Daily analysis of GBP/JPY for February 28, 2018

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Overview

The GBP/JPY pair formed a new bearish wave yesterday to approach support of the sideways range at 148.35. Until that moment, the price will remain trading sideways if the main levels settle, represented by the current support and the resistance at 151.00. Interestingly, strong negative momentum is provided by the main indicators, particularly stochastic is staying below 50 level. This will increase the chances for breaking the current support. The pair could start bearish correctional trading, so that the price is expected to reach 146.30 and then the bullish channel's support at 144.80. The expected trading range for today is between 150.40 and 148.35

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Daily analysis of Gold for February 28, 2018

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Overview

Gold price came under strong negative pressure yesterday evening to settle at 1,316.48 level. Please note that the price finds solid support at this level, reinforced by stochastic positivity. On the other hand, the EMA50 creates negative pressure that might push the price to break the mentioned level and extend the correctional bearish wave on the short-term basis. Therefore, we need to get a clearer signal for the next trend, which we will get through breaking 1,316.48 support or breaching 1,321.50 resistance. Be aware that breaking the mentioned support will push the price to target 1,301.20 as the next station. However, breaching the resistance will lead the price to start recovery attempts, the main target begins by testing 1,335.40. The expected trading range for today is between 1,300.00 support and 1,335.00 resistance.

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Daily analysis of Silver for February 28, 2018

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Overview

Silver traded with an obvious downward bias yesterday. Now silver is aiming to reach the key support 16.25. As we mentioned in our recent articles, holding above this level keeps the bullish scenario valid for the short term. The next main target is set at 17.43. Therefore, we still suggest the bullish trend on the intraday and short-term basis. Breaching 16.70 will ease the mission of achieving the mentioned target. Please note that breaking 16.25 will push the price to test 15.49 areas before any new attempt to rise. The expected trading range for today is between 16.20 support and 16.70 resistance.

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Global macro overview for 28/02/2018

The inflation in the Eurozone is a hot topic today on the markets in light of the publication of preliminary readings. After weaker than expected preliminary estimates from Germany, there was the possibility of a negative surprise with indications from the Eurozone. The German CPI index slowed in February to 1.4% from 1.6% annually. As for the CPI for the entire euro area, analysts expected core CPI inflation to remain above 1.0% in February. In the second month of this year, CPI inflation was also expected to slow down to 1.2% from 1.3%. In fact, in line with expectations and the first estimate, CPI inflation in February came in at 1.2% on a yearly basis and thus deviated from the ECB target. Its level equaled in February with the reading of the base CPI, which, contrary to the market consensus, stabilized at the level of January 2018.

The lack of inflationary pressure is the main reason behind the ECB loose monetary policy. The yearly inflation target is set at 2.0% minimum, but despite the ECB actions, the inflation does not want to grow higher. The only months when inflation was close to this level was April and May 2017 (2.0% and 1.9%), but since then the average inflation reading was at the level of 1.5%. In the recent months, the inflation is continuing to slide from 1.5% towards 1.0% rather than increase to the ECB target.

Let's now take a look at the EUR/USD technical picture at the H4 time frame. The market has tested the technical support at the level of 1.2203 and slightly bounced back on, but not for long. The bears are pressuring the price to break through this level and drop further towards the level of 1.2165 or even 1.2092. The weak momentum indicator, which is still below its fifty level, supports the bearish outlook.

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Analysis of Gold for February 28, 2018

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Recently, Gold has been trading downwards. As I expected, the price tested the level of $1,313.44 and reached both of our yesterday's targets. According to the 30M time – frame, I found a bearish flag (pennant) pattern in creation, which is a sign that buying looks risky. I also found a hidden bearish divergence on the stochastic oscillator, which is another sign of weakness. My advice is to watch for potential selling opportunities. The downward targets are set at the price of 1,313.50 and at the price of $1,295.35.

Resistance levels:

R1: $1,332.32

R2: $1,346.20

R3: $1,355.62

Support levels:

S1: $1,309.02

S2: $1,299.58

S3: $1,285.75

Trading recommendations for today: watch for potential selling opportunities.

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Global macro overview for 28/02/2018

Jerome Powell did not say anything during his inaugural speech before the Congress that would undermine the growing confidence among the global investors that his term would be marked by a more decisive normalization of monetary policy. The base scenario for the market is not the expectation of a maximum of three but a minimum of three interest rates this year. With the current discount assuming the probability of a hike in March at the level of 96% and the increase in the cost of money in the year by around 80 bps, the key to the stronger Dollar should be the rhetoric accompanying the tightening and the perception of the target level for the rates. It is also important to believe in the strength of the economy and its resistance to the correction on Wall Street, which guarantees that the Fed will not deviate from the chosen course.

Let's now take a look at the US Dollar Index technical picture at the H4 time frame. The market has finally managed to broke out above the black trend line around the level of 90.11 after the Powell speech in US Congress. Currently, the bulls are trying to test the technical resistance at the level of 90.59 and possibly break higher towards the next resistance at the level of 90.98. The momentum is still above its fifty level and remains strong, pointing to the north. he nearest support for the price is seen at the level of 90.20.

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EUR/USD analysis for February 28, 2018

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Recently, the EUR/USD pair has been trading downwards. The price tested the level of 1.2198. According to the 1H time – frame, I found a bearish breakout of 3-day balance in the background, which is a sign that sellers are in control. I also found that the pair is trading inside of the downward channel, which is another sign of weakness. My advice is to watch for potential selling opportunities. The downward targets are set at the price of 1.2162 and at the price of 1.2050.

Resistance levels:

R1: 1.2315

R2: 1.2390

R3: 1.2438

Support levels:

S1: 1.2190

S2: 1.2142

S3: 1.2063

Trading recommendations for today: watch for potential selling opportunities.

