Forex analysis review |
- Hot forecast and trading signals for the EUR/USD pair for June 23. COT report. Decisive moment for sellers. Recent chances
- Overview of the GBP/USD pair. June 23. Donald Trump has changed his mind about imposing sanctions on Chinese officials because
- Overview of the EUR/USD pair. June 23. A new recipe against "coronavirus" from Donald Trump.
- Why not bet on the pound's growth?
- June 22, 2020 : EUR/USD Intraday technical analysis and trade recommendations.
- June 22, 2020 : GBP/USD Intraday technical analysis and trade recommendations.
- Gold price breaks out of the two month trading range.
- Europe and Asia stock indices constantly change in fear of a new wave of the COVID-19 pandemic
- Short-term technical analysis of EURUSD
- Pound withstands pressure
- EUR / USD. EU online summit: modest results with optimistic color
- Evening review on EURUSD for June 22, 2020
- EURUSD: The assistance and recovery plan for the Eurozone is postponed until July
- Economists hope for recovery
- Do professionals lose their strength?
- GBP/USD: plan for the American session on June 22
- BTC analysis for June 22,.2020 - Watch for buying the dips intraday. Upward target set at the price of $9.640
- EUR/USD: plan for the American session on June 22
- Greenback prepares a breakthrough
- EUR/USD analysis for June 22, 2020 - Potential for the bigger rally on the EUR due to breakout of downward channel. Upward
- Analysis of Gold for June 22,.2020 - Potential for new upside movement due to nice pullback in the upward trend. Upward target
- Technical analysis of AUD/USD for June 22, 2020
- Gold to reach $ 2,000
- Oil price decline
- Trading recommendations for the EUR/USD pair on June 22, 2020
| Posted: 22 Jun 2020 06:03 PM PDT EUR/USD 1H The EUR/USD pair began to correct on the hourly timeframe on June 22, not quite reaching the first upward trend line. However, while the quotes of the pair continue to remain inside the downward channel, therefore, the trend in the current timeframe remains downward. A price rebound from the upper line of the channel may trigger a resumption of the downward movement, despite overcoming the critical Kijun-sen line. Thus, sellers remain in the market, and on the way up, buyers still have many potentially strong obstacles that can temper their ardor. This is, at the lowest, the Senkou Span B line and the resistance area of 1.1326-1.1343. If all these resistances are overcome, then the bulls will be able to activate and begin forming a new upward trend. EUR/USD 15M Both linear regression channels turned up on the 15-minute timeframe, so the trend has now changed to an upward one in the short term. So far, this movement is only a correction on the hourly chart. COT Report The euro/dollar pair steadily rose until June 16 (the deadline, data for which is included in the latest COT report) and only began a correction in the last two days. According to the COT report, professional traders were busy during the entire reporting week not with opening purchase contracts, which could be assumed based on the direction the pair was moving, but with closing sale contracts. In just five days, professional traders closed almost 20,000 sell contracts and at the same time opened 1,300 long euro contracts. Thus, the continued strengthening of the European currency was absolutely logical at that time. But, we emphasize that large market players were not buying the euro for the second week in a row, and therefore do not believe in the prospects of this currency. The euro grew for two weeks almost at the mere closure of contracts for sale by large speculators, which caused a skew of supply and demand for the euro. Accordingly, we believe that this week the dollar will continue to rise in price, and the new COT report will show a decrease in the net position in the euro. The general fundamental background for the EUR/USD pair did not change at all on Monday, since no important macroeconomic reports were published, and there were no important fundamental events. Market participants continue to be entertained by Donald Trump, however, apart from this, nothing interesting in the world happened on the first trading day of the week. By and large, traders are now ready to focus on important macroeconomic reports that are not yet available, and on serious fundamental topics that are now paused. There is one important topic in the European Union. The formation of a Recovery Fund worth 750 billion euros, which should be aimed at helping the European economy recover from the coronavirus crisis. There are many more topics in the United States, but all of them are also paused now, while the most important ones are threatening to be put on hold. It is primarily a confrontation between the United States and China. After several months of mutual skirmishes, insults, and accusations, it turned out that Washington was not ready to apply new sanctions and duties against Beijing. And it's better to say that Donald Trump is not ready to apply any sanctions against China, because any retaliatory measures can further damage him personally. It is regarding his political ratings four months before the presidential election. Today's business activity reports in the US and the EU are unlikely to have a significant impact on the movement of the euro/dollar pair. Based on the foregoing, we have two trading ideas for June 23: 1) Bulls continue to remain in the shade, so the EUR/USD pair could resume the downward movement. However, in the current conditions, it is imperative for the bears to stay inside the descending channel, which will maintain the current downward trend and will make it possible to trade with a view to the downward trend line, which has not yet been reached. Further downward movement will depend on overcoming or not overcoming the trend line. The potential Take Profit is 85 points. 2) We recommend considering the option to resume the growth of the EUR/USD pair only when bulls manage to gain a foothold above the downward channel. In this case, we recommend opening euro purchases with the first goal of the Senkou Span B line (1.1308). Further trading on the increase will be possible after overcoming the resistance area of 1.1326-1.1341 with the target level of 1.1417. Potential Take Profit in this case is from 30 to 150 points. The material has been provided by InstaForex Company - www.instaforex.com |
| Posted: 22 Jun 2020 05:11 PM PDT 4-hour timeframe
Technical details: Higher linear regression channel: direction - upward. Lower linear regression channel: direction - upward. Moving average (20; smoothed) - downward. CCI: -26.4393 The British pound also started to adjust against the US currency during the first trading day of the new week. In contrast to the euro, the previous downward movement was much stronger, so the pound/dollar pair needs to go a long distance to the moving average line. However, the overall volatility and strength of the pair's movement are higher than those of the euro/dollar. Thus, in the near future, the moving average can be worked out, and the future fate of the British currency for the next few days will be decided around it. On Monday, there were no important macroeconomic publications in either the United States or the UK. There were no important statements from high-ranking officials, and the main news package still flows from the White House, from the office of the US President. However, this time the information is very interesting in the context of the confrontation between China and the United States on the eve of the presidential elections in America. In short, Donald Trump once again broke his word and continues to adhere to the principle of "my word, I want to give, I want to take back". The American President was reminded that he threatened to impose sanctions against Chinese officials and organizations responsible for the oppression of the Uyghur people in one of the districts of China. When asked directly why Trump has not yet imposed sanctions, he will answer: "We were in the middle of a big trade deal. And I made a big deal - potential purchases of $ 250 billion." We recall the words of John Bolton from his memoirs that Trump hopes that Xi Jinping will help him in the upcoming elections. Or had hoped earlier, when there was at least some logical reason for it. Hardly anyone believes now that Beijing will help Trump defeat Joe Biden, who has always treated China well and will seek to establish business and working relations with him. Thus, it is not the introduction of new sanctions against China, Donald Trump is pursuing quite different goals. Most likely, the American president does not want to just completely bury the chances of his re-election in November. Recall that China about a month ago considered the option of canceling the "first phase" of the trade deal, the agreement on which was reached in January. At any time before the election, China can refuse to purchase agricultural products in the United States. Thus, American farmers will again be put in a very difficult position, which is already not the most enviable thanks to the "coronavirus crisis". However, Beijing has every chance to strike a new blow to Trump's political ratings, angering part of his electorate. It is easy to guess that farmers are unlikely to vote for Trump, who has damaged relations with China. Thus, from our point of view, the US leader will behave very carefully with China in the coming months. Of course, the accusations and "injections" against Beijing are unlikely to disappear, however, the American leader is unlikely to move from words to deeds. Any escalation of the conflict in Beijing threatens retaliatory measures that can further aggravate the deplorable state of Trump's popularity. Because the confrontation is now more Trump-China and not the US-China. At the same time, representatives of Donald