Technical analysis of USD/JPY for May 17, 2018

analytics5afd9662ef614.png

All our upside targets which we predicted in previous analysis have been hit. The pair is still trading in a higher range and expected to continue the upside movement. USD/JPY is proceeding toward the overhead resistance at 111.00 while being supported by the ascending 20-period moving average, which has just crossed above the 50-period one. The level of 110.40 has proven a strong downside support. The intraday configuration remains bullish, and the pair should target 111.25 upon reaching 111.25.

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 110.40, take profit at 111.00.

Resistance levels: 111, 111.25, and 111.50

Support levels: 110.20, 110.00, and 109.60.

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

Technical analysis of USD/CHF for May 17, 2018

analytics5afd94e249fda.png

USD/CHF is expected to trade with a bullish outlook. The pair is consolidating above the key support at 0.9980 (lows of May 15 and 16), which should maintain the buying interest. The relative strength index stands firmly above its neutrality level at 50 and lacks downward momentum. Hence, as long as 0.9980 holds on the downside, look for a further rebound with targets at 1.0055 and 1.0085 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 0.9980, take profit at 1.0055.

Resistance levels: 1.0055, 1.0085, and 1.0110

Support levels: 0.9955, 0.9930, and 0.9890

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

Daily analysis of EUR/JPY for May 17, 2018

EUR/JPY

There are mixed signals in the market. The EMA 11 is slightly below the EMA 56, and the RSI period 14 is slightly above the level 50. It may be prudent to stay away from this market until there would be a directional movement in it. There are no many fundamental factors expected today in the market, and so, major impacts are not expected.

analytics5afd9125e49ed.png

The situation on EUR/JPY is a kind of tricky right now. Price plummeted on Monday and Tuesday and Wednesday to test the demand zone at 129.50. After that, a rally effort was made, which made price rose by 110 pips, thereby frustrating the bears. Investors may want to wait until there is a directional movement in the market.

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

Daily analysis of USD/JPY for May 17, 2018

USD/JPY

This is a bullish market, and price is supposed to go further and further upwards (it has gained 150 pips so far this week), and it may reach the supply levels at 111.00 and 111.50, possibly going further than that.

analytics5afd90cf9c39d.png

The EMA 11 is above the EMA 56, and the RSI period 14 is above the level 50. There is currently a Bullish Confirmation Pattern in the market, which has become stronger as a result of the surge in the bullish movement. For this rally to be sustained, there is a need for continuous buying pressure in the market.

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

Daily analysis of USD/CHF for May 17, 2018

USD/CHF

The USD/CHF pair has been consolidating for about 2 weeks – in the context of an uptrend. A movement to the upside would strengthen the bullish bias, while a movement to the downside will render it invalid. Further consolidation will enforce a neutral bias on the market. The remaining part of the week will determine what will happen.

analytics5afd904cc3ed4.png

A rise in volatility is expected today or tomorrow. There is a Bullish Confirmation Pattern in the 4-hour chart. Price may rise again, possibly reaching the resistance level at 1.0050 and breaching it to the upside.

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

Technical analysis of NZD/USD for May 17, 2018

analytics5afd8b8479d86.png

NZD/USD is expected to trade with a bearish outlook. The pair retreated from 0.6935 and broke below the lower boundary of bollinger bands, indicating the potential of downward acceleration. The declining trend line, which emerged, should push the prices lower. The relative strength index has broken down its oversold level of 30. Therefore, as long as 0.6935 is not surpassed, look for a further decline with targets at 0.6850 and 0.6815 in extension.

Chart Explanation: The black line shows the pivot point. Currently, the price is above the pivot point which is a signal for long positions. If it remains below the pivot point, it will indicate short positions. The red lines show the support levels, while the green line indicates the resistance levels. These levels can be used to enter and exit trades.

Resistance levels: 0.6950, 0.6975, and 0.7010

Support levels: 0.6850, 0.6815, and 0.6775

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

Fundamental Analysis of USD/CHF for May 17, 2018

USD/CHF has been quite volatile recently inside an impulsive non-volatile bullish trend since the price bounced off the 0.9200 support area. USD has been the dominant currency in the pair for a long time whereas CHF has been struggling with downbeat economic reports. After certain impulsive pressure for months, certain volatility and correction made the market sentiment quite counter biased which is expected to lead to certain bearish momentum in the market.

Today, US Unemployment Claims report was published with an unexpected increase to 222k from the previous figure of 211k which was expected to be at 216k and Philly Fed Manufacturing Index report was published with an increase to 34.4 from the previous figure of 23.2 which was expected to decrease to 21.1. Moreover, today US CB Leading Index report is going to be published which is expected to increase to 0.4% from the previous value of 0.3% and Natural Gas Storage is also expected to increase to 105B from the previous figure of 89B.

On the CHF side, Swiss National Bank Chairman Jordan spoke recently about the recent struggle of the economy which is expected to recover with a limited pace in the process but SNB is already taking some steps to recover the lost grounds soon.

As for the current scenario, CHF is expected to put pressure on USD for a while in the coming days but the momentum of USD is expected to continue further after certain retracement along the way. Upcoming economic reports from Switzerland and the US will help the market sentiment to continue or change the future bias of the market.

