the forecast for the past week. We then regarded with suspicion the analysts’ opinions that unanimously predicted growth for all four pairs, and our doubts were justified:
- taking into account graphical analysis and an almost complete Inverted Hat pattern, it was suggested that on drawing the second brim of the hat, EUR/USD would sharply go downwards to 1.1070, which happened in fact;
- the forecast for GBP/USD was also fulfilled 100%. The pair predictably bounced off the upper boundary of the corridor and finished near the corridor’s lowest mark – 1.5500;
- over the last few months it was often said that USD/JPY would try to reach the height of 122.00. However, all that time the pair couldn’t pass the level of 120.50. Finally, the long awaited breakthrough happened, and the pair almost reached the coveted peak, finishing the week at 121.55;
- considering USD/CHF movements, we predicted a rise to at least 0.9290-0.9380. The pair quickly completed the set task and between Tuesday and Friday it remained in this corridor. Only at the end of the week did the pair move further up, taking after the US Consumer Price Index.

***

Now regarding the forecast for the coming week. Generalizing the opinions of 35 analysts from world leading banks and broker companies, as well as forecasts based on different methods of technical and graphical analysis, the following can be said:
- it very well may be that EUR/USD’s story with the second brim of the Inverted Hat isn’t over yet. Judging by the experts’ opinions (↑ – 42%, → – 6%, ↓ – 52%), it can’t be ruled out that the pair will go up, although almost all the indicators point towards its fall (↑– 9%, → – 9%, ↓ – 82%). The level of 1.1000 may become a very strong support for the pair, from which it will move upwards. If the pair manages to overcome the resistance around 1.1110, it will enter into a sideways trend of 1.1110-1.1400 and continue to draw the hat pattern. On the other hand, if the indicators are right and EUR/USD, having broken through the support at 1.1000, goes down, it may reach the zone of 1.0660-1.0800;
- GBP/USD also appears to have reached a strong support level of 1.5500. The analysts each have their own opinion (↑ – 38%, → – 32%, ↓ – 30%), so do the indicators – on the H4 timeframe the consensus is for a downward movement, on D1 – for a rise. Thus, we’ll venture to suggest that in the next few days the pair will be fluctuating in the 1.5500-1.5800 range;
- the opinions of the experts also diverge regarding the future of the USD/JPY pair (↑ – 38%, → – 12%, ↓ – 50%). The indicators, however, are clearly on the side of the bulls (↑ – 91%, → – 9%, ↓ – 0%), which most probably will rely on the support of 120.70 and push the pair up to 122.00. The second strong support level will be 120.20;
- a strong inverse correlation between USD/CHF and EUR/USD has been mentioned repeatedly in the forecasts, which is why there are two possible scenarios for USD/CHF: the first is a rise to a very strong resistance level of 0.9500 followed by a rebound downwards; the second is a fall starting already on Monday. In this case, support will be at the levels of 0.9370 (weak) and 0.9300 (main).

Roman Butko, NordFX

Generalized Forex Forecast for 1-5 June 2015

Let us start with a review of the forecast for the previous week:
- two scenarios were suggested for EUR/USD. One of them, supported by 52% of the analysts and 82% of the indicators, came true – the pair broke through the strong support at 1.1000, reached the zone of 1.0800 and, after a rebound, on Friday returned to where it had started – the level of 1.1000, which has now changed from support to resistance;
- there was total discord regarding GBP/USD among both analysts and indicators last week. Yet this pair also behaved decisively by immediately breaking through the strongest support at 1.5500 and running stepwise to the level below – the next support around 1.5300;
- the forecast for USD/JPY was fulfilled and even exceeded expectations. The pair was predicted to go up to 122.00 while it actually managed to rise above 124.00, reaching the high of July 2007;
- the behavior of USD/CHF has become very predictable lately – a strong mirror correlation with EUR/USD. Something similar took place last week – USD/CHF was expected to rise to a very strong resistance level of 0.9500 followed by a rebound downwards, which did happen.

