Global macro overview for 19/12/2017

The Geramn Ifo Business Climate data dropped slightly to 117.2 points, while the market participants expected a reading of 117.6 points. The Ifo Expectations sub-index dropped as well form 111.0 to 109.5 points. Only Ifo Current Assesment increased slightly from 124.5 to 125.5 points. This kind of pull-back in sentiment is nothing new after the all-time highs being hit during the last months, but it may also suggest, that political deadlock in Europe's economic powerhouse is clouding the outlook.Chancellor Angela Merkel is struggling to form a stable government after her conservative party lost voters to the far right in September's election. So far her attempts to form a government in the form of a three-way alliance with two smaller parties failed last month. Nevertheless, the market participants still expect the German economic uptrend will continue in 2018 and those slides in mood are only a temporary.

Let's now take a look at German DAX index technical picture at the H4 time frame. The technical Head & Shoulders pattern is almost invalidated as the price has opened gap up again and hit the level of 13,336 before a drop. Currently, the price is trading above all of the moving averages, momentum look strong and it does not look like the bears have much to say. The nearest technical support is seen at the level of 13,108.

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Global macro overview for 19/12/2017

During the Asian session, the global investors got acquainted with meeting minutes from the December Reserve Bank of Australia meeting, where, as expected, the main interest rate was maintained at 1.5%. In the minutes, investors can find hawkish accents regarding the prospects for the Australian labor market and generally favorable conditions in the economy, which should contribute to the increase in wage pressure and inflation. It is worth to notice, that recently the RBA has decided to remove the phrase saying that "inflation will most likely remain low for some time" from the recent meeting minutes. In addition, the bank is still convinced that the low level of interest rates is support for the economic climate and ensures sustainable economic growth and the return of inflation to the target in the medium term. Although there are no interest rate hikes on the horizon, the notes supported slightly the Australian Dollar.

Let's now take a look at the AUD/NZD technical picture at the H4 time frame. The markets still corrects the last drops. The current upward correction from 0.7500 has exceeded the maximum correction in the total downward impulse from 0.8123, which in technical terms supports the demand side of this pair. The nearest resistance in the form of converging average EMA 100- and 200-periodic D1 scale is at the level of 0.7698. Exit above the round level of 0.77 should lead to a continuation of increases in the area of 0.7750. The 50-period average EMA on a daily basis determines support at 0.7645.

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Technical analysis of USD/CHF for December 19, 2017

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Overview:

  • The pivot point of the USD/CHF pair is seen at the price of 0.9921. The price is still moving around the area of 0.9806 and 0.9921. Additionally, it should be noted that the bias remains bullish in the nearest term testing 1.0037 or higher. The USD/CHF pair continues to move upwards from the level of 0.9806. Last week, the pair rose from the level of 0.9806 to the top around the area of 0.9921 (pivot). Today, the first resistance level is seen at 0.9972 followed by 1.0037, while daily support 1 is seen at 0.9886. According to the previous events, the USD/CHF pair is still moving between the levels of 0.9886 and 1.0037. However, if the USD/CHF pair fails to break through the support level of 0.9886, the market will rise further to 0.9972. This would suggest a bullish market because the RSI indicator is still in a positive area and does not show any trend-reversal signs. The pair is expected to climb higher towards at least 1.0037 with a view to testing the double top. Briefly, the major support is seen at the price of 0.9806. So, it will be very useful to buy above the spot of 0.9806 with the targets of 0.9921 and 1.0037. On the other hand, if a breakout takes place at the support level of 0.9803, then this scenario may become invalidated.
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Bitcoin analysis for December 19, 2017

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Bitcoin (BTC) has been trading downwards. As I expected, the price tested the level of $17,202. One of Japan's largest used car automotive groups has partnered with the country's largest cryptocurrency exchange Bitflyer to enable bitcoin payments at its dealerships across Japan. Starting with 26 dealerships, the company also plans to add bitcoin payments to 550 additional locations. Technical picture looks bullish.

Trading recommendations:

According to the 30M time frame, I found successful rejection from the key supporrt at the price of $17,240, which is a sign that selling looks risky. I also found an inside candle formation and my advice is to watch for potential bullish breakout to confirm a further upward movement. The upward targets are set at the price of $18,853 and at the price of $19,420.