Trump and White House officials are trying their best to refute the statements of former national security adviser John Bolton. For example, the head of the trade council, Peter Navarro, said that Donald Trump never asked Xi Jinping to help him get re-elected for a second term. "Whatever Bolton says about China, it's just stupid, because no American president has treated China more harshly than the current one," Navarro said. However, Mr. Navarro forgot about such a concept as "political pressure", which was already applied to Trump in the case of his impeachment, which was initiated after the "pressure" on Kiev. The US leader, according to Bolton himself, wanted to get the support of the Chinese leader in exchange for a more lenient trade agreement or, perhaps, some trade preferences and easing. Well, in the UK at the same time, the population wants Boris Johnson to reduce his salary because of the "coronavirus" pandemic. The British believe that British politicians should reduce their wages in times of economic crisis, as did London mayor Sadiq Khan. These are the results of a social survey conducted recently. Unfortunately, no important news regarding Brexit negotiations with Brussels has been received in recent days. Thus, the fundamental background remains quite weak, to say the least. On Tuesday, the UK is also scheduled to publish business activity indices in the services and manufacturing sectors. The first indicator is expected to grow from 29 to 39.5, and the second – from 40.7 to 45.0. Thus, like in the Eurozone and the US, business activity will continue to increase, the only question is, to what extent will it be able to reach in the current economic conditions? Recall that even before the "coronavirus crisis", business activity in the UK manufacturing sector was below the mark of 50.0. From May 2019. Thus, as we can see, the industrial sector was in a state of decline even without the COVID-2019 epidemic. This applies not only to the UK but also to the entire EU and the US. According to many experts, the world economy has long been heading for a recession, and the "coronavirus" only helped it begin and manifest itself in full. Thus, we are not at all sure that in 2020 business activity will grow above 50.0, which is in Britain, which is across the ocean. The trend for the pound/dollar pair is still downward, so sell orders remain relevant. However, both channels of linear regression are directed upwards, so far the downward trend is only in the short term. If sellers manage to stay below the moving average, the downward movement is likely to continue. From our point of view, it is the further fall of the pound that will be most logical.
The average volatility of the pound/dollar pair continues to remain stable and is currently 125 points per day. For the pound/dollar pair, this indicator is "high". On Tuesday, June 23, thus, we expect movement within the channel, limited by the levels of 1.2338 and 1.2588. A reversal of the Heiken Ashi indicator downwards will indicate a possible resumption of the downward trend. Nearest support levels: S1 – 1.2390 S2 – 1.2329 S3 – 1.2268 Nearest resistance levels: R1 – 1.2451 R2 – 1.2512 R3 – 1.2573 Trading recommendations: The pound/dollar pair started to adjust on the 4-hour timeframe. Thus, today it is recommended to resume selling the pound/dollar pair with the goals of 1.2390 and 1.2329 if the Heiken Ashi indicator turns down or there is a rebound from the moving average. It is recommended to buy the pound/dollar pair not earlier than fixing quotes above the moving average with the first goals of 1.2573 and 1.2634. The material has been provided by InstaForex Company - www.instaforex.com |
| Overview of the EUR/USD pair. June 23. A new recipe against "coronavirus" from Donald Trump. Posted: 22 Jun 2020 05:11 PM PDT 4-hour timeframe
Technical details: Higher linear regression channel: direction - upward. Lower linear regression channel: direction - upward. Moving average (20; smoothed) - sideways. CCI: 33.5233 The euro/dollar currency pair spent in a not too strong corrective movement during the first trading day of the week. Since all the downward movement can be described as quite weak, the price could not even get far enough away from the moving average line. Therefore, the minimum correction and the pair are already moving. Based on this, a new price rebound from the moving average may trigger a resumption of the downward movement, according to the current trend. In general, the downward movement is much slower than the previous growth. Therefore, we can assume that sellers are not confident in their actions and doubt the feasibility of serious sales of the euro and purchases of the US dollar. Thus, the current fall in the currency best fits the description of the word "correction", which can end at any time. However, this will mean that the upward trend will resume, which has no fundamental support and banal logic under it. Recall that the main possible reasons for the sharp depreciation of the US currency in recent weeks were the following: mass riots and rallies in the US, the political crisis, the intensity of relations between China and the US due to the "Hong Kong" and "coronavirus" issues. These issues have not been resolved, however, at the same time, they cannot put pressure on the dollar permanently or for a long period. New information that can turn these topics in a different direction or give them development simply does not exist now. Thus, we do not see why the European currency can continue to grow now. However, in the currency market, you can never be 100% sure of anything. Thus, if traders manage to return to the area above the moving average line, then the upward trend will be resumed, and buy orders will become relevant again. On the first trading day of the week, no important macroeconomic statistics were published either in the United States or in the European Union. Thus, traders had nothing to react to during the day. However, as long as Donald Trump remains President of the United States, there will be no shortage of interesting comments and high-profile statements. For example, the US President previously linked the high incidence of American "coronavirus" with a large number of tests conducted in the US. However, as official data showed, the United States was not even in the top five countries in the world in terms of the number of tests performed per 1000 residents. Yesterday the leader of the United States brought a shock to his listeners, fans, and supporters with a statement in the pre-election rally in Oklahoma. Trump said that "when testing is carried out on such a scale as in the US, it inevitably leads to a large number of recorded cases of the disease". So the US President "asked his people to slow down testing". To be honest, we do not know how to react to this statement of the American President. By and large, Trump wanted to say the following: "The high incidence of American disease is hindering my campaign and lowering my political ratings, so I decided to slow down testing so that things don't look as bad as they are." Several Trump officials and advisers immediately called the president's words a "joke", although this is very controversial. Trump regularly amuses the public with his contradictory statements, which are refuted even without referring to experts from the field that the US leader has touched on this time. By the way, at the same time, eight states in America announced a record number of cases of COVID-2019. The total number of cases in the United States today is almost 2.3 million, the number of "deaths" - almost 120 thousand. The "contagion" curve is directed upward at the same angle as before, which means the same rate of increase in the spread of infection, no slowdown. Meanwhile, the American President also came up with a new name for "coronavirus", calling it "kung flu" (flu – English. "flu"), thus referring to the Chinese martial art "kung fu". In general, in the last 6 months of the presidential term, Donald Trump seems to be having as much fun as he can. On Tuesday, June 23, preliminary values of business activity indices in various services and manufacturing sectors will be published in the United States and the European Union. We already said in articles over the weekend that these reports are unlikely to cause any reaction from traders, since they are preliminary for June, which has not yet ended, and in any case, the values of these indicators will remain below the mark of 50.0. Therefore, no matter how much business activity increases, it will not be enough to declare the growth of the economy itself. Although it should be recognized that business activity in Germany is expected to be higher than 40.0 in both areas, just like in the European Union. Thus, in a few months, hypothetically, we can expect these indicators to return to the "growth zone". The situation in the United States is the same as in the European Union. Both Markit business activity indices are likely to be more than 40, and forecasts predict even values of 46.0 and 47.8, which is already "almost 50". Thus, it is American business activity that can be the first to return to the "growth zone", which will contribute to a faster transition to recovery than in the European Union. This factor may support the dollar in the medium term. As for technical factors, the most important now is moving. As long as the pair remains below the moving average, the downward trend persists, which will eventually contribute to a downward reversal of both linear regression channels. However, for now, both channels are directed upwards, so we would say that the chances of resuming the upward trend are even greater. The problem is that the foundation and macroeconomics do not support the euro currency and we do not see how the euro can show new long-term growth.
