Home Become a Member Contact Us WinPicks Software Scoresline Sports Forum

Forums   Register   Profile   Inbox   Address Book   Subscribe   My Forums   Search   FAQ   Login   Log Out
RE: Wave Analysis by InstaForex   Logged in as: Guest
Users viewing this topic: none
  Printable Version
All Forums >> [Market Talk] >> Technical Analysis >> RE: Wave Analysis by InstaForex Page: <<   < prev  22 23 24 25 [26]
Message << Older Topic   Newer Topic >>
RE: Wave Analysis by InstaForex - 7/7/2019 11:27:39 PM   
InstaForex Gertrude


Posts: 596
Joined: 5/16/2014
Status: offline
EUR/USD. 5th of July. Results of the day. NonFarm Payrolls - the killer of European currencies

4-hour timeframe

The amplitude of the last 5 days (high-low): 42p - 90p - 47p - 44p - 22p.

Average amplitude for the last 5 days: 49p (51p).

The last trading day of the current week has passed with the US currency having full advantage. There was only one reason for this - the publication of the NonFarm Payrolls report for June. Analysts' forecasts predicted 162,000 new jobs outside the agricultural sector, but in reality there were 224,000. Such a strong excess of the real value over the forecast naturally provoked strong purchases of the US dollar and so the US currency rose by 60 points against the euro. Against the background of strong NonFarms, traders ignored unemployment in the United States, which rose to 3.7%, as well as weaker wage growth than originally estimated. However, the key question for the entire currency market now is: do strong NonFarm mean the end of a period of failed macroeconomic statistics in the US or is it just an accident? As we all see, the US dollar has almost completely offset all losses against the European currency, which suffered during the month when reports from the United States could not please even the most ardent optimists. Only 120 points are left to reach the year lows and such a resurrection of the US dollar occurred, by and large, without particularly strong support from the foundation. Now a new question arises: if the macroeconomic statistics ceases to disappoint, the Fed may not soften the monetary policy in 2019, respectively, the main advantage of the euro, which bulls of the euro/dollar pair could plummet into oblivion. What should the euro count on in this case? There is no answer to this question yet, but we state the fact: the US dollar is very close to "returning to the game" and in the near future it will be possible to state the resumption of a downward trend.

Trading recommendations:

The EUR/USD pair resumed its downward movement. Thus, it is now again recommended to sell the euro with the target of 1.1177. At the beginning of the new trading week, new levels of support and resistance will be formed.

It is recommended that you buy the euro/dollar pair not earlier than when prices have consolidated above the Kijun-sen line. However, this will require a strong fundamental basis for the bulls.

In addition to the technical picture 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.

Analysis are provided by InstaForex

(in reply to InstaForex Gertrude)
Post #: 501
RE: Wave Analysis by InstaForex - 7/8/2019 11:58:06 PM   
InstaForex Gertrude


Posts: 596
Joined: 5/16/2014
Status: offline
Technical analysis of GBP/USD for 09/07/2019:

Technical Market Overview:
The GBP/USD pair has broken through the technical support at the levels of 1.2559, 1.2529 and 1.2505 on its way down to the new swing low made at the level of 1.2476. As we can see the price is now out of the descending channel, which is a very bearish sign. There is a Pin Bar made at the new swing low at the level of 1.2476, but so far there is not much bullish pressure on the market and the bears are still in full control of the market. The nearest technical resistance is located at the level of 1.2559 and it might be tested soon due to the oversold market conditions.

Weekly Pivot Points:
WR3 - 1.2853
WR2 - 1.2772
WR1 - 1.2630
Weekly Pivot - 1.2551
WS1 - 1.2402
WS2 - 1.2319
WS3 - 1.2180

Trading Recommendations:
The best strategy for the current market conditions is to follow the larger timeframe trend. The larger time frame trend is still down and there are no signs of any trend reversal. The key long-term technical support is seen at the level of 1.2431 and the key long-term technical resistance is seen at the level of 1.2775 and only if this level is violated, there is a chance for the trend reversal.