Support/Resistance

$18,853 – Intraday resistance (price action)

$19,420 – Major resistance

$17,240 – Key supporrt

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

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Trading Plan for EUR/USD and US Dollar Index for December 19, 2017

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Technical outlook:

The EUR/USD pair continues to consolidate looking to terminate into a standard flat or contracting triangle structure. It is expected to top out near 1.1860 levels in case of a flat, while prices should remain below 1.1860 levels in case of a triangle. In either cases, the EUR/USD pair is expected to stay below 1.1960 levels going forward, if bears are to stay in control. Resistance should be strong around 1.1840/50 levels, while support is seen at 1.1550 levels respectively. According to the wave counts, the pair is into its wave (3) lower as labelled here and is expected to push through 1.1500 levels at least. On the flip side, a break above 1.1860 and subsequently above 1.1960 would invalidate the following count.

Trading plan:

Please remain short for now, stop above 1.1960, target 1.1600 and 1.1500 levels.

US Dollar Index chart setups:

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Technical outlook:

The US Dollar Index is also seen to be consolidating into a potential contracting triangle or flat as depicted above. If it is to form a triangle, prices would remain above 93.30 levels and a break out higher would be seen from here. On the other side, if it to form a flat structure, then prices may re-test 93.20/30 levels going forward. In both the cases, we are expecting a bullish break out through 94.80/95.00 levels and higher respectively. On the flip side, a break below 92.50 levels would confirm that the index is looking to produce other structures. The bullish count stays intact till prices remain broadly above 92.50 levels. Support comes in at 92.60, while resistance is seen at 95.00 levels respectively.

Trading plan:

Please remain long stop below 92.50 and target is 95.00 and 98.00 levels respectively.

Fundamental outlook:

No major fundamental events lined up for the day.

Good luck!

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Technical analysis of NZD/USD for December 19, 2017

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Overview:

  • Right now, the price is still trading around the spot of 0.6948 and 0.7026. The NZD/USD pair will continue to rise from the level of 0.6948. The support is found at the level of 0.6948, which represents the 61.8% Fibonacci retracement level in the H1 time frame. The price is likely to form a double bottom. Today, the major support is seen at 0.6948, while immediate resistance is seen at 0.7026. Accordingly, the NZD/USD pair is showing signs of strength following a breakout of a high at 0.6948. So, buy above the level of 0.6948 with the first target at 0.7026 in order to test the daily resistance 1. Also, the level of 0.7026 is a good place to take profit because it will form a double top. Amid the previous events, the pair is still in an uptrend; for that we expect the NZDUSD pair to climb from 0.7026 to 0.7065 today. At the same time, in case a reversal takes place and the NZD/USD pair breaks through the support level of 0.6948, a further decline to 0.6820 can occur, which would indicate a bearish market.
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NZD/USD Intraday technical levels and trading recommendations for December 19, 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.

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 which initiated bearish reversal.

As expected, the price level of 0.7050 failed to offer enough bullish support for the NZD/USD pair. That's why, further bearish decline was expected towards 0.6800 (Reversal pattern bearish target).

Evident signs of bullish recovery was expressed around the recent low (0.6780). That's why, a bullish pullback is expected towards 0.7050.

Moreover, further bullish advance should be expected towards 0.7150 if enough bullish momentum is expressed above the price level of 0.7050.

Trade Recommendations:

An inverted Head and Shoulders pattern is being established on the chart indicating high probability of bullish reversal.

That's why, the price zone of 0.6800-0.6830 could be considered for a short-term BUY entry. Bullish persistence above 0.6950 (neckline) is mandatory to pursue towards next bullish targets.

S/L should be moved to 0.6900 to secure some profits. T/P level remains projected towards 0.7050 and 0.7110.

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Intraday technical levels and trading recommendations for EUR/USD for December 19, 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 was reversed when the Inverted 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 was expressed towards the price level of 1.2100 where the depicted Head and Shoulders reversal pattern was expressed.

If the recent bearish breakout persists below 1.1700 (Neckline of the reversal pattern), a quick bearish decline should be expected towards the price zone of 1.1415-1.1520 (Initial targets for the depicted H&S pattern).

