Forex analysis review |
- GBP/USD bounced off support, potential for further rise!
- AUD/USD moving towards key resistance where we could see a reversal occur!
- EUR/JPY approaching key support, potential to bounce!
- What was Trump really up to?
- EUR/USD: the market will wait until Friday
- Brent: in war as in war
- Pound under pressure: Brexit got stuck in a swamp of negotiations again
- AUD/USD. The RBA saved the aussie, but the key to an upward trend lies with Trump
- EUR/USD. May 7th. Results of the day. The US increases tariffs on Chinese imports
- AUD/USD 5 Star Trading Signal | Fundamental + Technical Analysis
- May 7, 2019 : EUR/USD Intraday technical analysis and trade recommendations.
- Ichimoku cloud indicator analysis for EURUSD for May 7, 2019
- Gold challenges important resistance
- May 7, 2019 : GBP/USD Intraday technical analysis and trade recommendations.
- EURUSD: The report of the European Commission put pressure on the euro, as well as weak data on German production activity
- Experts differ in their estimates regarding the prospects of EUR/USD
- Technical analysis of NZD/USD for May 07, 2019
- Technical analysis of AUD/USD for May 07, 2019
- Bitcoin analysis for May 07, 2019
- Analysis of Gold for May 07, 2019
- EUR./USD analysis for May 07, 2019
- GBP/USD: plan for the American session on May 7. The pressure on the pound is gradually increasing
- EUR/USD: plan for the American session on May 7. German data disappointed traders
- Aussie grows up on RBA meeting; dollar drifts downstream
- RBA took investors by surprise, "Aussie" sharply increased in price
| GBP/USD bounced off support, potential for further rise! Posted: 07 May 2019 07:12 PM PDT
Price bounced off our first support where we might see a further rise in price. Entry : 1.3047 Why it's good : horizontal swing low support, 100% Fibonacci extension, 38.2% Fibonacci retracement Stop Loss : 1.3017 Why it's good : 50% Fibonacci retracement Take Profit : 1.3125Why it's good : horizontal swing high resistance, 61.8% Fibonacci retracement
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| AUD/USD moving towards key resistance where we could see a reversal occur! Posted: 07 May 2019 07:08 PM PDT
Price is approaching a key resistance at 0.7058 where it could potentially reverse to its support at 0.6998. Entry : 0.7058 Why it's good : horizontal overlap resistance, 38.2% Fibonacci retracement, 100% Fibonacci extension Stop Loss : 0.7089 Why it's good : 50% fibonacci retracement Take Profit : 0.6998 Why it's good : 61.8% Fibonacci retracement, horizontal swing low support
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| EUR/JPY approaching key support, potential to bounce! Posted: 07 May 2019 07:06 PM PDT
EURJPY is approaching its support where it could potentially bounce Entry: 123.16 Why it's good :100% Fibonacci extension, 50% Fibonacci retracement, horizontal swing low support Stop Loss : 122.38 Why it's good : 61.8% fibonacci retracement, 100% Fibonacci extension Take Profit : 124.61 Why it's good: 38.2% Fibonacci retracement, 61.8% Fibonacci retracement horizontal swing high resistance
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| Posted: 07 May 2019 04:51 PM PDT It's no secret that Donald Trump likes to intimidate the markets; this is his favorite weapon. It is equally safe to say that all these threats cannot be taken at face value. If Washington actually introduces new duties, which Trump tweeted, then the tariff barrier between the US and China will be higher than in many developing countries. All these emotional outbursts are more like a continuation of the game "who blinks first," rather than a change in the course of trade negotiations. In this case, a logical question arises: what did Trump actually plan? There are suggestions that China has nothing to do with it, and Trump's tweets are part of a certain president's game with the Fed. Earlier, the pressure was on the central bank to strengthen the position of the economy, which could bear the consequences of a trade war without complications. Perhaps now Trump is trying to drive the Fed into a corner. If trade uncertainty exists, the regulator will be forced to lower rates and ensure an economic boom before the 2020 elections. By the way, expectations for a reduction in the rate have now increased, whereas a few days ago they were declining. It is unlikely that the head of the White House plays a strategic game, but in general, events confirm this. In addition, he has to reckon with what is happening in the foreign exchange market. The Chinese yuan, most of the post-crisis era, became cheaper following the slow growth of the country's economy. Companies that are subject to Chinese risk lagged behind other stocks, the exchange rate increased the competitiveness of the state. That all changed a little over a year ago, in part because of concerns about a trade dispute with the United States. On Monday, Chinese stocks plummeted, and the yuan fell to its lowest level in more than three years. The authorities of China continue to carefully monitor the national currency, so it will not be easy for Donald Trump to increase the competitiveness of the US economy. More precisely – it is impossible. We need the Fed to lower the rate. The material has been provided by InstaForex Company - www.instaforex.com |
