Daily analysis of GBP/JPY for February 07, 2018

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Overview

The 55 moving average carried on forming additional support at 151.00 to confirm the GBP/JPY pair's affection by the bullish bias for the near- term and medium-term trades. Thus, we are still waiting for new chances of gaining the bullish momentum. Then, we can expect the main targets starting from 153.50, followed by 50% Fibonacci correction level at 156.00. We remind you that attempts to crawl below the current support will force the price to suffer additional losses by targeting 149.35, followed by 148.25 levels to face 38.2% Fibonacci correction level. The expected trading range for today is between 151.00 and 153.50

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Daily analysis of Gold for February 07, 2018

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Overview

Gold price ended yesterday's trading below 1,335.40 that confirms the return of the correctional bearish trend in the intraday trading. We are waiting for a test of the 1,316.48 level as the next station. Therefore, the bearish trend is suggested for the short term, supported by the EMA50. Please note that breaking the target level will extend losses to reach 1,301.20. On the other hand, breaching 1,335.40 followed by 1,342.00 is the price action which will release the metal from the current negative pressure, so that the main bullish trend could regain again. The expected trading range for today is between 1,316.48 support and 1,340.00 resistance.

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Daily analysis of Silver for February 07, 2018

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Overview

Silver traded with a downward bias yesterday, aiming to test the key support of 16.56. This is needed to keep the price stability above it. Besides, stochastic is still providing positive signals on the daily time frame. Such price action encourages us to keep the overall bullish scenario for the short term. We are waiting for a target at 17.43 as the next upward station. The price needs to breach 16.85 to simplify the mission of heading towards the mentioned target. Please note that breaking 16.56 will put the price under more negative pressure with the next downward target of 15.49. The expected trading range for today is between 16.55 support and 17.00 resistance.

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Bitcoin analysis for February 07, 2018

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Bitcoin (BTC) has been trading upwards. The price tested the level of $8.443. The good news from Singapore made an impact on the currrent bitcoin corrective rally. The Monetary Authority of Singapore has been studying cryptocurrency developments and there is no strong case to ban crypto trading, a high-ranking government official told lawmakers. The adoption of regulations in other countries in the region has increased pressure on authorities in the city-state to clarify their stance on bitcoin, as more crypto companies in Asia are seeking friendlier business environments. Technical picture looks netural to bearish.

Trading recommendations:

According to the 30M time - frame, I found a bearish flag in progress, 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 if you see valid breakout level of lower diagonal. If there is a valid berakout of bearish flag the downward target will be set at the price of $5.972.

Support/Resistance

$8.443 – Intraday resistance

$7.130 – Intrarday support

$7.130 – Objective target

$5.972 – Objective target

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GBP/USD analysis for February 07, 2018

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Recently, the GBP/USD pair has been trading sideways around the level of 1.3914. I found that the price refused to test pivot support 1 at level of 1.3858, which is a sign that sellers lost power. I also found oversold conditions on the stochastic oscillator, which is another sign of strength. My advice is to watch for potential buying opporrtunities. The upward target is set at the price of 1.3980.

Resistance levels:

R1: 1.4020

R2: 1.4092

R3: 1.4185

Support levels:

S1: 1.3860

S2: 1.3765

S3: 1.3695

Trading recommendations for today: watch for potential buying opportunities.

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Analysis of Gold for February 07, 2018

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Recently, Gold has been trading downwards. The price tested the level of $1,322.45. According to the 30M time – frame, I found a successful rejection of the pivot level at the price of $1,330.23, which is a sign that sellers are in control. I also found a hidden bearish divegence on the stochastic oscillator, which is another sign of weakness. My advice is to watch for potential selling opportunties. The downward targets are set at the price of $1,314.60 and at the price of $1,304.50.

Resistance levels:

R1: $1,340.22

R2: $1,356.11

R3: $1,366.10

Support levels:

S1: $1,314.60

S2: $1,304.50

S3: $1,288.46

Trading recommendations for today: watch for potential selling opportunities.