Now let us look at the technical view. The price has been ranging between the resistance area of 0.9980 to 1.0040 area from where it is expected to push lower if a daily close below 0.9980 is observed in the coming days. The dynamic level Tenkan Line has been supporting the bullish gains of USD along the way which is currently being observed violated in the process. As the price remains below 1.01 price area with a daily close, there are certain chances of bearish intervention in the market.

analytics5afd8b8307fa6.png

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

Technical analysis of GBP/JPY for May 17, 2018

analytics5afd8a0045a63.png

GBP/JPY is expected to trade with a bullish outlook. The technical outlook of the pair turned bullish as the prices broke above the declining trend line since May 15. The 20-period moving average is turning up. The relative strength index is heading upward, calling for a further rebound. Therefore, as long as 149.05 is support, look for an advance with targets at 149.90 and 150.40 in extension.

Chart Explanation: The black line shows the pivot point. Currently, the price is above the pivot point which is a signal for long positions. If it remains below the pivot point, it will indicate short positions. The red lines show the support levels, while the green line indicates the resistance levels. These levels can be used to enter and exit trades.

Resistance levels: 149.90,150.40, and 160.00

Support levels: 148.70, 148.20, and 147.60

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

Fundamental Analysis of AUD/USD for May 17, 2018

AUD/USD has been quite in a corrective phase inside the range of 0.7500-50 area from where it is expected to push much lower in the coming days. Recently, AUD has been struggling amid economic reports which lead USD to gain non-volatile impulsive momentum over AUD since the price broke below 0.7750 area.

Today, Australia's Employment Change report was published with a significant increase to 22.6k from the previous figure of -0.7k which was expected to be at 19.8k, MI Inflation Expectation slightly increased to 3.7% from the previous value of 3.6%, and the Unemployment Rate unexpectedly edged up to 5.6% whereas it was expected to be unchanged at 5.5%.

On the other hand, today US Unemployment Claims report was published with an unexpected increase to 222k from the previous figure of 211k which was expected to be at 216k and Philly Fed Manufacturing Index report was published with an increase to 34.4 from the previous figure of 23.2 which was expected to decrease to 21.1. Moreover, today US CB Leading Index report is going to be published which is expected to increase to 0.4% from the previous value of 0.3% and Natural Gas Storage is also expected to rise to 105B from the previous figure of 89B.

As for the current scenario, despite the mixed economic reports from Australia with an increase in Employment Change and also increase in Unemployment Rate, AUD extended weakness against USD. US economic reports published today have been quite impressive, besides upcoming US reports are also forecasted to show positive readings that might lead to further bearish pressure in the pair. To sum up, USD is expected to have an upper hand over AUD in the coming days.

Now let us look at the technical view. The price has rejected the bulls of the dynamic level of 20 EMA whereas with confluence to horizontal and dynamic resistance further bearish pressure is expected in this pair with a target towards 0.74 support area in the coming days. As the price remains below 0.7550 with a daily close, the bearish bias is expected to continue further.

analytics5afd877162dc3.png

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

NZD/USD Intraday technical levels and trading recommendations for for May 17, 2018

analytics5afd61e7e0593.png

The price zone of 0.7320-0.7390 stood as a significant supply zone during recent bullish pullback. The bulls failed to execute a successful Bullish breakout above 0.7400 during the previous week's consolidations.

The NZD/USD pair had been trapped between the price levels of 0.7170 and 0.7350 until the bearish breakdown of 0.7200 occurred Yesterday.

Since April 13, significant bearish pressure has been applied. This probably turns the short-term outlook for the NZD/USD pair into bearish giving considerable significance to the multiple-top reversal pattern.

That's why a bearish breakdown of 0.7220-0.7170 (neckline zone) was needed to confirm the depicted reversal pattern. Bearish target levels around 0.7050 and 0.7000 have been achieved already.

The bearish scenario needs obvious bearish persistence below 0.7050 to maintain significant bearish momentum towards 0.6860 and 0.6820. That's why the price level of 0.7050 is currently considered a key-level for the NZD/USD bears.

Any bullish breakout above the price level of 0.7050 hinders further bearish decline allowing bullish pullback to occur towards 0.7170-0.7220.

This will probably allow conservative trend traders to wait for a bullish pullback towards the price zone of 0.7220-0.7170 (neckline zone) (significant supply zone) for a valid SELL entry. S/L should be placed above 0.7260.

On the other hand, If bearish momentum persists, the price zone of 0.6820-0.6780 should be watched for bullish rejection and a valid BUY entry.

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

Intraday technical levels and trading recommendations for EUR/USD for May 17, 2018

analytics5afd61e2d7a71.png

Daily Outlook

The EUR/USD pair had been trapped between the price levels of 1.2200 and 1.2500 until bearish breakout occurred recently.

Significant signs of bearish reversal were manifested around the price levels of 1.2400. This was manifested in the bearish engulfing daily candlestick of April 20.

The short-term outlook turns to become bearish as long as the EUR/USD pair keeps trading below the broken uptrend as well as the lower limit of the depicted consolidation range remains broken.

