Bitcoin analysis for February 21, 2018

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The Bitcoin (BTC) has been trading downwards. As I expected, the price tested the level of $10.645 and met the first target. Public consultations on a new regulatory regime for crypto companies in Italy are now closed. Interested parties were invited by the Ministry of Economy and Finance to share suggestions and comments on a draft decree introducing registration and reporting requirements in the sector. The new set of rules will come into force within 3 months of adoption. Technical picture looks bearish.

Trading recommendations:

According to the 30M time - frame, I found a rejection of the resistance at the price of $11.115, which is a sign that buying looks risky. I also found a breakout of Fibonacci retracement 38.2% (10.683), which is anotherr sign of weakness. My advice is to watch for potential selling opportunities. The downward target is set at the price of $10.410.

Support/Resistance

$11.137 – Intraday resistance

$10.645– Intraday support

$10.410 – Objective target

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Global macro overview for 21/02/2018

The British Pound is starting to get more attention under the pressure of Brexit information noise. Recently, the British currency gained through the article in Business Insider that the European Parliament is considering leaving Great Britain access to the single European market. The UK Parliament is to prepare a resolution allowing more flexibility in the negotiations, but analysts recommend a reduction in enthusiasm. First of all, each EP project must be approved by the European Council and all 27 EU members, so nothing is certain. Secondly, even the best indirect solution cannot be better than EU membership, so more stringent conditions for such an agreement should be expected. And that certainly would not appeal to the biggest supporters of Brexit in the British Parliament. Their determination is confirmed by Prime Minister Theresa May's "ransom demand" from 62 members of the conservative party with a list of postulates in Brexit (including regaining control over legislation and trade). The number of signatories has an additional meaning here, because the same number of votes is needed to submit a vote of no confidence in the government). If Prime Minister May gets scared and adjusts to demands for maintaining power in the country, it will also mean stirring up the conflict in negotiations with Brussels. Tomorrow meets the so-called The "War Council" of the British government, so we can count on leaks regarding potential compromises (or their absence).

In the meantime, GBP will focus on the report from the UK labor market. Signs of acceleration in wage dynamics will strengthen expectations for an earlier BoE interest rate hike, helping the currency strengthen its position to the other currencies across the board.

Let's now take a look at the GBP/USD technical picture in the H4 time frame. The market has hit the golden trendline two times already, but so far no avail. The price keeps returning to the consolidation zone as the local highs are getting lower. If the market will start to make more lower lows, then this will be a good justification for a local downtrend to continue towards the level of 1.3760 and 1.3691. The nearest support is seen at the level of 1.3921 and the resistance is seen at the level of 1.3986.

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Global macro overview for 21/02/2018

In the absence of important data and big events, the US Dollar's bounce is the path along the line of the least resistance. Today, the release of FOMC Meeting Minutes is attracting attention, but the market participants may have too high expectations.

The US Dollar continues to rebound this week, although it is difficult to attribute this to a greater extent, such as a temporary rebound of the last wave of weaknesses. The lack of key events and publications encourages the reduction of positions, because it does not look like the global investors will have to deal with the mass opening of long positions in USD yet. Although many economists do not agree with the scale of the US Dollar's decline in recent weeks, such alleged sell-off arguments (double US deficit, a strength of the global recovery, mild expectations towards the Fed against other central banks) have not weakened. It does not change the fact that EUR / USD and USD / JPY easily break the levels of support/resistance.

Today, the calendar is starting up a bit with the main attention to the report of the FOMC meeting. It seems that the market had expectations for hawkish notes in the document that would strengthen the argumentation for three or more interest rate hikes this year. Assessment of inflation outlook and attitudes towards rate hikes will be an important starting point for the new FOMC Chair J. Powell, although one can not forget that the document will not present FOMC views on recent market turmoil and strong CPI reading for January (the FOMC meeting is ahead of these events). In the current climate, the FOMC Metting Minutes release might turn out to be a big disappointment.

Let's now take a look at the EUR/USD technical picture in the H4 time frame. The market is still being supported by the levels of 1.2333 - 1.2295 and only a sustained, impulsive breakout below this levels would bring the bears back to control over this market. Please notice the market conditions are entering the oversold levels. The next technical resistance is seen at the level of 1.2384, 1.2408 and 1.2434.

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Trading plan 02/21/2018

Trading plan 02/21/2018

The general picture: The market is preparing the movement.

