Gold is entangled in taxes

Working with gold traders in the fall throws something in the heat, then in the cold. Dragmetall in early September against the backdrop of escalating geopolitical risks, seasonal purchases and the weakness of the US dollar reached its highest level for the year, but could not hold above $ 1,350 an ounce and the stone collapsed. Participants in the market battle little verbal skirmish between Washington and Pyongyang, they need action. In this regard, the words of US Secretary of State Rex Tillerson that the States are wasting time to negotiate with North Korea, which caused the most serious outflow from the largest specialized stock fund SPDR Gold Shares over the past couple of months are indicative.

Dynamics of capital flows in SPDR Gold Shares

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Source: Bloomberg.

Do not particularly believe in the prospects of XAU / USD and retailers. For the first 9 months of this year, the volume of sales of investment coins by the American Court declined by 2/3 compared to the same period of 2015 and 2016. Speculators cut the net long positions in gold at the fastest pace since the beginning of July (-16%), while JP Morgan recommends His clients stay in shorts for precious metals.

The main culprits of all ills are the "bulls" called the tax reform and the growth of the probability of tightening the monetary policy of the Fed. The December indicator jumped from 31% to 83% after the rumors in the press that the next head of the Federal Reserve would be Kevin Warsh. In 2011, he resigned from the FOMC in connection with the disagreement over the policy of cheap money. If the head of the Central Bank becomes a "hawk", then the probability of three acts of monetary restriction in the next 12 months will rapidly go up the hill, which will support the US dollar and the yield of treasury bonds. At present, the indicator is about 25%.

For gold, there is nothing worse than a strong "American" and a rally in the rates of the US debt market. It is not able to compete with bonds and is sensitive to changes in their profitability. However, some central banks do not panic about this. For example, the Russian regulator continues to buy up precious metals at the same rate as in 2015-2016 (approximately 200 tons). Its gold reserves are estimated at 1716 tons, which is equivalent to the sum of the indicator for Turkey, Mexico and India and is about 17% of the gold and foreign exchange reserves of the Russian Federation.

In the short term, bulls for XAU / USD may receive some support due to the disappointing report on US employment for September and the hawkish rhetoric of the minutes of the last meeting of the Governing Council of the ECB. The European regulator is very careful in preparing the markets for the normalization of monetary policy, step by step leading them to the need to fold QE.

As for the report on the US labor market, the weak expectations (+80 thousand for non-farm payrolls) are related to the impact of hurricanes on the economy. A technically successful storm of resistance at $ 1,280 per ounce will allow the bulls to create a foundation for future consolidation in the $ 1265-1320 range. If the test is unsuccessful, the risks of continuing the southern campaign will increase.

Gold, daily chart

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GBP/USD analysis for October 04, 2017

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Recently, the EUR/USD pair has been trading upwards. The price tested the level of 1.3287. Anyway, according to the 30M time- frame, I found a successful re-test of yesterday's high at the price of 1.3287. There is a hidden bearish divergence on the moving average oscilaotr, which is another sign of weakness. My advice is to watch for potential selling opportunities. The downward targets are set at the price of 1.3245 and 1.3220.

Resistance levels:

R1: 1.3273

R2: 1.3295

R3: 1.3310

Support levels:

S1: 1.3235

S2: 1.3222

S3: 1.3200

Trading recommendations for today: watch for potential selling opportunities.

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EUR/USD analysis for October 04, 2017

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Recently, the EUR/USD pair has been trading upwards. The price tested the level of 1.1787. Anyway, according to the 30M time- frame, I found a fake breakout of yesterday's high at the price of 1.1773, which is sign that buying looks risky. There is a hidden bearish divergence on the moving average oscilator, which is another sign of weakness. My advice is to watch for potential selling opportuntiies. The downward targets are set at the price of 1.1750, 1.1735 and 1.1700.

Resistance levels:

R1: 1.1773

R2: 1.1790

R3: 1.1800

Support levels:

S1: 1.1745

S2: 1.1731

S3: 1.1715

Trading recommendations for today: watch for potential selling opportunities.

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Bitcoin analysis for October 04, 2017

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The Bitcoin (BTC) has been trading downwards. As I expected, the price tested the level of $4.182 (yesterday's target). Two government officials of the Crimean Council of Ministers were caught mining bitcoin using government computers and were subsequently fired. They reportedly installed "malicious software" on the government's server and programmed over a dozen computers to mine bitcoin. The technical picture is bearish.