Analysis are provided by InstaForex

(in reply to InstaForex Gertrude)
Post #: 502
RE: Wave Analysis by InstaForex - 7/9/2019 10:52:47 PM   
InstaForex Gertrude


Posts: 596
Joined: 5/16/2014
Status: offline
Forecast for USD/JPY on July 10, 2019

Yesterday and today, the price is testing the strength of the resistance of the embedded line of the price channel at around 109.00. As we expected, the reversal of the signal line of the Marlin oscillator from the border with the territory of the decline on the daily chart took place. Now, the pair USD/JPY needs to overcome this resistance to pass only 25 points to the next resistance on the daily chart – the MACD line, which is an indicator of the current trend.

As seen on the four-hour chart, the growth of the Marlin oscillator slowed down, the price may roll back from the current level. But the general upward trend remains stable – the price is above the balance line (red indicator) and the MACD line. The level of 108.20 in this case is not the goal of a possible correction, it marks the "last line of defense" of the bulls. With the departure of the price below this line, a deeper drop is possible.

Analysis are provided by InstaForex

(in reply to InstaForex Gertrude)
Post #: 503
RE: Wave Analysis by InstaForex - 7/10/2019 10:30:42 PM   
InstaForex Gertrude


Posts: 596
Joined: 5/16/2014
Status: offline
EUR/USD. 1-0 in favor of the euro

The US dollar did not rest long on its laurels: after Friday's take-off on strong Nonfarm, today it began to swoop down just as rapidly throughout the entire market. Contrary to the hopes of dollar bulls, the Federal Reserve chief did not revise his position on the prospects for monetary policy and in fact confirmed the previously announced intention to lower the interest rate at the July meeting. The tone of his rhetoric was quite categorical and key messages were not ambiguous. Powell made it clear that the Fed is ready to ease monetary policy, and will proceed to this step in the very near future.

The key message of the Fed head is that the US economy is in a strong form, but assistance from the regulator is needed in order to maintain it - in the form of lower interest rates. Throughout his speech, he cited facts arguing this idea. In general, despite the fact that Powell has positively assessed the state of the US economy, he expressed serious concern about its prospects.

The head of the US Federal Reserve noted that after the June Fed meeting (at which, in fact, the dovish intentions of the regulator were announced), the overall uncertainty only increased. Powell actually offset the optimism of traders associated with the outcome of the US-China talks in Osaka. He said that a truce is certainly a positive signal, but in general the situation has not changed. Global trade conflicts, according to Powell, have slowed the economic momentum in many countries, and this fact has a negative effect on the US economy. A temporary truce, unfortunately, does not solve these problems. Denoting problems of a global nature, Powell also mentioned Brexit (which is likely to follow the "hard" scenario), as well as the issue of federal debt.

As for internal problems, the key "headache" of the Fed is inflation. According to Jerome Powell, inflation continues to be weak, and this weakness may be more stable and systemic. It is worth recalling that during the first half of the year, the Fed chief assured investors that the slowdown in key inflation indicators is a temporary phenomenon, and that the situation will change for the better in the second half of the year. Now Powell is by no means certain of that.

According to him, the latest indicators of wage growth are "very weak" for accelerating inflation (the June figures were in the red zone, not reaching the forecast values). Early inflation indicators suggest that inflationary pressure will remain muted this year. The latest published releases were really not in favor of the dollar. For example, the indicator of consumer confidence in Americans slumped to two-year lows, and the volume of orders for durable goods disappointed traders with negative dynamics. The indicator remained in the negative area (-1.3%), thus continuing the April trend. It is also worth noting the fall in business investment, the slowdown in global growth and the decline in investment in housing and manufacturing. I'm not even talking about the release of the consumer price index (general and pivotal), which also showed weak growth.

In other words, Powell's dovish position looks quite justified. It even "got" to the US labor market, which showed growth last Friday. Powell stated a fact, but noted that for many residents of the United States, this growth was "uneven". He voiced the structure of Nonfarms, according to which Asians and whites found work more often, unlike African Americans and Latin Americans. Powell also assured Congress that the labor market is not "overheated", and therefore there is no need to restrain with high rates.

Thus, Jerome Powell made it clear that the Fed will cut interest rates by 25 basis points at the end of this month. But the next steps of the regulator will depend on the incoming data, above all - inflation. The head of the Fed has mentioned that the real numbers may show a lower result relative to the preliminary forecasts of the regulator. In this case, he assured members of Congress that the Fed "will use all its means to keep economic growth and key indicators in the right path." In other words, inflation indicators will particularly strongly influence the dollar position - and in this context, tomorrow's release can cause increased volatility for the EUR/USD pair.