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NZD/USD Intraday technical levels and trading recommendations for February 7, 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, a further decline was expected towards 0.6800 (Reversal pattern bearish target).

Evident signs of bullish recovery were 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, the current bullish movement extended towards the price levels of 0.7320 and 0.7390.

A quick bullish movement was expected towards the depicted supply zone (0.7320-0.7390) where evident bearish rejection and a valid SELL entry is still expected.

On Friday, a bearish engulfing daily candlestick was expressed. This enhances the bearish scenario initially towards the price levels of 0.7230 and 0.7165.

Trade Recommendations:

Conservative traders should be looking for a valid SELL entry anywhere around the depicted supply zone (0.7320-0.7390).

S/L should be located above 0.7350. T/P levels should be located around 0.7230, 0.7170 and 0.7090.

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Intraday technical levels and trading recommendations for EUR/USD for February 7, 2018

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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 and recently above 1.2075.

Another bullish breakout above 1.2250 is being expressed on the chart. This hinders the bearish momentum allowing bullish advancement to occur towards 1.2750.

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Daily Outlook

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.

Bearish target for the depicted Head and Shoulders pattern extends 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 pullback 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 confirms a recent bullish flag continuation pattern with projected targets towards 1.2750.

Otherwise, bearish pullback may occur towards 1.2070 if a bearish breakout below 1.2160 is achieved on a daily basis (low probability).

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Global macro overview for 07/02/2018:

The recovery of Monday's declines was not entirely convincing so far, but from the point of view of the stockholders, it is good that it was there at all, because during the day there was little indication of the implementation of the upward scenario. It seems that the sentiment on the market has changed quite significantly and that the long-awaited correction finally has a chance to materialize. For now, however, it is too early to prejudge anything.

The market began to speculate about what happened on Monday that the sell-off was so abrupt and deep. Some people are combining panic with the powerful forced demand for futures contracts on the VIX index from ETFs playing a drop in volatility. After yesterday's session, the holders of this type of products lost over 90% (!) Of invested capital in one day, losing a total of approximately USD 3.4 billion. This illustrates the scale of risk associated with the growing importance of ETFs on the New York Stock Exchange.

In turn, the American authorities said that nothing bad happened on the stock market - the stock market and the clearing system functioned correctly. "It was a normal correction, although it was big" - said US Treasury secretary Steven Mnuchin. Mr. Mnuchin soberly noted that since the presidential election, the stock market has grown by over 30%, so the correction should not be surprising.

Let's now take a look at the Dow Jones Index technical picture at the H4 time frame. The low at the level of 23,930 will now act as a technical support for the price. The market has managed to test the important technical resistance at the level of 24,893 as it bounces from the extremely oversold conditions. The next important resistance is seen at the level of 25, 240 and it might be hit if the momentum will keep rising up towards its fifty level.

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Global macro overview for 07/02/2018

There is no sign that the RBNZ, which will publish its monetary policy report today, will need to tighten its monetary policy soon. Prospects for economic growth remain good, but inflation still needs no reaction from the bank.Unemployment has been falling gradually for more than five years, from close to 7.0% in 2012, a sign that the economy may be running at close to full speed, but the recent strengthening of the job market, which has firms reporting more difficulty in finding skilled labour than at any time since 2005, has come with little wage growth or inflation. The CPI index slowed in January to 1.6% which is still below the RBNZ inflationary target. Moreover, economist doubt that inflation would accelerate in the fashion the Reserve Bank expects, even if economic growth did accelerate. The reason might be in a surge in a self-employment and casual employment, together with a technology advance, so no real reason for RBNZ to hike this month.

The Reserve Bank of New Zealand interest rate decision will be published on Wednesday, February 8 at 08:00 pm GMT. The market participants expect the interest rate to stay on the spot at 1.76%. Together with the decision, RBNZ Monetary Statement will be published and Press Conference held later on.

