Technical analysis of USD/JPY for October 23, 2017

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All our targets which we predicted in Yesterday's analysis have been hit. USD/JPY is expected to continue its upside movement. The pair is trading above its rising 20-period and 50-period moving averages, which play support roles and maintain the upside bias. The relative strength index calls for a new upside.

To conclude, as long as 113.45 is not broken, look for a further rise with targets at 114.30 and 114.80 in extension.

Alternatively, if the price moves in the opposite direction, a short position is recommended below 113.45 with a target at 113.05.

Chart Explanation: The black line shows the pivot point. The current price above the pivot point indicates a bullish position, while the price below the pivot point is a signal for a short position. The red lines show the support levels and the green line indicates the resistance level. These levels can be used to enter and exit trades.

Strategy: BUY, Stop Loss: 113.45, Take Profit: 114.30

Resistance levels: 114.30, 114.80 and 115.35 Support Levels: 113.05, 112.70, 112.40

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Technical analysis of USD/CHF for October 23, 2017

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Our first target which we predicted in our previous analysis has been hit. The pair is supported by a bullish trend line since October 20, which confirmed a positive outlook. Both rising 20-period and 50-period moving averages suggest that the prices have a potential for a further upside. The relative strength index is above its neutrality level at 50 and lacks downward momentum.

Therefore, above 0.9820, expect a new challenge with targets at 0.9865 and 0.9900 in extension.

Chart Explanation: The black line shows the pivot point. The present price above the pivot point indicates a bullish position, and the price below the pivot points indicates a short position. The red lines show the support levels and the green line indicates the resistance levels. These levels can be used to enter and exit trades.

Strategy: BUY, Stop Loss: 0.9820, Take Profit: 0.9900

Resistance levels: 0.9900, 0.9935, and 0.9985

Support levels: 0.9795, 0.9770, and 0.9730

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Technical analysis of GBP/JPY for October 23, 2017

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All our targets which we predicted in of Friday's analysis have been hit. GBP/JPY is trading in the upper range and expected to continue the movement. The pair located an intraday key support at 149.45 before bouncing to the upside and trading along the upper Bollinger band. Currently, it has been supported by the rising 20-period moving average, which stands above the 50-period one. The relative strength index remains at levels above the neutrality level of 50, suggesting continued upward momentum for the pair. The intraday outlook remains bullish, and the pair should proceed toward the first upside target at 150.55.

Alternatively, if the price moves in the direction opposite to the forecast, a short position is recommended below 148.20 with the target at 149.40.

Strategy: BUY, Stop Loss: 149.45, Take Profit: 150.55

Chart Explanation: the black line shows the pivot point. The price above the pivot point indicates long positions; and when it is below the pivot points, it indicates short positions. The red lines show the support levels and the green line indicates the resistance levels. These levels can be used to enter and exit trades.

Resistance levels: 150.55, 151.00 and 151.75

Support levels: 149.00, 148.60, and 148.00

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Technical analysis of NZD/USD for October 23, 2017

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NZD/USD is expected to trade with a bearish outlook. The pair recorded lower tops and lower bottoms since October 16, which confirmed a bearish outlook. The downward momentum is further reinforced by both declining 20-period and 50-period moving averages. The relative strength index calls for a drop.

To conclude, as long as 0.7005 is not surpassed, look for a new test with targets at 0.6930 and 0.6900 in extension.

The black line is showing the pivot point. Currently, the price is above the pivot point, which indicates long positions. If it remains below the pivot point, it will indicate short positions. The red lines are showing the support levels and the green line is indicating the resistance levels. These levels can be used to enter and exit trades.

Resistance levels: 0.7035, 0.7060, and 0.7095

Support levels: 0.6930, 0.6900, and 0.6865

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NZD/USD Intraday technical levels and trading recommendations for October 23, 2017

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Daily Outlook

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.

This resulted in a quick bullish advance towards next price zones around 0.7150-0.7230 (Key-Zone) and 0.7310-0.7380 which was temporarily breached to the upside.

The 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 enhanced the bearish side of the market. This brought the NZD/USD pair again towards 0.7230-0.7150 (Key-Zone) which failed to pause the ongoing bearish momentum.