The average volatility of the euro/dollar currency pair as of June 23 is 94 points. Thus, the value of the indicator is still characterized as "high", but in general, volatility is decreasing. We expect the pair to move between the levels of 1.1165 and 1.1353 today. The reversal of the Heiken Ashi indicator downwards signals a new round of downward movement, however, the price must remain below the moving average. Nearest support levels: S1 – 1.1230 S2 – 1.1108 S3 – 1.0986 Nearest resistance levels: R1 – 1.1353 R2 – 1.1475 R3 – 1.1597 Trading recommendations: The euro/dollar pair has started at least an upward correction. Thus, at this time, sell orders with targets of 1.1165 and 1.1108 remain relevant if the pair bounces off the moving average line. It is recommended to return to buying the pair not before fixing the price above the moving average with the first goals of 1.1353 and 1.1475. The material has been provided by InstaForex Company - www.instaforex.com |
| Why not bet on the pound's growth? Posted: 22 Jun 2020 10:52 AM PDT The prospect of the absence of negative rates in the UK, in theory, was supposed to cause a pound rally, but this did not happen. Let's try to figure out why and what positions on the pound are most profitable now. Traders were enthusiastic about the decision of the Bank of England to keep the rate at the lowest level of 0.1%. But market players were a little alarmed by the position of one of the senior members of the English regulator. Andy Haldane voted to keep the target level of asset purchases unchanged. In his opinion, the current policy of the BoE favors economic recovery and the return of inflation to the 2% target. Nevertheless, the pound lost ground. The continuation of the downward trend, including in relation to the dollar, market players associate with continuing concern about Brexit. Pressure on sterling is also exerted by the BoE's penchant for pursuing a soft policy if the situation requires it, and the situation may require it, since the prospects for inflation and the economy remain vague. The GBP/USD pair ended in negative territory last week. Today, the course is slightly higher. Sterling gained 0.8% against the dollar and reached a local high at 1.2450 in the US session. However, this did not happen at all because of the attractiveness of the pound, but because of the US dollar's weakness. GBP/USD The dollar index was steadily losing value at evening trading, the quote was prepared to go below 97 points, threatening an upward trend in the US currency. Recently, the dollar has been extremely sensitive to the growth of stock indices, which have been increasing today, despite the alarming situation with coronavirus in America and in the whole world. However, investors are a little nervous because of the risks associated with the second wave of the pandemic, which means the dollar has a chance of recovery. This, in turn, will put pressure on the pound. As for the factors that come specifically from the pound, there is little positive. Most strategists predict a decline in sterling due to the threat of Brexit without agreement. In addition, the measures taken by the BoE may not be enough to compensate for the consequences of the coronavirus pandemic. And if you allow a new outbreak in the UK, how did this happen in other countries? The answer is obvious. The fundamental background does not yet create the prerequisites for long positions on the GBP/USD pair. Despite today's rise, the pair is trading below a key resistance level of 1.2590. Meanwhile, volatility in this pair may increase on Tuesday. The publication of business activity indexes is expected. The growth of indicators will support the GBP/USD rate. The material has been provided by InstaForex Company - www.instaforex.com |
| June 22, 2020 : EUR/USD Intraday technical analysis and trade recommendations. Posted: 22 Jun 2020 09:45 AM PDT
On March 20, the EURUSD pair has expressed remarkable bullish recovery around the newly-established bottom around 1.0650. Bullish engulfing H4 candlesticks as well as the recently-demonstrated ascending bottoms indicated a high probability bullish pullback at least towards 1.1065 (Fibo Level 50%). However, a bearish Head & Shoulders pattern was demonstrated around the price zone between (1.1075-1.1150). Shortly after, a sideway consolidation range was established in the price range extending between 1.0770 1.1000. The price zone of (1.0815 - 1.0775) has been standing as a prominent Demand Zone providing quite good bullish support for the pair so far. On May 14, Evident signs of Bullish rejection have been manifested around this price zone. Moreover, recent ascending bottom has been established around 1.0870 which enhances the bullish side of the market in the short-term. Intermediate-term technical outlook remains bullish as long as bullish persistence is maintained above the recently-established ascending bottom around 1.0850-1.0870. Bullish breakout above 1.1000 has enhanced further bullish advancement towards 1.1175 (61.8% Fibonacci Level) then 1.1315 (78.6% Fibonacci Level) where bearish rejection was anticipated. Although the EUR/USD pair has temporarily expressed a bullish breakout above 1.1315 (78.6% Fibonacci Level), negative divergence as well as bearish rejection were being demonstrated n the period between June 10th- June 12th. Moreover, after such a quick bullish movement, the EURUSD pair looked oversold. This suggested a probable bearish reversal around the Recent Price Zone of (1.1270-1.1315) to be watched by Intraday traders. That's why, Bearish persistence below 1.1250-1.1240 (Head & Shoulders Pattern neckline) was needed to confirm the pattern & to enhance further bearish decline towards 1.1150. Trade recommendations : The current bullish pullback towards the price Zone around 1.1300-1.1350 (recently-established supply zone) should be considered as a valid SELL Signal. T/P levels to be located around 1.1175 then 1.1100 while S/L to be located above 1.1390. The material has been provided by InstaForex Company - www.instaforex.com |
| June 22, 2020 : GBP/USD Intraday technical analysis and trade recommendations. Posted: 22 Jun 2020 09:35 AM PDT
Recently, Bullish breakout above 1.2265 has enhanced many bullish movements up to the price levels of 1.2520-1.2590 where temporary bearish rejection as well as a sideway consolidation range were established (In the period between March 27- May 12). Shortly after, transient bearish breakout below 1.2265 (Consolidation Range Lower Limit) was demonstrated in the period between May 13 - May 26. However, immediate bullish rebound has been expressed around the price level of 1.2080. This brought the GBPUSD back above the depicted price zone of 1.2520-1.2600 which failed to offer sufficient bearish rejection. Hence, short-term technical outlook has turned into bullish, further bullish advancement was expressed towards 1.2780 (Previous Key-Level) where signs of bearish rejection were expressed. Short-term bearish pullback is being expressed, initial bearish destination was located around 1.2600 and 1.2520. Moreover, a bearish Head & Shoulders pattern (with potential bearish target around 12265) is being demonstrated on the chart. That's why, bearish persistence below 1.2500 ( neckline of the reversal pattern ) pauses the bullish outlook for sometime and should be considered as an early exit signal for short-term buyers. Any bullish pullback towards 1.2520-1.2550 (recent supply zone) should be watched by Intraday traders for a valid SELL Entry. Trade recommendations : Intraday traders can wait for the current short-term bullish pullback towards 1.2500-1.2550 (Backside of the broken uptrend) for a valid SELL Entry. S/L should be placed above 1.2600 while T/P level to be located around 1.2265. The material has been provided by InstaForex Company - www.instaforex.com |
| Gold price breaks out of the two month trading range. Posted: 22 Jun 2020 08:46 AM PDT Gold price has broken above $1,750 and is heading towards our target of $1,780. Price is breaking above the trading range its been in for the last two months and more. This is an important break out.