| EUR/USD: the market will wait until Friday Posted: 07 May 2019 04:51 PM PDT Donald Trump's energy release continues to determine overall market sentiment. The belligerent position of the head of the White House on tariffs was confirmed by US Trade Representative Robert Lighthizer, who said that the Chinese side had abandoned its previous obligations, prompting anger and outrage from the American leader. Today, official Beijing contacted, announcing its intention to attend the trade talks in Washington on Friday. China will be represented by the main trade negotiator Liu He. This news had a calming effect on market participants. Thus, a clear risk schedule was established for the entire week. Traders are waiting for reports of trade negotiations for Friday. If we are talking about risks in the foreign exchange market, the mood vector was well defined at the beginning of the week: negative news about trade negotiations between the US and China is a strong G3 led by the yen. The British pound and the Swiss franc are moving independently. Sterling remains under Brexit's influence, and traders no longer perceive the franc as a safe haven, unlike what it used to be, which implies structural weakness. About gold Traders did not rush to hide in gold, and the precious metal did not go into a short-term rally, as expected. In fact, it should have been at least until Thursday, because on Friday, as you know, a Chinese diplomat will arrive in Washington for negotiations. However, gold failed to gain a foothold even at the level of $1285-1290, which indicates the weakness of buyers. Open interest has shown that the number of buyers is three times the number of sellers. But even in this case, gold is not ready to move up. From this we can conclude that the decline in metal prices from the end of March to the present is not due to an increase in sellers, but to a deterioration in demand for safe assets. It is also worth noting that the market is fueling the Fed's rhetoric. Against this background, the lion's share of investors, despite the approaching summer vacation, when the portfolio is revised, puts on a further rise in the dollar. From a fundamental point of view, the market is now in a state of euphoria. Fans of gold now have nothing to catch, with the exception of short bursts of panic, on which you can collect a couple of dollars inside the day. It is also risky to rely on long-term growth, since there are no weighty arguments foreshadowing changes in the US market. As for the dollar, the short-term support for it, as well as the euro as a funding currency, provides a large-scale closure of carry trade positions due to the growing risks of escalation of the trade conflict between the two largest economies of the world. This leads to a decrease in the currencies of developing countries and keeps the EUR/USD pair near the $1.12 mark. We look forward to Friday and follow the headlines from China and the United States on the trade agreement. The escalation of the conflict contributes to the weakening of the euro, the improvement of the situation will incite the rate of the single currency. The material has been provided by InstaForex Company - www.instaforex.com |
| Posted: 07 May 2019 04:33 PM PDT When pursuing many goals, you need to be prepared for the fact that they will begin to contradict each other. With a statement about raising tariffs from 10% to 25% for $200 billion worth of Chinese imports from May 10, Donald Trump brought Brent and WTI down by more than 2%, but at the same time strengthened the dollar (safe-haven asset) against currencies of developing countries (risky assets) . The risks of escalating the trade conflict between the United States and China, the two countries, which account for one-third of global oil consumption, led to a swift attack on black gold, but information about the United States sending bombers and aircraft carriers to the Middle East messed up all the cards. The White House wants to punish Iran by reducing its oil exports to zero, but is unhappy with the growth of Brent and WTI quotes. Threats to Tehran to block the Strait of Hormuz, which will create serious supply disruptions, force Americans to demonstrate military force. At the same time, the growth of geopolitical tensions is a "bullish" factor for black gold. Try to make both goals accomplished at the same time! The problem with China is as difficult. Trump declares that the United States annually loses $600-800 billion from trade, of which $500 billion falls on China. This can no longer continue! But excuse me, historically, the US is a consumer country. The better their economy feels, the faster the import grows and the trade balance deficit widens. At the same time, threats to raise tariffs from May 10 and then impose the entire Chinese imports on them provoked a 6% collapse of the Shanghai Composite on fears of a slowdown in the largest Asian economy. If there is no V-shaped recovery in China's GDP, then one of the key drivers of growth of world stock indices and oil will disappear, triggering them into a deep correction. Dynamics of the Chinese stock and oil market Donald Trump will be pleased to rub his hands over the rollback of Brent and WTI, but the S&P 500's fall is unlikely to please him . At the same time, the dollar will strengthen, which the White House also does not want. The goals of the US president are often contradictory, but they can still be achieved. For example, during the trade war, China reduced the import of American oil from 430 thousand b/d to 100 thousand b/d. Potentially, thanks to the negotiations, not only will it return the previous figures, but also increase them by $12 billion a year. In my opinion, the further fate of Brent and WTI will depend on two factors: a trade war and a prolongation of the agreement between OPEC and other producing countries on reducing production. The signing of an agreement on the contract of trade friction between Washington and Beijing, as well as the extension of the terms of the obligations of the cartel and Russia will make it possible for oil to continue the rally. On the contrary, the escalation of the conflict between the largest economies of the world and the increase in world production will launch a serious correction in the oil market. Technically, this can be expressed in the growth of quotations of futures for the North Sea variety above the resistance by $72.75 and $75.65, or in their fall below the support by $68.45 per barrel as part of the transformation of the "Shark" pattern in 5-0. The material has been provided by InstaForex Company - www.instaforex.com |