Now regarding the forecast for the coming week. Generalizing the opinions of 35 analysts from world leading banks and broker companies as well as forecasts based on different methods of technical and graphical analysis, the following can be said:
- the majority of experts (↑ – 69%, → – 12%, ↓ – 19%) predict a steady rise for the EUR/USD pair. The technical indicators on the H4 timeframe concur. Yet on D1 they show the opposite – a downward movement. Furthermore, the systems of graphical analysis clearly draw a rebound downwards from the strong level of resistance 1.1000 to at least last week’s support around 1.0800. In fact, this appears to be a most likely scenario;
- there’s a real clash between the analysts and the indicators regarding the forecast for GBP/USD. Most of the former are for a rise (↑ – 61%, → – 15%, ↓ – 24%) whereas the latter predict a fall (↑ – 17%, → – 8%, ↓ – 75%). Considering that last week, contrary to the expectations, instead of rebounding off the support of 1.5500, GBP/USD broke through it, the pair can be expected to hold out in the range of 1.5250-1.5500 for at least a week this time. Already on Monday or Tuesday it should be clear whether the pair will take a timeout or continue its fall to 1.5000;
- both experts (↑ – 57%, → – 14%, ↓ – 29%) and indicators (↑ – 78%, → – 18%, ↓ – 4%) foretell USD/JPY to rise further to the next symbolic high of 126.00, which the pair reached last all of 15 years ago. This historic charge may turn out not so easy to execute, and the pair may have to keep charging, pushing off the support in the area of 123.20-123.60;
- yet again, there is nothing original for USD/CHF – an inverse correlation with EUR/USD and no independent escapades. The most probable scenario is a rebound from 0.9400 to 0.9540. Or alternatively, a fall to 0.9280.

Roman Butko, NordFX

GENERALIZED FOREX FORECAST FOR 08 – 12 JUNE 2015

As usual, let us start with a few words regarding last week’s forecast. And so:
- for the EUR/USD pair the majority of experts (↑ - 69%, → - 12%, ↓ - 19%) predicted a stable growth. Technical indicators on the H4 timeframe also agreed with them. However, on the contrary, systems of graphical analysis drew a rebound downwards to the level of resistance of 1.1000. The rebound did indeed happen, though it was not as strong as expected – the pair rolled down by 100.0 points and then, confirming the wisdom of the experts, strived upwards again, reaching the strong resistance level in the zone of 1.1280÷1.1300;
- the forecast for the GBP/USD pair was fulfilled by 100%. We predicted that despite the obvious gravitation towards the 1.5000 mark, the pair would spend all of the previous week in a sideways trend, which is what happened – the pair finished at the same place where it had been at the start of the week – in the zone of 1.5270;
- the accuracy for the USD/JPY pair was also 100%. It was expected that when storming the height of 126.00, the pair would organise attack after attack, pushing off support in the zone of 123.60. There were three such attacks the previous week, and, as a result, only on Friday did the pair break through the defence line of the “Japanese” at the height of 124.60 and in a powerful jerk almost reached the its coveted goal;
- nothing original was predicted for the USD/CHF pair – an inverse correlation with EUR/USD and two possible scenarios: the first being a rebound from 0.9400 upwards, the alternative being a fall to 0.9280. The pair managed to execute both scenarios, after which it returned to the start line – the 0.9400 mark.
***
Now regarding the forecast for the coming week. Generalizing the opinions of 35 analysts from world leading banks and broker companies, as well as forecasts based on different methods of technical and graphical analysis, the following can be said:
- for the EUR/USD pair in the coming week an absolute majority of experts and indicators (61%) predict a completion of Friday’s correction and further growth to the height of 1.1500. It should be noted, however, that the very same experts agree that in July-August the pair ought to move back down to at least the zone of 1.0400÷1.0500. According to graphical analysis, on Monday the pair should grow to the level of 1.1190, and then dart downwards to 1.1000;
- regarding the future of the GBP/USD pair, the fight between the analysts and the indicators continues: the former – in their majority (77%) are for the pair’s growth, the latter (100%) are for its fall. Considering that last week the result of this fight was a sideways trend, it can be assumed that this week the pair will fluctuate around the axis of 1.5270, remaining in the corridor of 1.5150÷1.5450. Slightly increasing the timeframe, the pair can be expected to return to the zone of 1.5000
- last Friday the USD/JPY pair had already achieved the level of June 2007, and the next record height will be 135.00, where the height was found in the winter of 2002. However for this purpose the pair must first secure itself in the vicinity of 126.00. Technical indicators offer two possible choices as Pivot Points – 124.30 and 125.40. It seems more probable that 124.30 will become a support level for USD/JPY, leaning on which the “bulls” will push the pair upwards into the zone of 126.70÷127.40;
- for the USD/CHF pair, all 70% of experts, 61% of H4 indicators and systems of graphical analysis predict growth to at least 0.9530. The level of 0.9340 should become the main support level, until which the pair may fall in the start of the week in order to then shoot upwards.