Blues lines - trading range Black line -resistance trend line Red lines - Fibonacci targets The RSI is breaking above the resistance trend line. Price is making new highs. Price is showing bullish signs. There is also another bullish pattern in play here that traders should not ignore. An inverted bullish head and shoulders pattern.
Red lines - Head and shoulders Black line - neckline Gold price is breaking above the neckline resistance. This is a bullish sign. As long as price is above we remain short-term bullish. Our head and shoulders pattern target is at $1,820. The material has been provided by InstaForex Company - www.instaforex.com |
| Europe and Asia stock indices constantly change in fear of a new wave of the COVID-19 pandemic Posted: 22 Jun 2020 08:15 AM PDT
Today, there is no single direction of movement on the stock exchanges in Asia. The indices are changing in different directions, the reason for which was the growing anxiousness of the investors regarding a possible second wave of the COVID-19 pandemic. According to the latest data received yesterday from the World Health Organization, the number of new COVID-19 patients in the world has increased by 183 thousand people per day. Such a high rate has not yet been in the history of the pandemic. However, most of the infected were in Latin America mainly in Brazil and in the United States of America. The start of the trading day in the Asia-Pacific region was not so impressive. Market participants were in no hurry to take the initiative, and trading was sluggish and multidirectional. Investors cannot figure out further work, as they are pressured by two completely opposite factors. On one hand, concerns about the second wave of coronavirus infection are becoming almost a reality, which scares the markets. On the other hand, there are very positive statistics on economic growth. Many preliminary forecasts are adjusted with more positive values, which, on the contrary, supports the markets pretty well. In general, analysts believe that today the world is in a difficult situation when it is necessary to maintain a delicate balance between the resumption of economic activity and the caution associated with the spread of COVID-19. The premature removal of quarantine can further aggravate the situation in the economy, but the temptation to take active steps to quickly go through the acute phase of the crisis will also not lead to good. Thus, the situation in the markets is rather controversial, and quick decisions should not be expected in the near future. Japan's Nikkei 225 index fell slightly by 0.03%. China's Shanghai Composite Index, by contrast, rose to 0.1%. But the Hong Kong Hang Seng Index fell by 0.45%. The South Korean Kospi index also fell by 0.3%. Australia's S & P / ASX 200 Index did not move. A decrease is also expected on the European stock exchanges. Market participants are also extremely puzzled by the new increase in the incidence of coronavirus. Just as in Asia, they are afraid of the consequences that could happen in the economy if the second wave turns out to be a reality. The German DAX index in the morning became cheaper by 0.5%. The French CAC 40 index fell by 1.7%. The British FTSE 100 index was the least affected, which fell by 0.3%. Investors began to more closely monitor the situation of the spread of coronavirus, especially since now we can talk about the growth of infected in relation not only to China and the United States of America but also to European states. Thus, the indicator of the spread of infection in Germany showed a sharp jump to the level of 2.88. This has shown that in the long term new measures will be needed to contain the infection. The material has been provided by InstaForex Company - www.instaforex.com |
| Short-term technical analysis of EURUSD Posted: 22 Jun 2020 08:12 AM PDT EURUSD has reached our first target at the 38% Fibonacci retracement and is now bouncing off support. Price is testing resistance at 1.1280. Support at 1.1175 remains key for the short-term. Breaking below it will open the way for a move towards 1.1030.
Black line - RSI resistance trend line Red line - resistance trend line EURUSD is bouncing off the 38% Fibonacci retracement and the RSI is breaking above the resistance trend line. Will we see a break above the red trend line resistance as well? The chances are in favor of a move higher but bulls need to keep a close eye on the 1.1325 resistance level which is next. A rejection at that area would be a bearish sign. In any case, bulls must hold above the 1.1175 level. The material has been provided by InstaForex Company - www.instaforex.com |
| Posted: 22 Jun 2020 07:54 AM PDT The British pound saw its worst week since mid-May. Even an impressive growth in retail sales by 12% m /m failed to support the bulls. The bears, on the other hand, are gaining ground on such strong factors as the expansion of the quantitative easing program and a rise in government debt. It was reported that UK government debt exceeded the gross domestic product first time since 1963. Over the past year, the national debt of the UK government has increased dramatically and has reached the amount of £2 trillion. Obviously, it takes a lot of money to cope with the fallout of the coronavirus pandemic. It is planned that by the end of the current fiscal year the amount of government borrowing will increase up to £300 billion. This is twice as much as during the economic crisis in 2008-2009, and is equivalent to 15% of the national income. A huge public debt means that the economy will recover from recession at a very slow pace. This idea coupled with concerns about the British labor market forced the Bank of England to expand its QE program by £100 billion at its June meeting. This decision was supported by 8 out of 9 votes. Amid such negative background, it may seem that the pound is doomed to a failure. At the same time, purchases of BoE bonds are gradually slowing down. The stabilization in the financial markets does not require the regulator to participate so actively as before. The share of emission funds taken by private lenders will only increase. Andrew Bailey and his colleagues believe that GDP will contract by 20% in the second quarter instead of 27% as was previously expected. That is, the recession may not be so deep, and the economic recovery will take less time, judging by the sharp rise in retail sales. It may well be that the data on business activity in June will add optimism to the market and will prompt purchases on GBP/USD. In addition, the Brexit talks are showing some progress. First of all, London and Brussels agreed on a deadline. Active negotiations will start in late June, and the trade agreement should be concluded in the autumn so that it can be ratified until the end of 2020. Secondly, it was agreed that Britain can derogate from some of the EU trade standards, but must accept the tariffs related to these derogations. Finally, the EU will adhere to its own principles, but will be creative in interpreting them. It seems that the parties are steadily moving in the direction of signing the agreement. So traders, who have almost lost faith in the positive outcome, can push the GBP/USD pair higher. However, on Forex, any currency pair needs the effort from both sides. A reduced demand for Fed currency swaps from the largest global central banks and the associated reduction in the cost of raising capital is good news for risk assets. However, this is not good for the American currency. Meanwhile, the US stock indices were about to develop a downward correction. But as the daily death rate from COVID-19 in the United States has reached its low since March, and China has announced its plans to increase purchases of US agricultural goods, the correction has stopped. The improvement of the epidemiological situation and the lack of any trade wars created favorable conditions for purchasing the S&P 500 and the GBP/ USD pair. The breakthrough of the resistance level at 1.245 and 1.254 may serve as the main reason for opening long positions. The level of 161.8% may serve as the main target for opening buy positions according to the AB = CD pattern. The material has been provided by InstaForex Company - www.instaforex.com |
| EUR / USD. EU online summit: modest results with optimistic color Posted: 22 Jun 2020 07:31 AM PDT The EU leaders' summit held on Friday by a videoconference, did not catalyze the growth of the euro. However, the results of the online meeting did not sink the euro due to its predictability. Such a peculiar balance allowed the EUR/USD bulls to stay afloat and not collapse to the base of the 11th figure. Today, buyers decided on corrective growth, which, however, was mainly due to the weakening dollar. In general, traders of this pair will continue to focus on the greenback at least towards the medium term.