The last days in the market are correctional, range sentiments. This is normal: There is NO news, in fact. The last news was a week ago. The growth of inflation in the United States, it caused a correction in currencies but it has already won. The new news today at 19:00 London Time, the "minutes" of the Fed. What to expect? It is more likely that there will be no strengthening of the Fed's tight position and the dollar will decline. But there are also possible surprises.

More likely, a new round of growth against the dollar is expected.

This is the last week without important news. Next week, there will be a data package for the United States.

The euro is in the range of 1.2205 - 1.2555. We are waiting for release.

Pound: We are waiting for growth, we buy from 1.3940.

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Fundamental Analysis of GBP/USD for February 21, 2018

GBP/USD has been correcting itself above the support area of 1.3850-1.3950 for a few days now from where the price is expected to push higher in the coming days. Today GBP has been quite mixed with the economic reports but positive Claimant Count is expected to help the economy grow better in the coming days. Today GBP Average Earning Index report was published unchanged as expected at 2.5%, Claimant Count had a better figure of -7.2k decreasing from the previous figure of 8.6k which was expected to be at 2.3k, Public Sector Net Borrowing was also published with positive report of decrease to -11.6B from the previous figure of 1.0B which was expected to be at -11.5B, Unemployment Rate was slightly increased to 4.4% which was expected to be unchanged at 4.3% and Inflation report hearing is going on currently which is expected to have positive impact on the GBP gains in the coming days. On the other hand, today USD Flash Manufacturing PMI report is going to be published which is expected to have slight decrease to 55.4 from the previous figure of 55.5, Flash Services PMI is expected to have slight increase to 53.8 from the previous figure of 53.3 and Existing Home Sales increase to 5.61M from the previous figure of 5.57M. Moreover, today in the FOMC Meeting Minutes, upcoming Rate Hike in March is expected to be discussed which is expected to have a certain impact in the upcoming gains of USD. As of the current scenario, GBP is expected to gain good momentum against USD which may lead to further bullish pressure in the coming days.

Now let us look at the technical view. The price is currently residing at the edge of 1.3850-1.3950 support area with a dynamic level of 20 EMA holding the price as well. The price is currently expected to push higher towards 1.4250 price area in the coming days as it remains above the support area with a daily close.

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Fundamental Analysis of USD/CHF for February 21, 2018

USD/CHF has been in a strong bearish trend since it bounced off 1.00 price area which is still quite stable and expected to continue further. Recently USD has pushed the price higher against CHF having positive Employment Change report but the bullish pressure is expected to end very soon. Recently CHF Trade Balance report was published with a significant decrease to 2.09B from the previous figure of 2.63B which was expected to increase to 2.78B. The worse outcome of the Trade Balance, CHF lost grounds against USD significantly which is expected to be recovered soon in the coming days. On the USD side, today Flash Manufacturing PMI report is going to be published which is expected to have slight decrease to 55.4 from the previous figure of 55.5, Flash Services PMI is expected to have slight increase to 53.8 from the previous figure of 53.3 and Existing Home Sales increase to 5.61M from the previous figure of 5.57M. Additionally, today FOMC Meeting Minutes is going to be held where it is expected to have a discussion about upcoming March 2018 Rate hike decision which might lead to certain volatility in the market. As of the current scenario, CHF is expected to proceed further with its gains against USD until USD comes up with any high impact positive economic report or event to help sustain the bullish gains in the pair. Ahead of the upcoming Rate Hike in March, USD is expected to correct itself against CHF before having impulsive gains.

Now let us look at the technical view. The price is currently being held at the dynamic level of 20 EMA below 0.9450 price area. Though the bullish pressure has been quite impulsive recently as the price being contained by the dynamic level which is a sign of non-volatility and 0.9450 price area, the bearish gains are expected to continue further with the target towards 0.9200-50 price area and later towards 0.90.analytics5a8d5c4cd8f20.png

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Fundamental Analysis of EUR/AUD for February 21, 2018