Trading recommendations:

According to the 15M time frame, I found that price filed Monday gap, which is a sign that buyers lost power. Anyway, the critical support is set at the price of $4.181. My advice is to watch for the potential breakout of the support to confirm further downward movement. The downward target will be set at the price of $4.016. There is a hidden bearish divergence on the moving average oscillator, which is another sign of weakness. Watch for potential selling opportunities.

Support/Resistance

$4.334 – Intraday resistance (price action)

$4.260 – Intraday resistance FR 50% (Fibonacci)

$4.276 – Intraday resistance FR 61.8% (Fibonacci)

$4.181 – Key support

$4.016 – Downward target if the price breaks the support level

With InstaForex, you can earn on cryptocurrency's movements right now. Just open a deal in your MetaTrader4.

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The dollar holds positions

Published on Monday, the ISM report on activity in the manufacturing sector gave absolutely striking figures. The index for September reached the level of 60.8p, which is a historical record since May 2004. Similarly, the Markit index is more modest and correlates compared to the ISM that shows the index of index production. The gap between the Markit and the ISM is too large to ignore and reflects the imperfection or even the bias of the calculation methods, rather than the real recovery of the US economy.

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Markets reacted to the strong data as the S&P 500 index set yesterday reaching the next historical record of 2534.98p, closing the day near the maximum. The stock market grew as the expectations are implemented regarding the prospects for the forthcoming fiscal reform. Moreover, the prospect of reducing the tax burden attracts investors even under the threat of tightening financial conditions.The dollar in such a situation will be in high demand, which is certainly a bullish factor.

The employment report for September will be published on Friday. This is a significant increase in the value of both wages and salaries. However, the expected report may be significantly worse than the previous one. Primarily because of the hurricanes. Currently, it is projected that the number of new jobs will be reduced to 98,000 while the average wage growth is not expected to change to 2.5 percent.

Growth in the course of time, and in the course of time. Here the role of the Federal Reserve plays a role, this directly implies that the consequences of decisions on the monetary policy.

Market expectations are largely shaped by the position of the Fed. Also, it should be noted that labor market recovery becomes a marketing term since the real situation is much worse which is clearly demonstrated in the graph below. The ratio of the volume of jobs (Total Nonfarm Payrolls) to the number of workers leaving the labor force since 2011 is almost invariably and much worse than the pre-crisis period. The labor market gives off a similar picture to the potentially active population to the number of unemployed is in fact in a much worse state than in the pre-crisis period.

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The following statements can be concluded based on the above: There is no real basis to ensure that the high employment will ensure the growth of inflation according to the rhetorics of the Fed. It just forms market expectations, which is expressed in the willingness of investors to support the growth of the stock market and generally contributes to strengthening the position of the dollar. However, the long-term position cannot clearly justify the stock market. The rate hike in December, as well as the beginning of the Fed's contraction of the balance sheet, will help tighten financial conditions and increase deflationary pressure. In these conditions, there will be more demand for the dollar and the currency will objectively become more expensive.

Today, the ADP report on employment in the private sector for September will be published and probably the number of jobs will have a sharp decrease. Taking into account the decline of prices, it will cause a market reaction in case of a noticeable discrepancy with the forecast. Also, pay attention to the ISM report on activity in the services sector, the forecast is moderately positive. The result is not worse than expected which supports the dollar. An important event of the day is a speech by Janet Yellen at a conference in St. Louis, where she is expected to give her assessment on the state of the U.S. economy in the light of the planned tax reform.

Reduction of commodity prices, primarily oil and gold, as well as expectations of the beginning of the tax reform are pushing investors to shift into dollar assets. Market expectations are optimistic and investors are not inclined to pay attention to the threat of growth of deflationary pressure. On the contrary, they suggested during the rotation of FOMC members that President Trump will eventually create a more aggressive team that will pursue a more stringent monetary policy.

There should not be any active actions until Friday but the weakening must be considered temporary. Hence, this can be taken into an advantage and enter long positions. In general, the market environment continues to be favorable for the dollar.

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Trading plan 04/10/2017

Trading plan 04/10/2017

The overall picture of EUR/USD: We are playing the way out of the range.

On Tuesday, euro sellers and dollar buyers suffered a severe defeat. Neither the crisis of Catalonia - Spain nor the strongest data on the US economy helped to keep the EUR/USD rate below the level of 1.1700.