Let's now take a look at the NZD/USD technical picture at the H4 time frame. After the top at the level of 0.7435 was established, the market fell out of the channel and went down to test the technical support at the level of 0.7275. Then it tried to rally, but the technical resistance at the level of 0.7343 was too strong for the bulls, so the price moved lower again. Currently, the market trades inside of the horizontal zone between the levels of 0.7254 - 0.7343 in oversold market condition awaiting the RBNZ interest rate decision.

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US dollar: the panic is postponed

On February 5, the US stock indices collapsed at a record 4% over the past six years and the Dow Jones index fell 4.6%, which is the worst fall in a day in history. In the next morning, European exchanges have gained momentum followed by a drop in the Asian after the American indices.

Why did the exchanges fall? As it turned out, there is no rational answer. Yes, the Friday labor market report was significantly better than expected, which led to fears that the U.S. Federal Reserve will raise the interest rate more aggressively than anticipated and help cool the growth rate. However, these fears concerned only one possible additional increase in 2018 and could not serve as the reason for such large-scale sales.

Macroeconomic indicators indicate a steady and stable growth. On Monday, the PMI Markit index for the services sector came out at 53.3p, which corresponded to the forecasts and values of December.

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A similar index from ISM showed growth to 59.9p, significantly exceeding the forecast, which in the end should lead to an increase in the positive, and not to a decrease.

As for the rate forecasts according to the CME futures market data, they remained at the same level. The markets are waiting for an increase in March and June, and one more at the end of the year. The assumption that the markets were frightened of the fourth additional increase in the current year is not yet confirmed.

So what caused the fall of the markets? There is no rational explanation. The S&P 500 closed on Monday with the longest period of growth without correction in the last 20 years, which could mean an extremely powerful technical correction request. Hence, the stock market dropped on Friday after the publication of the employment report and trade robots entered the business, which signals fixing profits and sales.

If this assumption is true, the stock markets should again begin a period even if there is no growth, then at least a recovery to the reached highs. There are simply no reasons for continuing sales. The February index of economic optimism from IBD / TIPP shows a steady growth to 56.7p against 55.1p, while the GDPNow model from the Atlanta Federal Reserve Bank predicts US GDP growth in the 1st quarter at 4%, which in no way indicates a slowdown.

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The domestic political situation in the United States is also under control. Minister of Finance Mnuchin, anticipating the meeting of the Congress on the issue of the ceiling of the national debt, said that the fundamental indicators of the market are quite strong, and he is not concerned with "market volatility." In other words, it means not to pay attention to the fall of markets, raise the national debt, and everything will be in order.

Congress adopted the interim budget until February 23, so the shutdown was avoided. Temporary financing of the budget has been ensured. The tax reform comes into effect with the situation under control - that's how the situation looks like for the Wednesday morning.

Markets began to return in a calm state following various events including the slight decline of gold, rise in oil prices and stock indexes closed in the green zone which plays nearly a quarter from the recent fall. Sales are likely not to develop in creating a negative background. a new strong factor is needed and has to wait some more time given the good macroeconomic indicators.

The dollar reacted neutrally to sales, which underscores once again the lack of a link between the fundamental state of the economy and the collapse. Despite the fact of what Mnuchin said on Wednesday that he is committed to a strong dollar, the Ministry of Finance is likely to stick to its slow easing, which will help to balance the budget and somewhat narrow the gap between income and expenses.

Today, the situation in the U.S. economy will be commented on by several members of the FOMC, including Dudley. Most likely, they will try to calm the markets and confirm the policy of the unchanged policy of the Fed. Given the absence of important macroeconomic publications, the markets will trade in a tapering range by the end of the week. The dollar will weaken against European currencies, primarily against the franc and the euro, although a slight strengthening is possible against its commodity currencies.