Bearish target for the depicted Head and Shoulders pattern extends towards 1.1350. However, to pursue towards the mentioned target level, significant bearish pressure is needed to be applied against the mentioned zone (1.1415-1.1520).

However, In November, recent price action around the price zone of 1.1520-1.1415 indicated evident bullish recovery. This hindered further bearish decline which allowed the current bullish pullback to occur towards the price level of 1.1900.

Trade Recommendations

The price levels around 1.1900-1.1950 were suggested for a valid short-term SELL entry. It's already running in profits.

S/L should be lowered to 1.1870 to offset the associated risk. Remaining T/P levels to be located at 1.1700 and 1.1590.

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GBP/USD analysis for December 19, 2017

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Recently, the GBP/USD pair has been trading sideways at the price of 1.3372. According to the 15M time - frame, I found a broken intraday bearish flag in the background, which is a sign that buying looks risky. I also found overbought conditions on the stochastic oscillator. My advice is to watch for potential selling opportunities. The downward targets are set at the price of 1.3320 (pivot support 1) and at the price of 1.3255 (pivot support 2).

Resistance levels:

R1: 1.3432

R2: 1.3480

R3: 1.3545

Support levels:

S1: 1.3320

S2: 1.3255

S3: 1.3206

Trading recommendations for today: watch for potential selling opportunities.

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USD/JPY analysis for December 19, 2017

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Recently, the USD/JPY pair has been trading sideways at the price of 112.58. According to the 30M time - frame, I found that price rejected from the Fibonacci retracement 61.8% at the level of 112.35, which is a sign that selling looks risky. My advice is to watch for potential buying opportunities. I have placed Fibonacci expansion to find potential upward targets. I found Fibonacci expansion 61.8% at the price of 112.80 and Fibonacci expansion 100% at the price of 113.10.

Resistance levels:

R1: 112.80

R2: 113.08

R3: 113.33

Support levels:

S1: 112.28

S2: 112.03

S3: 111.76

Trading recommendations for today: watch for potential buying opportunities.

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Technical analysis of GBP/USD for December 19, 2017

The British pound against the Dollar is at a very critical junction. Price is still below the long-term resistance trend line but holding above the crucial 1.30-1.31 support. The GBP/USD is mainly moving sideways with no clear trend, but short-term view makes me favor the bearish side.

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Red line - resistance

Blue line - support

The GBP/USD pair is making lower highs and has tested the support at 1.33 so far 3 times. If there is a fourth time, I expect support at 1.33 to be broken and price move at least towards 1.32. Resistance at the red trend line is already hit three times. Breaking above it will push price towards 1.35 which is the long-term resistance.

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The GBP/USD so far respects both the upward sloping trend line from 2016 and the long-term downward sloping trend line from 2014. Breaking above 1.35 will open the way for a move towards 1.40. Break below 1.32-1.30 and we could see a sell off towards 1.20.The material has been provided by InstaForex Company - www.instaforex.com

Technical analysis of EUR/USD for December 19, 2017

EUR/USD is in a neutral short-term trend but vulnerable to the downside. I expect EUR/USD to break lower towards 1.14 over the coming weeks. Key levels for this scenario to come true are 1.17.35 and 1.1965.

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Black rectangle - critical support

Blue trend lines - resistance

EUR/USD is inside the 4-hour Kumo (CLOUD). Trend is neutral as price is trading between 1.17-1.1850 for the last few days. Short-term resistance is at 1.1820-1.1830. Support is at 1.1765. Break support and we are going to challenge the black rectangle area just above 1.17 which is critical support. Break above the blue trend lines and we are going to challenge 1.1950.

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Black rectangle - critical support area

So far price remains above the critical support area. Breaking below it will push price towards the red rectangle area and the Ichimoku cloud support around 1.14. This is my preferred scenario. However there still no confirmation of such a bearish move starting yet.

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Daily analysis of major pairs for December 19, 2017

EUR/USD: This pair has not assumed any directional movement this week, as it is consolidating in the short term. A rise in momentum is expected and it would most probably favor bears. A further bearish movement is expected this week as price is going towards another support line at 1.1700.

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USD/CHF: The USD/CHF pair

has generated a short-term "sell" signal. Price can go towards the support levels at 0.9850 and 0.9800. On the other hand, there are resistance levels at 0.9900 and 0.9950, which should serve as an impediment to any bullish attempts. There is also another great resistance level at 1.0000.