EUR/AUD is currently residing at the edge of breaking above 1.5750 resistance area with a daily close in the coming days. EUR has been quite positive with the recent economic reports which helped the currency to gain momentum over AUD which has been struggling with its worse economic report results. Today EUR has been struggling with the economic reports having French Flash Manufacturing PMI report decreasing to 56.1 from the previous figure of 58.4 which was expected to be at 58.1, French Flash Services PMI decreased to 57.9 decreasing from the previous figure of 59.2 which was expected to be at 59.1, German Flash Manufacturing PMI report also showed decrease to 60.3 from the previous figure of 61.1 which was expected to be at 60.6 and German Flash Services PMI decreased to 55.3 from the previous figure of 57.3 which was expected to be at 56.9. Moreover, EUR Flash Manufacturing PMI report was published with a decrease to 58.5 from the previous figure of 59.6 which was expected to be at 59.2 and Flash Services PMI report decreased to 56.7 from the previous figure of 58.0 which was expected to be at 57.7. The worse economic report started to show its impact on the market already leading to impulsive AUD gains which might lead to certain indecision and correction in the market. On the AUD side, today Construction Work report was published with a significant decrease to -19.4% from the previous value of 16.6% which was expected to be at -9.8% but Wage price report was published with a slight increase to 0.6% which was expected to be unchanged at 0.5%. As of the current scenario, the pair is expected to be volatile and corrective for certain period of time before EUR takes over AUD with upcoming better economic reports and events in the coming days. As of the long-term perspective, EUR is expected to sustain the gains and push the price much higher in the future.

Now let us look at the technical view. The price has been struggling below 1.5750 for a few days now where the price has currently found support at dynamic level of 20 EMA rejecting off the 1.5600 price area. Despite having worse economic reports EUR is expected to gain momentum against AUD in the coming days as the price remains above 1.56 and dynamic level of 20 EMA with a daily close.

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Pound is in the turbulence zone

Eurozone

The indicator of economic sentiment in the eurozone ZEW fell in February to 29.3p against 31.8p a month earlier, however, the results of the month it was still higher than the forecasts maintaining the long-term highs. A similar index for Germany was also slightly better than expected.

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Given some decline in ZEW, it is expected that the indices on Thursday will come down, but it will continue to show a confident expansion of the economy. The euro does not experience any pressure from this side, as a number of important parameters, such as GDP growth and the trade balance, indicate a steady growth.

Even inflation, which is the last stronghold of the ECB, unwilling to succumb to market pressures and announce the need to raise rates, may continue to accelerate. Production prices in Germany rose by 0.5% in January and an annual growth rate of 2.1%, which significantly exceeded forecasts.

On Friday, the inflation data for January will come out. This can have a significant impact on the mood of players if they show a deviation from the forecasts. Meanwhile, the inflation forecast will remain at 1.3%, like a month earlier. It is rather a bearish level, as it gives the ECB a variety of decision-making.

From a technical point of view, the bears have more chances for the next two days. One should expect an attempt to test the recent low at 1.2206.

United Kingdom

The published report on the UK labor market on Wednesday has sparked serious interest as it came out with positive results. Chances for an increase in the rate of the Central Bank of England could increase, which could eventually give the pound an additional driver for growth. .

In general, the report came out quite good with the average wage growth rates at the same level of 2.5%, which coincided with the forecasts. The number of applications for unemployment decreased. At the same time, the unemployment rate has risen from 4.3% to 4.4% and the average working week has decreased.

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The report was mixed and the pound reacted with the decline, which turned out to be shallow.

Perhaps, the pound will have the opportunity to experience increased volatility today. The Bank of England's head Mark Carney and chief economist Eric Haldane will address the Parliament with annual reports today. Most likely, details of the preparations for the exit from the soft monetary policy will be disclosed and inflation expectations will be commented upon, which may ultimately have a significant impact on investor sentiment.

While the pound remains in the side range, the nearest support is at the level of 1.3929 and the resistance is at 1.4145. By the end of the week, the decline is likely to be lower than the level of 1.3929 and move to the local minimum of 1.3763.

Oil

After a short drop in oil prices, it returned to the middle of the range of 60-70 dollars per barrel, which is recognized as fair by most manufacturers. The reasons for the collapse of quotations of a fundamental nature was not found, and therefore after the panic, the rollback was the most logical.

OPEC Secretary General Mohammed Barkindo said on Tuesday that OPEC + and other countries reached the agreement in January at 133 percent. No one has any intention to complete the agreement ahead of schedule. The agreement of OPEC is maturing in the path of the balance of supply and demand in two to three quarters instead of the end of the year. However, even after achieving the balance and completion of the agreement, OPEC + will retain mechanisms for coordinated actions in the oil market.

This is certainly a bullish news, which can support the growth of quotations. Today, a report on the API reserves is expected, if it is not negative, oil growth may continue.