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Technical analysis of NZD/USD for February 07, 2018

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Overview:

  • The NZD/USD pair didn't make a significant movement yesterday. There are no changes in my technical outlook. The bias remains bullish in the nearest term testing 7437 or higher. The NZD/USD pair is climbing from the price of 0.7305 in the long term. It should be noted that the support is established at the level of 0.7305 which represents the daily pivot point on the H4 chart. The price is likely to form a double bottom in the same time frame. The NZD/USD pair is showing signs of strength following a breakout of the highest level of 0.7305. So, buy above the level of 0.7305 with the first target at 0.7364 in order to test the daily resistance 1. Moreover, the RSI is still signaling that the trend is upward as it remains strong above the moving average (100). This suggests that the pair will probably go up in the coming hours. If the trend is able to break the level of 0.7364, then the market will call for a strong bullish market towards the target of 0.7437. The level of 1.4250 is a good place to take profits today. On the other hand, in case a reversal takes place and the NZD/USD pair breaks through the level of 0.7305 (pivot point), a further decline to 0.7202 can occur. It would indicate a bearish market.
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Technical analysis of USD/CHF for February 07, 2018

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Overview:

  • As expected, the USD/CHF pair continues to move downwards from the the spot of 0.9377/0.9333. The price of 0.9377 represents the first resistance on the four-hour chart.
  • The pair fell from the levels of 0.9377 and 0.9333 to the bottom around 0.9393. Today, the first resistance level is seen at 0.9333 and 0.9377 followed by 0.9432, while the daily support is seen at the levels of 0.9289 and 0.9230.
  • According to the previous events, the USD/CHF pair is still trapping between the levels of 0.9333 and 0.9230. Hence, we expect a range of 147 pips in the coming hours. The first resistance stands at 0.6790, for that if the USD/CHF pair fails to break through the resistance level of 0.9377, the market will decline further to 0.9289.
  • This would suggest a bearish market because the RSI indicator is still in a negative area and does not show any trend-reversal signs. The pair is expected to drop lower towards at least 0.9230 in order to test the second support (0.9230).
  • However, if a breakout takes place at the resistance level of 0.9377, then this scenario may become invalidated. Also, it should be noted that the stop loss should be placed above the zone of 0.9430.
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Euro does not pay attention to volatility

Eurozone

Indices of business activity in the euro area indicate a steady increase in optimism. Composite index PMI Markit rose to 12-year level, exceeding pre-crisis indicators. The volume of production orders in Germany exceeded forecasts in December, the indicator of investor confidence Sentix, despite a slight decrease, keeps at historical highs.

The flyweight added a report on retail sales, in December there was a decrease of 1.1%, the euro did not react, as the forecasts of experts were exceeded slightly.

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Mario Draghi, speaking on Tuesday in the European Parliament, did not comment on the record drop in the stock markets. Noting that the ECB is monitoring the development of the Brexit talks, Draghi added that eurozone countries need to be prepared for different outcomes, including the absence of an agreement on the withdrawal of the UK from the EU.

The serenity of Draghi calmed the players. Today, the markets in Europe opened in the green zone, the euro has a chance to resume growth if support for 1.2295 stands at the end of the day.

The United Kingdom

The pound before the meeting of the Bank of England and the publication of updated macroeconomic forecasts still looks convincing. The pullback from the highs, which occurred against the backdrop of a fall in stock markets and risk aversion, looks like an ordinary, long-awaited correction, and bulls are likely ready to begin the offensive again.

The NIESR Institute traditionally published a forecast for the development of the economy before the BoE meeting, the document was optimistic. The forecast for GDP growth for 2018 is raised to 1.9%, as well as in 2019, inflation will remain for some time at the level of 3%, but by next year it is expected to decrease to 2.4%.

The most important is the forecast on the rate, NIESR assumes that tomorrow the Bank of England will leave the current policy unchanged, and the increase will occur at the next expanded meeting in May this year.

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NIESR usually quite accurately predicts the behavior of the Bank of England and changes in macroeconomic forecasts, and therefore the pound's reaction to the outcome of the meeting can be positive. Since no one expects a rate hike, this factor will not cause any movement, but it is likely that the forecasts will improve, and the positive will cause the bulls to advance into the offensive against the background of the growing likelihood of accelerating the policy of monetary normalization.