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Daily analysis of USD/JPY for February 28, 2018

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The pair is bearish in the long term, but neutral in the short term. There are demand levels at 106.50, 106.00 and 105.50, which would impede bearish movements and they would eventually help bring about a bullish reversal. The outlook on JPY pairs remains bullish for this week, and the USD/JPY pair is no exception.

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When a breakout happens, it may be in favor of bulls, as price goes towards the supply levels at 107.00, 107.50 and 108.00. This is what can bring about a Bullish Confirmation Pattern in the 4-hour chart. A breakout to the downside will render this expectation invalid.

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Daily analysis of EUR/JPY for February 28, 2018

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On this cross pair, the southward journey has resumed (though the price did nothing significant at the beginning of the week), but the current Bearish Confirmation Pattern in the market has been upheld. The more price journeys southwards, the more the probability of a strong reversal in the market, which may overturn the current bearish bias.

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The EMA 11 is below the EMA 56, and the RSI period 14 is below the level 50. There are supply zones at 131.00, 131.50 and 132.00, which would be breached to be upside, in case there is a strong bullish reversal in the market.

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Daily analysis of USD/CHF for February 28, 2018

USD/CHF has started moving upwards in a predictable manner, thus ending the short-term consolidation that was witnessed on Monday and Tuesday. The market is currently above the support level at 0.9400, going towards the resistance level at 0.9540, which would be breached to the upside, as another resistance level at 0.9500 is targeted.

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The EMA 11 is above the EMA 56, and the Williams' % Range period 20 is in the overbought region. This means the outlook on the market is now bullish, irrespective of occasional pullbacks in the market. There is a Bullish Confirmation Pattern in the 4-hour chart.

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Analysis of bitcoin for February 28, 2018

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The Bitcoin (BTC) has been trading downwards. As I expected, the price tested the level of $10,353. In less than five hours, Zclassic will fork to create bitcoin private, a new privacy-oriented coin that uses zk-snarks to obfuscate transactions. Holders of bitcoin and zclassic will both be eligible to receive bitcoin private (BTCP) on a 1:1 basis. There's just one problem: 93% of all zlcassic (ZCL) is on Bittrex exchange, which so far has provided no comments on whether it would support the fork. As the price of ZCL has dropped sharply, bagholders have expressed their anger at Bittrex' slowness to act. Technical picture on Bitcoin looks neutral to bearish.

Trading recommendations:

According to the 30M timeframe, I found that price failed to test upper diagonal of the channel, which is a sign that buyers lost power. I also found a hidden bearish divergence in the background and broken median line, which is a sign that sellers are in control. My advice is to watch for potential selling opportuntiies. The downward targets are set at the price of $10,360, $10,135 and at $9,980.

Support/Resistance

$10,800 – Intraday resistance

$10,362– Intraday support

$10,130 – Objective target 1

$9,980 – Objective target 2

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

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Gold received a blow from the Fed

The quotations of gold futures fell to 2-week lows against the background of "hawkish" comments by Jerome Powell. Speaking before the Congress, the head of the Federal Reserve expressed confidence in the rapid achievement of inflation targeting, noted the strength of the world economy and a significant fiscal stimulus. In his view, the headwinds that took place in the past years, currently contribute to the dispersal of GDP. In particular, we are talking about the high demand for US exports, favorable financial conditions and the implementation of tax reform. Strong labor market allows you to count on increased investment.

Prior to the speech of Powell, investors believed that he would choose a cautious approach to monetary policy. After the accelerated growth of average wages and inflation, the futures market sharply slipped by a mark of three increases in the federal funds rate in 2018 and began to lay in the quotations of its instruments four acts of tightening monetary policy. Many expected that the chairman of the FRS will try to smooth this process and remind about the previous forecasts of the FOMC. This did not happen. On the contrary, Donald Trump's protege said that, in his personal opinion, compared with the December estimates, the outlook for GDP and inflation improved. The debt market reacted with the growth of bond yields, which triggered an avalanche of gold sales.

Dynamics of gold and yield of US bonds

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Source: Bloomberg.

Despite the growing risks of overclocking inflation, the rates of the US debt market are accelerating by leaps and bounds. As a result, the real yield also increases, which is a "bearish" factor for XAU / USD. And if in early 2018 investors preferred to ignore this factor, then the results of bond auctions returned their interest in the dollar. There is no panic about insufficient demand for US assets, and the inflow of capital will contribute to the correction of the USD index. Thus, the external background for precious metals begins to deteriorate, so do not be surprised that after an impressive start this year, its quotes are ready to plunge into the red zone.

Should the fans of gold throw a white flag? In my opinion, no. Most likely, the dollar's success will be temporary. Yes, interest in the Fed is back, but conditions change. If in 2015-2016 the Federal Reserve was the only issuing Central Bank G10, which planned to tighten monetary policy, in 2017 it had serious competitors. Among them is the ECB, to which hands are bound by inflation. Till. Overclocking the indicator in the second quarter will return the idea of normalizing monetary policy to the markets and will allow to restore the uptrend in EUR / USD. This will be a serious blow to the USD index and will return investors' demand for gold.

Technically, the breakthrough of the lower boundary of the short-term ascending trading channel increased the risks of implementing the target by 88.6% in the "Bat" pattern. A necessary condition for continuing the peak is a confident assault on the lower boundary of the long-term "bullish" trading channel.

Gold, daily chart

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Trading plan 02/28/2018

Trading plan 02/28/2018

The GBP / USD currency pair is preparing for growth.

The general picture: The first major event of the week passed. On February 27, the new head of the Federal Reserve, Powell, spoke in the US Congress.