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

Bearish persistence below the neckline 0.7150 confirms the reversal pattern. Next bearish targets are located around 0.7050, 0.6925 and eventually 0.6800.

As expected, the price level of 0.7050 offered temporary bullish support before bearish breakdown could take place. That's why the further bearish decline should be expected towards 0.6925 and eventually 0.6800 (Reversal pattern bearish targets).

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Intraday technical levels and trading recommendations for EUR/USD for October 23, 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 evidence of bearish rejection was expressed (Note the previous Monthly candlestick of September).

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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, an 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 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.

Initial T/P level should be placed at 1.1550. S/L should be placed above 1.1950.

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Global macro overview for 23/10/2017

Global macro overview for 23/10/2017:

The Thursday's decision of the European Central Bank will be the key event of the week. The historically low interest rates will probably not change, but - as promised by Mario Draghi - at the October meeting the Governing Council will announce the arrangements for the future quantitative easing program (QE). If the content of the message or the words of the president (the beginning of the conference at 12.30 pm GMT) deviates from the market consensus (cutting the scale of purchases from 60 to 40 billion euros per month, extending the program by at least half a year), then we can face serious turmoil in almost all markets . The choice of one of these solutions should be regarded as obligatory because of the fact that Germany exceeds the maximum exposure to the country debt limit in the next eight months. Traders should not expect the ECB message to include references to a clearly defined end of the QE, which should in some cases be linked to the first potential date for a rate hike. Mario Draghi will certainly be tempted to mention the lack of recalibration of key parameters in a slightly longer period and the presence of relatively dampened core inflation trends in the euro area.

Let's now take a look at the EUR/USD technical picture at the H4 time frame. Before the week's main event, the price is moving inside of the tight horizontal zone between the levels of 1.1729 - 1.1880. The 61% Fibo at the level of 1.1876 is still the key level to the upside and any violation of this level will lead to range breakout and a rally towards the next technical resistance at the level of 1.1936. The key level to the downside is seen at the level of 1.1665.

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Global macro overview for 23/10/2017

Global macro overview for 23/10/2017:

In her Saturday speech on "Monetary Policy Since the Financial Crisis" at a National Economists Club dinner in Washington, D.C., the Federal Reserve Bank Chairperson Jannet Yellen commented the inflationary pressure issues. She said, that the lack of inflation has been an unexplainable "surprise," while the Fed's removal of stimulus is "working well":""We've had a series of weak, soft readings on inflation, core inflation, beginning in March and the reasons for that are not immediately clear," Yellen said. Reasons for low inflation were "pretty understandable until this year. This year has been a surprise."Despite this kind of comments, Yellen did not mention any specific changes to the monetary policy and she did not want to comment on speculation whether she will be reappointed as Fed Chairperson again.

The lack of the inflationary pressures in 2017 might sound disturbing as the financial markets participants still expected the Fed to hike the interest rate for the third time in December this year. On the other hand, the process of removing the accommodation that had started last month is working well and unconventional monetary policy tools the Fed used in an effort to stimulate the economy in the wake of the financial crisis would remain an option for the central bank if needed.

Let's now take a look at USD/CHF technical picture at the daily time frame. The price has managed to break out above the 61% Fibo at the level of 0.9840 and currently is trading above 200 DMA and above the technical resistance at the level of 0.9856. The next target is 78% Fibo at the level of 0.9954, but the market conditions are overbought already.

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Bitcoin analysis for October 23, 2017

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The Bitcoin (BTC) has been trading sideways at the price of $5.900. Russia's First Deputy Prime Minister Igor Shuvalov promised not to let initial coin offerings (ICOs) in Russia "die" because of regulations last week. Despite bills being prepared to regulate them, President Vladimir Putin has said that ICOs hold "tremendous potential" and should not be obstructed. The intraday technical picture looks bullish.

Trading recommendations:

According to the 15M time frame, I found a fake breakout of pivot level at the price of $5.872, which is a sign that selling looks risky. There is also a change in momentum from bearish to bullish on the MACD oscillator, which is another sign of strength. My advice is to watch for potential buying opportunities. The upward targets are set at the price of $6.160 (R1) and $6.350 (S2, extreme intraday target).