But let us focus on the results of the Friday meeting. Despite the absence of tangible results, certain conclusions can still be drawn. For almost five hours, EU leaders, together with the leadership of key European institutions, tried to find a common denominator on two key issues. First, the creation of the 750 billion eurozone economic recovery fund, second, the approval of the seven-year EU budget plan for 2021–2027 (the total estimated amount is 1.1 trillion euros). Looking ahead, it should be said that a common denominator was never found: the differences between the leaders of the EU member states were too serious. This is an absolute negative for the euro which price recently rose solely due to the anti-crisis plan of the European Commission, which was presented at the end of May. The June online summit only confirmed and once again recalled the existing contradictions. As expected, the Netherlands, Austria, Denmark, Sweden proposed to form a fund not of non-repayable payments, but of lump-sum loans, and not more than two years with a limited scope of spending. The so-called "mean four" insisted on its position, indicating its opposition to the plans of the European Commission. This fact was not news for the market, but at the same time served as an anchor for the single currency. In addition, as EC head Ursula von der Leyen clarified a little later, disagreements remain in such issues as the size of the package, the method of sending funds, and the balance between grants and loans in the recovery fund (in the current version it is 500 to 250). Nevertheless, despite the voiced disagreement, the euro did not sink to the bottom. Traders focused on the optimistic attitude of the President of the Council of the EU, Charles Michel, who said during the summit that "a common point of view was developed on the need for a quick response to the ongoing crisis." He specified that he plans to convene a summit of EU leaders by mid-July (which should take place in a classic format). The head of the European Commission also expressed hope that a compromise could be found before the August summer holidays. According to her, despite the existing disagreements, the participants in the summit unanimously agreed that the seriousness of this crisis justifies an ambitious common response. Thus, the results of the online summit, on the one hand, did not surprise the market with their empty result, but, on the other hand, they kept hopes for a compromise. Now the euro will live on standby for several more weeks, that is, until the July summit.
This, of course, does not mean that the EUR/USD pair will freeze until mid-summer. The euro will simply focus more on the dynamics of the greenback, simultaneously reacting to current macroeconomic statistics. For example, tomorrow key EU countries will publish PMI reports. In general, experts expect positive dynamics - both in the manufacturing sector and in the service sector. EU countries are gradually opening their borders and restoring tourism, so the market reaction should be positive. The very fact of a positive trend can strengthen the bullish sentiment for the pair. But long positions should be considered only when overcoming the resistance level of 1.1290. At the moment, the price on the daily chart is located on the middle line of the Bollinger Bands indicator, and the trend indicators have not formed any clear and unambiguous signals. Nevertheless, if buyers show character and the pair consolidates above the mark, then the Ichimoku indicator will generate a bullish signal "Parade of Lines" - in this case, it will be possible to consider long positions with the target of 1.1422 (local maximum on June 10). Another important indicator on Tuesday is the index of business activity in the US manufacturing sector. In May, it rose to 39.8 points, but in June a sharper recovery of the indicator is expected - up to 52 points. If the indicator remains below the key 50-point mark, the EUR/USD pair will get an additional reason for its recovery. The material has been provided by InstaForex Company - www.instaforex.com |
| Evening review on EURUSD for June 22, 2020 Posted: 22 Jun 2020 07:31 AM PDT
EURUSD: The course breaks the daily minimum and then abruptly bounces up and takes off the stops. The same course happened for the third day in a row. You may prepare to buy the euro now from 1.1255, with a stop at 1.1210, and a target of at least 1.1415. Alternative: sell from 1.1165, with a stop at 1.1210, and target at 1.0900. The material has been provided by InstaForex Company - www.instaforex.com |
| EURUSD: The assistance and recovery plan for the Eurozone is postponed until July Posted: 22 Jun 2020 07:31 AM PDT The euro collapsed on Friday against the US dollar, as buyers of risky assets did not find positive moments after a video conference of EU leaders, who once again agreed to meet at the end of July to try to agree on a recovery plan and financial assistance of billions of euros. We are talking about a plan proposed by the European Commission for the amount of 750 billion, however, this proposal is not supported by the majority, as there are still quite large differences in how to create this package.
EU chief negotiator Michel Barnier said on Friday that EU leaders will meet in mid-July to agree on a recovery plan and budget. According to him, there is a consensus on some points of the recovery plan, however, the differences remain quite large. The European Commission's plan involves raising money in the debt and financial markets, which will then be distributed among the most affected member countries. And as you may remember, these countries are usually Italy and Spain. As for the budget, its approval raises far fewer questions. A budget of 1.1 trillion euros will come into effect next year. Some experts believe that one meeting in July is not enough, and at least two summits should be held next month to agree on such decisions. This development puts pressure on the European currency since without a new aid plan, it is unlikely that the economic recovery of the most affected EU countries from the coronavirus will be as rapid as in countries with stronger economies. This will create an even greater imbalance and lead to a gap in the spreads and yields of these countries' government bonds, which may ultimately affect the investment rating and increase divisions within the EU. Also on Friday, it was reported that the Federal Reserve is planning to analyze banks' readiness for scenarios with COVID-19 using stress tests, the results of which will be published on June 25. During his speech, US Federal Reserve Chairman Jerome Powell once again repeated practically everything he said throughout the week, saying that the economic shock caused by the coronavirus pandemic opened up those problem areas in the economy that had not previously caused alarm. Powell also noted that the economy will recover, however, it will take more time and effort since the pandemic has "opened up" long-term economic inequalities. As for the technical picture of the euro/dollar pair, it is not quite correct to talk about the pace of recovery of the European currency in the near future, although it suggests a correction after the downward trend formed on June 11 this year. To do this, buyers of risky assets need to overcome the resistance of 1.1255, since only then can we expect a larger growth in the area of the highs of 1.1300 and 1.1350. If the bulls do not manage to cope with this task at the beginning of the week, it is likely that there will be a smooth return to the lows of this week, the breakdown of which will open a direct path for the trading instrument to the lows of 1.1105 and 1.1035. The Canadian dollar remained trading in a side channel, ignoring the April data on the sharp decline in retail sales in Canada in April this year, which was the strongest in the history of this indicator. Social distancing and quarantine measures led to the closure of many stores and affected the index. According to the Bureau of Statistics of Canada, retail sales in April fell by 26.4% compared to March and amounted to 34.72 billion Canadian dollars. As for the technical picture of the USDCAD pair, trading in the side channel of 1.3515-1.3615 may continue this week, as many traders expect a downward correction in oil, which necessarily puts pressure on the Canadian dollar. A break in the resistance of 1.3615 will lead to a new wave of growth of the trading instrument in the area of highs of 1.3735 and 1.3825. The material has been provided by InstaForex Company - www.instaforex.com |
| Posted: 22 Jun 2020 06:50 AM PDT
The US dollar is still unstable. Today, on Monday, the exchange rate of the American currency fell again. The main question is how much time the recovery of the global economy would take. The fact is that the number of infected people is rising. The stable yen practically did not move. Last time, it was at the level of 106.87 per one US dollar. The pound sterling moved higher from a three-week low to $1.2393. By the way, the UK and the European Union have achieved insignificant results on the Brexit issues. The restrictions imposed in Victoria State in Australia have affected the growth of commodity currencies such as the Australian dollar, which, along with the New Zealand dollar, has been in the range for more than a week. The Australian dollar showed modest growth during the Asian session by 0.3% to $0.6854. The New Zealand dollar rose by 0.3% to $0.6422. By the way, the total number of the coronavirus cases in the world exceeds 8.8 million. There are fears that the second wave may lead to new restrictions. The material has been provided by InstaForex Company - www.instaforex.com |
| Do professionals lose their strength? Posted: 22 Jun 2020 06:42 AM PDT Goldman Sachs Bank noted that stocks favored by American retail investors have outperformed those favored by professionals from mutual and hedge funds. This happened on fears of missing out further stock growth. It is surprising that retail investors have managed to pick successful stocks without special preparation. Retail traders prefer to buy shares of the companies that have a difficult financial situation due to the coronavirus pandemic. Professionals, in turn, do not make such a large number of bets because these shares are either unprofitable or low-margin. The chart below shows how the shares of a small Chinese real estate company Fangdd surged in price by 13 times, but the next day the shares dropped again. This is why professionals do not spend time on small transactions.