The Fed is ready to raise the rate, at least 3 times + 0.25% in 2018. The main focus is on inflation in RFE (and this data will be released tomorrow, on Thursday, March 1, at 13:30 London time!)

The dollar strengthened on the Fed.

Today is the second event of the week. US GDP report (second reading for the 4th quarter) at 13:30 London time.

Pound: We expect the pound to rise in anticipation of a rate hike.

We buy a pound at a decrease from 1.3800 and lower, or after a breakout to the top 1.4150.

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Technical analysis of USD/CHF for February 28, 2018

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Overview:

  • The USD/CHF pair continues to move upwards from the level of 0.9382. Today, the first support level is currently seen at 0.9382, the price is moving in a bullish channel now. Furthermore, the price has been set above the strong support at the level of 0.9382. This support has been rejected three times confirming the veracity of an uptrend. According to the previous events, we expect the USD/CHF pair to trade between 0.9382 and 0.9471. So, the support is seen at 0.9382, while daily resistance is found at 0.9471. Therefore, the market is likely to show signs of a bullish trend around the spot of 0.9380. In other words, buy orders are recommended above the spot of 0.9380 with the first target at the level of 0.9471; and continue towards 0.9500. However, if the USD/CH pair fails to break through the resistance level of 0.9382 today, the market will decline further to 0.9297.
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Technical analysis of NZD/USD for February 28, 2018

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Overview:

  • The NZD/USD pair continues to move downwards from the level of 0.7336. Yesterday, the pair dropped from the level of 0.7336 to the bottom around 0.7230. Today, the first resistance level is seen at 0.7256 followed by 0.7336, while daily support 1 is found at 0.7200. Also, the level of 0.7200 represents a weekly pivot point for that it is acting as major resistance/support this week. Amid the previous events, the pair is still in a downtrend, because the NZD/USD pair is trading in a bearish trend from the new resistance line of 0.7256 towards the first support level at 0.7200 in order to test it. If the pair succeeds to pass through the level of 0.7200, the market will indicate a bearish opportunity below the level of 0.7200. Then, the pair will move downwards continuing the bearish trend development to the level 0.7145 in order to test the daily support1. However, if a breakout happens at the resistance level of 0.7336, then this scenario may be invalidated.
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Bitcoin analysis for 28/02/2018

The European Commission hosted a conference entitled "Cryptocurrencies - Opportunities and Risks", including the impact of cryptocurrencies on financial markets and problems arising in connection with Initial Coin Offers (ICO). The meeting was chaired by Valdis Dombrovskis, Vice-President of the Commission responsible for financial stability, financial services and the union of capital markets. The Commission's press release described the event as a place of organization, countries, central banks, scientists and entrepreneurs of the European Union to respond to the challenges of cryptocurrencies and the underlying Blockchain technology.

The conference was divided into three themes: cryptography and financial markets, investor protection and market integrity and ICO. After the end of the roundtable, Dombrovskis told the press that since Europe has such a small share in cryptocurrency trading, which he called a "global phenomenon", the next step is to discuss the same topics at the G20 level, reflecting the opinions of officials from the French and European Central Bank. He also told one journalist that he also did not exclude the possibility of speeding up regulation at EU level, pending future developments in the crypto world. He added that "Blockchain technology has strong promises for financial markets" and that steps should be taken not to hinder technological innovation. Dombrovskis reiterated the previous position of EU regulators on the risks involved in investing and trading in cryptocurrencies at the end of their roundtable debate, stating that "warnings about risks to consumers, investors must be clear in all jurisdictions."

The fintech action plan is to be presented by the European Commission at the beginning of March.

Let's now take a look at the Bitcoin technical picture at the H4 time frame. The market is still in a local uptrend and now is testing the golden trend line from the downside again. Any violation of the level of $11,000 will open the road towards the level of $11,698 (local high) and then $11, 937 ( wave (b) high). Only a sustained breakout back below the technical support at the level of $9,170 would change the current outlook from bullish to bearish.

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Trading plan for 28/02/2018

The Asian session does not bring a change in the market balance of power. EUR/USD is close to 1.22. GBP/USD is at 1.39. Volatility on the market is low.The US Dollar remains strong after yesterday's Powell speech before the US Congress. Stock markets are reversing downwards: Wall Street is more than 1.0% down already, and SP500 futures are again under 2,750 points.

On Wednesday 28th of February, the event calendar is busy with the important news releases, so the global investors should keep an eye on PMI Manufacturing data from China, GfK Consumer Climate, Unemployment Rate and Unemployment Change data from Germany, French GDP, and Consumer Spending data, KOF Economic Barometer data from Switzerland, Consumer Price Index data from the Eurozone. During the US session, Canada will post Raw Materials Price Index data and the US will present GDP Second Release, GDP Price Index, Chicago Purchasing Manager Index and Pending Home Sales data.

USD/JPY analysis for 28/02/2018:

The biggest overnight price movement on the market is the strengthening of the yen, which moved 50 pips off the night highs as a consequence of the Bank of Japan decision to limit the purchase of Treasury bonds at the long end of the yield curve. Such a step should not be considered in terms of the announcement of abandoning the ultra-soft monetary policy, but it still triggered a market reaction. Just recently, the Bank of Japan Governor Kuroda reassured the global investors that the BoJ will maintain the ultra-loose monetary policy as the inflation is still well below the BoJ target of 2.0%.

Let's now take a look at the USD/JPY technical picture at the H4 time frame. The market bounced from the level of 106.41 and tried to rally towards the recent local high at the level of 107.90, but so far it made only a high at the level of 107.68. If bulls want to gain the control over this market, then they must break out above the technical resistance zone located between the levels of 108.10 - 108.43. Otherwise, the downtrend might continue or the market might start to consolidate in a horizontal zone.