Our sales closed on stop-loss (at the break-even point 1.1770).

Now euro purchases look more preferable.

At the same time, we have a fairly narrow range within the limits of 1.1695 - 1.1835 and strong news ahead.

In particular, today we will report on employment in the US from the ADP agency. A strong decline in new jobs is expected, this should move the euro into growth.

Further, on Friday, we will see non-farms. Also a reason for strong movement.

We are preparing to enter the breakthrough of the range boundaries to the top of the purchase above 1.1835 or down the sales below 1.1695.

We place orders as on the chart below. Stop-loss 45 points, profit 100 points (in 4 digits).

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Global macro overview for 04/10/2017

Global macro overview for 04/10/2017:

Interesting remarks from Bank of Canada Deputy Governor Sylvain Leduc has hit the newswires. In a prepared speech he said that Canada's economic growth rate is expected to decline over next few quarters, but should still exceed potential output. Productivity has increased significantly since the middle of 2016 and recent data show the rate of entry for new firms appears to have stabilized. The contribution of new firms to increasing economy's productive capacity could give rise to a virtuous circle of growth and increase in productive capacity from new firm creation would allow the Canadian economy to grow faster without creating inflationary pressures. Nevertheless, a sharp CAD depreciation following a drop in Crude Oil prices may have contributed to lower growth of new firms.

Compared to other economies, Leduc noticed, that Canadian productivity is still "well below" the US as significant challenges remain. In this situation, the best contribution BoC can make is to "promote economic stability" by keeping inflation at 2.0% to avoid higher inflationary pressures and overheating the economy.

In conclusion, pretty much dovish tone of the Leduc remarks will definitely curb the recent intentions of interest rate hike supporters in Bank of Canada

Let's now take a look at the USD/CAD technical picture at the H4 time frame. The price tests the nearest technical support at the level of 1.2454 and the last candlestick hammer formation might suggest the demand side is fighting to defend this level of support. Nevertheless, the market conditions are still overbought and the upward momentum seems to be decreasing. A breakout below the technical support at the level of 1.2416 is needed to accelerate the sell-off towards 1.2338.

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Global macro overview for 04/10/2017

Global macro overview for 04/10/2017:

The UK PMI Construction data were worse than expected for the first time in 13 months. According to IHS Markit, the Construction PMI for September was at the level of 48.1, while market participants expected a figure around 51.1 points. A drop below fifty means this sector of UK economy is now contracting rather than expanding.

September data revealed a difficult month for building companies, as new projects failed to materialize to replenish jobs planned before the Brexit referendum. The drop in workload was attributed to fragile confidence and subdued appetite for risk, especially in the commercial building sector. Lower volumes of construction work reflected falls in both commercial and civil engineering activity during September. The reduction in civil engineering work was the steepest for almost 4,5 years, which some firms linked to a lack of new infrastructure projects to replace completed contracts. The only broad area of construction activity to register an expansion in September was home building. However, growth momentum eased to a six-month low amid reports citing worries about less favorable market conditions ahead. New business volumes dropped for the third consecutive month in September, thereby suggesting a continued shortage of work to replace completed construction projects. In conclusion, the data also follow a softer manufacturing survey for September – with both combining to suggest the British economy is faltering, which sooner or later will affect the British Pound in a negative way.

Let's now take a look at the GBP/USD technical picture at the H4 time frame. The price is trading right on the golden trendline support around the level of 1.3250. So far both bulls and bears are not giving up because a failure here would lead to a drop to the level of 1.3160 or a rebound towards the level of 1.3327. Oversold market conditions indicate a possible rebound towards the next target at 1.3327.

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NZD/USD Intraday technical levels and trading recommendations for October 4, 2017

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Daily Outlook

In February 2017, the depicted short-term downtrend was initiated around the depicted supply zone (0.7310-0.7380).

However, a recent bullish breakout above the downtrend line took place on May 22. Since then, the market has been bullish as depicted on the chart.

The price zone of 0.7150-0.7230 (Key-Zone) stood as a temporary resistance zone until a bullish breakout was expressed above 0.7230.

This resulted in a quick bullish advance towards the next supply zone around 0.7310-0.7380 which was temporarily breached to the upside.

Recent bearish pullback was executed towards the price zone of 0.7310-0.7380 (newly-established demand-zone) which failed to offer enough bullish support for the NZD/USD pair.