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GBP/USD: This market is consolidating at best, and there is no directional, perpetual movement at the present. Last week, the market reached the distribution territory at 1.3450 and the accumulation territory at 1.3300. Either of these boundaries would be breached this week, as price assumes a directional movement.

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USD/JPY: There is a Bearish Confirmation Pattern in the short-term (on the USD/JPY pair). The market has remained calm since the beginning of this week, and that is calm before the storm (heavy volatility). The market would come down again to test that demands level, and possibly breach it to the downside.

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EUR/JPY: This currency cross is quite choppy and without any direction on the higher time horizon. This kind of directionless scenario has been going on for more than two months and it seems to just be the beginning, unless there is a 300-pip movement to the upside or to the downside, which would result in a directional bias.

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Bitcoin analysis for 19/12/2017

Immediately after the start of the Bitcoin futures trading, by the CME Group, which will be closed in January, Bitcoin's price jumped to $ 20,800, after which, at the time of publication, it fell back to $ 18,800. However, contracts that expire in February, March, and June are still valued at $ 20,000. Considering the current market price of $ 18,500, Wall Street believes that the price is overstated. These conclusions are drawn despite the fact that the fall of 4% in the world of cryptocurrencies is relatively small.

The media also became interested in the opening of new CME Group products. The BBC has reported this fact, stating that the opening of this market is conducive to the widespread adoption of Bitcoin. The BBC considered it necessary to combine the above event with the statement of the chairman of UBS, Axel Weber, who expressed the opinion that Bitcoins are not money.

There are many theories about what will happen after the opening of the CME market. Although there are legitimate arguments for the possibility of investors breaking, new ones should remember that the trend is their friend. Recently, even JPMorgan Chase president Jamie Dimon admitted that before his fall, Bitcoin can be priced at even $100k at some point in time.

Let's now take a look at the Bitcoin technical picture at the H4 time frame. The price has made a new high at the level of $19,661, which can be labeled as the top for the wave (5). The local support at the level of $17,894 has been tested and together with a weekly pivot at the level of $18.062 will now act as a strong support zone for the price. Please notice a strong bearish divergence between the price and momentum indicator, which clearly favors the downside correction scenario.

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Trading plan for 19/12/2017

One step closer to Christmas means one degree lower on the scale of volatility in financial markets. Trading in major currencies is barely noticeable, and the situation has practically not changed since Monday evening. EUR / USD has anchored close to 1.18, USD / JPY orbits around 112.50, and GBP / USD returns to 1.3380. TheUS Dollar is waiting for the adoption of the tax bill, and reports from Washington suggest that the Republicans have enough votes. Gold slightly rallies above 10-day highs.

On Tuesday 19th of December, the event calendar is relatively busy with important data releases. Germany will post Ifo Business Climate, Expectations, and Current Assesment data and the US will present Building Permits, Housing Starts Current Account and CB Consumer Confidence data.

EUR/USD analysis for 19/12/2017:

The tradition of the boring course of the first sessions at the beginning of the week on the currency market has been undoubtedly sustained. This time, the emptiness in the economic calendar was accompanied by the prospect of the upcoming Christmas, which contributed to a significant narrowing of volatility on the main currency pairs. The European indexes survive their five minutes, which in part have benefited Donald Trump presents bringing the prospect of tax reform under the Christmas tree. Against the background of developing countries' currencies, South African rand (4.3%) stood out due to the election of Cyril Ramaphosy, the current vice-president of South Africa, as the leader of the social democratic African National Congress. There is a little bit more data to be published today, but it looks like the volatility will stay at the same levels.

Let's now take a look at the EUR/USD technical picture at the H4 time frame. The market remains closed between the levels of 1.1725 - 1.1855 and only a sustained breakout above or below one of this levels would be considered as a game changer. Moreover, the momentum indicator remains hovering around its fifty level, which supports the directionless market scenario.