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NZD/USD Intraday technical levels and trading recommendations for February 28, 2018

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Daily Outlook

In July 2017, an atypical Head and Shoulders pattern was expressed on the depicted chart which indicated upcoming 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 depicted low (0.6780). An inverted Head and Shoulders pattern was expressed around these price levels.

The price zone of 0.7140-0.7250 (prominent Supply-Zone) failed to pause the ongoing bullish momentum. Instead, a bullish breakout above 0.7250 was expressed on January 11.

That's why, a quick bullish movement was expected towards the depicted supply zone (0.7320-0.7390) where evident bearish rejection and a valid SELL entry were expected.

On February 2, a bearish engulfing daily candlestick was expressed off the price level of 0.7390. Moreover, a double-top reversal pattern was expressed around the price zone (0.7320-0.7390).

As expected, the price zone (0.7320-0.7390) stood as a significant supply zone for the NZD/USD pair. This allowed the current bearish decline to occur towards the price zone of 0.7230 - 0.7165 (neckline of the reversal pattern).

A bearish breakdown of 0.7300 (neckline) is needed to confirm the depicted reversal pattern. Bearish projection target would be located around 0.7050 and 0.7000.

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Intraday technical levels and trading recommendations for EUR/USD for February 28, 2018

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Monthly Outlook

In January 2015, the EUR/USD pair moved below the major demand levels near 1.2100-1.2200 (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 and recently above 1.2075.

Another bullish breakout above 1.2250 was expressed on the chart. This hinders the bearish momentum allowing bullish advancement to occur towards 1.2750 provided that the bullish breakout above the price level of 1.2250 remains defended by the bulls.

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Daily Outlook

In September, bearish target for the depicted Head and Shoulders pattern was projected towards 1.1350. However, the market failed to apply significant bearish pressure against the mentioned zone (1.1415-1.1520).

Instead, In November, evident bullish recovery was manifested around the price zone of 1.1520-1.1415.

This hindered further bearish decline which allowed the current bullish momentum to occur towards the price level of 1.2100 which failed to pause the ongoing bullish momentum as well.

Daily persistence above 1.2470-1.2500 was needed to confirm a recent bullish flag continuation pattern with projected targets around the price level of 1.2750. However, the EUR/USD bulls failed to fixate above 1.2470.

That's why, a recent bearish pullback is being expressed below the price level of 1.2450 thus expressing a double-top reversal pattern with projected target around 1.1990.

The current bearish pullback will probably extend towards 1.2070-1.1990 (reversal pattern projection targets) if bearish breakdown of the level of 1.2200 (the depicted uptrend line) is achieved on a daily basis.

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Ichimoku cloud indicator analysis of USDX for February 28, 2018

As we mentioned yesterday the Dollar bounced off the critical support area but price remains below the recent high at 90.60. Only a break above this level will confirm that a bigger bounce is in play for the Dollar index. The chances of this break out have increased dramatically.

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Red line - resistance trend line (broken)

Black rectangle - horizontal resistance

The Dollar index is in a bullish short-term trend as price is trading above the Kumo (cloud) and above both the tenkan- and kijun-sen indicators. Resistance is found at 90.60. Support is at 89.60-89.50.

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Blue line - resistance

On a daily basis the Dollar index is above both the tenkan- and kijun-sen indicators. Price is below the cloud and below the blue trend line resistance. Cloud resistance that bulls must overcome is at 91-91.70. This is strong daily resistance. A break above this area will be an important bullish signal. I'm bullish about the index as long as price is above 89.50.

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Ichimoku cloud indicator analysis of gold for February 28, 2018

Gold price broke below support yesterday after a wave of strength in the Dollar was the result of the new Fed chair's testominy. Gold is making lower lows and lower highs. Price got rejected at the cloud resistance but is still holding above $1,310-07 support area.

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Gold price is trading below the cloud resistance in the 4hour chart. Short-term trend is bearish as long as price is at below $1,337. Our most probable next target is now at the 61.8% Fibonacci retracement at $1,285. This is also the next important support. Resistance is at $1,325-26. This is the first obstacle bulls must overcome, but the most important one is at $1,337.

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Gold has reached the Ichimoku cloud in the daily chart as we expected, after the rejection at the tenkan-sen (Red line indicator). Gold is at important support. A daily close below the upper cloud boundary at $1,314 will most probably push price towards $1,300.The material has been provided by InstaForex Company - www.instaforex.com

Technical analysis of USD/JPY for February 28, 2018

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USD/JPY is under pressure. Under pressure. The pair has struck against its nearest key resistance at 107.60, and also remains under pressure below its declining 20-period and 50-period moving averages. The relative strength index is below its neutrality area at 50, and calls for a new drop. Last but not least, the process of lower highs and lows remains intact, which should confirm a bearish outlook, and call for a further decline to 106.75 and 106.35 in extension.

Alternatively, if the price moves in the opposite direction, a long position is recommended to be above 107.60 with a target of 107.90.

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 at 107.60, take profit at 106.75.

Resistance levels: 107.90, 108.20, and 108.50

Support levels: 106.75, 106.35, and 106.

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Brent woke up appetite for risk

Thanks to an improving external background and unexpected growth of US stocks by 1.6 million barrels, by the end of the week by February 16, oil futures managed to close 8 out of the last 9 trading sessions in the green zone. Where are the fears that the extraction of black gold in the United States in 2019 will overtake a similar figure for Russia and come out on a clean first place? Why did the talk about the increase in drilling rigs from Baker Hughes go to the back burner? Traders say that they have not seen such a favorable macroeconomic background for a long time, which contributed to the rapid recovery of Brent and WTI.

