Weak prospects for the euro and pound

Eurozone

Macroeconomic data from the eurozone is quite contradictory, the euro looks weak, acting as internal contradictions in the eurozone, and increasing fears about the likely expansion of the trade war.

The volume of production orders in Germany fell by 4% in June, industrial production as a whole fell by 0.9%, which was significantly worse than forecast, year on year decreasing orders by 0.8%, and, quite possibly, the reason - in the escalating trade war. Recent talks between Juncker and Trump reduced tensions, this is noted in the monthly Sentix study, which notes a slight increase in optimism in the business environment, while in the 6-month perspective the index continues to be below zero, meaning the fears of slowing economic growth are very strong.

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It should also be noted and tightening of financial conditions. Despite the fact that the ECB does not directly fix the date of the first rate increase, the yields of bonds are growing, because the global trend, which is set by the Federal Reserve, can not be ignored.

The currency pair EUR / USD will continue its march to the south, in the near future we can expect a test for the strength of 1.15 support, followed by a decrease to 1.1420.

United Kingdom

On Monday, the pound has updated the 11-month minimum, and, most likely, will remain under pressure in the near future.

Despite the fact that the Committee voted for the growth rate unanimously and in every possible way stressed that the situation is under full control, markets still experience significantly greater skepticism than in the spring. Quite an indicative situation with consumer prices and the interpretation of their dynamics by the Bank of England.

The quarterly inflation report underscores that the Bank of England expects a certain slowdown in inflation starting in August, as two factors will play a role: reducing energy prices and the effect of a depreciating pound, while domestic inflationary pressures are gaining momentum and remain stable. However, when considering the components of inflation, it is striking how a certain slowdown in price growth in the services sector in comparison with 2017, as well as an even clearer decline in prices for the main group of goods without taking into account energy carriers and food products. In fact, just the internal inflationary pressures are shrinking and its further growth is in great doubt.

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The market seems to be rather skeptical about the UK's economic prospects in light of the withdrawal from the EU in March 2019 and calls into question the intention to raise the rate again in May next year. There is a reassessment of the prospects for the rate, the next step can be postponed to September or even December 2019, respectively, the pound will look weaker than predicted in recent months.

The currency pair GBP / USD will continue to decline, medium-term target of 1.2770, growth attempts will be used by players as an excuse to enter short positions.

Japan

The Bank of Japan in fact recognized the inability to lead the country out of the deflationary trap, proceeding to curtail the asset repurchase program after 5 years of struggle. Changing the method of buying bonds, BoJ provoked an increase in yields, while Reuters's forecast at a rate indicates that BoJ can raise rates twice this year.

Household spending in Japan showed only a short period of growth, as of June, a decrease of 1.2%, low consumer activity has negated all efforts to disperse inflation.

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The currency pair USD / JPY will continue to trade in the sideways range with a slight advantage in the direction of growth, it is likely that the attempt will rise again to 112.15.

Oil and ruble

Oil prices are trying to grow against the backdrop of US sanctions against Iran and a significant decline in production in Saudi Arabia. Stop the price increase may slow the global economy, these fears are still weak, so the mouth, most likely, continued. Brent will attempt to rise to 75.80 in the short term.

The ruble continues to confident movement to 65, however, it is unlikely to overcome this level from the first attempt. The weakening of the ruble is largely emotional and will stop with a decrease in currency purchases by the Ministry of Finance.

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GBP / USD. 6th of August. Results of the day. China begins to respond with US countermeasures

4-hour timeframe

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Amplitude of the last 5 days (high-low): 55p - 83p - 49p - 115p - 68p.

The average amplitude for the last 5 days: 74p (70p).

The currency pair GBP / USD on the first trading day of the week, as well as the EUR / USD pair, continues the downward movement. In the UK today there was no significant economic publication, as in the United States. However, interesting news came from China. It turned out that Chinese oil companies decided to abandon purchases of American oil. Most likely, it was not without the influence of the Chinese authorities, within the limits of countermeasures, on trade taxes, which Washington threatens to introduce. It is not clear yet whether a decision will really be taken to abandon the hydrocarbons from the United States, but in itself a bad sign for America. Firstly, it is the loss of an item of export earnings. Secondly, Beijing shows that it is not going to be a "whipping boy" and does not intend to make any concessions like the EU. Thus, now one can say with certainty about one thing - the escalation of the trade conflict between the PRC and the US. So far, traders still interpret this news in favor of the US currency. But, as we said earlier, over time, the mood of traders can change the opposite. It should be understood that the States will also suffer losses in the trade war. The companies importing Chinese products, and companies that export products to China, and the end user will suffer too. Thus, we believe that, as soon as the first negative consequences of Trump's policy are visible, the US dollar will be pressured, despite the "tough" position of the Fed. By the way, it is the Federal Reserve that is most concerned about Trump's policy of protectionism. Powell has already noted that he does not know what will end the trade war. And this means that the consequences can be negative. Once the head of the Federal Reserve is worried about this, then he has grounds.

Trading recommendations:

The currency pair GBP / USD continues to move down and worked out the first target of 1.2927. The price rebound from this target may trigger a correction, and the overcoming is a further decline to the levels of 1.2875 and 1.2852, which are recommended to be rejected if there is no signal of the beginning of correction.