We are talking about the publication of data on the growth of US inflation. The overall consumer price index should show a negative trend, dropping to 1.6% in annual terms and down to zero - on a monthly basis. Core inflation, excluding prices for food and energy, can demonstrate minimal growth in monthly terms (from 0.1% to 0.2%) and remain at the same level (2.0%) in annual terms. If the real numbers are below fairly weak forecast values, the dollar may again fall under the wave of sales.

Tomorrow, Powell will continue his speech in the US Congress - this time in the Banking, Housing and Urban Affairs Committee. Today's round of "correspondence" has ended in favor of the euro. On Thursday, EUR/USD bulls can consolidate their results and enter the area of the 13th figure, hinting at the restoration of the upward trend.

Analysis are provided by InstaForex

(in reply to InstaForex Gertrude)
Post #: 504
RE: Wave Analysis by InstaForex - 7/11/2019 11:19:35 PM   
InstaForex Gertrude


Posts: 596
Joined: 5/16/2014
Status: offline
EUR/USD: US inflation drowned out the upward impulse

Data on the growth of US inflation was very controversial. The general consumer price index showed mixed dynamics: on a monthly basis, it remained at the level of May (that is, at the level of 0.1%) with the forecast of decline to zero. In annual terms, the index came out in accordance with the forecast, being at the level of 1.6% (previous value - 1.8%). But core inflation has pleased investors with minimal growth. On a monthly and annual basis, CPI turned out to be better than forecast, coming out in the "green zone" (0.3 m/m and 2.1% y/y)

After the release of this report, the market hesitated for a while - on the one hand, the inflation rate was pleasantly surprising (especially the base one), on the other hand, the growth of the main indicators was minimal. But an hour later, the market decided that "the glass was half full" than vice versa, and so the US currency gradually began to restore its position. The dollar index moved away from lows of the day (and week), rising from 96.417 to the current value of 96.620. Although the growth of the greenback is not of a large scale, this situation indicates that the upward impulse of the EUR/USD pair is too unsteady and uncertain, and the dollar, in turn, retains the potential for further growth. After Powell's pessimistic comments and the release of the dovish Fed minutes, such dynamics from the greenback looks abnormal. But if we consider this situation in terms of market expectations, many things fall into place.

By and large, the Fed follows the expectations of the market, and to be more precise, it prepared the traders fairly smoothly and well in advance for their further steps. Representatives of the dovish wing of the Fed (James Bullard, Rafael Bostic, Lael Brainard) first spoke about the need to mitigate monetary policy. Then the likelihood of such a scenario did not exclude Jerome Powell, however, as a necessary (extreme) measure. Over the coming weeks, the Fed chief strengthened the dovish tone, allowing for a rate cut this year. In the end, at its June meeting, the Fed excluded from the text of the accompanying statement the phrase "showing patience" regarding the prospects for monetary policy, thus opening the door to the first rate cut. Thus, the probability of monetary policy easing gradually grew and reached almost 100% at the end of last month. Moreover, the market began to exaggerate information that the Fed would reduce the rate immediately by 50 basis points or start a rate reduction cycle (one decrease in July, one more in the fall). Against the background of such conversations, the dollar has noticeably weakened - in particular, the EUR/USD pair even tested the 14th figure for the first time since March of this year.

But strong Nonfarm weakened the fears of traders about an aggressive rate cut. At the same time, the likelihood of a July decline was still preserved. That is why the dollar relatively calmly survived Jerome Powell's unambiguously dovish report to Congress. Despite the clear hints of the Fed, the dollar just moved away from annual lows against the euro, but buyers could not even enter the area of the 13th figure. The thing is that the market was ready for the July rate cut - the only question was how aggressive the Fed's actions would be after this "preventive" step. In turn, today's data on inflation has suggested that the Fed will take a wait-and-see position following the decline in July.