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Technical analysis of USD/CHF for February 21, 2018

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Overview:

  • The USD/CHF pair will continue to climp from the level of 0.9295 (38.2% of Fibonacci retracement levels) in the long term. It should be noted that the support is established at the level of 0.9295 which represents the daily pivot point on the H1 chart. The price is likely to form a double bottom in the same time frame. Accordingly, the USD/CHF pair is showing signs of strength following a breakout of the highest level of 0.9295. So, buy above the level of 0.9295 with the first target at 0.9361 in order to test the daily resistance 1. If the trend is able to break the level of 0.9361, then the market will call for a strong bullish market towards the objective of 0.9409 today. The level of 0.9409 is a good place to take profits. 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 coming hours. On the other hand, in case a reversal takes place and the USD/CHF pair breaks through the support level of 0.9254, a further decline to 0.9180 can occur. It would indicate a bearish market. Since the trend is below the 38.2% Fibonacci level, the market is still in an utrend. Overall, we still prefer the bullish scenario.
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The ideas for market movements have ended

The US dollar continued to strengthen and develop its momentum, which was formed last Friday. According to the markets, the wave of panic that formed excessively strong caused the employment report to decline, there are not so many reasons for accelerating the normalization policy by the Fed.

It should be noted that both the Fed and the US government continue to coordinate policies on global cash management. The Fed reduces the balance as it reduces the global supply while raising the rate leads to a tightening of credit conditions.

The government, proceeding from the fact that the Fed reduces the purchase of treasuries, relies on other sources of financing, particularly on the repatriation of capital and the revival of economic activity through tax reform. Everything goes to the fact that the value of the dollar will rise, as the hedging transactions using the dollar will also rise, which reflects to the latest dynamics of overnight index swap (OIS) in favor of the dollar.

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In order to pass between "Scylla" and "Charybdis", the dollar remains nothing either. More difficult conditions will cause its cost and increase the weight of the dollar, but at the same time, it will serve as the basis for continuing the policy of excluding the dollar from international settlements.

To prevent this, a policy is required as the dollar will become "as reliable as gold" again. This can be achieved by compromising the economic support of the competitors' currencies Among the possible measures is the imports restriction of steel in the US from China, Russia and other several countries. This step is currently under consideration by the government, its introduction can seriously undermine the position of the single European currency. The European Union, in any case, reacted as quickly as China regarding the event of imposing protective duties, the response will be rapid and adequate

On the other hand, the dollar should be strong and shall not strengthen against the euro, this will disperse inflation due to the rise in import prices. The American financial authorities will manage to get out of this contradiction until it remains uncertain.

The investors' reaction towards the recent turmoil in the financial markets is rather calm before the publication of the FOMC minutes. On December 1, the markets proceeded from the fact that the rate will be raised in March, with a probability of more than 60% rate hike in June again, and the third raise will take place either in September or in December.

At this point in time, there are no signs of the possibility of four rate increase. According to CME, the probability of an increase in the rate in June is 54.3%, which is less than 3 weeks ago, and the probability for September is reduced from 40.1% to 32.6%, hence, there is no more discussion about the fourfold rate increase.

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Hence, it is clear that the January 31 minutes of meeting will not contain the opinion of the markets and any hint of four increases. This also means that the tightening of rates does not increase, so you can return to the previous models.

In the absence of significant macroeconomic reports, the focus will be on the speech of the Fed leadership. There are quite a few planned performances for the second half of the week. Most likely, the members of the Committee will calm markets, as usual, and assure that the policy of "gradual normalization" remains unchanged. The majority of attention will be on the speech of the Federal Reserve Bank of New York head, William Dudley scheduled on Friday night. Dudley is considered the most influential member of the Fed after Fischer's resignation.

The business activity data in February from Markit will be published today, the outlook is positive, while PMI in the service sector is expected to grow which may give the dollar an additional impulse.

Based on the set of indicators, the strengthening of the dollar in the short term appears to be more logical. Gold pulled back again from resistance at 1.370, which indicates a decrease in tension. After a long weekend, stock indices on Tuesday traded in a narrow range which indicates the lack of market driver. Moreover, markets need new benchmarks.

* The presented market analysis is informative and does not constitute a guide to the transaction.