Re-consolidation below the price level of 0.7300 enhances the bearish side of the market. This brings the NZD/USD pair again towards 0.7230-0.7150 (Key-Zone) where recent weak bullish recovery was manifested earlier in September.

An atypical Head and Shoulders pattern is being expressed on the depicted chart indicating high probability of bearish reversal.

The current price levels of 0.7320-0.7350 can be watched for a valid SELL entry if enough bearish rejection is expressed.

Breakdown of the neckline 0.7150 confirms the reversal pattern. Expected bearish targets are located around 0.7050, 0.6925 and eventually 0.6800.

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Intraday technical levels and trading recommendations for EUR/USD for October 4, 2017

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Monthly Outlook

In January 2015, the EUR/USD pair moved below the major demand levels near 1.2050-1.2100 (multiple previous bottoms set in July 2012 and June 2010). Hence, a long-term bearish target was projected toward 0.9450.

In March 2015, EUR/USD bears challenged the monthly demand level around 1.0500, which had been previously reached in August 1997.

In the longer term, the level of 0.9450 remains a projected target if any monthly candlestick achieves bearish closure below the depicted monthly demand level of 1.0500.

However, the EUR/USD pair has been trapped within the depicted consolidation range (1.0500-1.1450) until the current bullish breakout was executed above 1.1450.

The current bullish breakout above 1.1450 allowed a quick bullish advance towards 1.2100 where recent evident of bearish rejection was expressed.

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Daily Outlook

In January 2017, the previous downtrend reversed when the Head and Shoulders pattern was established around 1.0500. Since then, evident bullish momentum has been expressed on the chart.

As anticipated, the ongoing bullish momentum allowed the EUR/USD pair to pursue further bullish advance towards 1.1415-1.1520 (Previous Daily Supply-Zone).

The daily supply zone failed to pause the ongoing bullish momentum. Instead, evident bullish breakout is being witnessed on the chart. The next Supply level to meet the pair is located around 1.2100 (Level of previous multiple bottoms) where bearish rejection and a valid SELL entry can be anticipated.

On the other hand, If the current bearish breakout persists below 1.1800 (the depicted uptrend line) and 1.1700, a quick bearish decline should be expected towards the price zone of 1.1415-1.1520 where BUY entries can be offered.

Trade Recommendations

Bullish pullback towards the price zone of 1.1835-1.1850 (the backside of the broken uptrend line) should be considered for a valid SELL entry.

S/L should be placed above 1.1950.

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Technical analysis of USD/JPY for Oct 04, 2017

Forex analysis review
Technical analysis of USD/JPY for Oct 04, 2017

Bitcoin analysis for 04/10/2017

Bitcoin analysis for 04/10/2017:

Goldman Sachs, one of the largest investment banks in the world, is investigating the possibility of introducing new cryptocurrency-based trading operations. This is what the GS press spokesman described as "customer interest in virtual currencies." The Wall Street Journal explains that the study is ongoing and may not produce any results. Both the currency trading department and the strategic investment group of the bank are involved in research into such opportunities. "Goldman Sachs' efforts include both the currency trading department and the strategic investment group of the bank. This suggests that the company believes Bitcoin's future is more of a payment method than holding value, like gold, "the Wall Street Journal reports.

This news is not the first signal that Goldman Sachs is interested in cryptocurrencies. The company's website includes a description of the basics of blockchain technology for the beginners. Previously, Goldman Sachs was the first Wall Street bank to publish a Bitcoin price report. This is complete opposite point of view that was recently presented by another large investment bank CEO Jamie Daimon, who called Bitcoin a "scam".

Let's now take a look at the Bitcoin technical picture at the H4 time frame. After falling out from the channel to the level of $4,211 the price bounced slightly, but no new high was made so far. The momentum is decreasing and the stochastic is currently in the neutral zone, coming down from the overbought levels. There is still a slight chance for a rally towards the second target projection for wave (c) towards the level of $4,661, but so far the market is rather in a consolidation cycle. Breakout below the weekly pivot at the level of $4,143 opens the road to the technical support at the level of $,4000.

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Burning forecast 10.04.2017

Burning forecast 10.04.2017

EURUSD: Buying looks preferable.

On Tuesday, euro sellers and dollar buyers suffered a severe loss. Neither the crisis of Catalonia - Spain, nor the strongest data on the US economy helped to maintain the EURUSD rate below the level of 1.1700.

Selling closed on the stop-loss (at the break-even point 1.1770).