Roman Butko, NordFX

Crownless Krone
Currency Basket 2015-2016: How to Avoid Financial Setbacks
Causes and Effects of Black Thursday

Without question, the reliability of a currency concerns not only representatives of the IMF, central banks and other systemically important financial institutions but anyone deciding what country’s banknotes will at the very least safeguard their savings and ideally increase them.

For the past five or six years, currency ratings have been topped mostly by the Norwegian krone and the Swiss franc rather than by the US dollar or the euro. Back in 2008, HSBC analysts declared the Norwegian krone the most stable currency in the world. The same was said about the Swiss franc by nearly all world leading experts.

In 2011, the Swiss National Bank (SNB) reaffirmed its commitment to the minimum exchange rate of CHF 1.20 per euro and was prepared to buy foreign currency extensively in order to maintain it. Thus, taking into account the average interest rate Libor, the pair was supposed to be trading at 1.22-1.24 in the medium term. Rumor had it that the SNB might raise the EUR/CHF rate to 1.3-1.4 due to a sluggish economic situation in Switzerland.

Over the recent years, the Swiss National Bank kept the established rate. On 12 January 2015, SNB vice president Jean-Pierre Danthine officially called the cap on the franc a cornerstone of the country’s monetary policy. But already on Thursday, 15 January, catching the majority of financial market players off guard, the SNB decided to abandon all the restrictions for the currency market. As a result, the franc soared up almost instantaneously, even up to 30 percent at a time, which hasn’t happened for the past 25 years.

Who were the losers? In fact, there were many:
■ Firstly, it’s the SNB itself, whose assets were kept mainly in dollars and euros. As these currencies depreciated, the bank sustained a loss of about 60 billion.
■ Secondly, Switzerland’s economy was dealt quite a heavy blow. According to national stock market data, on Thursday, 15 January, the Swiss Market Index (SMI), comprising 20 largest companies, dropped 8.67 percent. One of the country’s main revenue items is exports. Swiss goods aren’t generally cheap, and if, for instance, Swiss chocolate becomes more expensive even by 15 percent, it will quickly start giving way to French and Belgian chocolate. The same applies to medicines and other export products. In Jean-Pierre Danthine’s words again, exporters may come short of 5 billion francs. On top of it, the share of tourism might contract whereas it currently stands at 7 percent of Switzerland’s GDP.
■ Thirdly, steep losses were sustained by those who had taken out Swiss franc loans as they got more expensive by 20 percent overnight. In France, for one, such contracts made 50 percent. Millions of private borrowers in other countries were affected by that turn of events – they considered the franc the most stable currency and thus believed that Swiss franc mortgages would be the most secure.
■ Deutsche Bank lost nearly €130 million due to the exchange rate, about the same as the US group Citibank in Europe and Barclays.

John Gordon, a leading analyst with international brokerage NordFX comments, “The exchange rate plunged so swiftly that brokers simply couldn’t close positions fast enough and those who traded against the franc suffered huge losses. The consequences for the Forex market were very grave, and hundreds of thousands of people worldwide said goodbye to their capitals.”

The next logical questions are why all that happened and who benefitted from it?

Some analysts tend to believe it was a plot by financiers (like what George Soros did with the British pound on Black Wednesday 1992). To prove it, they refer to a recoil 20 minutes after the fall of the dollar and euro rates – the profits gained by the initiators of the crash. They say that the initiators actually skimmed a 20 percent profit in just a few minutes!

Despite the fact that such a recoil did happen, most international experts hold a different view of the event. According to Alessandro Bee, a strategist at J. Safra Sarasin AG in Zurich (one of the oldest banks in Switzerland), the Swiss National Bank didn’t see any future for the franc rate cap, considering the strong US dollar and quantitative easing ahead in the eurozone.

Pick your reason (a possible Grexit, imminent ECB plans or the UK’s in-out EU referendum), the euro itself is facing a serious crisis and soon – so much so that, in Swiss bankers’ opinion, there’s just no time to contrive smart moves. Therefore, regardless of the losses, they decided to unpeg the franc from the euro. Otherwise, the sinking ‘euro Titanic’ would inevitably pull down the Swiss economy in its wake. Switzerland’s GDP certainly looks impressive with its $600 billion but, in comparison with the EU’s total GDP of 15,669 billion, it’s just too small to keep the euro afloat.

“What occurred has once more proved that it’s hardly possible to find an absolutely quiet and all-around sheltered haven for one’s savings,” says John Gordon from NordFX. “For instance, see what happened to the exchange rates of two of the most stable currencies supposedly. On January 15th, the Norwegian krone fell against the Swiss franc by over 17 percent. Krone investors lost majorly. Recently, I’ve come to realize once again that only a multi-currency basket can provide real capital protection. As for its makeup for the upcoming year or two, I wouldn’t concentrate on Norway’s krone. It’s just too dependent on oil prices and has dropped against the US dollar by about 25 percent over the past year alone. So, despite the Black Thursday developments, I still wouldn’t get rid of euros but actually stick with the classic combination – euros, US dollars and Swiss francs.