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Market Snapshot: Gold breaks higher

The price of Gold has managed to break out a little bit higher again and currently is trading at the end of the resistance zone at the level of $1,265. The momentum is still strong, but the market conditions look overbought, so there is a chance for a false breakout and reverse for the current levels. The nearest support is seen at the level of $1,260

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Market Snapshot: USD/JPY bounces from 61% Fibo

The price of USD/JPY has almost touched the 61% Fibo at the level of 111.94 as it bounced from the level of 112.04. Currently, the price got back under the moving average around the level of 112.75 in somehow oversold market conditions. Nevertheless, the neutral momentum does not help the bull camp to push higher towards the next technical resistance at the level of 113.09 so far.

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Ichimoku cloud indicator analysis of USDX for December 19, 2017

The Dollar index got rejected once again at the 94 price level and is testing short-term support at 93.30. So far price is trading sideways trapped inside the trading range of 94-93.

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Red rectangle - resistance

Black rectangle -support

The Dollar index is trading inside the 4hour Kumo (cloud) .Trend is neutral. Price bounced off the cloud support (black rectangle) but bulls are not strong enough to push price back above the Kumo (cloud). Price is below both the tenkan- and kijun-sen indicators. This is a bearish sign, increasing the chances of breaking the black rectangle support level.

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On a weekly basis price has bounced off the 61.8% Fibonacci retracement as expected but so far is unable to break above the resistance of the kijun-sen (yellow line indicator). Support is at 93-92.50 and if this level is broken we should expect price to move towards 91. Resistance at 94 is crucial for bulls. Break it and we go towards 96-97.The material has been provided by InstaForex Company - www.instaforex.com

Ichimoku cloud indicator analysis of gold for December 19, 2017

Gold price continues to make higher highs in the short-term as yesterday price broke above $1,262 to a marginal new high at $1,264. Short-term trend is bullish and changes only if price breaks below $1,255.

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Red lines - wedge pattern

Gold price is trading above the 4-hour Kumo (cloud). Support is at $1,257. Wedge support is at $1,261. Resistance is at $1,265-66. I do not believe Gold price has much more upside. I expect Gold to reverse lower soon.

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Blue line - resistance trend line

Gold price is trading above the weekly Kumo (cloud) and has bounced off of it as expected. Gold price is however below both the tenkan- and the kijun-sen. As long as price is below these two indicators and the blue trend line, I will be expecting price to move towards $1,200-$1,220 for a final new low.

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The yen reduced the dose

The Bank of Japan puts the final chord in a series of meetings of the central banks issuing G10 currencies in December. Despite sluggish inflation at 0.8% y / y, none of the 44 economists surveyed by Bloomberg expects monetary policy adjustments at the meeting on 20-21. Most of them believe that the next step will be its tightening. Although, this is unlikely to happen until 2018.

Evidence shows that BoJ has already started to normalize monetary policy while carefully trying to avoid talking about this topic. During the last 12 months, it acquired assets worth 61 trillion yen despite the Central Bank's reiterated 80 trillion yen. Such a breakdown is associated with the transition in 2016 to the regime of targeting the yield curve, which reduces the need for an active presence of the regulator in the debt market. It already owns about 40% of circulating bonds. Curiously, the median forecast of Bloomberg experts suggests that the volume of purchases will drop to 41 trillion yen in 2018 and more than a third of specialists expect BoJ to raise the required yield of 10-year bonds from 0%. If so, the growth rate of the balance sheets of the world's leading central banks will continue to fall.

Dynamics of central bank balances

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Source: Financial Times.

The tightening of the monetary policy of the Bank of Japan is likely to strengthen the yen's position, which will create difficulties in achieving a 2% inflation target. That is why Tokyo is trying its best to convince investors of its commitment to the principles of cheap monetary policy. Moreover, there are increased risks of a "dovish" rhetoric of the Board of Governors at the meeting on December 20-21 due to the growing gap between inflation and other economic indicators. Indeed, GDP gained a good move. Business activity is near the maximum marks for the 10th anniversary and consumer prices are behaving very modestly.

Do not be mistaken. The Bank of Japan is just hiding behind the screen of adherence to monetary expansion but in fact, it will normalize the policy which makes the yen a very interesting asset in 2018. Moreover, Asia will catch up. While the economies of its countries lagged behind the US and the eurozone, a strong global demand and a lagging cycle can all change the situation.