Support/Resistance

$5.872 – Intraday pivot level

$6.160 – Pivot resistance 1

$6.350 – Pivot resistance 2

$5.879 – Pivot support 1

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Trading plan for EURUSD and US Dollar Index for October 23, 2017

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Technical outlook:

As seen on the hourly chart setup here, EUR/USD has been drifting sideways potentially into a triangle setup after having rallied from 1.1670 levels since October 06, 2017. The entire drop from 1.2092 through 1.1670 levels can be termed as A or 1, while we are expecting B or 2 to terminate somewhere above 1.1920 levels. In between these 2 points, a potential triangle setup has been shown. If this wave count holds to be true, a push can be expected on the north side towards at least 1.1920/30 levels. Please note that 1.1920/30 is also the fibonacci 0.618 resistance level of the entire drop between 1.2092 through 1.1670 levels respectively. The immediate price resistance is seen through 1.2030 levels, while the support lies at 1.1670 levels respectively.

Trading plan:

Aggressive traders might want to remain long with a risk below 1.1670 levels while conservative traders would want to remain flat for now and look to sell around 1.1920/30 levels.

US Dollar Index chart setups:

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Technical outlook:

The US Dollar Index short-term view presented here indicates a simple flat wave count is underway as a correction. The entire rally between 91.00 and 94.20 levels has been labelled as A or 1, while an (a)-(b)-(c) correction has been shown under and probably into its last leg (c), which is expected to resume any moment. Wave B or 2 is expected to terminate around 92.00/20 levels as it is also a convergence of fibonacci 0.681 support of trend and counter trend depicted here. Immediate price support is seen between 91.00 and 91.40 levels while resistance stands at 94.20 levels respectively. If the above wave count holds to be true, the US Dollar Index should be looking to drop lower towards 92.20 before picking up again on the north side.

Trading plan:

Aggressive traders could remain short, with a risk above 94.20 levels and target 92.30, while conservative traders should be looking to remain flat for now and buy lower towards 92.20 levels.

Fundamental outlook:

No major fundamental events are lined up for the rest of the day.

Good luck!

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Technical analysis of GBP/USD for October 23, 2017

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Overview:

  • The GBP/USD pair is still moving upwards from the zone of 1.3017. The first support level is currently seen at 1.3017, the price is moving in a bullish channel now.
  • Furthermore, the price has been set above the strong support at the level of 1.3017, which coincides with the 61.8% Fibonacci retracement level.
  • This support has been rejected three times confirming the veracity of an uptrend. According to the previous events, we expect the GBP/USD pair to trade between 1.3017 and 1.3298.
  • So, the support is seen at 1.3017, while daily resistance is found at 1.3298.
  • Therefore, the market is likely to show signs of a bullish trend around the spot of 1.3017. In other words, buy orders are recommended above the zone of 1.3017 with the first target at the level of 1.3298; and continue towards 1.3655 in coming days.
  • On the other hand, if the GBP/USD pair fails to break through the resistance level of 1.3298 today, the market will decline further to 1.2820 (major support).
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Analysis of EUR/CHF for October 23, 2017

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Recently, the EUR/CHF pair has been trading sideways at the price of 1.1600. On the 15M chart, I found a fake breakout of pivot level at the price of 1.1593, which is a sign that selling looks risky. There is also a positive reading on MACD oscilator, which is another sign of potential strength. My advice is to watch for potential buying opportuntiies. The upward targets are set at the price of 1.1629 (S1) and 1.1665 (S2, extreme intraday target).

Resistance levels:

R1: 1.1629

R2: 1.1665

R3: 1.1700

Support levels:

S1: 1.1557

S2: 1.1521

S3: 1.1485

Trading recommendations for today: watch for potential buying opportunities.

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Analysis of GBP/USD for October 23, 2017

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Recently, the GBP/USD pair has been trading sideways at the price of 1.3167. According to the 15M timeframe, I found a successful rejection from the pivot point resistance at the price of 1.3227, which is a sign that buying looks risky. I also found a hidden bearish divergence on the MACD 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 1.3119 (S1) and 1.3050 (S2).