Thus, the growth of the pound is constrained by the growth of anti-risk sentiment and concerns about the outcome of the negotiations on the UK's withdrawal from the EU, but on the whole, a positive information background promotes investment growth. The failure in the economy after Brexit has not happened, and investors are playing out better forecasts, which leads to an increase in demand for the pound.

The main support is 1.3834, the pound will try to return to the resistance level of 1.4277, further actions will depend on whether it will be able to overcome this level or not.

Oil and ruble

The collapse of oil quotations is a consequence of the fall of stock markets and the panic flight of investors from risk, but even against a background of strong shocks, the decline from the maximum reached on January 25 did not exceed 5%, which indicates a fundamental strength.

The main factors remained the same, the restoration of the world economy, growing demand, control of the level of OPEC+ production and a high probability of prolonging the agreement for another six months. On Wednesday, oil supported the API, oil reserves in Cushing fell by 1.05 million barrels, in addition, stock indices partially regained the fall. Today, there will be official data from the EIA, before publication, oil is likely to be traded in a narrow range.

The ruble reacted to the collapse of the markets by a decrease, but the weakening was not deep. If the anti-risk sentiment in the markets persists, the ruble continued its slow weakening and will be able to move to the range of 57.50 / 58 rubles / dollar, at the same time there is doubt that this option will be a priority. Today, the Finance Ministry will sell OFZs for 35 billion rubles, the proposal could weaken the bulls, but even fears of a reduction in the rate of Russian banks on Friday sales of the Russian currency do not cause. Fundamentally, the ruble has strong support, the easing will be of a local nature, following the results of the week, a decline to 56.20 / 56.30 rubles / $ is likely.

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Bitcoin analysis for 07/02/2018

The Deputy Prime Minister of Singapore, Tharman Shanmugaratnam, made a new comment regarding the government's commitment not to ban cryptocurrencies - as part of its future regulatory plans. In a series of fourteen statements published on Monday, February 5 in response to questions from parliamentarians - Tharman Shanmugaratnam, deputy prime minister, and minister responsible for the regulatory body, namely the Singapore Monetary Office (MAS), confirmed the passive cryptocurrency policy in the future."MAS is carefully monitoring these events and the potential risks they pose. So far, there is no strong argument to prohibit trading in cryptocurrencies "- Deputy Prime Minister said.

Like Japan, in the last few years Singapore has emphasized that it is a permissive environment for both cryptocurrencies and Blockchain innovations. In contrast to China and Indonesia, the city-state favored Blockchain in particular as part of its desire to become a global technology center. Referring to the discrepancy between Singapore and its neighbors, Shanmugaratnam pointed out that the volumes involved were relatively small and that the exposure to the financial system was insignificant. "For now, the nature and scale of cryptocurrency trading in Singapore do not pose a threat to the security and integrity of our financial system (...) In addition, the links between cryptocurrency transactions and the Singapore financial system are not significant at the moment. The Singapore banking system has no significant exposure to global and local cryptocurrency entities. Therefore, we do not have wider, systemic risk concerns with regard to cryptocurrencies "- Shanmugaratnam continued. Last month, Managing Director of MAS, Ravi Menon, spoke in a similar way to the future of cryptocurrencies when he went to the mainstream media to say that he hopes that assets and underlying technology will endure a serious breakdown.

Let's now take a look at the Bitcoin technical picture at the daily time frame. The price hs bounced from the longer trend line dynamic support at the level of $5,846 and is trying to move higher. The low at the level of $5,846 might be the bottom of the wave (C), but it needs a further confirmation. The next important technical resistance is seen at the level of $9,132.

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Trading plan 02/07/2018

Trading plan 02/07/2018

The general picture: The correction in the US market sharply slowed down.