The Bank notes that this year the number of small transactions on stock options is rapidly growing. The reason for that is the increased activity of retail investors. They have a fairly large supply of cash that makes it possible to earn money in the market. Charles Day, Managing Director of UBS Global Wealth Management, assures wealthy clients that they should not worry about losing huge profits. According to him, it is better to leave this type of trading for amateur speculators. The expert also reminds about the threat of the second wave of COVID-19 and recommends focusing on "growth stocks" as well as on cheap "stocks of value". In addition, he advises holding some cash and government bonds to protect investment portfolio against volatility. The material has been provided by InstaForex Company - www.instaforex.com |
| GBP/USD: plan for the American session on June 22 Posted: 22 Jun 2020 06:03 AM PDT To open long positions on GBPUSD, you need: Buyers of the British pound need to cope with the resistance of 1.2431, which was formed today in the morning. And although the bulls managed to recoup most of Friday's losses, there is a chance that the upward momentum may continue in the afternoon. However, it is possible to talk about new purchases only after a breakout and consolidation above the level of 1.2431, which will open a direct path to the highs of 1.2483 and 1.2545, where I recommend fixing the profits. Buyers should also not forget about protecting the support of 1.2381, since only the formation of a false breakout on it will be a signal to open long positions in the expectation of continuing the upward trend. If there is no activity on this damage during the next test, it is best to postpone purchases until the next update of this week's minimum in the area of 1.2334, and then only in the expectation of a correction of 30-40 points within the day, since a repeated test of this range will indicate the continuation of the bearish trend formed on June 9 this year. To open short positions on GBPUSD, you need: Bears are not in a hurry to return to the market after Friday's volatility, and the first sales from the level of 1.2431, or rather the closing of morning purchases, so far indicate a wait-and-see position of major players. In the North American session, I recommend opening short positions only after another unsuccessful attempt by the bulls to get above the resistance of 1.2431. However, the more important task is to return the pound/dollar pair to the support level of 1.2381, the breakout of which will increase pressure on the pair and lead to a repeated return to the area of the week's minimum of 1.2334, where I recommend fixing the profits. In the scenario of the pound's growth in the second half of the day above the resistance of 1.2431, sales will be relevant only after the resistance test of 1.2483, counting on a correction of 30-40 points by the close of the day.
Signals of indicators: Moving averages Trading is conducted in the area of 30 and 50 daily averages, which indicates that the market has returned to balance, however, the sellers remain in control. Note: The period and prices of moving averages are considered by the author on the hourly chart H1 and differ from the general definition of the classic daily moving averages on the daily chart D1. Bollinger Bands A break in the upper limit of the indicator around 1.2431 will strengthen the demand for the pound. Breaking the lower border of the indicator in the area of 1.2381 will lead to another wave of decline in the pair. Description of indicators
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| Posted: 22 Jun 2020 05:55 AM PDT News:
Bitcoin held on exchanges hit a two-year low this month, according to data from Santiment. A massive outflow of BTC from exchanges is a sign of accumulation and signals investor's positive perception of the cryptocurrency. Technical analysis: BTC has been trading upwards. The price tested the level of $9500. I see potential for rise towards the $9,640 and $9,895. Trading recommendation: Watch for buying opportunities on the BTC due to breakout of the slope pattern in the background and potential end of the intraday downside cycle. The material has been provided by InstaForex Company - www.instaforex.com |
| EUR/USD: plan for the American session on June 22 Posted: 22 Jun 2020 05:53 AM PDT To open long positions on EURUSD, you need: The bulls slightly recovered their losses after a sharp Friday collapse of the pair. Now, in the second half of the day, buyers of the European currency need to try to get above the resistance of 1.1230, as only a consolidation at this level will maintain the bullish momentum that was formed in the first half of the day. A breakout of 1.1230 will open a direct path to the area of the maximum from June 16 - 1.1290, where I recommend fixing the profits since important fundamental data are not published in the North American session, which will limit the upward potential. The longer-term goal for the middle of the week will be a maximum of 1.1349. In the scenario of a decline in the euro in the second half of the day, you can still return to long positions on a false breakout of 1.1170 support or buy the euro/dollar pair immediately on a rebound from the minimum of 1.1106 in the expectation of an upward correction of 30-40 points by the end of the day. To open short positions on EURUSD, you need: Sellers are still in no hurry to return to the market amid the lack of important fundamental data after a major spike in volatility last Friday. Most likely, after a failed break of the resistance of 1.1230, the bears will be more active that the sawtooth movement will return the euro/dollar to this week's minimum in the area of 1.1170, where I recommend taking the profit. The bears' longer-term goal for the middle of the week is at least 1.1106. If the bulls manage to cope with the resistance of 1.1230 in the second half of the day, it is best to postpone short positions until the test of the area of 1.1290 in the expectation of correction of 30-40 points within the day.
Signals of indicators: Moving averages Trading is conducted in the area of 30 and 50 daily moving averages, which indicates the restoration of market equilibrium with a slight advantage for sellers of the euro. Note: The period and prices of moving averages are considered by the author on the hourly chart H1 and differ from the general definition of the classic daily moving averages on the daily chart D1. Bollinger Bands A break of the upper border of the indicator in the area of 1.1225 will lead to a new wave of euro growth. The pair's downward movement will be limited in the support area of 1.1170. Description of indicators
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| Greenback prepares a breakthrough Posted: 22 Jun 2020 05:50 AM PDT
This morning, the exchange rate of the greenback was marked by a slight decrease in relation to the euro. Meanwhile, the dollar remained stable in relation to the Japanese yen. The yuan, on the other hand, began to get cheaper since the National Bank of China decided not to change the level of the base interest rate, which remained at around 3.85%. The main factor that puts pressure on the US dollar was the EU summit, which took place at the end of last week in a video conference format. During the meeting, some agreements were noted regarding the creation of an economic support fund for the EU states, the idea and amount of which have been discussed for a long time. Members of the organization have not yet been able to reach a complete agreement on both the size and distribution of funds between the affected countries. The Friday meeting brought the parties closer to the adoption of an agreed decision related to the seven-year budget of the future fund. Further agreements will be adopted at a real meeting of participants, which is scheduled for July this year, provided that the epidemiological situation allows it. Aussie, on the other hand, is becoming stronger. The main reason for the rise should be considered an improvement in the forecast for the state labor market. According to the Reserve Bank of the country, the number of hours worked will be less by 10%, whereas previously it was assumed that the reduction would be 20%. In addition, the head of the regulator noted that the authorities are ready to take any measures that can stimulate economic growth. Thus, interest rates are likely to continue to be at an unprecedented low level for at least a couple more years, and if necessary, even longer. Recall that in March of this year, the regulator reduced the base interest rate to 0.25%, which was a record low. The value of aussie against the greenback increased by 0.45% and reached the level of 0.6866 dollars for the aussie. In the morning, the value of the euro rose by 0.22% and reached the level of 1.1203 dollars per euro. Recall that Friday's trading closed at around 1.1178 dollars per euro. In relation to the Japanese yen, the single currency of Europe also increased (by 0.27%) and began to trade in the region of 119.78 yen per euro. Bidding last week ended at around 119.46 yen per euro. The greenback has grown a bit in relation to the Japanese yen. It increased by about 0.06%, and the current level