Bearish persistence below the price level of 1.2200 allowed further bearish decline towards the price levels of 1.1990 and 1.1880.

As mentioned, the price zone (1.1850-1.1750) offered significant bullish rejection and a short-term bullish pullback for intraday traders.

However, a recent descending high was established around the price level of 1.1990 as the EUR/USD bulls failed to pursue towards higher bullish targets. This enhances the bearish scenario of the market.

If bearish momentum dominates, bearish persistence below 1.1700-1.1750 (zone of previous daily lows) will be needed to enhance further bearish decline towards 1.1400 (the previously mentioned monthly key-level).

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

Global macro overview for 17/05/2018

Another bunch of economic data from the US was published yesterday. Industrial production in April increased by 0.7% m/m (an increase of 0.6% was expected). Capacity utilization amounted to 78% (versus expected 78.4%). Data on a started construction of houses and permits for their construction showed that 3.7% fewer construction projects were started in April (an increase of 0.4% was expected) and 1.8% fewer permits were issued (a 2.4% drop was expected). On Wednesday, Wall Street could show that Tuesday's slumps in the indexes were just an accident at work, and players slowly get used to a higher than 3% yield on ten-year bonds. It would be a strong signal to buy shares. Of course, the alternative was the continuation of the correction. It turned out that the bulls still in control of the market, despite the fact that they had a strong dollar against each other and still growing bond yields in an increasingly difficult geopolitical situation. And yet, the indexes grew. At the beginning of the session there was a lot of hesitation, but from her half the bulls definitely took the wheel into their own hands. The session ended with an increase in the SP500 index (0.41%).

Of course Wall Street did not react to what was happening in Europe. How could it react if indexes in Europe (especially in Germany) grew? It was quite strange to behave in a situation where ideas forming the new government in Italy, the Northern League and the 5 Stars Movement, overestimated the euro. These parties want, that the ECB should give them EUR 250 billion which they bought from the market within QE. The idea is so absurd that it's probably why traders on European stock exchanges have not reacted. Only the index on the Italian stock market was losing. Other European investors, however, should also react because such an Italian government could lead to turbulence worse than what the Donald Trump administration does.

In conclusion, Tuesday's decline was definitely no sign of a longer fall in indices. The global investors seem to get used to high bond yields and a strong dollar. It is said that the bull market continues when the indexes climb the wall of fear. It seems that this is the situation we are seeing.

Let's now take a look at the SP500 technical picture at the H4 timeframe. The market has hit the technical resistance at the level of 274.20 and today's the price has gaped down towards the level of 269.87. The high at the level of 274.20 might be considered as a new higher high and any breakout above this level would lead to the test of the next technical resistance at the level of 278.85. Nevertheless, the market conditions are now overbought, so a temporary pull-back towards the level of 267.96 would be a good move before another wave up will take place.

analytics5afd59379efee.jpg

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

Global macro overview for 17/05/2018

The price of the oil barrel in New York approaches 72 USD. This means that the crude oil in this quarter recorded a two-digit increase and its prices since the end of December 2017 increased by almost 20%. The crude oil price is, in effect, the highest in more than three years.

According to the data of the US Department of Energy, supplies of gas in the week (5-11 May) fell (contrary to expectations built on the basis of the API Report) by 1.4 million barrels. This is a result close to the average change in inventories in this period of the year recorded in the last five years. It is worth noting, however, that in his aftermath stocks are 10 million barrels lower than their five-year average. At the same time, it should be remembered that for a long period of oversupply of oil, the average has dropped significantly in recent years. The data, however, confirm the rapid balancing of the gas market, as the current availability of raw material is almost 90 million barrels lower than last year.

The main driving force behind the tightening of the stock inventories in the US is the new oil export records. Last week its volume reached a record 2.57 million barrels. For comparison: its annual change is as much as 136% (almost 1.5 million barrels). The widest brent spread - WTI, which is over USD 7, is the factor that drives the demand for US oil. At the same time, mining in the United States set a new historical record close to 10.75 million barrels/per day. We are also dealing here with gigantic increases because production is a dozen or so percent higher than last year and there is no reason to expect that mining activity will stop growing. This will eventually end up in higher than current oil prices, that might even reach $100.

Let's now take a look at the Crude Oil technical picture at the H4 time frame. The market has made another higher high at the level of 72.28, but the momentum does not follow the price and the bearish divergence is clear and visible. This technical situation might lead to a temporary pull-back towards the technical support at the level of 70.24 and even 69.65. The extremely overbought market conditions support the bearish bias.

analytics5afd557af2de6.jpg

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

GBP/USD analysis for May 17, 2018

analytics5afd507fbd18f.png

Recently, the GBP/USD pair has been trading sideways at the price of 1.3511. According to the H1 time – frame, I found rejection of the supply trendline in the background, which is a sign that buying looks risky. I also expect the end of a bullish corrective phase (abc), which is another sign of weakness. My advice is to watch for potential selling opportunities. The downward targets are set at the price of 1.3460 and at the price of 1.3420.

Resistance levels:

R1: 1.3580

R2: 1.3613

R3: 1.3675

Support levels:

S1: 1.3485

S2: 1.3423

S3: 1.3390

Trading recommendations for today: watch for potential selling opportunities.

