Forex analysis review |
- Forecast for EUR/USD on March 23, 2020
- Forecast for GBP/USD on March 23, 2020
- Forecast for USD/JPY on March 23, 2020
- EUR/USD. Results of the week. Epidemic is rapidly spreading in Italy, Spain, Germany and France
- GBP/USD. Results of the week. China begins to recover from the epidemic. Boris Johnson enforces full quarantine in the UK
| Forecast for EUR/USD on March 23, 2020 Posted: 22 Mar 2020 08:12 PM PDT EUR/USD The price was marked on the support line of the embedded price channel in the region of 1.0636 on Thursday, Friday, and today. Finally, the signal line of the Marlin oscillator turned upwards on the daily chart, which creates the prerequisite for corrective growth to the level of 1.0879 - to a low of October 1, 2019. Overcoming the Friday low of 1.0636 opens the target 1.0493 - the low of February 2017. On the four-hour chart, the Marlin oscillator did not form a strong convergence, the signal line has not yet left the zone of negative indicators. The indicator potential may be enough to work out the price of correctional target of 1.0879.  |
| Forecast for GBP/USD on March 23, 2020 Posted: 22 Mar 2020 08:03 PM PDT GBP/USD The pound sterling showed increased volatility on Friday (range of the day is 530 points!) and worked out the expected correction to the Fibonacci level of 200.0% at the price of 1.1935 on the same day. If the correction is considered completed, then the price will reach the target level of 1.1375 at the Fibonacci level of 271.0% by today or tomorrow. Consolidation below the level will open the second target at the level of 314.0% at the price of 1.1035. On the four-hour chart, the signal line of the Marlin oscillator was already in the zone of positive values, it is currently at the boundary of the growth and decrease zones and is waiting for a signal from the market - the position is guided. Before the decline continues, a price increase is possible with the development of the resistance of the MACD line, slightly higher than the Fibonacci level of 200.0%, possibly 1.2000 - to the low of March 17, where the price will meet with the MACD line.  |
| Forecast for USD/JPY on March 23, 2020 Posted: 22 Mar 2020 08:03 PM PDT USD/JPY The price did not reach the price channel line (111.98) last Friday as well as today in the Asian session, reinforcing the intention to resume the decline. This intention will intensify when the price overcomes the support of the MACD line on the daily chart, below the price of 109.10, which opens the target along the lines of price channels in the 107.05/90 range. Technically, the intention of the price to turn down on this chart is visible only by the reversal of the Marlin oscillator. The reversal signal is more pronounced on the four-hour chart, this is the formed divergence in the oscillator. Here, the price reduction can get support from the MACD line (blue indicator), which is already close to the lower boundary of the target range 107.05 and may be higher than this level when meeting the price. Accordingly, on the H4 scale, the 107.05/90 target range is confirmed. The material has been provided by InstaForex Company - www.instaforex.com |
| EUR/USD. Results of the week. Epidemic is rapidly spreading in Italy, Spain, Germany and France Posted: 22 Mar 2020 03:29 PM PDT 24-hour timeframe The currency pair has fallen by 400 points over the past trading week. In the current conditions, this figure does not seem to be the lower limit of losses for the European currency. On the 24-hour chart, the pair's quotes fell to the second support level of 1.0650 and it even failed to overcome this level on Friday. Thus, there are some hopes for the beginning of a corrective movement. Although we can say that on Friday most of them were dispelled, as in the afternoon, the bears again began to attack the euro. Thus, the downward trend movement is maintained. The highest volatility of the pair is maintained. And the worst thing is that the rate of spread of the coronavirus across the planet continues. At the moment, according to official information, more than 300,000 people around the world have been infected. However, we are all well aware that the real figure is much higher. 171 countries are already considered infected, and the largest centers of infection are now located in Italy, the United States, Spain, Germany, Iran, and France. Thus, the situation with the global epidemic is not yet resolved. Accordingly, the panic does not leave the currency market, the stock market, or the commodity market. Despite the fall in demand for oil and the next oil war, the price of the world's number one energy carrier cannot remain below or even slightly above its cost price for a long time. According to some experts in this field, US shale oil will have to leave the world market. However, from our point of view, this will not happen and, rather, it will end in another world conflict. Commercial at best. It is unlikely that US oil companies will simply shut down their production until better times. This is not in the