Now, euro buying look more preferable.

At the same time, there is a fairly narrow range within the limits of 1.1695 - 1.1835 - and significant data ahead.

Particularly today the report on employment in the US from the ADP agency will be relesed- a strong decline in new jobs is expected - this should influence the euro to rise.

Prepare to enter the breakthrough of the range boundaries - upward- buy above 1.1835 - or downward- sell below 1.1695.

Place orders as on the chart below. Stoploss 45 points, profit 100 points (in 4 digits).

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Trading plan for 04/10/2017

Trading plan for 04/10/2017:

After publication of the Bloomberg article (the list of prospects for the new Fed chairman was closed to four people), the US dollar was sold out across the board, although the reaction was brief. EUR/USD jumped to 1.11780, USD/JPY decreased to 112.50. The most profitable are AUD and NZD. The stock market can be seen stopping at the current elevated levels. The Nikkei remains unchanged, but Hang Seng is up 0.6%.

On Wednesday 4th of October, the event calendar will be quite busy with important news releases. During the London session, the set of PMI Services data from across the Eurozone will be released, including the UK. During the US session, ADP Non-Farm Employment Change, ISM Non-Manufacturing PMI, PMI Composite and Final Services PMI data will be released. Later on, there is a scheduled speech from ECB President Mario Draghi and Federal Reserve Chairperson Janet Yellen.

EUR/USD analysis for 04/10/2017:

The set of PMI Services data from across the Eurozone is scheduled for release all morning. The most important will be data from France, Germany, and EU. Market participants are still in the positive mood and do not expect any downside surprises this month. Much more interesting data will be released during the afternoon the US session - a series of data that may be a clue before Friday's NFP report (ADP report, ISM for the service sector). The ADP Non-Farm Employment Change is expected to decrease from 231k to 131k which is very significant change, that might be taken into account before NFP report. On the other hand, the ISM Services data are expected to stay almost unchanged at the level of 55.5 points.

Let's now take a look at the EUR/USD technical picture at the H4 time frame. This pair will be under influence of today's data, so the volatility might be increased all day. So far the price is trading around the level of 1.1775, which is in the middle of the recent price range. In case of a better than expected data, the nearest technical resistance is the zone between the levels of 1.1821 - 1.1847. The most important support remains at the level of 1.1614.

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Market Snapshot: AUD/USD breaks out from the rising wedge pattern

The price of AUD/USD has broken out from the rising wedge pattern around the level of 0.7808 and tested the nearest technical resistance at the level of 0.7867. Nevertheless, the price is still trading below the 50 and 100 moving averages and the recent shooting star candlestick pattern might suggest a temporary reversal towards the level of 0.7825.

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Market Snapshot: DAX close to the swing highs

The price of German DAX30 is trading close to the recent swing highs on a daily time frame chart. The market gapped up to the level of 12896 and it is only 60 points away from the swing high at 12953.The trading conditions are extremely overbought, so a possibility of a double top formation is very high. The nearest technical support is seen at the level of 12841.

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Technical analysis of gold for October 04, 2017

Gold price has broken out of the downward sloping triangle pattern. Both RSI indicators have suggested that a bounce was imminent. Minimum target for the bounce is the $1,295 area.

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Black line - resistance

Blue lines - bullish divergence signs

Gold price has broken above the triangle pattern and is bouncing towards the Ichimoku cloud resistance of $1,288. Support is at $1,268 now and if broken we should expect a move towards $1,260-50. Trend remains bearish as long as price is below $1,316.

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On a daily basis we have the first signs of a possible 20$ bounce towards $1,298. There are bullish divergence signs in the RSI and I do not expect to see Gold price trading near the lows for much longer. The $1,300 level is expected to be tested again.The material has been provided by InstaForex Company - www.instaforex.com

Elliott wave analysis of USDX for October 4, 2017

The Dollar index has most probably completed a corrective bounce of a zig zag type (A-B-C) at recent highs. This implies that the next downward leg has already started and we should expect the Dollar index to reach 90 or lower.

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Red lines - bullish channel

From the lows at 91.50 the Dollar index has completed 5 waves up. This is wave C. The rise from 91 to 92.66 is clearly a three-wave move and that is why is labeled as wave A. The entire formation is most probably the entire upward correction. Price has also broken out of the bullish channel.