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

USD/JPY analysis for May 17, 2018

analytics5afd4d869ad65.png

Recently, the USD/JPY pair has been trading upwards. As I expected, the price tested the level of 110.75. According to the H1 time – frame, I found broken bullish flag in the background, which is sign that buyers are in control. I also found rising MACD histogram, which is another sign of strength. My advice is to watch for potential buying opportunities. The upward target is set at the price of 111.40.

Resistance levels:

R1: 110.50

R2: 110.64

R3: 110.87

Support levels:

S1: 110.13

S2: 109.91

S3: 109.75

Trading recommendations for today: watch for potential buying opportunities.

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

Bitcoin analysis for May 17, 2018

analytics5afd481d2fe7b.png

The Bitcoin (BTC) has been trading sideways at the price of $8.235. 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 until today had neglected to pass comment 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. The technical picture on Bitcoin looks bearish.

Trading recommendations:

According to the H1 time - frame, I found that price did successful breakout of larger bearish flag, which is sign that sellers are in control. I also found a smaller bearish flag in creation, which is sign that buying looks risky. My advice is to watch for potential selling opportunities. The downward targets are set at the price of $8.067 and at the price of $7.668.

Support/Resistance

$8.462 – Intraday resistance

$8.067– Intraday support

$8.067 – Objective target 1

$7.688 – Objective target 2

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

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

Pound leads in corrective growth

GBP / USD

The British pound took advantage of the confusion in the European market and gained 70 points this morning due to profit taking and easing of pressure of sellers. Speculators of buying the pound take caution on yesterday's unimpressed economic data for the United States. Industrial production increased by 0.7% against expectations of 0.6%, but capacity utilization remained at 78.0%. The number of bookings of new houses in April showed a decrease from 1.34 million to 1.29 million.

Confusion in the dollar caused North Korea's decision to cancel the meeting between Kim Jong-un and Donald Trump in Singapore scheduled on June 12, if its does not see the reciprocal positive plans from the US in the nuclear disarmament process of the DPRK.

Today in the United States, the number of applications for unemployment benefits is 216 thousand compared to 211 thousand a week earlier. The business activity index in the manufacturing sector of Philadelphia in May is expected to decrease from 23.2 to 21.1, which may contribute to deepening the correction. We are expecting the pound at 1.3625.

analytics5afd0fca07f1f.png

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

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

Bitcoin analysis for 17/05/2018

The State Duma of the Russian Federation will support the first reading of the initiative, which will add the basic norms of the digital economy to the civil code of the Russian Federation. This is the latest step on the way to introducing cryptocurrencies in the country, informs local press service.

"The initiative aims to minimize the existing risks associated with the use of digital objects to transfer assets to an unregulated digital environment to legalize criminal income, bankruptcy or sponsorship of terrorist groups" - said Pavel Krasheninnikov from the United Russia political party and head of the legislative work commission. The initiative to be considered next week does not mean that digital currencies will become a legal tender. Instead, a separate act developed by the Central Bank, the Ministry of Finance and the Ministry of Economic Development will set the conditions for digital currencies to be used as payments "in controlled quantities." The initiative will make the digital confirmation by the user in a smart contract equal to his written consent.

Russia first prepared a draft "On Digital Financial Assets" bill in March this year, which would provide federal laws regulating cryptocurrencies and ICO, after President Vladimir Putin's decision to initiate crypto-regulation from July 1. The project of 20th March defines cryptographic and digital tokens as assets intended exclusively for trading on authorized exchanges, also requiring that user accounts on the cryptographic exchange comply with AML regulations and terrorism financing regulations. "It is important that cryptocurrencies and tokens are included in the legal field of the Russian Federation. On the one hand, these are opportunities that we can not miss. On the other hand, when they are outside the legal field, you can use them to give bribes, withdraw money in the event of bankruptcy, pay black salaries and simply steal - without any consequences [for criminals]"- said Igor Sudets, director of the "Blockchain for Lawyers" program at the Russian University of Economics in Plekhanov in Moscow.

In conclusion, one might speculate, that after the cryptocurrency use in Russian Federation will become legal and regulated, it might be a good time for a national cryptocurrency? According to the current path of events this idea does not seems to be far fetched.

Let's now take a look at the Bitcoin technical picture at the H4 time frame. The price has bounced from the 50% Fibo at the level of $8,132 again, but the bounce was short-lived so far. The market is still trading below the golden trend line, so the outlook remains bearish. The next target is seen at the level of $7,974 and $7,712. The impulsive scenario invalidation level is still at $6,402.

analytics5afd2c1c74b74.jpg

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

Courage takes Fujiyama

USD / JPY

Yesterday, the Japanese yen slightly changed in price on the multidirectional external factors. Economic data on Japan, especially GDP, came out extremely weak, but the US stock market continued to grow than support the yen. The second GDP estimate for the first quarter showed a collapse of -0.2% against expectations of 0.0% and growth of 0.4% in the first estimate. In annual terms, GDP was -0.6% YoY against the forecast of -0.2% YoY. Capital quarterly expenses decreased by 0.1% against expectations of an increase of 0.4%. Consumer spending in the first quarter showed the expected 0.0% after the previous growth of 0.2%, and revised downward from 0.5%. The only good news was the growth of industrial production in March by 1.4% against the forecast of 1.2%. But capacity utilization increased by 0.5% only against expectations of 1.0%.