interests of either the companies themselves or the US government. Even now, threats to the key culprits of the sharp decline in oil prices are being heard from across the ocean. Saudi Arabia and Russia are blamed for the collapse of the oil market, and the Saudis are also accused of dumping prices. That is, unfair competition. Thus, we believe that oil prices can recover only if the conflict between OPEC and Russia is resolved and a new one is not initiated. So far, all these details have an indirect meaning for the currency market. We still cannot say that the collapse of European currencies is influenced by any specific factors from the European Union or the United States. Thus, most likely there is an influence of all factors combined, or a banal panic in which market participants trade based on their personal considerations and do not follow the market at all. Unfortunately, the coronavirus is still the number one topic for the whole world. At least it's because no macroeconomic statistics currently affect the movement of currency pairs. The actions of central banks and governments do not affect either. Traders remain in a state of panic, as the epidemic has a strong impact on all areas of activity almost around the world. While the United States came out in third place with the most number of infected with the Chinese virus in the world, Donald Trump continues to make promises for an early victory over the epidemic. "It can be done sooner than many think," said the leader of the offensive of the United States. However, official statistics and statements from representatives of the medical sphere suggest the opposite. More precisely, the number of infected people in the United States has increased to 26 thousand and almost half of them are in New York. All states of the country have been quarantined. For example, the so-called full lockdown quarantine mode has been introduced in California. It means that citizens are forbidden to go outside for no apparent reason, only to a bank, grocery store, or pharmacy. There is no longer any panic in the stores. It was noted only at the very beginning of the epidemic, but now most citizens have calmed down and are sitting at home without panic. But in Italy, which is the leader in the number of cases in Europe, a strict quarantine is introduced, which means stopping the work of all industries except the vital ones. Any physical or sporting activity on the street is prohibited. All construction projects are stopped, and all entrepreneurs must suspend the activities of their companies, with the exception of the areas of food and medicine supply. These measures mainly concern the region of Lombardy. The situation is not much better in Germany, where more than 20,000 people have been infected with the coronavirus. There are not so many people who died from the virus, about 70 people, and more than 200 have recovered. The country is also under quarantine. The strongest downward movement continues from a technical point of view. But just as we said before the crisis, the euro and the pound often grow against the dollar unreasonably, so now we can say that the dollar does not deserve such a sharp strengthening. However, the US currency's growth may continue next week, and could be followed by a reversal upward and no less strong weakening of the US currency. Anything is possible. Markets in a state of panic are out of control. It is impossible to predict where a particular currency will move. The best thing to do is to follow the trend based on the indications of technical indicators. Recommendations for short positions: Sales of the euro remain relevant in the 24-hour timeframe, since all indicators are directed downward. The target is 1.0522. Turning the MACD indicator up may indicate the beginning of a correction, but it can also be very late with the reaction. Recommendations for long positions: Euro currency purchases with a target of resistance level 1.1282 can be considered no earlier than overcoming the Kijun-sen line. However, such a development is not expected in the near future. Explanation of the illustration: Ichimoku indicator: Tenkan-sen is the red line. Kijun-sen is the blue line. Senkou Span A - light brown dotted line. Senkou Span B - light purple dashed line. Chikou Span - green line. Bollinger Bands Indicator: 3 yellow lines. MACD indicator: Red line and bar graph with white bars in the indicators window. The material has been provided by InstaForex Company - www.instaforex.com |