NordFX analysts believe that these three currencies aim at exchange rate parity around 1.0000, and the formation of such a congruent triangle should become the main trend for the next 6 months to a year. By the way, it’s not just our opinion but according NAB (National Australia Bank) forecasts, the EUR/USD exchange rate will reach 1.0000 already by this December and stay around it till at least the summer of 2016. Besides, SNB vice chairman Bruno Gehrig assured that the Swiss Central Bank would carry out large-scale interventions in order to curb growth of the domestic currency. To sum up, the tri-currency basket may not yield spectacular profits but, in any case, will help to prevent any tangible setbacks by acting like a gyroscope in a stable position regardless of the fluctuations on financial markets.”

Generalized Forex Forecast for 15-19 June 2015

First, a few words about the forecast for the past week:
- most experts and technical indicators (61%) predicted that EUR/USD would rise further to 1.1500. The pair indeed went up, quickly reached a very strong level of resistance in the zone of 1.1280-1.1300 and then rolled back, repeating the scenario of the first week of June and finishing the five days at 1.1260;
- last week saw a continued battle between the analysts and indicators regarding the future of GBP/USD. The former, for the most part (77%), were for the pair’s rise, the latter – for its fall. Looking at the chart, you can see how convincing the victory of the experts turned out to be – climbing up at an angle of 45 degrees, the pair reached the symbolic mark of 1.5550 by Friday;
- USD/JPY apparently decided that it was ascending too fast and, instead of the expected continuation of growth, made a swift nosedive, turning the 123.80 support level into resistance;
- USD/CHF was expected to fall to 0.9340 at the beginning of the week and then rebound upwards. The pair indeed went down but, dashingly breaking through the level of 0.9340, changed it from support to a Pivot Point under somewhat prevailing bearish tendencies.

Now regarding the forecast for the coming week. Generalizing the opinions of 35 analysts from world leading banks and broker companies, as well as forecasts based on different methods of technical and graphical analysis, the following can be concluded:
- the majority of the experts (71%) predict that EUR/USD may fall to 1.1050, assuming the pair’s monthly sideways trend will be in a 1.1050-1.1350 corridor. The indicators on H4 and D1 also support the idea of a sideways trend with Pivot Points on the line of 1.1260. With this, they don’t rule out the pair may rise at the start of the week;
- as for the future of GBP/USD, the analysts are at a total loss (↑ – 29%, → – 29%, ↓ – 42%). The indicators however are clearly (83%) for the pair’s rise to the level of 1.5680. Support is around 1.5440 – if you consider graphical analysis, the pair is bound to fall to this level first;
- there’s no unanimity among the experts about USD/JPY either. The summary of their forecasts produces a 122.45-125.00 corridor with a Pivot Point at 123.50. On the D1 timeframe, the indicators totally agree with the analysts. As for the indications on H4, they show a possible fall to the bottom boundary of the corridor early in the week;
- as for the USD/CHF pair, 67% of the experts predict its rise at least to the main level of resistance of the previous week around 0.9400. In case the pair manages to break through this defence line, its next target will become 0.9500. However, the indicators on H1, H4, D1 and even W1 persistently assert the opposite, giving a distinct advantage to the bears. Acting usually as a third force, graphical analysis has sided with the human mind this time – it shows the pair’s rise to 0.9400 first and then its return to support at 0.9300 or 0.9250.

Roman Butko, NordFX

Generalized Forex Forecast for 22-26 June 2015

First, let’s review last week’s predictions:
- the forecast for the EUR/USD pair for the previous five days was based on the assumption of a monthly sideways trend in the range of 1.1050-1.1350 with Pivot Points along 1.1260. With that, the possibility of a rise at the start of the week was not excluded. Until Wednesday, EUR/USD followed the forecast to the letter but later, due to the news from the US Federal Reserve, it shot upwards, breaking through the level of resistance at 1.1350. Then, however, the pair quickly returned to the mentioned range and finished the week near its upper boundary;
- the analysts and the indicators were certain that GBP/USD would grow to 1.5680. Before that, according to graphical analysis, the pair was supposed to fall to the support level around 1.5440. That actually happened – on Monday the pair fell to 1.5487 and then went upwards, reaching the target upper boundary by Wednesday. Later on, the news from England and the USA started to actively push the British pound even higher, which resulted in the pair reaching the level of last December;
- despite the reports from the USA, the USD/JPY pair managed to remain in the mentioned range of 122.45-125.00 with the Pivot Point at 123.50, fulfilling the forecast 100%;
- in the standoff between the analysts and the indicators about the future of USD/CHF, the latter came out to be right, supported by graphical analysis. As predicted, the pair first went up and then dropped down, reaching the support level at 0.9250. Then, due to the very same news from the USA, the pair decisively broke through it and turned the support into the upper level of a sideways trend.