is 106.93 yen per dollar. This is also higher than the last auction last week, when the ratio of these currencies was at around 106.87 yen per dollar. Meanwhile, the GBP/USD pair fell by 0.28%. Its current level was around $ 1.2384 per pound. Bidding on the last business day of the last week ended at around 1.2348 dollars per pound. The euro also fell in price against the pound sterling by 0.14%. It began to trade at a level of 1.1063 euros per pound, while the last mark was around 1.1047 euros per pound. The Chinese national currency dropped to 7.0793 yuan per dollar, compared with the previous value of 7.0723 yuan per dollar. Recall that the country's main regulator - the People's Bank of China - for the second month leaves the base annual interest rate unchanged at 3.85%. At the same time, the interest rate on loans for a period of five years was also not revised and remained within 4.65%. The index of the greenback against a basket of six major currencies of the world fell by 0.07% today compared with the previous trading day. Recall that on Friday last week he reached his maximum for the current month indicator, which was at around 97.6 points. Market participants expressed serious concern about the possibility of a second wave of the COVID-19 pandemic. Also, they were not at all pleased with the statistics, especially regarding the level of unemployment and newly submitted applications to the labor exchange. The greenback can now demonstrate a good strengthening, which will be provided by the desire of investors to preserve their assets. In general, the situation with an increase in the number of cases in the world will strengthen the greenback, so we can expect its further growth in the long term. The material has been provided by InstaForex Company - www.instaforex.com |
| Posted: 22 Jun 2020 05:35 AM PDT Corona virus summary:
WHO reports record daily increase in coronavirus casesThe World Health Organization reported a record increase in global coronavirus cases on Sunday, with the total rising by 183,020 in a 24-hour period. The biggest increase was from North and South America with over 116,000 new cases, according to its daily report. Technical analysis: EUR/USD has been trading upwards. The price tested the level of 1,1226. I see potential for rise towards the 1,1292 and 1,1340. Trading recommendation: Watch for buying opportuntiies on the EUR/USD due to breakout of the slope pattern in the background and potential end of the downside cycle. The material has been provided by InstaForex Company - www.instaforex.com |
| Posted: 22 Jun 2020 05:22 AM PDT Corona virus summary:
Concerns that Donald Trump's inner circle might pressure the Food and Drug Administration (FDA) to rush a coronavirus vaccine to market in time for the presidential election have risen after the White House attacked the agency for reversing itself on an experimental drug treatment. Critics say that the FDA's decision in April to approve hydroxychloroquine for emergency use – an approval that the agency revoked last Monday – demonstrated that the regulator is vulnerable to political pressure from the White House. Technical analysis: Gold has been downwards most recently.The price tested and rejected of the level at $1,742. I see potential for further upside continuation due to strong bullish trend condition on the larger time-frame. Trading recommendation: Watch for buying opportunities at $1,745 for potential test of $1,753 and $1,758. Support level is set at $1,742 Resistance levels and upward targets are set at the price of $1,753 and $1,758. The material has been provided by InstaForex Company - www.instaforex.com |
| Technical analysis of AUD/USD for June 22, 2020 Posted: 22 Jun 2020 05:05 AM PDT Overview: Pivot: 0.6882. The trend of AUD/USD pair movement was controversial as it took place in a narrow sideways channel, the market showed signs of instability. Amid the previous events, the price is still moving between the levels of 0.6782 and 0.7040. The AUD/USD pair broke resistance which turned to strong support at the level of 0.6882 last week. The level of 0.6882 coincides with a golden ratio (61.8% of Fibonacci), which is expected to act as major support today. The Relative Strength Index is considered overbought because it is above 70. The RSI is still signaling that the trend is upward as it is still strong above the moving average (100). This suggests the pair will probably go up in coming hours. Accordingly, the market is likely to show signs of a bullish trend. In other words, buy orders are recommended above 0.6882 with the first target at the level of 0.7040. The level of 0.7040 will act as strong resistance and the double top is already set at the point of 0.7040. From this point, the pair is likely to begin an ascending movement to the point of 0.7040 and further to the level of 0.7099. On the other hand, if a breakout happens at the support level of 0.6830, then this scenario may become invalidated. The material has been provided by InstaForex Company - www.instaforex.com |
| Posted: 22 Jun 2020 04:25 AM PDT
Demand for gold returned, after the need for reliable safe haven assets has increased once again. Forecasts for the precious metal are at unprecedented heights, most of which are rational, taking into account the upward trends in the market. Last Friday, June 19, gold rose by almost 1.5% and by the end of the day added 0.6%, closing at $ 1,734 per 1 ounce. It gave about $ 1,756 on exchanges with precious metals, and on Monday, June 22, is being traded near $ 1,758 - $ 1,759 per ounce. Experts believe that the dynamics of gold for the coming months will be determined this week. Leading experts in the precious metals market expect gold to have long price increases, which can alternate with downward turns. Nevertheless, a return to growth is guaranteed, says Everett Millman, an expert at Gainesville Coins. Millman predicts gold to increase to $ 1,750 per 1 ounce, which will become a key resistance level to exit the current range. The forecast for precious metals for the coming days is neutral, pointing to the level of $ 1,700 as reliable support. Charles Nedoss, chief market strategist at LaSalle Futures Group, opposes this, claiming that gold will rise this week above $ 1,760 and consolidate in this range. The most optimistic scenario for gold was offered by the Goldman Sachs, which is confident that gold will easily reach $ 2,000 per ounce in case inflation in the United States grows to 2% or more. This is facilitated by the current policy of the Federal Reserve, which strives for this indicator and intends to keep interest rates at a record low. The Goldman Sachs also improved its forecast for gold for the next three to six months to up to $ 1800 and $ 1900 per 1 ounce, respectively. The main driving force for gold, according to several experts, including Gainesville Coins analysts, is the tense relations between the United States and China. Additional factors are the political crisis in the US, as well as the impending second wave of coronavirus pandemic. At the moment, investors are actively buying gold due to the concerns about new outbreaks of the infection. Gold is also set to rise if the dollar continues to weaken. According to experts, a decline in the currency will activate a rise in demand for the precious metal, which may lead to an increase in the quotes to the round level of $ 2,000 per 1 ounce. At the moment, gold is supported by the large-scale growth rate of money supply coming out from world central banks. Analysts also believe that in the short and medium term, the upward trend in gold will not only continue but also strengthen, as three factors will support the precious metal: weak data on the US and the EU economies, high probability of a second wave of COVID-19, and escalation of geopolitical tensions. These drivers will help gold reach a value up to $ 2000 for 1 ounce or even higher. The material has been provided by InstaForex Company - www.instaforex.com |
| Posted: 22 Jun 2020 04:24 AM PDT