| Posted: 22 Mar 2020 02:49 PM PDT 24-hour timeframe After the British pound collapsed by more than 1500 points, it is time for a respite. No, not for a correction, but for a respite. The quotes of the GBP/USD pair rose by 450 points for a moment on Friday, March 20, which is not so small even compared to the previous fall, but eventually, it fell to almost the lows of the week, month, year and decade near the end of trading. Thus, we believe that there is not enough reason to conclude that an upward correction has started, at least on the 24-hour timeframe. The correction looks weak and already completed even on the 4-hour timeframe. Unfortunately, there is nothing to talk about now except the coronavirus epidemic and the countries' fight against it. We would like to note the actions of the Bank of England and the Federal Reserve, the US and UK governments in combating the negative consequences of the epidemic, but, first of all, there is no official information or figures that could confirm that the measures taken have improved the situation. Secondly, the mood of traders is not affected by either macroeconomic reports or the fundamental background. There is panic everyday in the forex currency market, in principle, you can write the same thing, since the situation does not change at all. Before introducing a general quarantine in the UK, Prime Minister Boris Johnson, as usual, distinguished himself. Recall that initially the prime minister did not want to introduce strict quarantine measures, did not want to close schools, did not want to close pubs, suggesting that it is better that the majority of Great Britain's population got sick with the virus and they developed immunity. However, having come under a barrage of criticism for his actions, as well as for forecasts (according to Johnson, many families will lose their loved ones, and 80% of the British population may get sick), Johnson still ordered to close all establishments except grocery stores and pharmacies. "We ask you to stay at home to protect our health care system and save lives," the prime minister asked. Johnson also said: "I am convinced that we will defeat the coronavirus. I think we can turn the tide over the next 12 weeks, but it depends on collective, decisive action." A statement in the style of Donald Trump. "We will win everyone," "we will win this war," and so on. Well, then everything, as everywhere else in the world now. British citizens are asked not to leave their homes unnecessarily, and not to receive guests. As for the economy, the Johnson government is developing a plan to compensate all quarantined workers for their wages for the duration of the quarantine. These measures will be taken as part of the fight against the total number of cuts. However, having not yet managed to really calm the British people, who are no longer worried about the coronavirus, but because of the closure of pubs and the lack of football, Johnson immediately made another statement, in which he calmed the people in his own style. The British prime minister believes that the country can repeat the Italian scenario of the spread of the epidemic, if the population does not limit social activity. "The number of deaths in Italy is in the thousands and is constantly growing. If we do not act together and make heroic and collective efforts at the national level to slow down the epidemic, there is a high probability that our national health system will also be overloaded," Johnson said. However, according to experts, it is not even a matter of how closely citizens adhere to the government's decrees. The UK lags behind Italy by about two weeks in the dynamics of the epidemic. At the same time(!!!) there is no strict quarantine in Britain. Public places and places are closed, but there is no direct ban on movement. Thus, Britain has every chance to repeat the fate of Italy, where there are already more than 50,000 thousand cases and almost 5,000 deaths... The bright spot on the global map of the spread of the virus is now China. The main focus of the epidemic has managed to contain the infection and now, according to the International Monetary Fund, its economy is beginning to recover. Most large businesses have opened, and employees who were quarantined and sent to work remotely have returned to their offices. However, the IMF believes that it is still very early to celebrate the victory, since the COVID-2019 virus may return to China with the resumption of international air traffic and the opening of borders. Also, experts believe that for a long time, many consumers of Chinese goods may avoid these products, fearing to get infected with the coronavirus. Recommendations for short positions: The pound/dollar continues to be in a downward trend on the 24-hour timeframe. Thus, short positions remain relevant, although the goals are no longer there, they were all overcome. Recommendations for long positions: It will be possible to buy the British pound no earlier than when the price is consolidated above the critical line. However, the price is too far from the Kijun-sen line, so this scenario is not expected in the near future. Explanation of the illustration: Ichimoku indicator: Tenkan-sen is the red line. Kijun-sen is the blue line. Senkou Span A - light brown dotted line. Senkou Span B - light purple dashed line. Chikou Span - green line. Bollinger Bands Indicator: 3 yellow lines. MACD indicator: Red line and bar graph with white bars in the indicators window. The material has been provided by InstaForex Company - www.instaforex.com |
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