Today, important economic data continued to emerge. Basic orders in mechanical engineering in March collapsed by 3.9%, and the forecast was also quite weak at -2.7%. On an annualized basis, this indicator fell from + 2.4% YoY to -2.4% YoY. The forecast assumed a weakening of growth only to 0.3% YoY.

At present, the Japanese yen has shown extraordinary stability but the yen loses only 10 points, as of this writing. And the Japanese currency is holding together with the Nikkei 225 stock index, which shows an increase of 0.63%. While the Australian S&P / ASX 200 fell by -0.43%, the Chinese Shanghai Composite by -0.23% and the South Korean Kospi SEU by -0.08%. Together with the Nikkei 225, the Indonesian IDX Composite is up to + 0.78%.

If the yen's growth continue, it can be safely assumed that the JPY will grow in the range of 110.85-111.10 exclusively on the optimism of the US stock market.

analytics5afd0e082a062.png

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

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

Ichimoku cloud indicator analysis of USD/CAD for May 17, 2018

The USD/CAD is in a bearish trend making lower lows and lower highs. Price is trading below the Ichimoku cloud and recently got rejected when it tried to bounce towards 1.2930. I'm bearish USD/CAD specially if we break below 1.2730.

analytics5afd2893afd64.png

Blue line - resistance trend line

Yellow rectangle - support area

The USD/CAD pair is trading below the 4-hour cloud. However we have critical short-term support at 1.2730-1.2750. A break below this area will open the way for a move lower towards 1.2650. Bulls need to see a bounce from this area and a break above the short-term resistance of 1.2830. Cloud resistance is at 1.2830 until 1.2870. Breaking above the blue trend line and above the cloud are the signs bulls want to see in order to control the trend. Until then bears are under control of the trend and I remain bearish.

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

Did they fail before they start?

If the data on the number of housing permits of new homes in the US put pressure on the US dollar in the afternoon of Wednesday, May 16, then a good report on industrial production began to gradually return the US dollar to the buyer market.

It is important to note that the number of housing permits for new homes in the US for the month of April 2018 fell by 3.7% compared to the previous month and amounted to 1.287 million homes per year. The number of construction permits decreased by 1.8% compared to the previous month and amounted to 1.352 million homes per year. Economists had expected a fall in the number of tabs by 1.4% and the number of permits was only at 0.3%.

According to the report of the Federal Reserve System of the USA, industrial production in April of this year has grown. The growth was due to good demand from consumers, as well as small and medium-sized businesses.

Thus, industrial production grew by 0.7% compared to the previous month and compared to the same period by 3.5%. The increase in capacity utilization to 78% for April of this year also indicates an increase in activity in the manufacturing sector. Economists had expected that production would grow by 0.6%, and the capacity utilization would be at 78.4%.

analytics5afd2549105db.png

The negotiations between the US and China, which have not yet begun, are already at risk of failure. This is all because of the media that attacked the President of the United States Donald Trump indicating the desire of the presidential administration to soften American sanctions against the Chinese telecommunications giant ZTE Corp.

All this led to the fact that in his Twitter account, Trump said that there would be no concessions to the Chinese side. It is important to note that a delegation from China arrived in the United States, headed by Vice-Premier of the State Council of the People's Republic of China Liu He. The main purpose of the negotiations is an agreement that will allow to weaken sanctions from the US against ZTE in exchange for softening the position of China regarding duties on American agricultural products.

Quotes of oil rose after data on commercial oil reserves in the US.

According to the report of the US Department of Energy, for the week of May 5 to 11, oil reserves fell by 1.4 million barrels to 432.4 million barrels, while economists assumed a fall in oil reserves of 400,000 barrels. The reserves of gasoline fell by 3.8 million barrels to 232 million barrels, and stocks of distillates by 92,000 barrels to 114.9 million barrels. The load of oil refining capacities increased to 91.1%, while analysts had expected the growth of the index by 0.4 percentage points.

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

Technical analysis on Gold for May 17, 2018

Gold price remains under pressure near the weekly lows. Medium-term support is very close and bulls would not like to break below as this would imply more downside towards $1,255 should be expected. I prefer to be a contrarian and be bullish at current levels but specially if we close the week and break above $1,300.

analytics5afd278620aa7.png

Red line -long-term resistance

Blue line - medium-term support

Green line - long-term support

Gold price is trading below the Ichimoku cloud. Trend is bearish for the short term but still bullish in the medium term. Gold price is at the trend line support and at the 61.8% Fibonacci retracement support of the rise from $1,237 to the 2018 highs. This is a highly probable turning point that we should not ignore. I'm conservatively bullish about Gold and will get more aggressive bullish on a break above $1,300.