Resistance levels:

R1: 1.3230

R2: 1.3270

R3: 1.3343

Support levels:

S1: 1.3118

S2: 1.3050

S3: 1.3005

Trading recommendations for today: watch for potential selling opportunities.

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Technical analysis of EUR/USD for October 23, 2017

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Overview:

  • Last week, the EUR/USD pair fell from the level of 1.1836 towards 1.1716. However, the trend rebounded to the key level around the spot of 1.1873/1.1800. Right now, the price is set at 1.1804. The resistance is seen at the levels of 1.1836 and 1.1911. Volatility is very high for that the EUR/USD pair is still expected to be moving between 1.1836 and 1.1716 in coming hours. In the short term, we expect the EUR/USD pair to continue to trade in a bearish trend from the new resistance level of 1.1836 to form a bearish channel. Also, it should be noted that the major resistance is seen at 1.1911, while immediate resistance is found at 1.1836. According to the previous events, the pair is likely to move from 1.1836 towards 1.1716 and 1.1657 as targets. Let's now take a look at the H1 time frame. If the pair succeeds to pass through the level of 1.1836, the market will indicate a bullish opportunity above the level of 1.1836. So, the market will rise further to 1.1911 in order to return to the resistance 2. Moreover, a breakout of that target will move the pair further upwards to 1.1994. Also, it should be noted that the double top is seen at the point of 1.2031.
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Fundamental analysis of USDJPY for October 23, 2017

USD/JPY has been impulsively bullish recently which is pushing the price towards 114.50 resistance area. The price started today with a gap which was due to positive speech from Yellen about the US economy and a rate hike in December. Today there was no economic reports or events on JPY but tomorrow we have the Flash Manufacturing PMI report which is expected to increase to 53.1 from the previous figure of 52.9. On Thursday we have the SPPI report which is expected to show a slight increase to 0.9% from the previous value of 0.8% and on Friday the National Core CPI is expected to be unchanged at 0.7%. Besides, the Tokyo Core CPI is expected to be unchanged as well at 0.5%. On the USD side, today there is no economic reports but the Unemployment Claims report is going to be published on Thursday. This report is expected to bring in some volatility in the market as it is expected to increase to 236k from the previous figure of 222k. As of the current situation, the economic reports from Japan are not going to make any significant impact on the currency, whereas the US dollar is expected to gain momentum further if the economic reports come out to be positive which will strengthen the gains and push the price much higher in the coming days.

Now let us look at the technical view. The price is currently residing above the gap area which is expected to be covered very soon in the coming days. As the dynamic level of 20 EMA is way down which was acting as a dynamic support level to push the price higher, so currently the price is expected to retrace towards the recent support area of 113.20-50 in the coming days before it pushes up higher towards 114.30-50 area and later towards 118.50 resistance area. As the price remains above 112.50 support area, the bullish bias is expected to continue further.

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Daily analysis of major pairs for October 23, 2017

EUR/USD: This pair moved downwards on Monday and Tuesday, turned higher on Wednesday and Thursday and then came down on Friday. The erratic (zigzag) movement has resulted in a neutral bias, which would be overridden this week as the price goes above the resistance line at 1.1900, or it would go below the support line at 1.1700. The pair needs to breach either of these two boundaries for the current neutral bias to end (and this would require a strong momentum). However, a movement to the downside is more likely this week owing to a strong bearish outlook on EUR pairs.

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USD/CHF: The market is bullish in shorter and longer term. Price has gained 110 pips this month, and the resistance level at 0.9850 has been tested (it would be tested again). This week, the resistance levels at 0.9900 and 0.9950 would be aimed. Two factors would make this possible: 1) an expected stamina in USD. 2) an expected fall in the EUR/USD.

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GBP/USD: The cable has gone downwards by 170 pips last week, resulting in a Bearish Confirmation Pattern in the 4-hour chart. The shallow rally that happened on October 20 could end up being an opportunity to go short at a slightly higher price, for price would continue moving downwards this week, reaching the accumulation territories at 1.3150, 1.3100 and 1.3050.