On the US market, a strong fall of shares took place on February 2 and 5. On February 6, on the contrary, the US market showed a strong rebound-upward turn. The main US indices showed a strong increase of + 1.7 + 2.3%, trading volumes on the main exchanges were recorded at 60-95% above the average.

Thus, the fall was stopped.

The foreign exchange market behaved similarly to the US market. The euro pierced the daily minimum at 1.2330 but jumped abruptly to the upward

We expect a new growth against the dollar.

Pound: We are buying from the level of 1.3930.

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Trading plan for 07/02/2018

There is a sharp reversal of sentiment on stock markets. In its last installment, the initiative is in the hands of buyers, which allows for a moment of respite and stabilization on the currency and commodity markets. The SP500 session ended at 1.75% up. The DJIA, which recorded the strongest rise since November 2016, gained even more. This translates into less than the percentage increases of Nikkei 225 and Hang Seng.

On Wednesday 7th of February, the main event of the day is the Reserve Bank of New Zealand Interest Rate Decision, which will be published together with RBNZ Rate Statement and RBNZ Press Conference in the late evening today. However, before that happens, the market participants should keep an eye on German Industrial Production data, European Commission Economic Forecasts data, Canadian Building Permits data and two speeches made by FOMC Member Robert Kaplan and William Dudley.

EUR/USD analysis for 07/02/2018:

Stabilization of moods and the atmosphere of waiting are visible on the forex market, where there was a limited volatility at night. A partial reason behind the temporary lack of volatility lies in a fact, that there is not much data to release today, so the market wants a breather after a violate last week swings. On the other hand, the American economy, for which a bucket of ice water was poured during the Tuesday session, can talk about the inflow of not very optimistic data. According to the latest indications, the December US trade deficit reached US $ 53.1 billion, which surprised slightly more optimistic market participants (consensus: USD 52.1 billion). An additional light on the net export dependence was cast by estimates summarizing the year 2017. According to them, the trade gap has been at levels unchanged since 2008 (12.1%), which was undoubtedly caused by the record exchange deficit with China (USD 375.2 billion). ).

Let's now take a look at the EUR/USD technical picture at the H1 time frame. The market remains inside of the horizontal correction between the levels of 1.2314 - 1.2522. The bulls did not manage to break out above the level of 1.2434 and the price returned below the level of 1.2384 recently. The nearest support is seen at the level of 1.2333 and the nearest resistance is seen at the level of 1.2408.

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Market Snapshot: SPY bounces to 38% Fibo

The price of SPY (SP500 ETF) has bounced towards the level of 269.65, which is 38% Fibo retracement of the previous swing down. The extremely oversold market conditions support this bounce together with the rising momentum indicator. The next main resistance for the price is seen at the level of 270.62 - 271.21.

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Market Snapshot: DAX bounces as well

The price of German DAX Index has bounced higher as well, but not that much in price like the other indices. The gap between the levels of 12,551 - 12,626 is still not filled and this might be the next target for bulls. The question remains whether there is a strong rebound momentum behind this move up? So far the market conditions remains oversold and no increase in momentum was seen yet.

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Fundamental Analysis of NZD/USD for February 7, 2018

NZD/USD has been quite impulsive with the bullish gains after bouncing off the support area of 0.7250 recently. The price has been quite impulsive with the bearish pressure after the positive USD Employment Change report was published on Friday but as expected the bearish pressure lasted for a certain period before the bulls took charge. Today, NZD Employment Change report was published at 0.5% which was better than the expectation of 0.4% but the rate decreased from the previous value of 2.2%, Unemployment Rate decreased to 4.5% from the previous value of 4.6% which was expected to increase to 4.7%, and Labor Cost Index was published with a decrease to 0.4% from the previous value of 0.7% which was expected to be at 0.5%. NZD having mixed economic reports did confuse the market sentiment whereas NZD is currently struggling to sustain the gains it has received recently. On the USD side, today, FOMC Member Dudley is going to speak about the upcoming monetary policies and the interest rate decision which is expected to have a rise on March 2018. Moreover, Crude Oil Inventories report is going to be published today as well which is expected to decrease to 3.2M from the previous figure of 6.8M. As of the current scenario, Corrective market sentiment is expected to be published as the recent NZD economic reports failed to provide the required push in the market, but still NZD is expected to have an upper hand over USD in the coming days until USD comes up with any positive economic report to support its gains.