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

Trading plan for 17/05/2018

The yields of the 10-year-old US jumped over 3.10%, but the dollar's reaction disappoints. The prime leads the GBP thanks to information on Brexit, and AUD found support in a solid report from the labor market. EUR/USD bounced back from 1.1760 on Wednesday, and managed to reach 1.1830 after the information was denied that the new ruling coalition in Italy wanted the ECB to write off EUR 250 billion of Italian bonds. USD/JPY has stopped in the range of 110.0-110.40. There is a mixed picture in the stock market. On the one hand, Japanese Nikkei managed to gain 0.7%, and in China Shanghai Composite loses 0.4%. Gold remains under the pressure of growing profitability and barely defends itself against a more durable decline of $1,290. Not much is happening in the oil market, where WTI is testing the recent highs at 71.70.

On Thursday, 17th of May, the event calendar is full of important data. Canada will issue Foreign Securities Purchases and ADP Non-Farm Employment Change data. The US will present Philly Fed Manufacturing Index data, Unemployment Claims and Continuing Claims data, CB Leading Index data, and EIA Natural Gas Storage Change data. Moreover, there are two speeches scheduled later today where FOMC Member Neel Kashkari and Rober Kaplan and MPC Member Andy Haldane participate.

AUD/USD analysis for 17/05/2018:

The labor market of Australia confirmed its good condition. In April employment increased by 22.6k against a forecast of 20k. Full-time employment increased by 37.5k due to a drop of 25.1k a month earlier. Part-time work decreased by 10k after an increase of 24.4k earlier, the improvement in the composition of employment is good and covered the increase in the unemployment rate to 5.6% from 5.5%.

Let's now take a look at the AUD/USD technical picture after the data has been published. The market has initially moved towards 0.7550, but is slowly retreating to 0.7530. Nevertheless, the market is bouncing from the oversold conditions and the next target is seen at the level of 0.7563, which is a 38% Fibo of the previous swing down. Any breakout through this level will directly expose the technical resistance at the level of 0.7578 - 0.7589 to test. The immediate technical support is seen at the level of 0.7472 and 0.7445.

analytics5afd281308832.jpg

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

Fractal analysis: May 17 GOLD

Forecast for May 17:

Analytical review on the scale of H1:

analytics5afcf8370d173.png

analytics5afcf84b75e31.png

For Gold, the key key levels on the H1 scale are: 1304.79, 1302.97, 1298.88, 1295.70 and 1286.41. On this instrument, we follow the local top-down cycle from May 11. At the moment, the price is near the limit values for this structure. In connection with this, we expect a rollback towards correction and the formation of the initial conditions for the upward cycle.

Short-term upward movement is possible in the area of 1295.70 - 1298.88. The breakdown of the last value will lead to in-depth movement. Here, the target is 1302.97. The range of 1302.97 - 1304.79 is noise. Before reaching this level, we expect the initial conditions for the upward cycle to be formed.

The main trend is a local structure for the bottom of May 11.

Trading recommendations:

Buy: 1297.70 Take profit: 1298.80

Buy 1296.00 Take profit: 1298.00

Sell: Take profit:

Sell: Take profit:

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

Fractal analysis for major currency pairs as of May 17

Dear colleagues.

For the EUR / USD pair, we expect the downward trend of May 14 after the breakdown of 1.1750. For the GBP / USD pair, the price has entered the equilibrium state. The level of 1.3565 is the key support for the downward structure from May 14. For the USD / CHF pair, the situation is in an equilibrium state. We expect the cancellation of the downward structure after the breakdown at 1.0042. For the USD / JPY pair, we follow the upward structure of May 4. For the EUR / JPY pair, the price is in an equilibrium state: the upward structure of May 8 and the downside potential of May 14. For the GBP / JPY pair, we follow the development of the upward structure of May 8.

Forecast for May 17:

Analytical review of currency pairs in the scale of H1:

analytics5afcf785e5b55.png

For the EUR / USD pair, the key levels on the scale of H1 are: 1.1995, 1.1928, 1.1889, 1.1862, 1.1807, 1.1751, 1.1684 and 1.1640. Here, we continue to follow the downward structure of May 14. The continuation of the downward movement is expected after the breakdown of 1.1807. In this case, the target is 1.1751. The breakdown of this level, in turn, should be accompanied by a pronounced movement towards the level of 1.1684. Near this level is the consolidation of the price. The potential value for the bottom is the level of 1.1640. Upon reaching this level, we expect a rollback to the top.

Short-term upward movement is possible in the area of 1.1862 - 1.1889. The breakdown of the last value will lead to in-depth correction. Here, the target is 1.1928. This level is the key support for the downward structure from May 14.

The main trend is the local structure for the bottom of May 14.

Trading recommendations:

Buy: 1.1862 Take profit: 1.1887

Buy 1.1892 Take profit: 1.1925

Sell: 1.1805 Take profit: 1.1755

Sell: 1.1748 Take profit: 1.1688

analytics5afcf7942edb5.png

For the GBP / USD pair, the key levels on the H1 scale are 1.3608, 1.3564, 1.3529, 1.3445, 1.3412, 1.3388, 1.3326 and 1.3285. Here, the price is still in the field of initial conditions for the downward movement of May 14. The continuation of the development of the downward structure is expected after the breakdown of 1.3445. In this case, the target is 1.3412. Near this level is the consolidation of the price. Passing the price of the noise range at 1.3412 - 1.3388 should be accompanied by a pronounced movement towards the level of 1.3326. The potential value for the bottom is the level of 1.3285. After reaching this level, we expect consolidation as well as a rollback to the top.