Driven by oil, copper and other commodities, the S&P GSCI Index, tracking the dynamics of 24 assets, jumped nearly 6% since February 9. Its movement is closely correlated with the US and global stock markets, while raw materials are clearly undervalued compared to equity securities. So, oil prices are only 56% of their highest levels reached in 2008, and the cost of gold and oil is only 30% and 31%. All this is well understood by hedge funds, whose long positions for black gold are 16 times higher than short ones.

Dynamics of commodity and stock markets

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Source: Wall Street Journal.

While OPEC and American producers continue to pull the rope, the key factor is global demand. And investors are judging about its prospects for the dynamics of the S&P500 and other global stock indices. At the same time, the rapid recovery of the stock market testifies to the strong health of the global economy. And can it be otherwise, if the US GDP, without a fiscal stimulus, grows by leaps and bounds, and if we factor in the tax reform, then is it able to achieve growth at a permanent 3%?

Personally, I strongly doubt that the Fed is going to radically change its stance and abandon the idea of a gradual normalization of monetary policy. The central bank risks accelerating the selling of debt bonds, which will push the yield of 10-year US Treasury bonds significantly above 3% and thus provoke a correction of the S&P 500. Such development is seen to cause Donald Trump's discontent, who has repeatedly stressed that the success of the president's policy is reflected in the "bullish" trend of the stock market. Curiously, why should the proteges of the head of the White House cross his path?

References to the continuation of the course of monetary policy by Janet Yellen, in which the Fed must consider seven times before stopping (raise the federal funds rate), can weaken the US dollar. This, in turn, will have a favorable effect on oil prices. As constraints, expectations are for restoring an upward trend in US stocks and Britain's readiness for the first time in 14 years to become a net exporter of oil.

Technically continues the transformation of the "Shark" pattern in 5-0. Breakthrough of resistance at 78.6% and 88.6% of the wave of CD will open the "bulls" to the upward path. On the contrary, a return to support at $65 per barrel will increase the risks of correction.

Brent, daily chart

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BITCOIN Analysis for February 27, 2018

Bitcoin has been quite impulsive with bullish gains recently above the $10,000 price area, which is expected to push the price higher in the coming days. The market players are still lacking confidence in Bitcoin and seem to be quite indecisive. The hype of crypto market is currently fading away, whereas the gains of bitcoin has been quite stable. Most of market giants have already been realizing the stability of the crypto market, while the value of bitcoin has not been as drastic as expected. The bitcoin market lacks liquidity, but sustaining gains is a good sign of mature market structure. As of the current scenario, the price is expected to head towards the $12,000 price area in the coming days if the price remains above the$10,000 price area.

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Daily analysis of EUR/JPY for February 27, 2018

EUR/JPY

On this cross, the southward journey may soon be over this week, which could have been harbingered by the slight rally in the context of a downtrend (which happened on February 26), and which would eventually remove the current Bearish Confirmation Pattern in the market. The outlook on JPY pairs is bullish for this week, and for the month of March.

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When the demand zones at 131.50 and 131.00 are tested – especially the demand zone at 131.00, the recent bearish bias would receive more emphasis. A movement above the supply zones at 132.50 and 133.00 would result in a threat to the bearishness in the market.

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Daily analysis of USD/JPY for February 27, 2018

USD/JPY

The market was bearish in the long-term. On Monday, nothing significant happened except a tight, sideways movement. There are demand levels at 106.50 and 106.00, which would impede bearish movements and they would eventually help bring about a bullish reversal, which is expected to take place before the end of this week.

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When a breakout happens, it may be in favor of bulls, as price goes towards the supply levels at 107.00, 107.50 and 108.00. This is what can bring about a Bullish Confirmation Pattern in the 4-hour chart, pointing to a northwards propensity.

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Daily analysis of USD/CHF for February 27 2018

USD/CHF

The market did nothing significant on Monday, and thus the bias on the market is neutral in the short-term (while the medium-term bias is bearish). It is expected that this short-term neutral bias would continue for some time until there is a breakout in the market, which would most probably favor bears.

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There are resistance levels at 0.9400 and 0.9450 and there are support levels at 0.9300 and 0.9250. Once the support level at 0.9250 is breached to the downside, the bias on the market would turn bearish. A movement above the resistance level at 0.9450 would reveal the bullish intent.

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Global macro overview for 27/02/2018

In his speech in the European Parliament, The European Central Bank (ECB) president Mario Draghi demanded a central role in the supervision of clearing central counterparties (CCPs), yet struck a more flexible tone than some European politicians who want the multi-trillion Euro clearing industry to be removed from London City. Draghi made it clear that he sees Brexit as a reason for the EU to speed up the pact of regulations which will give the ECB more power over clearing houses in London financial center and beyond. Draghi said he wants to "stress the crucial importance of finalizing the adoption of key pieces of EU legislation, such as Emir II, well in advance of Brexit, in order to be prepared for all possible contingencies, including a no-deal scenario." The latest update of the European Market Infrastructure Regulation (Emir II) would allow the ECB to directly regulate third-country clearinghouses, with the possibility of stricter rules or even forcing systemically important firms to move their operations to the Eurozone. The rules are currently being discussed in the European Parliament and could pass as soon as the end of the year.

London City is the biggest in the world financial center, where companies use derivatives to hedge against the risk of a whole host of market movements, such as changes in interest rates or foreign exchange, and the vast majority of euro-denominated banking clearing currently taking place in the UK. It would be a huge loss for the London and the whole UK if this center would have been moved in one of the European cities like Frankfurt, Brussel or even Warsaw.

Let's now take a look at the GBP/USD technical picture at the H4 timeframe while the London is still the world financial center. The market is still trading below the golden trend line in a narrow range between the levels of 1.3921 - 1.3986. The momentum is hovering around its fifty level as well, which indicates more sideways price action.