Now let us look at the technical view. The price is currently residing above the dynamic level of 20 EMA and the 0.7250 support area. The recent bullish Engulfing bar has already engulfed a certain portion of the bearish pressure in the market which is expected to push the price much higher towards the 0.7450 resistance area in the coming days. As the price remains above the 0.7250 support area, the bullish bias is expected to continue further.

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Daily analysis of major pairs for February 7, 2018

EUR/USD: The signal on the EUR/USD pair has almost become bearish. Price has gone below the resistance line at 1.2400, and it is consolidating between that resistance line and the support line at 1.2350, which has been tested before, and will be tested again. It is more likely that the support line would even be breached to the downside.

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USD/CHF: What is happening on the USD/CHF pair can normally be called "a rally in the context of a downtrend". A movement below the support level at 0.9250 would put more emphasis on the bearish signal, while a movement above the resistance level at 0.9450 would lead to a bullish signal. Either of this situation should be fulfilled this week.

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GBP/USD: There is a strong bearish outlook on the GBP/USD pair. The EMA 11 is below the EMA 56, and the RSI period 14 is below the level 50. Price has dropped massively this week, testing the accumulation territory at 1.3850. There has been an upwards bounce since then, and price is currently moving sideways. When a breakout occurs, it would be to the downside.

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USD/JPY: This currency trading instrument is bearish – though volatile. Price has come down this week, and in spite of desperate attempts from bulls (trying to push price upwards), the market seems poised to go downwards again, reaching the demand levels at 109.00 and 108.50. Further selling pressure can propel price towards the demand level at 108.00.

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EUR/JPY: There is a Bearish Confirmation Pattern in this market, which plummeted heavily earlier this week. Things are quite choppy right now but the bearish bias is intact. The demand zones that have already been tested (135.00, 134.50, and 134.00) would eventually be tested again as price goes further south.

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

Ichimoku cloud indicator analysis of USDX for February 7, 2018

The Dollar index is showing short-term reversal signs. Price has broken out and above the 4-hour Kumo (cloud) resistance. Price is now back testing the cloud support (previous resistance) and is expected to move higher towards 91.

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The Dollar index has short-term support at 89.60-89.50 which was previous resistance. This is also where the cloud is now. The kijun-sen support is now at 89.30. Bulls do not want to see a 4 hour close below this level. Resistance is yesterday's high. Break above 90 and we are off to 91.

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On a daily basis the Dollar index is trading above the tenkan-sen. Support is at 89.30 (tenkan-sen) and resistance is at 90.50 (kijun-sen). A daily close above 90.50 could push price towards the Ichimoku cloud at 91.50-92. There are signs of a Dollar bottom, so bears need to be very cautious.The material has been provided by InstaForex Company - www.instaforex.com

Technical analysis of USD/JPY for February 7, 2018

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Our first target which we predicted in yesterday's analysis has been hit. The pair continues a rebound initiated at a low of 108.43 seen yesterday (February 6). Currently support is located at 108.80 while striking against the upper Bollinger band. Extra support is provided by the ascending 20-period moving average, which has crossed above the 50-period one. The relative strength index is still going strong, indicating continued upward momentum for the pair. As intraday bullishness persists, the pair should proceed toward the overhead resistance at 109.70 before advancing toward 110.05.

Alternatively, if the price moves in the opposite direction, a Short position is recommended to be below 108.80 with a target of 109.70.

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

Strategy: BUY, stop loss at 108.80, take profit at 109.75.

Resistance levels: 109.70, 110.75, and 111.00

Support levels: 108.40, 108.10, and 107.75.