In other words, the Fed has been preparing the markets for monetary policy easing for quite a long time. Therefore, the Fed chief's semi-annual report did not provoke a large-scale weakening of the dollar. If we talk about the EUR/USD pair, in this case, Powell only interrupted the downward trend and allowed the pair's bulls to go for a correction, the "ceiling" of which is 1,1300. This ceiling is not only due to the growth of core inflation in the United States.

The single currency is also under pressure from the fundamental background, primarily from the ECB. So, the minutes of the last meeting of the European regulator was released today, which demonstrated the dovish intentions of the ECB. In the opinion of the members of the Governing Council, the regulator needs to prepare for easing monetary policy in view of the reduction in inflation expectations. Almost all representatives of the ECB agreed that the central bank needed to change its position, demonstrating readiness for "retaliation". Arsenal of possible measures includes both the resumption of QE and lower interest rates. It is not known what algorithm of actions the regulator will choose for itself, but at the same time it is obvious that the ECB will take the path of easing monetary policy - just like the Fed.

This fact limits the potential correctional growth of the EUR/USD pair. The first resistance level is the mark of 1,1285 (the middle line of the Bollinger Bands indicator on the daily chart, which coincides with the Tenkan-sen line). Today, the pair has reached this level, but was unable to break through it, and after the publication of the US CPI, it retreated to the level of today's opening. Just above - at around 1.1300 - is the next resistance level, which corresponds to the Kijun-sen line. But if the demand for the dollar will increase (especially if tomorrow's producer price index will be released in the "green zone"), then the pair will most likely return to the base of the 12th figure, namely, to the support of 1.1205, which corresponds to the lower Kumo cloud on D1.

Analysis are provided by InstaForex

(in reply to InstaForex Gertrude)
Post #: 505
RE: Wave Analysis by InstaForex - 7/15/2019 10:18:36 PM   
InstaForex Gertrude


Posts: 596
Joined: 5/16/2014
Status: offline
Is gold going higher and higher and higher?

After many years of waiting, the hopes of investors who invest in gold were finally rewarded, as gold showed an impressive trend in the first half of 2019, which was caused by several reasons. Is it worth it to invest money in gold now and is it time to take profits to those who bought gold from the levels of $1,300, we will analyze in this article.

If we consider gold from the point of view of distant investment horizons, then investors should have no questions at all. Regardless of the behavior of gold in the derivatives market, it should be in the portfolio of each investor in a volume of up to 20% or more if the portfolio is denominated in reserve currencies. Even if gold falls short in price in the short term, it should be taken as the foundation of a house: you don't want to bury money in the ground, but you have to, because you need to build a house on stone and not on sand. Moreover, in the long run, gold is the most profitable asset in any currency.

Since 2001, gold has increased by five times in price against the dollar. The price of gold was $287 per troy ounce on September 11, 2001 but now gold is worth $1,415. Over the same period, investments in S&P 500 stocks, inflated from free money in the last ten years, have brought a yield of "just" 2.8 times the return - it was 1,050, it was 3,000. No one argues, 285% is good, but you have to agree that 500% is better, and if you take 2008-2009, then there were no questions at all as to where money should be invested - in gold or shares.

It seems to me that the best investment in order to save money for retirement or the education of children will be an investment in gold coins. Yes, there are periods of recession, but long-term gold is a very stable and profitable asset. Over a period of 20 years, gold gives an annual increase of 8% on invested capital.

Of course, it's easy to talk about a distance of two decades, it's more difficult to figure out shorter periods, but we'll try. If we talk about the current time, then, according to the World Gold Council, now the following factors influence the situation:

Financial market uncertainty and adaptive monetary policies are likely to support investment demand for gold; Price momentum and positioning can stimulate rallies and create kickbacks, as investors constantly revise their expectations based on new information; Weaker economic growth in the near term could soften consumer demand for gold, but structural economic reforms in India and China are likely to support long-term demand.

Regarding monetary policy easing, Federal Reserve Chairman Jerome Powell and the Open Market Committee now occupy a balanced policy and would rather prefer not to lower the rate at the next meeting, which will be held in late June. However, markets literally force the Fed to do this, suggesting a 100 percent likelihood of such a move. As the analysis conducted by the World Gold Council shows, the US Federal Open Market Committee conducted a rate change whenever more than 65% of traders expected such a move from it (Fig. 1).