Consolidated movement is possible in the area of 1.3529 - 1.3564. The breakdown of the last value will lead to the formation of an upward structure. Here, the potential target is 1.3608.

The main trend is the formation of a local structure for the downward movement of May 14.

Trading recommendations:

Buy: Take profit:

Buy: 1.3565 Take profit: 1.3607

Sell: 1.3445 Take profit: 1.3412

Sell: 1.3386 Take profit: 1.3328

analytics5afcf7a5f19ce.png

For the USD / CHF pair, the key levels on the scale of H1 are: 1.0083, 1.0067, 1.0042, 1.0022, 0.9993, 0.9979, 0.9955, 0.9933 and 0.9910. Here, the price is in an equilibrium state: the downward structure of May 10 and the formation of the potential for the top of May 14. The continuation of the development of the upward structure is expected after the breakdown of 1.0022. In this case, the target is 1.0042. Near this level is the consolidation of the price. The breakdown at 1.0042 will lead to the cancellation of the downward structure from May 10. In this case, the target is 1.0067. The potential value for the top is the level of 1.0083. After reaching this level, we expect a pullback downwards.

Short-term downward movement is possible in the area of 0.9993 - 0.9979. The breakdown of the last value will lead to the development of the downward structure from May 10. In this case, the first target is 0.9955.

The main trend is the equilibrium situation.

Trading recommendations:

Buy: 1.0022 Take profit: 1.0040

Buy: 1.0044 Take profit: 1.0065

Sell: 0.9991 Take profit: 0.9980

Sell: 0.9977 Take profit: 0.9960

analytics5afcf7b2275c6.png

For the USD / JPY, the key levels on a scale are: 111.38, 110.96, 110.66, 110.09, 109.87 and 109.55. Here, we follow the development of the upward structure of May 4. The continuation of the upward movement is expected after the breakdown of 110.66. In this case, the first target is 110.96. Near this level is the consolidation of the price. The potential value for the top is the level of 111.38. Upon reaching this level, we expect a pullback downwards.

Short-term downward movement is possible in the area of 110.09 - 109.87. The breakdown of the last value will lead to in-depth correction. Here, the target is 109.55. This level is the key support for the top.

The main trend is the upward structure of May 4.

Trading recommendations:

Buy: 110.66 Take profit: 110.94

Buy: 110.98 Take profit: 111.36

Sell: 110.09 Take profit: 109.90

Sell: 109.85 Take profit: 109.60

analytics5afcf7bd597a5.png

For the CAD / USD pair, the key H1 scale levels are: 1.2934, 1.2889, 1.2839, 1.2801, 1.2726 and 1.2660. Here, the continuation of the movement downwards is expected after the breakdown of 1.2726. In this case, the target is 1.2660. Up to this level, we expect the formulation of local initial conditions for the subsequent development of a downward trend.

Short-term upward movement is possible in the area of 1.2801 - 1.2839. The breakdown of the latter value will lead to the formation of an upward structure. In this case, the target is 1.2889. Capacity building for the top is expected to reach level 1.2934.

The main trend is the formation of a local structure from May 15.

Trading recommendations:

Buy: 1.2801 Take profit: 1.2837

Buy: 1.2841 Take profit: 1.2887

Sell: 1.2724 Take profit: 1.2665

Sell: Take profit:

analytics5afcf7cfd415b.png

For the AUD / USD pair, the key levels on the scale of H1 are: 0.7679, 0.7622, 0.7599, 0.7563, 0.7503, 0.7480, 0.7445, 0.7408 and 0.7359. Here, the resumption of the upward trend is expected after the breakdown of 0.7563. In this case, the first target is 0.7599. In the area of 0.7599 - 0.7622 is the consolidation of the price. The potential value for the top is the level of 0.7679. Upon reaching this level, we expect the consolidated movement as well as a possible pullback downwards.

Short-term downward movement is possible in the area of 0.7503 - 0.7480. The breakdown of the last value will lead to the development of the a downward trend. Here, the target is 0.7445. In the area of 0.7445 - 0.7408, we expect short-term downward movement. The potential value for the downward movement is the level of 0.7359. From this level, we expect a pullback to the top.

The main trend is the upward structure of May 9.

Trading recommendations:

Buy: 0.7563 Take profit: 0.7598

Buy: 0.7624 Take profit: 0.7676

Sell: 0.7503 Take profit: 0.7481

Sell: 0.7478 Take profit: 0.7447

analytics5afcf7dd15078.png

For the of EUR / JPY pair, the key levels on the scale of H1 are: 132.26, 131.78, 131.40, 130.98, 129.61, 129.18, 128.85 and 128.15. Here, the price entered the equilibrium situation. The continuation of the traffic to the top is possible after the breakdown of 130.98. In this case, the first target is 131.40. In the area of 131.40 - 131.78 is the consolidation of the price. The potential value for the upward structure is, for the time being, the level of 132.26.