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Technical analysis of NZD/USD for February 21, 2018

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Overview:

  • The NZD/USD pair continued moving upwards from the level of 0.7370. Last week, the pair rose from the level of 0.7370 (pivot) to the top around 0.7436. But the trend was rebounded to the price of 0.7370 again. Today, the first support level is seen at 0.7314 followed by 0.7285, while daily resistance is seen at 0.7360. According to the previous events, the NZD/USD pair is still moving between the levels of 0.7314 and 0.7394. For that, we expect a range of 80 pips in coming hours. This would suggest a bullish market because the RSI indicator is still in a positive area and does not show any trend-reversal signs. Furthermore, if the trend is able to break out through the first resistance level of 0.7360, we should see the pair climbing towards the second resistance (0.7374) to test it. On the contrary, if a breakout takes place at the support level of 0.7314, then this scenario may become invalidated. Remember to place a stop loss; it should be set below the second support of 0.7261.
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Analysis of Gold for February 21, 2018

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Recently, the Gold has been trading downwards. The price tested the level of $1,325.30. According to the 30M time – frame, I found lower lows and lower highs, 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 advice is to watch for potential selling opportunities. The downward targets are set at the price of $1,322.72 and at the price of $1,315.65.

Resistance levels:

R1: $1,342.26

R2: $1,355.09

R3: $1.361.95

Support levels:

S1: $1,322.70

S2: $1,315.60

S3: $1,302.82

Trading recommendations for today: watch for potential selling opportunities.

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GBP/USD analysis for February 21, 2018

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Recently, the GBP/USD has been trading downwards. The price tested the level of 1.3972. Anyway, according to the 30M time – frame, I found a successful rejection of pivot support at the price of 1.3940, which is a sign that selling looks risky. I also found a hidden bullish divergence on the stochastic oscillator, which is another sign of the strength. My advice is to watch for potential buying opportunities. The upward targets are set at the price of 1.4035 and at the price of 1.4075.

Resistance levels:

R1: 1.4035

R2: 1.4075

R3: 1.4130

Support levels:

S1: 1.3945

S2: 1.3890

S3: 1.3850

Trading recommendations for today: watch for potential buying opportunities.

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Intraday technical levels and trading recommendations for EUR/USD for February 21, 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 was expressed on the chart. This hinders the bearish momentum allowing bullish advancement to occur towards 1.2750 provided that the price level of 1.2250 remains defended by the bulls.

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Daily Outlook

In September, a 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 is needed to confirm a recent bullish flag continuation pattern with projected targets towards 1.2750.

On the other hand, a recent bearish pullback is being expressed below the price level of 1.2450. This could extend towards 1.2070 if a bearish breakdown of the level of 1.2200 is achieved on a daily basis.

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Bitcoin analysis for 21/02/2018

On Monday, February 19, the UK newspaper The Telegraph gave the statement of the Bank of England Governor, Mark Carney, in which he stated that according to traditional definitions Bitcoin cannot be considered a legal currency. During an event at London's Regent's University, Carney said that Bitcoin did not meet the two main requirements of the traditional currency, it is neither a means of exchange nor a means of storing value. The argument that cryptocurrencies are not usable as a means of exchange is, in particular, the case with Bitcoin. On January 24, 2018, the Stripe payment processor ceased to use Bitcoin due to high fees and slow transaction confirmation times. Earlier on December 7, 2017, the Steam gaming platform stopped accepting Bitcoin payments, citing transaction fees of up to USD 20 and high volatility. Carney also stated that Blockchain technology, on which cryptocurrencies are based, may still be useful due to its decentralized nature: "The basic technology of cryptocurrencies may prove to be useful as a method of verifying financial transactions in a decentralized manner."

Let's now take a look at the Bitcoin technical picture at the H4 time frame. The five waves up seem to be completed with a high at the level of $11,800, just after the golden trend line was hit. It is quite possible, that a corrective cycle is in progress. The next target is at the level of weekly pivot support at $10,180, but it might easily be violated, so then the price will likely drop towards the next support at the level of $9,434.

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Trading plan for 21/02/2018

The US Dollar bounce remains the theme of this week, although the Asian session does not bring major changes. The activity focused only on USD/JPY and AUD/USD - in both cases part of the blame may lie on the side of local data. The stock market is green. Commodities fall under the weight of the Dollar.

On Wednesday 21st of February, the main event of the day is FOMC Meeting Minutes release, but the global investors will keep an eye on Flash PMI Services, Manufacturing and Composite reading from across the Eurozone, Claimant Count Change, Unemployment Rate and Average Earnings Index data from the UK, together with Inflation Report Hearings and Mark Carney speech. In the US the important data to keep an eye on are Existing Home Sales and Flash PMI's.