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USD/JPY: This pair started making bullish efforts at the beginning of last week, and the efforts were successful. Price gained 170 pips, testing the supply level at 113.50 on Friday. The outlook on the market is bullish for this week, owing to the expected stamina in USD and expected weakness in JPY. Thus, the supply levels at 114.00 and 114.50 would be tested. A very strong bullish momentum could even cause another supply level at 115.00 to be reached.

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EUR/JPY: This cross consolidated in the first few days of last week, and then started moving northwards around the middle of the week. The pair gained 200 pips, closing above the demand zone at 133.50 on Friday. This week, further bullish movement is expected because the outlook on certain JPY pairs is bullish for the week. The supply zones at 134.00, 134.50 and 135.00 could thus be reached.

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Bitcoin analysis for 23/10/2017

Bitcoin analysis for 23/10/2017:

Research by CB Insights shows that Goldman Sachs, Google and Citi Bank are among the five most active corporate investors in Blockchain. According to the report, financial services companies and major banks were the first corporate users of the technology. On the basis of the information contained in the report, as many as 91 large companies have invested in this technology since mid-October 2017. Among the over 50 corporate investors are global financial services companies. The report also showed that the top ten banks in the United States spent $267 million on Blockchain. IT Corporation has revealed that total corporate investment in Blockchain has reached $327 million by 2017. By comparison, total investment for 2012-2017 was $1.2 billion.

Let's now take a look at the Bitcoin technical picture at the H4 time frame. The market might have just finished the wave 3 of the overall impulsive cycle, which means the price will now enter a corrective cycle wave 4. When the correction is completed, the market will make another higher high above the level of $6,168. The first target is seen at the weekly pivot resistance at the level of $6,398. The key intraday support is the zone between the levels of $5,580 - $5,737 and any violation of this zone will immediately lead to a test of the recent support at the level of $5,092. The larger time frame trend remains up.

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Trading plan 23 - 10/27/2017

Trading plan 23 - 10/27/2017

Catalonia, ECB, important news in the United States.

The beginning of the week is nervous because of Catalonia. Literally at the current hour (08.30 London time) in Catalonia, a meeting of leaders of separatists and authorities of Catalonia will begin to give Madrid's response to tough statements. The Prime Minister of Spain Rajoy demands to abolish the autonomy of Catalonia, in response to an attempt to declare independence of the region. In Catalonia, not earlier than a month ago there was a referendum, illegal from the point of view of Madrid about independence. Voted for separation from Spain, no more than 40% of the inhabitants of Catalonia but of those who voted 90% for independence. The crisis has not subsided yet and it weighs heavily on the euro.

The second event of the weekend is the elections in Japan. Won by the party of incumbent prime minister Shinzo Abe, a supporter of the active policy of economic growth (monetary pumping). The yen declined at the opening, but moderately.

The main event of the week is the ECB on Thursday. The market is waiting for the announcement of the ECB on the reduction in monetary pumping since January 2018 in 2 times.

In addition, the first reading of US GDP on Friday will be released, this is important.

There will also be a report on orders for durable goods in the US on Wednesday, October 25.

The pair EUR/USD is in a tight consolidation.

We are ready to move both up and down, taking positions to break the boundaries of the range.

Purchase for the breakthrough 1.1860 and 1.1880.

Sales for a breakthrough down 1.1728 and 1.1668.

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Trading plan for 23/10/2017

Trading plan for 23/10/2017:

USD/JPY touched three-month highs after Prime Minister Abe's victory in the Japanese election. The Nikkei shows a positive reaction while other markets remain stable in the face of today's lackluster publication. EUR/USD stands at 1.1770 and investors do not show much interest in the political dispute in Spain.

On Monday 23rd of October, the event calendar is very light in important events releases. The only news worth to keep an eye on is the Wholesale Sales data from Canada.