Figure 1: Changes in the Fed's monetary policy in line with market expectations. Source: World Gold Council

Despite good inflation data (core inflation rose to 2.1% in June) and excellent unemployment data, the Fed is unlikely to decide to go against the will of the markets and leave the rate unchanged. In turn, the rate reduction is negative for the US dollar, which will lose 0.25% of potential, which is very likely to lead to a decrease in the dollar against a basket of major reserve currencies. At the same time, the US dollar has a 90 percent negative correlation with the US dollar. Earlier, in 2010 - 2015, gold significantly correlated with the yen, but later began to correlate with the euro and the dollar, in turn, the correlation with the yen had decreased.

Speaking about the factors that highly affect the price of gold, it is necessary to note the demand of exchange-traded funds - ETF - and the positioning of Money Manager speculators in the futures market. They are the main buyers of gold, and it is the influx of money to the derivatives market that determines the medium and short-term price dynamics. By volume, the COMEX-CME conglomerate is the largest exchange for trading gold and its derivatives, followed by London and Shanghai.

From June 1, Open Interest, which characterizes the influx of new money into the market, grew by more than a quarter and for the first time in history exceeded the level of 1 million contracts. However, in July, the process slowed down somewhat and has stabilized at this point. Some traders preferred to take profits, which resulted in a slight decrease in OI to 1.01 million. Speculators, after the explosive growth of May-June, also slightly reduced their long positions, which currently amount to 241 thousand contracts. At the same time, short positions of speculators remain at the lowest values of 24.3 thousand contracts (Fig. 2), which does not indicate their desire to sell gold against its trend. Therefore, wishing to open a short position in gold should not be smarter than the market. Traders need to be with the market, and if you call yourself a speculator, then you must act together with the Money Manager, and not against them.

Fig.2: Position of traders in the COT report. Source Commodity Futures Commission - CFTC

Based on the above factors, as well as technical analysis, it can be assumed that the range of 1380-1435, formed by the price of gold in the previous three weeks, is more likely a continuation figure than a reversal figure. In this case, in the event of growth, gold has every change to reach the level of $1500 and continue further upward movement.

However, if the Fed does not lower the rate, which is now highly unlikely, or Jerome Powell's comments on future monetary policy prospects will lead to an increase in the US dollar, there is some small chance that gold could fall to $1,375-$1,350. In this case, traders should remember that "Murphy's Law" says that if trouble can happen, it will happen, it will be realized on the markets with an enviable constancy. In this regard, no need to make exceptions to the rules of money management and open positions that you can not afford to lose.

Analysis are provided by InstaForex

(in reply to InstaForex Gertrude)
Post #: 506
RE: Wave Analysis by InstaForex - 7/16/2019 10:50:31 PM   
InstaForex Gertrude


Posts: 596
Joined: 5/16/2014
Status: offline
EUR/USD: potential decline to 1.1170 and a "powder keg" for dollar bulls

Bears of the EUR/USD pair managed to overcome the support level of 1.1230, which corresponded to the Kumo cloud boundaries on the daily chart, and then headed towards the 11th figure - or more precisely, to the next support level of 1.1170 (the bottom line of the Bollinger Bands indicator on D1). The overall market situation is unequivocally negative for the euro and fairly neutral for the dollar. However, today the US currency received support from retail sales in the US, while the single currency received another blow from the German statistics.

Thus, the euro was pressured by figures from the ZEW Institute. In particular, the sentiment index in the business environment of Germany dropped immediately to the level of -24.5 points - this is the most negative result since last November. Analysts expected a negative trend, but, according to their forecasts, the indicator should have dropped to -22.7 points. In Europe as a whole, this indicator also remained at semi-annual lows, having stood at -20.3 points. At the same level, the indicator was released last month. After the surge of optimism in April, when for the first time in 2 years, both in Germany and in the EU as a whole, they were above zero, this dynamic looks depressing, and this fact had a corresponding impact on the single currency. Judging by the rhetoric of members of the ECB, the central bank is ready to use its whole arsenal of available actions in the fall. In particular, we are talking about the bond purchasing program and reducing the interest rate. Not so long ago, the head of the ECB acknowledged that many of the early indicators warn of a worsening situation in the eurozone, so the risks for forecasts remain downward.