Is it worth it to actively sell USD / JPY now? We don't think so. Short-term implementation of tax reform and a compromise on the issue of the ceiling of the national debt will return interest of investors to the US dollar. Trade on reflation, topical at the end of 2016, is not in a hurry to wake up as participants in market battles need facts, not rumors. Who wants to lose serious money because of unpleasant surprises from Congress? Let them agree, then buy.

Technically, the USD / JPY exit out of the upward trading channel, followed by a successful support storm at 111.65-111.85 and at 111, will increase the risks of activation of the pattern "Head and shoulders" and the likelihood of a long-term downtrend recovery. On the contrary, a successful resistance test at 113.8 will allow the pair to continue the upward trend.

USD / JPY, daily chart

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Technical analysis of USD/JPY for December 18, 2017

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USD/JPY is expected to trade with bearish outlook as Key resistance at 113.00. The pair is rebounding from a low of 112.29 seen yesterday (December 18) but remains capped by the key resistance at 113.00. Currently, the pair is trading at levels around the 50-period moving average. The relative strength index stands above the neutrality level of 50, indicating that the rebound may proceed for a while.

However, as long as 113.00 is not surpassed, the intraday outlook remains bearish and the pair could return to 112.30 on the downside.

Alternatively, if the price moves in the opposite direction, a long position is recommended above 113.00 with a target of 113.15.

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: SELL, Stop Loss: 113.00, Take Profit: 112.30

Resistance levels: 113.15, 113.35 and 113.65 Support Levels: 112.30, 112.05, 111.70

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Technical analysis of USD/CHF for December 19, 2017

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Our first target which we predicted in yesterday's analysis has been hit. USD/CHF is Under pressure. The pair is trading below its declining 20-period and 50-period moving averages, which play resistance roles and maintain the downside bias. The relative strength index is bearish and calls for a further drop.

The U.S. dollar gave up some gains made in the prior two sessions, as investors took profits ahead of Congress' voting on the tax-reform bill.

Hence, as long as 0.9885 holds on the upside, another drop to 0.9835 and even to 0.9815 seems more likely to occur.

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: SELL, Stop Loss: 0.9885, Take Profit: 0.9835

Resistance levels: 0.9905, 0.9935, and 0.9975

Support levels: 0.9835, 0.9815, and 0.9795

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Technical analysis of GBP/JPY for December 19, 2017

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GBP/JPY is expected to trade with Bullish bias above 149.85. Despite the recent pullback from 149.85, the pair is still trading above the key support at 132.45, which should maintain the buying interest. The relative strength index lacks downward momentum.

To conclude, as long as 149.85 holds on the downside, look for a rebound to 151.05. A break above this level would trigger another rise to 151.50.

Alternatively, if the price moves in the direction opposite to the forecast, a short position is recommended below 149.85 with the target at 149.40

Strategy: BUY, Stop Loss: 149.85, Take Profit: 151.05

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: 151.05, 151.50, and 152.10

Support levels: 149.40, 149.00, and 148.50

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

Technical analysis of NZD/USD for December 19, 2017

NZDUSDM30.png

NZD/USD is under pressure below the key resistance at 0.7015, which limit the upside potential. The 20-period moving average is turning down. The relative strength index is bearish and calls for a further downside.

Therefore, as long as 0.7015 is not surpassed, look for a new test with targets at 0.6975 and 0.6960 in extension.

The black line shows the pivot point. Currently, the price is above the pivot point, which is a signal for 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: 0.7030, 0.7050, and 0.7070

Support levels: 0.6975, 0.6960, and 0.6920

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

Elliott wave analysis of EUR/NZD for December 19, 2017

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Wave summary:

EUR/NZD likely bottomed at 1.6744, just above the expected target at 1.6720. Short-term a break above minor resistance at 1.6939 and more importantly a break above 1.6965 is needed to confirm that wave (iv) has completed and wave (v) higher towards 1.7770 is developing.

As long as resistance at 1.6965 is able to cap the upside, we need to allow a decline closer to 1.6720.

R3: 1.7075

R2: 1.6965

R1: 1.6880

Pivot: 1.6789

S1: 1.6944

S2: 1.6720

S3: 1.6695

Trading recommendation:

We bought EUR at 1.6873 and will placed our stop at 1.6700.