USD/PY analysis for 23/10/2017:

Due to the lack of important news at the beginning of the week, the trading day will likely be dominated by a dispute about Shinzo Abe's victory in the election in Japan. On Sunday's election, former Japanese Prime Minister Shinzo Abe and his ruling coalition won 312 out of 465 seats in the lower parliament, securing a majority of two-thirds. For investors, the most important signal is the strengthening of "abenomics" that is implemented by the governing of the economic policy based on fiscal stimulus and mild monetary policy. Both factors translate into increases in the Japanese stock market. Suffice it to say that since November 2012, when it became clear that Abe was in power (former prime minister in 2006-2007), the Nikkei index has grown by 146% so far. The result is better than expected and reinforces the belief that economic policy will continue to be driven by fiscal and monetary expansion. USD/JPY jumped to 114.10 and Nikkei 225 rose 1.2 percent to 21-year high.

Let's now take a look at USD/JPY technical picture at the H4 time frame. The market opened higher above the technical resistance at the level of 113.43 and now is trying to fill the small gap. The next technical resistance is seen at the level of 114.47, but the market conditions are overbought already. There is still a possibility of a spike up towards this level followed by a correction towards the level of 113.43.

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Market Snapshot: USD/CAD breaks out of the range

The price of USD/CAD has broken out of the horizontal range between the levels of 1.2416 - 1.2598 and it is heading towards the next technical resistance at the level of 1.2662. This is the last level before the local swing high at the level of 1.2777. The strong momentum supports the short-term bullish bias.

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Market Snapshot: SPY opens gap up

The price of US SPY index (SP500 ETF) has opened with a gap between the levels of 255.83 - 256.37, which means another higher high was made in the trend up in this index. The price is trading above all of the moveing averages and the next technical support is seen at the level of 255.46. The larger time frame trend remains up.

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Last minute burning forecast 23.10.2017

Last minute burning forecast 23.10.2017

The GBPUSD rate is upwards.

At the beginning of the week, pressure remains on European currencies due to the Catalonia-Spain crisis. During the weekend, the crisis escalated further. In addition - the authorities of Madrid (Prime Minister M. Rajoy) - threatened to set aside the head of Catalonia and abolish the autonomy of the region. On Monday morning, the meeting of the authorities of Catalonia should take place in response.

Under such pressure, the euro and the pound declined. Nevertheless, while the support line for the multi-month trend upwards by the pound has not been broken (in the figure below, it is marked by a thick line) - the growth of the pound is more likely.

Buy the pound with a target of 1.3110 and below towards 1.3050 with a target upwards to 1.3630.

Cancellation of buying - closing of the day below 1.3000.

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Ichimoku indicator analysis of USDX for October 23, 2017

The Dollar index has broken above the short-term trend line resistance and back above the 4 hour Ichimoku cloud. Short-term trend is bullish. The price has held above 93 on any attempt so far to break it so we can't ignore the bullish support the index has.

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Blue line - trend line resistance (broken)

The Dollar index is making new higher highs. The price is above the 4 hour Kumo (cloud) and the blue trend line resistance. Support is at 93.50. Bears need to first break this level in order to show some sign of Dollar weakness. The most important level for bulls and bears is the 93 level. As long as we are above it, bulls remain in control.

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Blue lines - bullish channel

Black lines - bearish channel

The Dollar index remains inside the bullish channel and is trying to break above the bearish longer-term channel and the daily cloud resistance. Support is at 93.30. Resistance is at 94.

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Ichimoku indicator analysis of gold for October 23, 2017

The Gold price got rejected last week and has made a new short-term low below $1,277. Price is making new lows but the RSI is not. The price remains close to the 61.8% Fibonacci retracement of the latest rise but the weekly chart warns that unless we see a swift reversal upwards, we could push lower towards $1,240-50.

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Blue line - resistance

Red lines - bullish divergence signs

The Gold price is trading below the 4 hour Kumo (cloud). This is a bearish sign. However price is still trading around the 61.8% Fibonacci retracement while both RSI indicators warn that the downside is limited and weak and we should expect a bounce higher. Resistance is at $1,283 and next at $1,290. Support is at $1,274.

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Magenta line - long-term resistance

Blue line - long-term support trend line

The Gold price has closed last week below the kijun-sen (yellow line indicator). Unless we see a reversal this week, there is still a danger of moving towards the weekly Kumo (cloud) at $1,245-50 area. Weekly resistance is at $1,281 and next at $1,307. Support at $1,250.