DXY analysis for 21/02/2018:

The most important item in today's calendar will be the minutes from the FOMC meeting, which will outline the mood in the Fed. Nonetheless, the March interest rate increase seems to be safe as the new FOMC Chairperson Powell is known to be a hawk. Recent solid data, including job and inflation, are justifying the case for three rate hikes this year, and markets would now want to see if more board members are starting to considering four hikes.

Let's now take a look at the US Dollar Index technical picture at the H4 time frame. The market has managed to break out above the technical resistance at the level of 89.63 as the rebound continues (now support). The next target is the level of 90.11 and then the key technical resistance, the level of 90.59. Stong momentum and uprising stochastic indicator support this view.

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Market Snapshot: DAX still under the resistance

The price of German DAX index is third time testing the technical resistance at the level of 12,503 and the market conditions will soon become overbought. Only a sustained breakout above this level would open the road towards the next technical resistance at the level of 12,676.

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Market Snapshot: Gold falls further

The price of Gold has broken below the black trendline support around the level of $1,331 and it looks like it will continue the fall towards the level of $1,322 and even $1,313. The RSI indicator stays below its fifty level, so the negative outlook is being supported.

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Ichimoku cloud indicator analysis of USDX for February 21, 2018

The Dollar index is moving higher. Price has moved above the 4-hour Ichimoku cloud resistance. Could the low be in for the Dollar or is this just another short-term bounce. 90.56 is the most important level to watch out for, as this is the previous short-term high and as long as we are below it, we consider this move higher as a bounce and not as a new move.

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Red line - long-term resistance trend line

In previous posts I mentioned the possibility that the entire move from 103.60 could be over or could soon be. The Dollar index is now challenging a resistance area that if it is broken, the scenario that the entire decline is over would gain a lot of chances of success. Resistance is at 90 and 90.56. Support is at 89.50 and at 89.10.

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Blue line - long-term resistance trend line

On a weekly basis, the Dollar index remains in a bearish trend. However, we could see a big upward bounce even towards the 94-95 area. First important weekly resistance is at 91.60 and next at 92.60. Breaking above the 92.60 will open the way for a move towards 94-95. The market is at least correcting the decline from 95.20. Minimum bounce target is at 91.50. This is not the time to be bearish the Dollar.

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NZD/USD Intraday technical levels and trading recommendations for February 21, 2018

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Daily Outlook

In July 2017, an atypical Head and Shoulders pattern was expressed on the depicted chart which indicated an 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 the 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, 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 were anticipated.

On February 2, a bearish engulfing daily candlestick was expressed. This enhances the bearish scenario initially towards the price levels of 0.7230 - 0.7165 where the recent bullish recovery was expressed.

Trade Recommendations:

The current price zone (0.7320-0.7390) remains a significant supply zone to offer a vaid SELL entry.

Stop Loss should be set as a daily candlestick above 0.7450.

Bearish fixation below 0.7300 is needed to allow a further bearish decline towards 0.7160 and 0.7090.

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

Ichimoku cloud indicator analysis of gold for February 21, 2018

Gold price as expected pulled back towards the cloud support but also broke below in early Wednesday trading. The dollar strength seems to be affecting the gold price negatively as the technical picture has weakened.

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The 4 hour cloud support is broken. Next important support is at $1,317, the post CPI report is low, and next the February lows are at $1,307. Resistance is at $1,331-36-41. Taking a look at the bigger picture, it is important for Gold bulls to hold the price above $1,300-$1,290.

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Magenta line -long-term resistance

Blue line - long-term support

The second rejection at the long-term resistance of $1,350 was a bearish sign, and we mentioned this at a previous post. Weekly support is at $1,320, and the next one is at $1,300. Breaking below these two levels will be a very bearish sign that could even push prices towards the long-term blue trend line support. Bulls need to step in and react very fast to save the bullish scenario. Look for clues also on what the Dollar index does. Bullish Dollar is bad for Gold prices.

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

Breaking forecast 02/21/2018

Breaking forecast 02/21/2018

EURUSD: Continue to prepare for growth.

So, for two days this week there is a corrective decline in the euro.

Nevertheless, the growth trend is not broken.

A strong rebound is expected at first - with the formation of a significant high in the area of 1.2380 - 1.2400 - and then, after stopping not less than 8 hours, a breakdown and a breakthrough.

So far there is no point to enter the upper level.

Buy for the breakthrough of 1.2555.

Sell for the breakthrough 1.2205.

We expect at 6:00 PM London Time the report from the last meeting of the Fed.

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