| Pound under pressure: Brexit got stuck in a swamp of negotiations again Posted: 07 May 2019 04:13 PM PDT A miracle did not happen: Brexit was again stuck in a swamp of counterproductive negotiations. Theresa May and the Labour Party representatives could not come to a common decision, and this fact became obvious. According to the British press, on Tuesday, the prime minister was supposed to submit her updated action plan, which would include the creation of a temporary customs union with the EU (which would be valid until the next general election in 2022), as well as the introduction of common market rules goods. In addition, the Cabinet was supposed to introduce (and support) to Parliament a law that guarantees the workers in Great Britain with the same rights as those in the European Union. After a resonant publication, the market was inspiringly waiting for today, but traders were again disappointed: the May government failed to reach an agreement with the Labour Party. Moreover, the opposition accused the prime minister of violating the confidentiality of the negotiations. One of the most influential Laborites, John McDonnell, attacked the prime minister with criticism: in his opinion, May leads a "double game", disclosing details of the non-public dialogue. Judging by the reaction of the Labour Party, the situation could really move forward, however, internal party behind-the-scenes intrigues (both among Labor and conservatives) led to a leak of information and subsequent scandal. As a result, the parties were forced to back down, voicing the duty phrase about "continuing the negotiation process." By and large, Labour and the Conservatives have lost their last chance to prevent Britain from participating in the European Parliament elections. Theresa May looked visibly disappointed today: she expressed regret that the British would have to go to the polls. Indeed, the election of British representatives to the European legislature looks ridiculous, since the country has "with one foot" already withdrawn from the EU. Nevertheless, London is forced to take this step, fulfilling the conditions of the "postponement" of Brexit. After the events of Tuesday, the pound approached the bottom of the 30th figure against the dollar, since the future prospects of the negotiations look vague. The main problem is that there is no solidity among the members of the Conservative Party or among the representatives of the Labour Party. The "hawkish" wing of the Conservatives strongly opposes the customs union with the European Union and still demands the prime minister's resignation. Part of the Labour Party also does not support the idea of creating/maintaining a common customs space with the EU (even temporary), insisting on holding a repeat referendum. Moreover, in their opinion, the British should choose not only between the versions of Brexit, but also express their opinion on the expediency of the "divorce process" as a whole. Given the diversity of the political positions of the parties, it will not be easy for the prime minister to collect votes, even if there are certain concessions on her part. And yet many experts do not lose hope that Labour and Conservatives will eventually come to a compromise, although this may take several more weeks (and maybe months) of negotiations. According to them, the failed results of the local elections (which were held last week in England and Northern Ireland) brought together the positions of the opposing political forces. Let me remind you that the Conservative Party of Great Britain lost more than 1.3 thousand seats out of 8.4 thousand, while losing control over 49 local councils from 248. The election results were also disappointing for the Labour Party: they lost 6 local councils and 86 deputies. Both parties associate such a negative result with Brexit, namely with a long-term period of uncertainty, therefore, after the announcement of the election results, the politicians started the negotiation process. Furthermore, analysts are not excluding the option of a second referendum. Over the past year and a half, British politicians have treated this scenario differently - for example, at one time Laborites actively lobbied for this idea, but then abandoned it. Now, many oppositionists are again campaigning for a re-plebiscite, and is rumored to be very successful. So, according to the British press, Theresa May recently held a meeting with her assistants and the cabinet ministers where she tried to plan the script in case the government could not prevent a Parliamentary vote on the second referendum. This meeting was held on the eve of the next round of negotiations with the Labour Party, which will be held this week. In other words, the option of a repeated referendum cannot be disregarded, although such a scenario implies a rather complicated legal procedure (many legislative acts must be amended). But if the parties finally reach an impasse, Parliamentarians can take this step, despite all its negatives and difficulties. Thus, the British currency has no choice but to respond to the next rumors and comments on further negotiations between Labour and Theresa May's government. Given the fact that the British still have to participate in the elections to the European Parliament, the next dialogue between the parties may again be delayed for several weeks. The material has been provided by InstaForex Company - www.instaforex.com |
| AUD/USD. The RBA saved the aussie, but the key to an upward trend lies with Trump Posted: 07 May 2019 03:52 PM PDT The Reserve Bank of Australia has come to the aid of the Australian currency, which paired with the dollar is in the area of the psychologically important mark of 0.7000. Against the background of a general increase in anti-risk market sentiment, yesterday, AUD/USD bears were able to lower the price for a key support level, however, the regulator's rhetoric made it possible for the bulls to regain lost positions. However, it is still too early to talk about a trend reversal. After an impulsive growth to the level of 0.7040, the pair began to gradually slide back to the "round" level. This is not surprising, given the emerging prospects for the resumption of the trade war between China and the United States. At the same time, the results of the RBA's May meeting allowed the aussie bulls to take a defensive