The material has been provided by InstaForex Company - www.instaforex.com

Fundamental Analysis of EUR/USD for October 23, 2017

EUR/USD has been quite corrective in nature which has shown some impulsive bearish pressure inside the range between 1.1660 to 1.2040 area. USD has been quite positive with the economic reports recently which lead to further bearish pressure in the pair against EUR. The recent situation in Spain has been quite a bit of pressure for the Euro but the currency is expected to overcome the obstacles and regain the momentum again. Ahead of the ECB and Minimum Bid Rate report on Thursday the market is expected to be quite corrective and volatile whereas after the events the pair is expected to show some directional move in the coming days where the bearish pressure is more probable. Today EUR German Buba Monthly report is going to be published which is expected to be quite neutral in nature and have minimal effect on the market. Tomorrow there is a number of economic reports to be published on EUR has well but all the economic reports are expected to have a minimum impact this week prior to ECB meeting. On the USD side, today we do not have any USD economic event or reports to be published but on Thursday, which is at the same day of the ECB meeting and Bid rate report, Unemployment Claims report is going to be published which is expected to show an increase to 236k from the previous figure of 222k. As of the current scenario, the pair is expected to be quite volatile this week due to some important economic events and reports are going to be published. The pair is expected to continue its sideline trend for a few days now which is expected to show an impulsive pressure by Thursday to indicate the upcoming directional move in the future.

Now let us look at the technical view, the price is currently residing inside the lower part of the range of 1.1660 to 1.2040 area whereas the price has also broken below the dynamic level of 20 EMA support with a daily close which is expected to push the price lower towards 1.1660 and later towards 1.1500 support area. The price has bounced off the midrange resistance area of 1.1850, as the price remains below the 1.1850 resistance area in the coming days the bearish pressure is expected to continue further.

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The material has been provided by InstaForex Company - www.instaforex.com

The dollar increases the advantage

The dollar finished the week on a positive note, increasing its pressure across the entire spectrum of the foreign exchange market. One of the reasons for this growth is the adoption of a resolution by Congress regarding the formation of the budget for the fiscal year of 2018. This eliminates another obstacle to the promotion of tax reform.

Meanwhile, the US budget deficit in the fiscal year ending on September 30, 2017 amounted to a symbolic $ 666 billion, or 3.5% of the GD. This is the highest level since 2013. For the year, the deficit grew by $ 79 billion, which is less than the recent forecast. In general, the situation for the beginning of reforms looks quite favorable.

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Stock markets closed on growth on Friday, updating historical records. The Dow Jones overcame the mark of 23 thousand points for the first time in history. The rally, in addition to the adoption of the draft budget, was due to the overall growth of the global economy as well as a positive start to the reporting season. A significant number of companies from the S & P 500 index, who have already published their reports, have exceeded their profit forecasts, which on the whole, contributes to the growth of positive sentiment.

The dollar, thus, looks like a winner on the background of a significant improvement in the prospects for tax reform but investors are still reacting quite cautiously. The CFTC report published on Friday does not show any positive dynamics in favor of the dollar, which looks somewhat unexpected on the background of its noticeable growth. The significant dominance over its counterparts retained the Canadian and Australian dollars, which is supported not only by the rise in oil prices and the achievement of record prices for industrial metals, but also by expectations for the overall growth of the world economy. There is no reduction in speculative positions on the euro, which indicates not only the growing expectations for the start of the ECB's reduction of the bond buying program, but also a relatively high share of skepticism about the expected financial results of the upcoming US tax reform.

Published earlier this week, the Treasury's report on the inflow of foreign capital does not show any rush demand for US assets. The continued reduction in the share of foreigners in the state agency bonds portfolio indicates a general risk reduction. However, the emerging capital inflow to the stock market has slowed. The overall balance is not only significantly worse than the level of pre-crisis years but also even worse than recent bursts of activity in 2015.

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The growth of the dollar, therefore, is supported at the moment mainly by internal reserves, that is, a reaction to short-term positive news. Massive inflow of investments into the US economy has not yet been observed, which means that the main events are still ahead.