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

Fundamental Analysis of USD/JPY for February 7, 2018

USD/JPY has been volatile and corrective, recently having resistance of the dynamic level and being above the support area of 108.50-109.20. Despite having positive Employment Change report of USD on Friday, JPY sustained the bearish momentum which resulted the price to reside between the 108.50-109.20 support area. Today, JPY Average Cash Earning report was published better than expected - at 0.7% which was expected to be at 0.6% decreasing from the previous value of 0.9%, and Leading Indicators report showed a slight decrease to 107.9% from the previous value of 108.3% which was expected to be at 108.1% The positive economic report helped the regain momentum after the recent bounce off the support area with impulsive USD gains over JPY. On the USD side, today, FOMC Member Dudley is going to speak about the upcoming monetary policies and the interest rate decision which is expected to have a rise on March 2018. Moreover, Crude Oil Inventories report is going to be published today as well which is expected to decrease to 3.2M from the previous figure of 6.8M. To sum up, JPY is currently quite unstoppable having positive economic reports fueling the gains and expected to dominate USD in the coming days taking the price much lower below the 108.50 support area.

Now let us look at the technical view. The price is currently quite bearish above the 108.50-109.20 support area where the price is expected to proceed much lower as of the current market impulsive bearish pressure. Having dynamic level of 20 EMA as a resistance, the bears in this pair seemed quite powerful currently and a daily close below 108.50 will lead to further impulsive bearish pressure in the pair with a target towards the support area of 107.00 in the coming days.

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

Ichimoku cloud indicator analysis of gold for February 7, 2018

Gold price broke below the $1,334-30 support and pushed towards $1,319-23 where the Head and shoulders neckline support is found. The price briefly broke the neckline but reversed back upwards towards $1,331. As long as price is below $1,345 I believe it is more probable to see $1,310.

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Blue line - neckline support

Black rectangle - resistance

Gold price is trading below both the tenkan- and kijun-sen 4 hour indicators. Trend is bearish. Resistance is at $1,333-35 and next at $1,345-48. As long as the price is below the 2nd resistance, trend will remain bearish and I will be expecting prices to move towards $1,310-$1,300.

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On a daily basis, Gold price is trading below both the tenkan- and kijun-sen indicators. Trend is showing reversal signs. Daily resistance is at $1,340. A daily close above $1,340 will put bears on a difficult spot. A break of yesterday lows will be a bearish sign and would push price towards a cloud support. A break above $1,348-50 will open the way for a move towards $1,380-$1,400.The material has been provided by InstaForex Company - www.instaforex.com

Technical analysis of USD/CHF for February 7, 2018

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Our first target which we predicted in previous analysis has been hit. USD/CHF is still expected to trade in the upper range. Although the pair posted a pullback, a support base at 0.9315 has formed and has allowed for a temporary stabilization. The rising 50-period moving average is playing a support role.

To sum up, as long as 0.9335 is not broken, look for a further rise with targets at 0.9395 and 0.9425 in extension.

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

Strategy: BUY, stop loss at 0.9315, take profit at 0.9425.

Resistance levels: 0.9395, 0.9425, and 0.9465

Support levels: 0.9300, 0.9275, and 0.9240.

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

Technical analysis of GBP/JPY for February 7, 2018

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GBP/JPY is expected to trade with a bullish outlook. Despite the pair breaking below its 20-period and 50-period moving averages, it is still trading above the key support at 152.05, which should limit the downside potential. Even though a continuation of consolidation cannot be ruled out, its extent should be limited.

To conclude, as long as 152.05 holds on the downside, look for a further upside with targets at 153.35 and 153.90 in extension.

Alternatively, if the price moves in the direction opposite to the forecast, a short position is recommended to be below 152.05 with the target at 151.25.

Strategy: BUY, Stop loss at 152.05, Take profit at 153.35

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 point, 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: 153.35, 153.90, and 154.40

Support levels: 151.25, 150.15, and 149.65.

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