position - at least until the issue was resolved regarding further relations between Beijing and Washington. Let me remind you that, on the eve of today's meeting of the members of the Australian central bank, there were rumors that the RBA would lower the interest rate. On the one hand, the likelihood of such a move was indeed high: inflation in the country slowed to zero (in monthly terms), and economic growth shows a stable downward trend since the second quarter of last year. Even the commodity market, which has significantly strengthened this year (in particular, the cost of iron ore has increased), could not provide support to key macroeconomic indicators. The RBA's reaction has been discreet for over the past half year. The head of the regulator, on the one hand, expressed concern about certain trends - but on the other hand, he was optimistic about the future prospects. This balance kept the Australian afloat, or to be more precise, above the key support level of 0.7000. This continued until the April meeting of the Reserve Bank of New Zealand, at which members of the regulator actually announced a reduction in interest rates. Many AUD/USD traders are concerned that RBA members will follow this example and will also move on to mitigate the parameters of monetary policy. Recent data on the growth of Australian inflation, which came out much worse than forecasts, only increased the excitement about this. RBA Deputy Head Guy Debelle also added fuel to the fire, not excluding the reduction of the rate "if necessary". Well, the "cherry on top" was served by the warlike tweet of Donald Trump, who, with his threats, jeopardized the negotiation process between the US and China. In other words, the fundamental picture on the eve of the RBA's May meeting was clearly not in favor of the Australian dollar. Even the consensus forecast regarding the outcome of the meeting said that the regulator will reduce the interest rate by 25 basis points. The AUD/USD bears actively used the situation - thanks to the general nervousness, the pair plunged below the 70th figure. However, not only did the Reserve Bank of Australia not reduce the interest rate, but it even retained "cautious optimism" regarding future prospects. In particular, Philip Lowe said that he "sees spare capacity in the economy," although quarterly inflation was below forecasts, and the uncertainty surrounding household spending remains high. In his opinion, inflation can still be brought to the target level, but this requires further strengthening in the labor market (especially in terms of wage growth). Despite the rather "dovish" rhetoric (although not as mild as many experts had expected), the head of the RBA did not hint at a possible rate cut in the near future. This fact surprised traders, after which the aussie then jumped to the middle of the 70th figure. This position of the RBA is explained by several factors. First, the prospects for trade negotiations between the United States and China remain unclear. According to the latest data, the vice-premier of China agreed to visit Washington, however, this visit will be short. In other words, the Chinese did not "slam the door" in response to Trump's threats, but the fate of the trade deal is still in limbo. In addition, the wait-and-see position of the RBA may be due to the general federal elections to be held in Australia on May 18. Deputies of the Lower House of Parliament and half of the Congress will be re-elected in the country. The party that receives the majority of seats in the House of Representatives will have the right to form a government, and its leader will accordingly become the prime minister of the country. In the context of the foreign exchange market, it is worth noting that both the current government and its opposition had promised the residents of Australia that it would reduce taxes and increase investment in infrastructure. It is obvious that on the eve of "big changes" it is not advisable to change the parameters of monetary policy, especially since the country's economy does not require the use of emergency measures from the RBA: against the background of lower inflation and GDP, retail sales increased, business activity in the sectors of production, services and construction accelerated. In addition, the Australian labor market demonstrates positive dynamics, although the growth of wages leaves much to be desired. Summarizing what has been said, we can conclude that now the Australian dollar is completely dependent on the prospects for the US-China talks. The Reserve Bank of Australia made it clear that it is not going to lower the interest rate in the near future, so in this part the AUD/USD bears lost a powerful enough trump card to put pressure on the pair. If the next round of talks between Washington and Beijing ends more or less successfully (the White House will not introduce announced duties on Friday), the aussie will have a reason to recover throughout the market - and above all against the US currency. The material has been provided by InstaForex Company - www.instaforex.com |
| EUR/USD. May 7th. Results of the day. The US increases tariffs on Chinese imports Posted: 07 May 2019 03:36 PM PDT 4-hour timeframe The amplitude of the last 5 days (high-low): 53p - 78p - 48p - 70p - 37p. Average amplitude for the last 5 days: 57p (58p). The EUR/USD pair ends the second trading day of the week with a decline of "as much as" 30 points. Formally, this is still a downward movement, in fact - this is the usual market noise. There is no trend now, and even the Ichimoku indicator does not signal any trend. No important macroeconomic reports were published today, so we once again draw attention to the fact that there was nothing for traders to respond to. Based on this, the pair can move in any direction at any time. In recent weeks, the pair, it would seem, has shown willingness to form a new downward trend, but the downward movement has stalled near the level of 1,1100, and so far the bears lack the strength and desire to continue it. Meanwhile, the US trade representative said that