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Global macro overview for 27/02/2018

The currency market shows no major signs of life, and investors focus on the Fed Chair's J. Powell afternoon speech. The text of Jerome Powell's speech will be published at 03:30 pm GMT and the meeting in front of the Financial Services Commission will start at 05:00 pm GMT. The main attention, however, will be the question session, which will start after the presentation of the statement. The market will look for signals whether the Fed is closer to three or four hikes this year and whether it intends to be more aggressive in the next period. So far, Powell has presented neutral views, so turning to one of the camps (hawks/doves) will be an important signal. Nevertheless, in the context of the next meeting in March, he does not have to do much when the market does not fully discount the increase. In addition, it is up to Powell to build consensual forward guidance with the recognition of the dovish camp's arguments, which reduces the chances of a clearly hawkish tone. On the other hand, even moderate Powell openness to more interest rate hikes (if the data from the economy remains very good) will be a sign of a clear change at the Fed rhetoric compared to the dovish Yellen. The market, however, quietly counts on it and positions itself on the hawkish tone of the performance.

Let's now take a look at the EUR/USD technical picture at the H4 time frame before the Powell statement. The market is consolidation inside of a very narrow zone between the levels of 1.2366 and 1.2257. Moreover, there is a golden trend line support located just below the technical support at the level of 1.2257, so any violation of this line will put the bears back in control over the market. In a case of a sell-off, the next technical support is seen at the level of 1.2203.

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Fundamental Analysis of GBP/USD for February 27, 2018

GBP/USD has been quite bearish recently above the support area of 1.3850-1.3950 from where the price is expected to push lower in the coming days. Ahead of the high impact economic reports this week, USD is expected to take the lead in the pair whereas mixed economic reports of GBP published recently is holding the currency back. Today USD Core Durable Goods Orders report is going to be published which is expected to decrease to 0.4% from the previous value of 0.7%, Durable Goods Orders report is expected to be negative at -2.4% from the previous positive value of 2.8%, Goods Trade Balance report is expected to be unchanged at -72.3B and CB Consumer Confidence is expected to have slight increase to 126.2 from the previous figure of 125.4. Moreover, today Fed Chair Powell is going to testify the upcoming monetary policies and interest rate hike in March 2018. On the other hand, today we had no GBP economic report to help the currency to protect its grounds but on Thursday Manufacturing PMI report is going to be published which is expected to have slight decrease to 55.1 from the previous figure of 55.3 and Net Lending to Individuals is expected to increase to 5.4B from the previous figure of 5.2B. Moreover, on Friday Construction PMI is expected to increase to 50.5 from the previous figure of 50.2 along with Prime Minister May and Bank of England Governor Carney to speak about upcoming monetary policies and economic developments of Britain. As of the current scenario, USD is expected to take the lead until GBP comes up with positive economic report and development possible in the Friday events to push back higher in the future.

Now let us look at the technical view. The price is currently residing at the edge of 1.3850-1.3950 support area from where the price is expected to break below 1.3850 and proceed lower towards 1.36 support area in the coming days. There has been a number of bullish rejections along the way from where the Pre-Breakout Squeeze structure is formed. As the price remains below 1.4050 area, the bearish bias is expected to continue further.

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Fundamental Analysis of USD/JPY for February 27, 2018

USD/JPY is currently consolidating below 107.30-50 price area from where the price is expected to push lower. Ahead of USD high impact economic reports to be published today, the market is quite indecisive having positive JPY economic report today. JPY BOJ Core CPI report was published today with an increase to 0.8% from the previous value of 0.7% which was expected to decrease to 0.6%. The positive economic report of JPY lead to certain indecision in the market resulting in more correction below 107.30-50 area. This week there are several economic reports to be published on the JPY side, which is expected to have a good impact on the upcoming growth of the currency against USD. On the other hand, today USD Core Durable Goods Orders report is going to be published which is expected to decrease to 0.4% from the previous value of 0.7%, Durable Goods Orders report is expected to be negative at -2.4% from the previous positive value of 2.8%, Goods Trade Balance report is expected to be unchanged at -72.3B and CB Consumer Confidence is expected to have slight increase to 126.2 from the previous figure of 125.4. Moreover, today Fed Chair Powell is going to testify the upcoming monetary policies and interest rate hike in March 2018. As of the current scenario, the pair is expected to be quite volatile this week having a number of impactful economic reports on the USD side and JPY side as well. To sum up, USD is expected to gain momentum in the coming days ahead of the Rate Hike in the coming days whereas positive economic report results will provide a good push to the USD buyers in the future.

Now let us look at the technical view. The price is expected to proceed towards 107.30-50 price area before showing any bearish or bullish pressure in the coming days. A daily close above 107.50 is expected to lead to further bullish pressure with target towards 108.50. On the other hand, a bullish rejection off the 107.50 with a daily close is expected to push the price lower towards 105.50.