Now regarding the forecast for this week. Summarizing the opinions of 35 analysts from world leading banks and broker companies, as well as forecasts based on different methods of technical and graphical analysis, the following can be put forward:
- the absolute majority of the experts tend to believe that EUR/USD will remain in the monthly sideways trend and thus will have to fall to its bottom boundary around 1.1200 and even further to 1.1160. Graphical analysis confirms this. The indicators are definitely (74%) against all of the above. Most likely, the pair’s movements early in the week will make it clear which of the forecasts should be trusted;
- the indicators show just one thing for GBP/USD – only an upward movement. The analysts, in turn, are again at a loss: ↑ – 33%, → – 12%, ↓ – 55%. Graphical analysis as an arbitrator supports the pair’s entering into a sideways trend and a fall to the levels of the beginning of May. Support will be around 1.5800 and 1.5740;
- most experts (60%), indicators (52%) and even graphical analysis agree that GBP/USD should first fall to 121.50-122.00 but their further forecasts diverge. Even with graphical analysis, there is an antagonism – the H4 timeframe clearly shows a rebound upward and a 122.00-124.50 sideways corridor while D1 pulls the pair further down to support at 120.00, the level off which the pair may rebound and rise even above 126.00;
- all forecasts of the experts regarding the USD/CHF pair continue to spin around 0.9250. At first, it was support, then became resistance, and now the experts consider it a Pivot Point. Yet the indicators propose a slightly lower Pivot Point around 0.9180-0.9200. In both cases the talk is about a sideways trend, the difference being that in the former case, the boundaries are set in the range of 0.9080-0.9390 while in the latter, upper resistance will be about 0.9250.

Roman Butko, NordFX

Generalized Forex Forecast for 29 June - 3 July 2015

First, a review of the forecast for the past week:
- most experts suggested that the EUR/USD pair would hold in the monthly sideways trend and therefore descend to its lowest level around 1.1200 and possibly beyond that to 1.1160, which happened with 100% accuracy;
- taking into consideration the opinion of 55% of the analysts and graphical analysis indications, the GBP/USD pair was predicted to go down to the 1.5740 support level. The forecast was also fulfilled as the pair finished the business week at that level precisely;
- the prediction of the 122.00-124.50 sideways corridor for USD/JPY also ended up being correct. However, it was said that before getting to the upper boundary of the corridor, the pair would descend to just below 122.00 but it didn’t happen. Nonetheless, there was a just minor descent, and on Monday the pair lunged upwards, making it to the 124.40-124.50 resistance level by Wednesday;
- the experts set 0.9390 as a resistance level for USD/CHF. The pair reached this mark already on Tuesday, after which its volatility rapidly diminished and the pair continued to move within a much more modest range of 0.9285-0.9390 for the rest of the week.

Forecast for the upcoming week
Generalizing the opinions of 35 analysts from world leading banks and brokerage companies, as well as forecasts based on various methods of technical and graphical analysis, the following can be concluded:
- both the majority of the experts and the indicators foretell a further sideways trend for EUR/USD, with the bears enjoying a certain advantage. Thus, 1.1035 can be considered as a likely strong support level. The upper boundary of the corridor remains at 1.1450, the Pivot Point is 1.1200;
- according to the analysts, the GBP/USD pair will most probably be in a sideways trend too. Unlike the EUR/USD scenario, bullish tendencies will dominate here. Due to this, one can’t rule out either the pair’s rise to the upper boundary of the corridor at 1.5930 or a break through it and an upward movement towards 1.6000;
- the experts and the indicators agree that the bears will also demonstrate their strength in the battle for the future of the USD/JPY pair. A likely Pivot Point is 123.85, last week’s final level, while the pair’s target will be a break through resistance around 124.40 and reaching 125.00;
- the USD/CHF pair displays an inverse correlation with EUR/USD time and time again, in view of which USD/CHF can be expected to rise to 0.9400 or even further to 0.9450.

Roman Butko, NordFX

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