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Black lines - bearish channel

Blue lines - expectation

The Dollar index is in a bearish trend. The recent bounce is just part of a corrective wave up and we should soon see the resumption of the down trend towards 90 or even lower. In elliott wave terms, this scenario will strengthen once price breaks below 92.66 this way any possibility of a bullish scenario will be canceled.

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Brent goes to the red zone

The one who rises high, falls painfully. The growth of Brent prices to a 26-month high against the backdrop of an increase in the net long positions of financial managers to record highs ended- a fiasco of the bulls. The fall from the highs was due to the massive closure of the longs after it became known that Turkey was bluffing, and OPEC members preferred to increase it in September instead of reducing production. Its contribution to the negative was made by the International Energy Agency, which stated that, at current levels of oil production by the cartel, the growth of American production and the active build-up of reserves by China will create problems for reducing global reserves and moving the market to a stable deficit.

So far, only one thing is clear: the higher the prices, the less chance of an extension of the Vienna agreement of OPEC and the greater the likelihood of an active increase in shale production in the United States. IEA predicts that the latest figure in 2018 will grow by an impressive 1.1 million b/d, which is a serious "bearish" driver for Brent and WTI.

The situation is well understood by large banks. According to the median forecast of 15 of them, the average cost of the Brent in the next year will be $53 per barrel, while the Texas one will be at $50. Oil will not be able to overcome and permanently gain a foothold above the psychologically significant level of $60 even in 2019: forecasts of the average Brent price have been reduced from $72 in September 2016 to $57.91 per barrel.

Projections of oil prices

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Source: Wall Street Journal.

In the short-term period, the bearish side plays on the information regarding the growth of production by the OPEC countries, in the medium-term - about the onset of the unfavorable season, as the closure for maintenance of American refineries leads to a reduction in demand and to the growth of US stocks. In addition, the return to the market of the idea of reflationary trade supports the US dollar, which negatively affects the prices of Brent and WTI.

It is not known what games OPEC is playing, but according to a median estimate by Bloomberg experts, in September, the cartel reduced their compliance to their obligations to reduce the production oil from 88% to 80%. The production increased by 120, 000 b/d and amounted to 32.83 million b/d. The index increased: Saudi Arabia by 60, 000 b/d to 10.06 million b/d, Kuwait by 50, 000 b/d to 2.76 million b/d and other countries. It is possible that this was a response to the rise in prices against the backdrop of the referendum on the independence of Kurdistan. OPEC perfectly understands that at a Brent price of $60 per barrel, it will be unrealistic to compete with American producers.

Thus, the strengthening of the dollar, the seasonal factor, the activity of the cartel, the growth of the activity of extractive companies in the United States and the gradual reduction of net oil lagoons create a solid foundation for the reduction of prices of Brent and WTI.

Technically, after implementing a target of 224% on the pattern AB=CD, a natural rollback followed. To develop a correction for "bears", it is necessary to break through the diagonal support in the form of the lower border of the ascending trading channel. On the contrary, the inability of sellers to keep prices below $56 per barrel will be evidence of their weakness.

Brent, daily chart

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Daily analysis of USDX for October 04, 2017

The USDX managed to retrace during Tuesday's session and it can test the 200 SMA on the H1 chart, which is approaching the current price. If the index does a breakout above 94.04, it is expected to test the resistance level of 94.58. Overall, the index shows a price action in favor of the bulls. The MACD indicator is in the negative territory, favoring an extension of the decline.

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H1 chart's resistance levels: 94.04 / 94.58

H1 chart's support levels: 93.00 / 91.67

Trading recommendations for today: Based on the H1 chart, place buy (long) orders only if the USD Index breaks with a bullish candlestick; the resistance level is at 94.04, take profit is at 94.58 and stop loss is at 93.50.

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Daily analysis of GBP/USD for October 04, 2017

GBP/USD continues to extend losses across the markets and now it is forming a lower low pattern on the H1 chart. The support zone of 1.3209 is now being challenged and if it gives up to the bears' force, the pair could touch the 1.3121 level. To the upside, gains should be limited by the 200 SMA. The MACD indicator still remains in favor of the bulls.

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H1 chart's resistance levels: 1.3309 / 1.3446

H1 chart's support levels: 1.3209 / 1.3121

Trading recommendations for today: Based on the H1 chart, sell (short) orders only if the GBP/USD pair breaks a bearish candlestick; the support level is at 1.3209, take profit is at 1.3121 and stop loss is at 1.3294.

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