China refuses to comply with the previously reached agreements, and precisely because of this, the United States intend to raise duties on imports from China this Friday from 10% to 25%. We believe that this is only from the side of the US. In reality, everything can be quite different. In any case, China has not yet made official statements on this matter, so it is difficult for us to judge this situation, since it is visible only from one side. It is also reported that new negotiations will have to be held with China on Thursday and Friday this week, however, there is also information that the PRC may refuse to participate in them due to Washington's overly radical position and unfair increase in duties on Chinese goods. Trading recommendations: The EUR/USD pair has broken the Kijun-sen line, however there is no clear trend for the pair at the moment. Formally, short positions are relevant in small lots with a target of 1.1136, which can be supported before the MACD reversal. It is recommended that you consider long positions no earlier than when the pair consolidates above the Ichimoku cloud. However, as we have already mentioned, there is no evident trend for the pair at the moment. In addition to the technical picture, one should also take into account the fundamental data and the time of their release. Explanation of the illustration: Ichimoku indicator: Tenkan-sen - the red line. Kijun-sen - the blue line. Senkou Span A - light brown dotted line. Senkou Span B - light purple dotted line. Chikou Span - green line. Bollinger Bands indicator: 3 yellow lines. MACD Indicator: Red line and histogram with white bars in the indicator window. The material has been provided by InstaForex Company - www.instaforex.com |
| AUD/USD 5 Star Trading Signal | Fundamental + Technical Analysis Posted: 07 May 2019 01:15 PM PDT
Sell entry: 0.7058 Why It's Good: We're seeing a lot of resistance at that level, like 100% Fibonacci extension and 38.2% Fibonacci retracement. Strong overlap resistance too. Stop loss: 0.7089 Why It's Good: Very nice retracement and a horizontal swing high resistance. Take profit: 0.7012 Why It's Good: Really nice retracement and extension The material has been provided by InstaForex Company - www.instaforex.com |
| May 7, 2019 : EUR/USD Intraday technical analysis and trade recommendations. Posted: 07 May 2019 10:47 AM PDT
Few weeks ago, a bullish Head and Shoulders reversal pattern was demonstrated around 1.1200. This enhanced further bullish advancement towards 1.1300-1.1315 (supply zone) where significant bearish rejection was demonstrated on April 15. Short-term outlook turned to become bearish towards 1.1280 (61.8% Fibonacci) then 1.1235 (78.6% Fibonacci). For Intraday traders, the price zone around 1.1235 (78.6% Fibonacci) stood as a temporary demand area which paused the ongoing bearish momentum for a while before bearish breakdown could be executed on April 23. Currently, the price zone around 1.1235-1.1250 has turned into supply-zone to be watched for bearish rejection. Few days ago, another recent bullish head and shoulders pattern was being demonstrated around 1.1140 on the H4 chart. That's why, conservative traders were suggested to wait for another bullish pullback towards 1.1230-1.1250 where a valid SELL entry was suggested. On Friday, the market has failed to sustain bearish pressure below the price Level of 1.1175. That's why, another bullish pullback was expected to occur towards the depicted SELL zone around 1.1235. However, the EURUSD pair found great bearish rejection around 1.1200 - 1.1210 which brought the EURUSD pair down towards 1.1175 again. Trade recommendations : Conservative traders should wait for an obvious H4 bearish closure below 1.1175 for a valid SELL entry. S/L should be placed around 1.1200. Initial Target levels should be located around 1.1135 and 1.1080. The material has been provided by InstaForex Company - www.instaforex.com |
| Ichimoku cloud indicator analysis for EURUSD for May 7, 2019 Posted: 07 May 2019 10:38 AM PDT Trend remains bearish in EURUSD in the Daily and weekly time frame according to the Ichimoku cloud indicator. There is no sign of trend reversal but in this post we will point out the levels bulls need to break in order to reverse trend according to Ichimoku cloud indicator.
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| Gold challenges important resistance Posted: 07 May 2019 10:00 AM PDT Gold price is challenging important resistance trend line and we should soon see either a breakout towards $1,300 and higher or a rejection and a move below $1,270 towards $1,250-60.
Blue line- major resistance trend line Blue rectangle - short-term support Gold price is challenging the downward sloping blue trend line resistance while trading inside the major confluence zone. Breaking above the red zone and the blue trend line will be a bullish sign. Gold will be expected to move at least towards $1,300 which is the next resistance. Support is at $1,276 shown by the blue rectangle. Failure to stay above it will open the way for a move towards $1,250-60. The material has been provided by InstaForex Company - www.instaforex.com |
| May 7, 2019 : GBP/USD Intraday technical analysis and trade recommendations. Posted: 07 May 2019 09:24 AM PDT
On March 29, the price levels of 1.2980 (the lower limit of the newly-established bearish movement channel) demonstrated significant bullish rejection. This brought the GBPUSD pair again towards the price zone of (1.3160-1.3180) where the upper limit of the depicted bearish channel as well as the backside of the depicted broken uptrend line demonstrated significant bearish rejection. Since then, Short-term outlook has turned into bearish with intermediate-term bearish targets projected towards 1.2900 and 1.2850. Last week, a bullish pullback was executed towards the price levels around 1.3035 - 1.3070 (50% - 61.8% Fibonacci levels) where temporary bearish rejection was demonstrated. However, by the end of Friday's consolidations, significant bullish momentum was initiated around 1.3000 failing to maintain bearish persistence below 1.3030-1.3000. Short-term outlook turns to become bullish provided that the price levels around 1.3035 (50% Fibonacci level) remains defended by the bulls. Currently, The price zone of 1.3030-1.3050 constitutes a prominent demand-zone to be watched for bullish entries. On the other hand, bearish breakdown below 1.3030 enhances a quick bearish decline towards 1.2930 where the backside of the broken channel is located. Trade Recommendations: Conservative traders should be waiting for signs of bullish reversal around the current price levels (1.3035-1.3050) as a valid BUY signal. T/p levels to be located around 1.3170 and 1.3250. Any bearish breakdown below 1.3030 invalidates this bullish scenario. The material has been provided by InstaForex Company - www.instaforex.com |