On Tuesday, a preliminary index PMI Markit for October is expected. At the moment, there is a big gap between the Markit and ISM indexes for activity in the manufacturing sector. It is projected that the publication on Tuesday will close this gap a little wherein the Markit index will show growth, which in the end will support the dollar.

On Wednesday, the key event of the week is the publication of the report on orders for durable goods, which allows you to assess the level of investment, and indirectly, consumer activity. Forecasts are cautious but in general, the market is of the opinion that the report will show positive dynamics and demand after the liquidation of the consequences of hurricanes will grow. The publication, therefore, can also provide support to the dollar.

On a set of criteria, the dollar maintains a positive attitude. The yen and the franc seem to be the most vulnerable. It is probable that they will continue their decline next week and the pound and the euro can even join them.

The material has been provided by InstaForex Company - www.instaforex.com

For the ECB meeting, the euro is too strong

Eurozone

The most important event of the upcoming week is the ECB meeting on Thursday, October 26. Investors expect that the regulator will finally announce a reduction in the asset purchase program, and the whole issue consists only in the volume of the reduction. At the moment, monthly purchases amount to 60 billion euros a month, and this regime will remain in effect until December, then the program can be reduced to 40 or even 30 billion euros a month, and the euro will react with growth or decline if the result is better or worse than expected.

At the two-day EU summit in Brussels, the leaders of European states reviewed the situation with the negotiations on Brexit. A rather tough stance was expressed by Angela Merkel- the EU will continue negotiations only if London officially confirms its obligations to the EU. This is a sum of 60 billion euros, and the EU's rigidity regarding the matter puts pressure on the pound and supports the euro, since it calls into question London's desire to maintain a privileged status on access to EU markets during the two-year transition period.

On Tuesday, preliminary PMI Markit data for October for the euro area will be published. Since August 2016, the index is on the rise at the level of six-year highs, which increases the probability of outperforming GDP growth relative to forecasts and gives additional arguments in favor of a more aggressive change in the ECB monetary policy.

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Also, markets should pay attention to the release of the IFO indices for Germany on Wednesday. The ZEW index published last week showed an increase in economic expectations, so the IFO outlook is favorable, and the data can support the euro.

Demand for the dollar is supported mainly by the expectations of reforms in the tax code, while in the eurozone the majority of macroeconomic indicators are on the rise. This equalizes the odds of the euro against the dollar, and, most likely, the coming week will prove to be quite dragging, but the reason for the exit from the trading range is unlikely to appear earlier than Thursday.

United Kingdom

The volume of retail sales in September unexpectedly decreased by 0.8% compared to August, year on year growth slowed from 2.3% to 1.2%. The pound reacted to the data with a decline, but it was limited, since it is unlikely to influence the plans of the Bank of England to raise the rate at the next meeting.

Looking at the dynamics of retail sales based on historical data, one can clearly see a positive result after the failure of 2015.

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On Wednesday, the first preliminary reading on GDP growth in the third quarter will be published, as well as the MBA mortgage lending report. In anticipation of the meeting of the Bank of England on November 2, the market will form expectations for the pound, and currently the high probability of a rate increase of a quarter point does not support the prices of the British currency. Inflation is largely a consequence of higher import prices than a sign of the strength of the consumer market, and therefore the actions of the Bank of England may well lead to a deterioration in financial conditions.

There is no reason to expect the pound to rise in the short term, the probability of a decline below support of 1.30 remains fairly high.

Oil

The weekly report of Baker Hughes again showed a decrease in active drilling rigs, which contributed to the growth of oil prices by the close of the week. The market is also waiting for the OPEC meeting in November in Vienna, where the issue of prolonging the agreement on limiting production to the end of 2018 will be discussed.

The formation of the peak is just below $ 60 per barrel until it is completed. Bearish factor in the form of the probability of production growth in the US against the backdrop of the growth of [roces does not work, as shale producers are experiencing serious difficulties with the growing cost price. The probability of movement is above 60 dollars per barrel for Brent looks still high.

The material has been provided by InstaForex Company - www.instaforex.com