This morning, prices in the markets for crude oil began to adjust downward. Last week's soaring take-off seems to have come to an end, due to mixed news. Last week, the price of black gold rose well amid positive news from OPEC. As it became known, the situation with the insufficient reduction in oil production in some countries that have signed the agreement has begun to change for the better. Thus, Kazakhstan and Iraq entered into negotiations with the organization and presented their own plans to eliminate the excess production that they had after signing the contract with OPEC. Moreover, other states that are also not fulfilling their obligations will have to submit to the organization exactly the same plans to achieve the objectives of the treaty by June 22nd. If this does not happen, strict sanctions will be imposed. Market participants were extremely encouraged that, as a percentage, the deal to reduce raw material production was already at a fairly high level, but now it will generally strive for 100%, which cannot but cause additional joy for investors. In addition, the oil market reacted positively to news of the achievement of some agreements between the EU countries. The latter is trying to open a fund to restore the economy of the region, the amount of the tranche in which should be at least 750 billion euros, which corresponds to 840 billion dollars. The negotiation process seems to have moved forward. States are ready for the final stage of negotiations, which is also a factor in supporting oil. The creation of the fund in itself will be a good lever to maintain the economies of European countries affected by coronavirus infection. However, this will have an even greater impact on the growth in demand for crude oil, which is extremely important today, since there are still too many offers on the black gold market. Another tense situation for crude oil also no longer exerts such serious pressure. The conflict between the United States of America and China has ceased to flare up, the tension have subsided, although it is not completely ruled out. Nevertheless, market participants had the hope that relations between the countries, if not immediately and not in the near future, could be improved. The fact that China announced its intention to purchase agricultural products from the United States of America, which will take place as part of the first step in implementing the trade agreement signed earlier by the US, is in favor of mitigating the conflict. However, the rise in the oil market is limited by several factors. First, market participants continue to closely monitor the increase in the number of patients with coronavirus in China and the United States. New outbreaks hint to investors about the possibility of a second wave of the COVID-19 pandemic in the world. In Beijing, traffic was reduced due to quarantine measures. In addition, they again had to resort to extreme measures and close stores and other retail outlets that had just begun their activities after the first quarantine. Of course, this will be the next and perhaps, even bigger blow to the Beijing economy, which has not fully recovered after the first wave of the crisis. A record number of cases is also again recorded in some states of America, so maybe strict quarantine measures will again be implemented. The situation with coronavirus does not allow the cost of crude oil to rush up without looking back. Prices, therefore, continue to remain in a rather narrow corridor and remains unbroken. Most analysts believe that this will not be broken in the near future. However, there are some positive aspects of the oil market. Thus, the number of operating oil and gas drilling rigs in the United States of America has again declined. This time, another thirteen stations suspended their activity, and the total number of employees turned out to be at the level of 266 units. This is a record low, since a year earlier the number of drilling units was 967 units. The number of oil installations also decreased by 10 and reached 189 units, which is also an extremely low indicator in the entire history. This morning, the price of futures for Brent crude oil for delivery in August at a trading floor in London fell by 0.33% or 0.14 dollars, which sent it to the mark of 41.05 dollars per barrel. Recall that Friday's trading ended with a steady increase of 1.6% or 0.68 dollars. The price of WTI light oil futures for July delivery in electronic trading in New York also fell today. In the morning, the decline was 0.68% or 0.27 dollars, and the current level was at around 39.48 dollars per barrel. On the last trading day last week, the price of raw materials rose immediately by 2.3% or 0.91 dollars. This has become its maximum value in the last three months or more. In general, the dynamics of the cost of crude oil last week was more than good. So, the Brent brand increased by 8.9%, and WTI went even further and added 9.6%. But the new week can be extremely mixed for prices in the oil market. The material has been provided by InstaForex Company - www.instaforex.com |
| Trading recommendations for the EUR/USD pair on June 22, 2020 Posted: 22 Jun 2020 03:16 AM PDT From the point of view of complex analysis, we can see that the quotes recovered and reached very important price levels. Last trading week kept the trend downward, where the initial correction from 1.1440 / 1.1500 became a process of recovery relative to the inertial course. It is estimated to approximately 33% of the movement on May 26, which is small in scale, but the change in market sentiment suggests that the repetition of the movement seen on March 10 may occur in the market. The high speculative activity, which the market has observed recently, formed an upward trend, which jeopardized the medium-term downward trend. Instability has led to a rapid change in market sentiment, not only the European currency, but also to the British pound. Thus, for a short period of time, it might seem that the pound is moving to a new range of fluctuations, but in reality, it is just a trap of locally speculative interest and does not lead to anything cardinal. The head and shoulder pattern seen in the H4 chart has developed 38%, which is a good signal for a subsequent downward movement. Analyzing the trading last Friday in detail, we can see a high activity, during which the quotes showed a local surge in speculative activity at 12: 30-16: 00 (UTC + 1). During the surge, the quote managed to reach the level of 1.1180, in the area of which there was a slowdown and subsequent rollback. As discussed in the previous review, traders expected a decline, in which 1.1180 is the support level that would play an important role in the regrouping trading forces. With regards to volatility, an activity equal to the daily average was recorded, which is a good signal for subsequent dynamic development. Analyzing the daily chart, we can see sharp movements over a period of four weeks, which became the second rally in the market in the current year. The news published on Friday did not have important macroeconomic reports on Europe and the United States, so the attention of traders were focused on the technical picture of the market. An EU summit was also held, in which the EU leaders discussed the issues related to the total amount of the assistance package after the coronavirus and the next EU budget, as well as questions about whether funds should be allocated exclusively in the form of subsidies, conditions for making cash payments, and the criteria by which they will be decided. The European Parliament also called out during the EU summit to prepare in case a consensus was not reached between the UK and the EU, since there is very little time to reach an agreement. "The European Parliament stands for an agreement, in which we support the intensification of the dialogue. However, we also urge you to prepare for a Brexit without an agreement, so that you would know what to do if this happens. There is very little time left to reach a deal, and we must do everything possible to reach an agreement, "said European Parliament President David Sassoli. Today, the data in home sales in the US secondary market will be published, in which a 2.0% decrease is expected. Further development Analyzing the current trading chart, we can see a slow downward movement within the area of 1.1180, which formed a small rebound that is already being considered in terms of regrouping trading forces. A recovery is still one of the current topics of discussion among traders, so the continuation of a downward trend is possible soon. Nevertheless, market participants are still focused on speculative excitement, which is confirmed by the structure of candles, volumes and speculative activity coefficient. The regrouping of trading forces may be delayed if the quotes consolidate above 1.1210, which will lead to a local move in the direction of 1.1240 / 1.1250. With regards to the recovery, take main trading positions if the quotes consolidate below 1.1165, which will push the quotes in the direction of 1.1100-1.1080. Based on the information listed above, consider these trading ideas: - Open buy positions if the quotes consolidate above 1.1210, in the direction of 1.1240-1.1250 - Open sell positions if the quotes consolidate below 1.1165, in the direction of 1.1100-1.1080 Indicator analysis Analyzing the different sectors of time frames (TF), we can see that the indicators in the hourly and daily periods signal sell due to the rapid downward movement and consolidation of prices in the area of 1.1180, while short-term periods signal buy due to the regrouping of trading forces. Volatility per week / Measurement of volatility: Month; Quarter year The volatility measurement reflects the average daily fluctuation calculated per Month / Quarter / Year. (June 22 was built, taking into account the time of publication of the article) The volatility of the current time is 38 points, which is 55% lower than the average daily dynamics. General market sentiment, as well as stable activity, will bring today's volatility up. Key levels Resistance Zones: 1.1300; 1.1440 / 1.1500; 1.1650 *; 1.1720 **; 1.1850 **; 1,2100 Support Areas: 1.1180; 1.1080 **; 1,1000 ***; 1.0850 **; 1.0775 *; 1.0650 (1.0636); 1,0500 ***; 1.0350 **; 1,0000 ***. * Periodic level ** Range Level *** Psychological level The material has been provided by InstaForex Company - www.instaforex.com |
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