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Technical analysis of USD/CHF for February 27, 2018

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Overview:

  • The USD/CHF pair could not break the major support at the 0.9328 level yet. The level of 0.9328 coincides with 50% of Fibonacci retracement which is expected to act as major support today. Equally important, the RSI is still signaling that the trend is upward, while the moving average (100) is headed to the upside.
  • Accordingly, the bullish outlook remains the same as long as the EMA 100 is pointing to the uptrend. This suggests that the pair will probably go above the price of 0.9328 in the coming hours.
  • The USD/CHF pair will demonstrate strength following a breakout of the high at 0.9328. Consequently, the market is likely to show signs of a bullish trend. In other words, buy orders are recommended above 0.9328 with the first target at 0.9409. Then, the pair is likely to begin an ascending movement to 0.9436 marks and further to 0.9469 levels. The level of 0.9469 will act as strong resistance because it forms the double top on the H1 chart.
  • On the other hand, the daily strong support is seen at 0.9328. If the USD/CHF pair is able to break out the level of 0.9328, the market will decline further to 0.9254 (38.2% Fibonacci retracement).
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Bitcoin analysis for February 27, 2018

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The Bitcoin (BTC) has been trading upwards. The price tested the level of $10.751. The Supreme Court of Israel issued a temporary injunction order on Monday forbidding Bank Leumi from sweepingly halting the account activity of the Bits of Gold bitcoin exchange. This is seen as a major victory in the Israeli cryptocurrency industry that will set a precedent for other bitcoin businesses struggling to get banking services.

Trading recommendations:

According to the 30M time - frame, I found that price is having trouble to go above the strong reference points Fibonacci retracement 61.8% ($10.805) and upper diagonal of the channel, which is sign that buying looks risky. I expext at least the price back into the median line from the channel. My advice is to watch for potential selling opportunities. The first downward target is set at the price of $10.405.

Support/Resistance

$10.805 – Intraday resistance

$10.640 – Intraday support

$10.405 – Objective target

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Technical analysis of NZD/USD for February 27, 2018

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Overview:

  • As expected, the NZD/USD pair continues to move downwards from the areas of 0.7337 and 0.7314. Last week, the pair dropped from the level of 0.7337 to 0.7280, which coincides with a ratio of 23.6% Fibonacci on the H4 chart. Today, resistance is seen at the levels of 0.7337 and 0.7280. So, we expect the price to set below the strong resistance at the levels of 0.7337 and 0.7280; because the price is in a bearish channel now. Amid the previous events, the price is still moving between the levels of 0.7314 and 0.7238. In overall, we still prefer the bearish scenario as long as the price is below the level of 0.7314. Furthermore, if the NZD/USD pair is able to break out the first support at 0.7285, the market will decline further to 0.7238. Hence, the price will fall into a bearish trend in order to go further towards the second support at 0.7261. The level of 0.7238 will form a double bottom to test it again. On the other hand, if the price closes above the strong resistance of 0.7337, the best location for a stop loss order is seen above 0.7350.
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Analysis of Gold for February 27, 2018

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Recently, Gold has been trading downwards. As I expected, the price tested the level of $1,330.70. Anyway, I found a breakout of the upper channel, which is a sign that buying looks risky. I also found an overbought condition on the stochastic oscillator, which is another sign of weakness. My advice is to watch for potential selling opportunities. The downward targets are set at the price of $1,326.87 and at the price of $1,321.00.

Resistance levels:

R1: $1,340.65

R2: $1,348.05

R3: $1,355.00

Support levels:

S1: $1,326.30

S2: $1,319.30

S3: $1,311.90

Trading recommendations for today: watch for potential selling opportunities.

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GBP/USD analysis for February 27, 2018

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Recently, the GBP/USD pair has been trading sideways at the price of 1.3958. Anyway, according to the 30M time – frame, I found a broken intraday bearish flag pattern, which is a sign that sellers are in control. I also found an overbought condition on the stochastic oscillator, which is another sign of weakness. My avice is to watch for potential selling opportunities. The downward targets are set at the price of 1.3928, 1.3905 and at the price of 1.3848.

Resistance levels:

R1: 1.4048

R2: 1.4130

R3: 1.4190

Support levels:

S1: 1.3905

S2: 1.3847

S3: 1.3765

Trading recommendations for today: watch for potential selling opportunities.

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Bitcoin analysis for 27/02/2018

Elon Musk, a billionaire, and entrepreneur known for setting up and running Tesla Motors and SpaceX, on Thursday, February 22, revealed on his Twitter how many Bitcoins he has. This is 0.25 BTC, or about $ 2,478, equivalent to 0.000012% of its total net assets. Musk revealed the number of cryptocurrencies owned, after several false Twitter accounts pretending to represent various famous characters, including Musk, published information promises donations in cryptocurrencies to those who send their digital currencies to them.

On February 22, a Twitter user, worried about the scams, asked Musk in the tweet where these rumors come from. Musk replied that he does not know and that he had already reported the problem to the president of Twitter, Jack Dorsey, for now without success. Musk also added that apart from 0.25 BTC, which his friend gave him many years ago, he has literally zero in cryptocurrencies. The amount in Bitcoin, in which Musk is owned, is a very small part of total net wealth, which is $ 21.4 billion.

As a curiosity, it can be added that in November 2017 Musk denied rumors suggested by former SpaceX intern Sahil Gupta that Musk is probably Satoshi Nakamoto, the legendary anonymous creator of Bitcoin.

Let's now take a look at the Bitcoin technical picture at the H4 time frame. After the bounce from the technical support zone located between the levels of $9,174 - $9,434, the price has broken above the local resistance at the level of $10,455 and currently is moving higher towards the next target at the level of $10,802. This level is very important for the bulls and bears because is very close to the golden trend line, and any violation of this trend line will lead to another upward rally towards the level of $11,896.

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Trading plan for 27/02/2018

Financial markets are in a sleeping mode with the hope of awakening with the help of a Fed chairman's speech this afternoon. Asia limited its activity with zero premises from the currency market. Japanese Nikkei225 has found the strength to increase by 1.07%, but in China, the indexes are losing - Shanghai Composite is lower by 1.12%.

On Tuesday 27th of February, the event calendar is busy with important data releases. During the London session, Eurozone will post M3 Money Supply and Private Loans data and Germany will issue Preliminary Consumer Price Index data. During the US session, there will be Durable Goods Orders and CB Consumer Confidence data revealed and Federal Reserve Chairman Jerome Powell speech.