| Posted: 07 May 2019 08:22 AM PDT Data indicating a sharp slowdown in the German manufacturing sector, which is experiencing a clear recession, as well as a revision of the forecasts of the European Commission for the worse, and are putting pressure on the European currency, which is gradually declining in the pair with the US dollar. If the soft monetary policy of the eurozone supports domestic demand in Germany, the problems with foreign trade remain at a high level, which creates additional downward risks for the manufacturing sector. In today's report, the Federal Bureau of Statistics of Germany stated that orders in the manufacturing sector of Germany in March 2019 increased by 0.6% compared with the previous month, while economists had expected an increase of 1.2%. But compared to March 2018, orders decreased by 6.0% at once. Today's report of the European Commission also disappointed investors who expect to continue the upward correction in the euro, which was quite expected, given the macroeconomic indicators in the 1st quarter of this year. Most likely, it is for this reason that the euro slightly slipped in pair with the US dollar. According to the new forecasts, the eurozone GDP is expected to grow in 2019 at 1.2% against the previous forecast of 1.3%. The European Commission also forecasts GDP growth in the eurozone in 2020 at 1.5% against the previous forecast of 1.6%. As for inflation, the situation is slightly better. It is still expected to grow at 1.4% in 2019, while inflation in the eurozone in 2020 will be at 1.4% against the previous forecast of 1.5%. The expectations of the labor market as a whole were very optimistic, which should spur inflationary pressure. The report of the European Commission stated that unemployment in the eurozone in 2019 will be 7.7% against the November forecast of 7.9%. In 2020, the unemployment rate is expected to be at 7.3%, against a forecast of 7.5%, which was published in November last year. In general, the conclusions of the economists of the European Commission are quite straightforward. The main downside risks to economic growth are directly tied to US protectionism and trade duties. Also, the slowdown in economic growth in the eurozone is due to the deterioration of the situation in world trade and uncertainty with Brexit, as the UK's exit without an agreement will further weaken the already sluggish economic growth of the eurozone this year. As for the technical picture of the EURUSD pair, it remained unchanged, except for the fact that the buyers of risky assets missed the large resistance level of 1.1220. Bears can show themselves at the breakdown of a large support 1.1180, which will attempt to build the lower border of the new upward channel in order to test the lows of April this year in the area of 1.1110. Buyers still want a refund and a break above 1.1220 resistance that will allow you to "pull over" to their side and will open the way to the area of the highs of 1.1260 and 1.1320. The material has been provided by InstaForex Company - www.instaforex.com |
| Experts differ in their estimates regarding the prospects of EUR/USD Posted: 07 May 2019 08:22 AM PDT Societe Generale and Rabobank experts agree that the monetary policy pursued by the Fed and the ECB has become a less significant driver for the EUR/USD pair than the economic growth indicators of the US and the eurozone. At the same time, currency strategists of banks have different assessments of the pair's short-term prospects. Thus, if Societe Generale confirmed this recommendation to buy EUR/USD at the end of April with a target of 1.16, Rabobank believes that there is no need to hurry with the opening of long positions, and market participants should prepare for the fact that the pair will update the multi-month lows. "On the horizon of six months, the euro will fall in price to the dollar to $1.10, but then the EUR/USD pair will begin a gradual recovery, which will continue next year and will be supported not just by a slowdown in economic growth in the US, but by a slight recession in the US economy," said Jane Foley, chief currency strategist of Rabobank. Experts of ING Group are also waiting for the fall to the level of 1.10, although they are inclined to believe that soon the imbalance in the economic growth of the US and the eurozone will begin to change in favor of the Europeans. "Signs of recovery outside the US may encourage investors to switch from the dollar to such long-suffering undervalued currencies such as the euro," said Charles Tomes, portfolio manager at Manulife Asset Management. According to C. Tomes, his fund has reduced short positions on the euro. We proceed from the fact that all economic problems are already included in the rate of the single European currency depreciated in recent months. For a reversal of the euro will be quite a little good news," said C. Tomes. The material has been provided by InstaForex Company - www.instaforex.com |