By the way, tomorrow's data on the growth of European inflation may put additional pressure on the euro if they are revised downward. We will know the final data for June. According to initial estimates, the overall consumer price index rose to 1.2%, while the core index rose to 1.1%. According to the general opinion of experts, core inflation will be subject to revision - the indicator can be reduced to 1%. In this case, bears of the EUR/USD pair will have another reason to sell the single currency, and the price will certainly be consolidated within the 11th figure.

Moreover, the greenback's growth is fueled by fairly good statistics from the United States. Today, dollar bulls have pleased retail sales. Contrary to negative forecasts, indicators of consumer activity have not decreased, but in fact remained at the level of the previous period. The overall figure, as well as the figure excluding car sales, grew in June by 0.4% (with a decline forecast to 0.1%). Excluding auto and fuel sales, the indicator has been growing for the second month in a row, reaching 0.7%. Against the background of the growth of key macroeconomic indicators (strong Nonfarm and positive dynamics of inflation), these figures have provided significant support to the dollar. I note that Jerome Powell, in the course of his speeches and without this release, stated the intensification of consumer activity. He associated the main risks for the Fed with other factors (first of all, we are talking about geopolitical risks and reducing the volume of business investments).

Nevertheless, today's release made it possible for dollar bulls to once again show character - in almost all pairs, the greenback strengthened their positions, and the EUR/USD pair was no exception. In general, the dollar is gradually gaining momentum throughout the market, and either Powell or Trump can hinder this process. Here it is necessary to emphasize the fact that the Fed's July interest rate cut is largely taken into account in prices, so any reminder about this on the part of the US central bank's members is quite calmly perceived by the market. Dollar bulls fear only aggressive rates of monetary policy easing - for example, a one-time cut in the rate by 50 basis points or the beginning of a decline cycle. The "precautionary" rate cut of 0.25% was largely played by the market, especially after the Fed head's dovish speech in Congress, during which he actually announced the relevant intentions of the regulator.

In my opinion, the greatest danger to the dollar is not the Fed, but Donald Trump, who repeatedly expressed outrage at the overvalued exchange rate of the national currency. According to Bloomberg, the US president has already instructed his advisers to develop a strategy to weaken the dollar. According to insider sources, Larry Kudlow, the chief economic adviser to the president, and Stephen Mnuchin, the minister of finance, opposed any US intervention to weaken the greenback. But according to Trump, an overly expensive dollar is almost the key obstacle to a country's economic growth. In turn, economic growth, according to the head of the White House, should provide him with a second presidential term. Here it is worth noting that the overwhelming majority of opinion polls are giving a definite advantage to former Vice-President Joe Biden. Even the Fox News channel, which clearly sympathizes with Trump, acknowledged this fact. According to their polls, Trump is almost 10% behind Biden.

Thus, good news for dollar bulls is that the greenback has acquired "immunity" regarding the Fed's stated intentions to cut the rate by 25 points (and more aggressive measures are unlikely to be applied). In addition, US statistics also provide background support for the dollar. The bad news is that Trump may initiate currency interventions, especially if the US currency continues to rise in price across the entire market. Taking into account such (possible) perspectives, dollar bulls sit on a "powder keg", which can jerk at any moment.

From a technical point of view, the EUR/USD pair has the potential to fall to the bottom line of the Bollinger Bands indicator on the daily chart, which corresponds to the mark of 1.1170. If the bears overcome this support level (which is unlikely within the next few days), the pair will head to the bottom of the 11th figure, that is, to the bottom line of the Bollinger Bands indicator on the weekly chart.

Analysis are provided by InstaForex

(in reply to InstaForex Gertrude)
Post #: 507
Page:   <<   < prev  22 23 24 25 [26]
All Forums >> [Market Talk] >> Technical Analysis >> RE: Wave Analysis by InstaForex Page: <<   < prev  22 23 24 25 [26]
Jump to:

New Messages No New Messages
Hot Topic w/ New Messages Hot Topic w/o New Messages
Locked w/ New Messages Locked w/o New Messages
 Post New Thread
 Reply to Message
 Post New Poll
 Submit Vote
 Delete My Own Post
 Delete My Own Thread
 Rate Posts

Forum Software © ASPPlayground.NET Advanced Edition 2.4.5 Unicode