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

Elliott wave analysis of EUR/JPY for December 19, 2017

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Wave summary:

EUR/JPY is back testing the broken minor support-line, which now acts as resistance. This former support, now resistance, is expected to cap the upside for more downside pressure towards the pivot point at 131.14, which needs to be broken to confirm that wave (D) completed at 134.50 and wave (E) now is developing towards the ideal target seen at 123.43.

Short-term a break below minor support at 132.10 confirms more downside pressure towards 131.14.

R3: 133.89

R2: 133.76

R1: 133.00

Pivot: 132.10

S1: 131.70

S2: 131.14

S3: 130.56

Trading recommendation:

We are short EUR from 133.40 with stop placed at 133.80.

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

Technical analysis of EUR/USD for Dec 19, 2017

EURUSD.jpg

When the European market opens, some Economic Data will be released, such as German Ifo Business Climate. The US will release the Economic Data, too, such as Housing Starts, Current Account, and Building Permits, so, amid the reports, EUR/USD will move in a low to medium volatility during this day.

TODAY'S TECHNICAL LEVEL:

Breakout BUY Level: 1.1840.

Strong Resistance:1.1833.

Original Resistance: 1.1822.

Inner Sell Area: 1.1811.

Target Inner Area: 1.1783.

Inner Buy Area: 1.1755.

Original Support: 1.1744.

Strong Support: 1.1733.

Breakout SELL Level: 1.1726.

Disclaimer: Trading Forex (foreign exchange) on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.

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

Technical analysis of USD/JPY for Dec 19, 2017

USDJPY.jpg

In Asia, Japan today will not release any Economic Data, but the US will release some Economic Data, such as Housing Starts, Current Account, and Building Permits. So, there is a probability the USD/JPY will move with low to medium volatility during this day.

TODAY'S TECHNICAL LEVEL:

Resistance. 3: 113.18.

Resistance. 2: 112.96.

Resistance. 1: 112.74.

Support. 1: 112.46.

Support. 2: 112.24.

Support. 3: 112.02.

Disclaimer: Trading Forex (foreign exchange) on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.

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

Fundamental Analysis of GBP/USD for December 19, 2017

GBP/USD has been very volatile recently residing above the 1.33 support area. Last week GBP gained some momentum having unchanged Official Bank Rate at 0.50% as expected whereas USD was struggling to provide sufficient push with an increased interest rate to 1.50% from the previous value of 1.25%. Despite the political and economic issues GBP has been quite weak recently but USD could not quite dominate in the meantime leading to indecision and correction in the pair. This week we do not have much GBP economic reports or events which can help the currency to gain momentum except the Current Account report which is going to be published on Friday, which is expected to have decreased in deficit to -21.3B from the previous figure of -23.2B. The positive result of this report is expected to help GBP gain some momentum against USD but it is expected not to be quite sustainable. On the USD side, today Building Permits report is going to be published which is expected to decrease to 1.28M from the previous figure of 1.32M, Current Account is expected to show less deficit at -117B from the previous figure of -123B, Housing Starts is expected to decrease as well to 1.25M from the previous figure of 1.29M and FOMC Member Kashkari is going to speak today about the interest rate decisions and upcoming monetary policies. As of the current scenario, USD is quite strong fundamentally in comparison to GBP, which is expected to have a greater impact in the long-term trading environment. USD is currently expected to dominate GBP and push the price lower in the future.

Now let us look at the technical view, the price is currently quite indecisive having back to back impulsive bearish and bullish daily candles. As of the context, the price is expected to move much down towards 1.31 support area if the price breaks below the support area of 1.3270-1.3300 with a daily close. As the price remains below 1.3450 the bearish bias is expected to continue further.

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

NZD/USD dropping nicely, remain bearish

The price has tested our major resistance area and is dropping nicely. We remain bearish looking to sell below major resistance at 0.7055 (Fibonacci retracement, horizontal overlap resistance, resistance area) and we're expecting a drop from this level towards 0.6822 support (Fibonacci retracement, horizontal swing low support.

Stochastic (34,3,1) is seeing resistance at our 97% level and dropping nicely with good downside potential.