| Technical analysis of NZD/USD for May 07, 2019 Posted: 07 May 2019 06:36 AM PDT The NZD/USD pair is showing signs of weakness following a breakout of the lowest level of 0.6648. On the H1 chart, the level of 0.6648 coincides with 23.6% of Fibonacci, which is expected to act as minor support today. Since the trend is below the 23.6% Fibonacci level, the market is still in a downtrend. However, the major resistance is seen at the level of 0.6690. Furthermore, the trend is still showing strength above the moving average (100). Thus, the market is indicating a bearish opportunity below the above-mentioned support levels, for that the bearish outlook remains the same as long as the 100 EMA is headed to the downside. Therefore, strong resistance will be found at the level of 0.6690 providing a clear signal to buy with a target seen at 0.6575. If the trend breaks the minor resistance at 0.6575, the pair is likely to move downwards continuing the bearish trend development to the level 0.6544. The material has been provided by InstaForex Company - www.instaforex.com |
| Technical analysis of AUD/USD for May 07, 2019 Posted: 07 May 2019 06:29 AM PDT The AUD/USD pair is set above strong support at the levels of 0.7046 and 0.7168. This support has been rejected four times confirming the uptrend. The major support is seen at the level of 0.7046, because the trend is still showing strength above it. Accordingly, the pair is still in the uptrend in the area of 0.7046 and 0.7168. The AUD/USD pair is trading in the bullish trend from the last support line of 0.7112 towards thae first resistance level of 0.7168 in order to test it. This is confirmed by the RSI indicator signaling that we are still in the bullish trending market. Now, the pair is likely to begin an ascending movement to the point of 0.7168 and further to the level of 0.7290. The level of 0.7389 will act as the major resistance and the double top is already set at the point of 0.7389. At the same time, if there is a breakout at the support levels of 0.7112 and 0.7046, this scenario may be invalidated. The material has been provided by InstaForex Company - www.instaforex.com |
| Bitcoin analysis for May 07, 2019 Posted: 07 May 2019 06:02 AM PDT BTC did break the resistance of the trading range at $6.110 and confirmed further upward continuation. It is the late stage of the upward trend but seems that there is still fuel for the upside.
Purple rectangle – Resistance which became support Green rectangle – Support Green channel – Potential bullish flag According to the H1 time-frame, we found that BTC did upward break of the resistance cluster, which confirmed demand for the BTC and potential more upside. The bullish flag in creation after the breakout is another sign that BTC my continue with the upside. Support levels are seen at the price of $6.105 and $5.718. Upward objective is set at the price of $6.400. Watch for buying opportuntiies. The material has been provided by InstaForex Company - www.instaforex.com |
| Analysis of Gold for May 07, 2019 Posted: 07 May 2019 05:48 AM PDT Gold has been trading sideways at the price of $1.279. Gold is trading inside of defined range between $1.285 and $1.277. We are neutral to bearish on the Gold.
Yellow horizontal line – Support 1 Yellow horizontal line – Support 2 Blue line – Middle of Keltner Channel EMA According to the H1 time-frame, we found that that Gold is trading in the downward sloping channel and we expect potential test of the lower diagonal at $1.275 before any further upside. Gold is trading in the trading range and the current stance is neutral. Anyway, there is potential for the test of $1.275 and $1.270. To confirm upside, we would like to see breakout of the $1.284 in order to establish buying positions. The material has been provided by InstaForex Company - www.instaforex.com |
| EUR./USD analysis for May 07, 2019 Posted: 07 May 2019 05:34 AM PDT EUR/USD has been trading sideways at the price of 1.1186. EUR did break the support trendline in the background, which is sign that sellers took control from buyers at least on the intraday prospective.
Yellow rectangle – Resistance 1 Yellow rectangle – Resistance 2 Yellow horizontal line – Support 1 Yellow horizontal line – Support 2 According to the H1 time-frame, we found that EUR confirmed resistance at the price of 1.1215, which is good sign that sellers are in control. EUR did break the diagonal support in the background and the momentum increased on the downside. We expect, potential testing of support levels at 1.1171 and 1.1136. Upward scenario will come into the play only if we see clean break of resistance at 1.1215. Watch for intraday selling opportunities. The material has been provided by InstaForex Company - www.instaforex.com |
| GBP/USD: plan for the American session on May 7. The pressure on the pound is gradually increasing Posted: 07 May 2019 05:17 AM PDT To open long positions on GBP/USD, you need: The bulls failed to return to an important resistance level of 1.3130, which scared off new buyers of the pound. The main task is to consolidate above the resistance of 1.3130, which will break the formed upper limit of the downward channel formed and give GBP/USD an impulse for a new breakthrough up to the highs of 1.3167 and 1.3227, where I recommend fixing the profits. Also, the bulls will need a lot of strength to stay above the support of 1.3078 in the afternoon. Only the formation of a false breakdown will allow us to expect a return to the maximum in the area of 1.3130. In a scenario of the breakdown of 1.3079, I recommend buying a pound immediately to rebound only after a test of the minimum of 1.3038. To open short positions on GBP/USD, you need: Bears coped with the morning task and did not allow the pair to break through the resistance of 1.3130, to which I paid attention. However, the main goal of the sellers is to break through and return to the support level of 1.3080, which will push the GBP/USD pair to the area of the minimum of 1.3038 and 1.2992, where I recommend fixing the profits. In the growth scenario above 1.3130, and this can only happen after the positive news on Brexit from Theresa May, you can sell after updating the maximum of 1.3167, but it is best to wait for the test level of 1.3227 and open short positions from there to rebound. Indicator signals: Moving Averages Trading is conducted just below 30 and 50 moving averages, which indicates only a small advantage of the sellers of the pound. Bollinger Bands In the case of a company of pounds in the afternoon, the upper limit in the area of 1.3130 will act as resistance. The breakthrough of the lower limit of the indicator in the area of 1.3179 may increase the pressure on the pound. Description of indicators