The development of the downward movement from May 14 is expected after the breakdown of 129.61. Here, the first target is 129.18. In the area of 129.18 - 128.85 is the consolidation of the price. The potential value for the bottom is the level 128.15. From this level, we expect a departure towards correction.

The main trend is the equilibrium situation which is the formation of the potential for the bottom of May 14.

Trading recommendations:

Buy: 131.00 Take profit: 131.40

Buy: 131.42 Take profit: 131.75

Sell: 129.60 Take profit: 129.20

Sell: 128.85 Take profit: 128.20

analytics5afcf7e8c2e3b.png

For the GBP / JPY pair, the key levels on the scale of H1 are: 151.36, 150.81, 150.01, 149.29, 148.35, 147.84, 147.00, 145.75 and 145.12. Here, we follow the formation of the upward structure from May 8 in correction from the downward structure. The continuation of the upward movement is expected after the breakdown at 149.30. In this case, the target is 150.01. Near this level is the consolidation of the price. The breakdown at the level of 150.01 should be accompanied by a pronounced upward movement. Here, the target is 150.81. In the area of 150.81 - 151.36 is the consolidation of the price.

Short-term downward movement is possible in the area of 148.35 - 147.84. The breakdown of the last value will lead to the development of the a downward structure. In this case, the target is 147.00. Near this level is the consolidation of the price. The breakdown of 147.00 should be accompanied by a pronounced movement towards the potential target of 145.75.

The main trend is the formation of the potential for the top of May 8.

Trading recommendations:

Buy: 149.30 Take profit: 150.00

Buy: 150.05 Take profit: 150.80

Sell: 148.35 Take profit: 147.85

Sell: 147.80 Take profit: 147.00

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

The dollar is still strong

After a short pause, the US dollar again began to strengthen, growing against the euro to a 6-month high at the trades on Wednesday. The markets once again felt a taste for risk, which is reflected in the stable growth of yields on government bonds and the increase in the stock markets on both sides of the Atlantic.

What are the reasons for this optimism?

The Philadelphia Federal Reserve published a forecast for the main economic indicators of the US for the next four quarters. Compared with the results of three months ago, there is a clear improvement in the forecast for almost all points: GDP growth is expected to be at 3.0% in Q2 against 2.9% in the previous forecast, moreover, forecast for the third and fourth quarters has also improved.

It is expected that unemployment in the current quarter will decline slightly more than previously forecast, and, of course, one of the main indicators of economic growth, the pace of creating new jobs, has been revised upward.

analytics5afd1dcf0dfe1.png

Perhaps only the forecasts for inflation are the ones that don't look so confident. However, in this case, it is expected that by the end of the year, the results will be positive and some slowdown in the second and third quarters should, in the opinion of the Federal Reserve Bank of Philadelphia, be offset by a higher price increase in the fourth quarter with the annual inflation rate at the level of 2.3%.

Similar results are obtained by other regional offices of the Federal Reserve, forming a picture of the confident growth of the US economy, which in the end justifies the Fed's policy of normalizing interest rates and reducing the balance. According to CME, two rate increases in June and September does not cause doubts in the market. The probability of a fourth increase in December is now 50% higher, which gives the dollar grounds for expecting a long and steady growth.

We also note the negative aspects. The tax reform has not only revived consumer activity and production growth, but also led to a significant decrease in budget revenues, which must be compensated. The growth of income tax is possible only after the industry starts to grow confidently and the trade balance begins to be corrected.

analytics5afd1deb16e54.png

This is what Donald Trump, who pursues a policy of aggressive pressure on China and the European Union, is going to make them finance American reforms.

In both directions there are prerequisites to fail. After the aggressive start of negotiations on May 3, when the US delegation unequivocally demanded from China to increase the import of American goods and reduce the trade deficit to $ 200 billion, there was a rapid easing of the position once it became clear that China's retaliatory measures could cause significant damage to the US economy. The national strategy "Made in China 2025" threatens the US with the loss of global technological leadership. It is the interest of the US to prevent implementation of these plans but excessive pressure will only accelerate their implementation.

Thus, financing of the US budget deficit by China is under big question, and this is a negative factor for the dollar, which will gain strength in the next few months.

As for the US withdrawal from the nuclear deal on Iran, it would make sense only if this step did not become one-sided. However, in reality, everything turned out the other way round: the volume of oil trade on the Shanghai Stock Exchange rose to 12% of global consumption, which means that the petrodollar is rapidly losing its positions.

The second blow came from Europe. The EU countries do not intend to blindly follow the US strategy and exit from business in Iran, for which they began to develop a trade scheme with, not for the dollar, but for the euro. In fact, the point is that an attempt by the US, through pressure in forcing its trading partners to participate in financing the US economy, can lead to the opposite effect: the creation of parallel financial contours, in which the dollar will be excluded.

Until the end of the week, the dollar will remain the leader of the market. It can be expected that there will be a test at 1.17 paired with the euro and 1280 on gold. It will likely grow against the yen to 110.85. The positions of commodity currency against the dollar will not be lost due to a sharp increase in the cost of oil.

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