Sell below 0.7055. Stop loss is at 0.7181. Take profit is at 0.6822.

analytics5a3868b555885.png

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AUD/USD dropping perfectly from our selling area, remain bearish

The price continues to drop nicely and sees major resistance below our selling area. We remain bearish below major resistance at 0.7698 (Fibonacci retracement, horizontal swing high resistance) for a further drop down to at least 0.7537 support (Fibonacci retracement, horizontal overlap support). Stop loss is at 0.7751 (Multiple Fibonacci retracements, horizontal pullback resistance).

Stochastic (34,3,1) is seeing major resistance below our 97% and is reversing nicely below this level. It has good downside potential to play the drop.

Sell below 0.7698. Stop loss is at 0.7751. Take profit is at 0.7537.

analytics5a3868752f22c.pngThe material has been provided by InstaForex Company - www.instaforex.com

Daily analysis of USDX for December 19, 2017

The index is starting to correct the bullish bias held from December 15th session and it's now being supported by the 200 SMA at H1 chart. However, the risk to the downside remains high and we're expecting a leg lower to test the support zone of 93.30. If USDX does a breakout below that area, the next target should be the 92.83 level.

USDXH1.png

H1 chart's resistance levels: 94.09 / 94.85

H1 chart's support levels: 93.30 / 92.83

Trading recommendations for today: Based on the H1 chart, place sell (short) orders only if the USD Index breaks with a bearish candlestick; the support level is at 93.30, take profit is at 92.83 and stop loss is at 93.76.

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

Daily analysis of GBP/USD for December 19, 2017

The pair has found support in the 1.3303 level and one could expect a consolidation once again above the 200 SMA at H1 chart. That's the last hurdle before to reach the resistance zone of 1.3444. If it manages to break above that area, gains are expected to take place towards the 1.3516 level. MACD indicator remains in the positive territory.

GBPUSDH1.png

H1 chart's resistance levels: 1.3444 / 1.3516

H1 chart's support levels: 1.3303 / 1.3234

Trading recommendations for today: Based on the H1 chart, buy (long) orders only if the GBP/USD pair breaks a bullish candlestick; the resistance level is at 1.3444, take profit is at 1.3516 and stop loss is at 1.3372.

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

Fundamental Analysis of USDJPY for December 18, 2017

USD/JPY has been very volatile above the support area from 110.80 to 111.70 which is expected to push the price higher towards 114.50 in the coming days. Despite the recent Federal Funds Rate increase to 1.50% from 1.25% earlier, USD failed to gain momentum over JPY and is still struggling to push higher. Today, Japan's Trade Balance report was published which showed an increase to 0.36T from the previous figure of 0.35T which was expected to decrease to 0.27T. The positive Trade Balance indicates the increase in exports in comparison to imports of the country which will lead to further economic development in the medium term. Moreover, BOJ Policy Rate report is going to be published on Thursday which is expected to be unchanged at -0.10%. On the USD side, today NAHB Housing Market Index report is going to be published which is expected to be unchanged at 70, but any change in the figure is expected to have a minor impact on USD to gain or lose some momentum in the coming days. As for the current scenario, USD is still quite strong as despite today's positive report JPY failed to gain momentum. This describes JPY is quite weak in comparison that may lead to further bullish pressure in the pair in the coming days where USD is expected to dominate further.

Now let us look at the technical chart. The price is currently residing above the support area of 110.70 to 111.70 having dynamic level of 20 EMA holding the price to resist its upward movements. The recent bearish rejection on the daily candle indicates that there is certain bullish pressure in the market which is expected to push the price higher towards 114.50 area. As the price remains above the support area of 110.80 to 111.70, the bullish bias is expected to continue further.

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BITCOIN Analysis for December 18, 2017

Bitcoin has been impulsive with the gains recently which pushed the price up to the record high price of $19,600. Nevertheless, BTC could not keep the momentum that has led to impulsive bearish pressure taking the price towards $18,500. The price is expected to hit $20,000 by the first quarter of January as recently CME Exchange launched the Bitcoin Futures which is expected to trade Bitcoin above $20,000 price area. The market is likely to be quite volatile in the coming days as new investors and market players are going to enter the Bitcoin market. As for the current scenario, price is currently residing inside the Kumo Cloud support above $18,500 price area after impulsive bearish pressure, but the support is expected to push the price higher towards $20,000 in the coming days. As the price remains above the $17,500, the bullish bias is expected to continue further.

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