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| EUR/USD: plan for the American session on May 7. German data disappointed traders Posted: 07 May 2019 05:17 AM PDT To open long positions on EURUSD, you need: A weak report on orders in the German industry and unconvincing forecasts of the European Commission led to pressure on the euro, which kept the pair in a narrow side channel and did not allow to continue growth. The main goal remains the breakdown and consolidation above the resistance of 1.1218, which will lead EUR/USD to the maximum area of last week 1.1260 and will retain the upward potential with the test levels of 1.1282 and 1.1301, where I recommend fixing the profits. In a decline scenario, it is best to return to long positions in euro after a correction down from the support of 1.1180 or a rebound from a larger area of 1.1138. To open short positions on EURUSD, you need: The bears were satisfied with the weak report on Germany and managed to form a false breakdown in the resistance area of 1.1217. As long as the trade is conducted below this level, the pressure on the euro will continue, which will lead to a decrease and consolidation below the support level of 1.1180, the breakdown of which will push EUR/USD to the minimum area of 1.1138 and 1.1112, where I recommend fixing the profits. With the euro growing above the resistance of 1.1218 in the second half of the day, against the background of the absence of important fundamental statistics for the United States, it is best to open short positions to rebound from a maximum of 1.1260, but the intermediate resistance may be the level of 1.1240. Indicator signals: Moving Averages Trading is conducted in the area of 30 and 50 moving averages, which continues to indicate the lateral nature of the market. Bollinger Bands The volatility of the indicator has decreased, which does not give signals on entering the market. Description of indicators
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| Aussie grows up on RBA meeting; dollar drifts downstream Posted: 07 May 2019 02:52 AM PDT The Australian dollar jumped sharply after the central bank of the left. The currency rose by about 0.7 percent, to $ 0.7035, after the Reserve Bank of Australia (RBA) kept the rate at 1.50 percent. It is worth noting that the decision of the bank was expected, despite calls for easing of monetary policy after data on weak inflation in the first quarter. And although the RBA left politics unchanged, the stage is set for future cuts, if in case unemployment does not begin to fall. In relation to the yen, the Australian rose 0.5 percent to 77.82 yen. The US dollar was mostly kept in the usual range in relation to major currencies, even though there are US statements saying that China "retired" from trade related issues. This had a negative impact on US bond yields and stock futures. It is in the interests of China to conclude a bargain, and a break in negotiations is not very favorable for the domestic economy. And although it was recently assumed that Washington and Beijing could agree, it now became clear that negotiations would take more time. Given that China is not fulfilling its obligations, the White House issued a notice of a proposed increase in tariffs on Chinese goods worth $ 200 billion from 10 to 25 percent. The euro uses the temporary difficulties of the dollar to compensate for the recent losses, but it turns out it is very weak - 1.1210 dollars, which is only 0.1 percent higher compared to the previous day. Sterling rose by about 0.2 percent, to $ 1.3122. In relation to the yen, the dollar fell by one tenth of a percent, to 110.615 yen. During the previous session, he updated the five-week low of 110.285 yen to the dollar. The Japanese currency tends to rise in times of geopolitical or financial stress, since Japan is the largest creditor country in the world. The material has been provided by InstaForex Company - www.instaforex.com |
| RBA took investors by surprise, "Aussie" sharply increased in price Posted: 07 May 2019 02:52 AM PDT In anticipation of the decision of the Reserve Bank of Australia (RBA) on monetary policy, the AUD / USD pair slipped to 4-month lows. The sale of the Aussie was primarily caused by the threat of an escalation of the trade conflict between Washington and Beijing. In addition, analysts had expected the Australian Central Bank to lower the interest rate this month. However, following the results of the next meeting, the RBA decided to keep the rate unchanged (1.50%). This caught many market participants off guard and provoked a rapid rally "Aussie". The head of the RBA, Philip Low, was rather restrained in the comments. He noted the availability of free capacity in the economy and the need to further improve the situation on the labor market so that inflation could reach the target level, but did not give any hints of monetary policy easing over the coming quarters. Apparently, the regulator chose to refrain from any action on the eve of the elections to the federal parliament of Australia, which will be held on May 18. The current government and the opposition have promised voters a tax cut and increased investment in the country's infrastructure. In addition, increasing trade tensions between the United States and the Celestial Empire gives the RBA many causes for concern. Given the inclination of the head of the White House, Donald Trump, to take spontaneous decisions, it seems reasonable for the RBA to wait for the official settlement of this conflict before lowering the interest rate. If Washington is able to push Beijing to sign a trade agreement soon with its threats, then the rate cut will probably not be needed at all. The material has been provided by InstaForex Company - www.instaforex.com |
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