NZD/USD analysis for 27/02/2018:

The biggest drop in price overnight was noted on NZD due to disappointment in the New Zealand trade balance. January brought an unexpected deficit of NZD 566 million, after a surplus of NZD 596 million in December. A positive Trade Balance (surplus) indicates that exports are greater than imports. When imports exceed exports, the country experiences a trade deficit. Because foreign goods are usually purchased using foreign currency, trade deficits usually reflect currency leaking out of the country. Such currency outflows may lead to a natural depreciation unless countered by comparable capital inflows (inflows in the form of investments, FDI - where foreigners investing in local equity, bond or real estates markets). At a bare minimum, deficits fundamentally weigh down the value of the currency.

Let's now take a look at the NZD/USD technical picture at the various intraday time frames. The market still moves inside of the golden descending channel and the market conditions are now oversold. Moreover, there is a visible bullish divergence between the price and the momentum oscillator, which might indicate a possible short-term bounce towards the level of 0.7317 or even 0.7345. Nevertheless, the key intraday support is seen at the level of 0.7268 - 07275 zone, so if this level is clearly violated, the price might fall towards the next support at the level of 0.7239.

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Ichimoku cloud indicator analysis of USDX for February 27, 2018

The Dollar index started weak on Monday but found support at the Ichimoku cloud, at the 38% Fibonacci retracement and at the broken resistance trend line.

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Red line - resistance trend line (broken)

The Dollar index bounced right off support. This support is at 89.50. As long as price is above that level bulls have hopes. Resistance is at 90.05. A break above resistance would be a very bullish sign for the index and if it happens, I would expect price to move towards 91-92.

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Blue line - resistance

On a daily basis the Dollar index remains above both indicators. But also below the daily Kumo. Bulls need to break above the blue resistance at 90.60 for a bigger bounce to be seen. As long as we are below 90.60, there is still a big danger of seeing another sell off in the Dollar index towards 87-86.

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Ichimoku cloud indicator analysis of gold for February 27, 2018

Gold price got rejected at the $1,342 level yesterday and pulled back towards the short-term $1,330 support by the kijun-sen. Price remains below the Ichimoku cloud in the short-term, implying trend remains bearish, as price could not break above the cloud.

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Blue line - support trend line

Black rectangle - resistance area

Gold price reached the 50% Fibonacci retracement and pulled back. However price continues making higher highs and higher lows in the 1 hour chart as shown above, holding also above the blue trend line support. Next important resistance area is at $1,343-50. If bulls manage to break above that area then we could see a run towards $1,400.

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Magenta line - long-term resistance

Yesterday price got rejected at the Daily tenkan-sen indicator and price closed below the kijun-sen. This is not a good sign for bulls. Key short-term support is at $1,320. A break below it could push price lower towards $1,305. Daily clous support is at $1,300-$1,305. As long as this holds bulls have hopes for another run towards the important long-term resistance of $1,350-60.

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Fundamental Analysis of EUR/USD for February 26, 2018

EUR/USD is currently struggling at the 1.23 price area ahead of the ECB President Draghi's speech. The price has been quite indecisive at the edge of the 1.23 price area as it is the most important event level from where if broken below the price is expected to be quite impulsive with further bearish pressure. This week USD is expected to be quite strong in nature having Fed Chair Powell to testify the interest rates which is expected to hike in March and also the upcoming monetary policies. Today, USD Home Sales report is going to be published which is expected to show an increase to 655k from the previous figure of 625k. If the economic report comes positive then USD in the coming days is expected to quite impulsive. As of the current scenario, USD is expected to gain momentum further in the coming days of the week whereas EUR may struggle to co-op with the impulsive pressure on the USD side.

Now let us look at the technical view. The price is currently residing below the dynamic level of 20 EMA above the 1.23 price area. Ahead of the upcoming high impact economic reports on the USD side, the price is expected to break below 1.23 this week from where the price is expected to be quite impulsive with the bearish pressure with target towards the 1.2050 support area. As the price remains below 1.2350 with a daily close, the bearish bias is expected to continue further.

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Global macro overview for 26/02/2018

The post of President of the People's Republic of China, Xi, took place at a time that only apparently required a new head of state to carry out far-reaching reforms. Going back in time, you can see that the first months of Xi's power are primarily the presence of relatively strong shocks generated by financial markets. The Chinese economy was surprisingly well prepared for perceptible shocks, which ultimately translated into maintaining high and stable economic growth and lack of deepening the existing imbalances. Currently, the Chinese authorities face problems of a much larger caliber, which can not be solved by one modest package of laws.

The decision of the Chinese Communist Party may lull the Xi cabinet a little, which will be much more gentle in solving structural problems. The delayed decision-making process at the highest levels will only contribute to the deepening of macroeconomic discrepancies and will keep the risk of a sudden deterioration in the condition of local financial institutions. Analyzing only the observed attempt to consolidate power, we note that it may be beneficial in the medium term for the strength of the yuan - despite the increased uncertainties associated with the process of further market opening. The global investors expect, that in the coming months the strength of the Asian currency will depend on the plans related to the minimization of systemic risk, deleveraging or minimizing the percentage of non-performing loans.

Let's now take a look at the Gold technical picture in the H4 time frame. The yellow metal is a very popular asset to invest in China, which is why it is worth to take a closer look at the market behavior. Recently, the price has bounced from the level of $1,322 and currently is testing the black trend line resistance from the bottom. Any breakout through the level of $1,344 would indicate a possible rally towards the last swing high at the level of $1,365. On the other hand, a failure would strengthen the bears and make suggest a push lower, towards the level of $1,322 or even $1,311.

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