Orders for purchase can be considered small lots with targets for the critical line and the level of 1.3015 if an upward correction starts, which can be signaled by turning the MACD indicator upward.

In addition to the technical picture, one should also take into account the fundamental data and the time of their release.

Explanations to the illustration:

Ichimoku Indicator:

Tenkan-sen is a red line.

Kijun-sen is a blue line.

Senkou Span A is a light brown dotted line.

Senkou Span B - a light purple dotted line.

Chinkou Span is a green line.

Bollinger Bands Indicator:

3 yellow lines.

MACD indicator:

Red line and histogram with white bars in the indicator window.

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

EUR / USD. 6th of August. Results of the day. Blank news calendar, no reason to rest

4-hour timeframe

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Amplitude of the last 5 days (high-low): 71p - 63p - 43p - 86p - 51p.

The average amplitude for the last 5 days is 63n (61p).

On Monday, August 6, the EUR / USD currency pair continues not too strong, but a confident downward movement. An absolutely empty calendar of macroeconomic news did not become an obstacle for traders to conduct active trade. As well as on Friday, traders did not begin to reduce dollar positions, wishing to fix profit. And this means only one thing, the market is confident in further strengthening of the US currency. Why is that? On the one hand, everything is clear. The Fed continues to tighten monetary policy. The introduction of trade duties against China and other partners is regarded by traders as a positive moment for America. Thus, while Trump continues to escalate the situation and threaten China with the imposition of duties on almost all exports to America, it will be in the hands of the US dollar. The situation may change when it becomes clear which common response China will take. Recall that the loss of such a market as America, for China will be extremely disadvantageous. At the same time, his economy is strong enough to withstand such a blow. Thus, most likely, Beijing will respond to Washington with comparable countermeasures. And when markets see the negative effects of these measures on the US economy, their optimism may diminish. So far, this has not happened, the US dollar may go up for several months in a row, if not more. Especially, considering the fact that the European Union has nothing to cover in this confrontation. Through the efforts of Jean Claude Juncker, it was possible at least to begin negotiations with America on the abolition of all duties between the countries, but so far these are only oral agreements. About the monetary policy, the ECB says nothing, it is at times "softer" the policy of the Fed, and a rate hike in Europe in the coming months is not planned. Thus, the growth of the US dollar is fully justified and does not cause any criticism.

Trading recommendations:

The currency pair EUR / USD continues to move down without signs of a correction beginning. The target for short positions is 1.1503. Turning the MACD indicator up (with a parallel increase in price) will signal a manual shortening of the shorts.

Orders for the purchase can be considered small lots if the MACD indicator signals the beginning of the correction. The Tenkan-sen and Kijun-sen lines have moved away from each other, and the downward movement has been going on for several days, so the correction is still brewing.

In addition to the technical picture, one should also take into account the fundamental data and the time of their release.

Explanations to the illustration:

Ichimoku Indicator:

Tenkan-sen is a red line.

Kijun-sen is a blue line.

Senkou Span A is a light brown dotted line.

Senkou Span B - a light purple dotted line.

Chinkou Span is a green line.

Bollinger Bands Indicator:

3 yellow lines.

MACD indicator:

Red line and histogram with white bars in the indicator window.

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

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

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Daily Outlook

In April 2018, the EUR/USD pair outlook turned to become bearish when the pair pursued trading below the broken uptrend as well as the lower limit of the depicted consolidation range.

Shortly after, the price zone (1.1850-1.1750) offered temporary bullish rejection towards 1.1990. The EUR/USD bulls failed to pursue towards higher bullish targets. Instead, a descending high was established around 1.1990.

This was followed by bearish breakdown below the price zone of 1.1850-1.1750. This price zone has been standing as a significant Supply zone since June 2018.

On the other hand, the price zone of 1.1520-1.1420 was considered a prominent demand zone where a valid bullish BUY entry was offered during previous weeks' consolidations.

On July 10, signs of bearish rejection were manifested around 1.1750. That's why, a bearish movement was expected to occur towards 1.1650.

Lack of enough bearish momentum allowed another bullish pullback to occur again towards 1.1750 (the depicted supply zone) where another episode of bearish movement was initiated towards 1.1520.

On the other hand, recent signs of bullish rejection were expressed around the lower limit of the mentioned consolidation range (1.1520).

That's why, the EUR/USD pair remains trapped within the consolidation range of 1.1750-1.1520 until breakout occurs in either direction.

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Daily Technical Analysis Video, 7th August 2018

Daily Technical Analysis Video, 7th August 2018

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GBP/USD analysis for August 07, 2018

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Recently, the GBP/USD has been trading sideways at the price of 1.2956. According to the M15 time frame, I found that price is trading inside of the upward channel, which is a sign that buyers are in control. Watch for potential buying opportunities if you see a breakout of the resistance trendline. The upward target is set at the price of 1.2994.

Resistance levels:

R1: 1.2996

R2: 1.3051

R3: 1.3089

Support levels:

S1: 1.2903

S2: 1.2865

S3: 1.2810

Trading recommendations for today: watch for potential buying opportunities.

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

Bitcoin analysis for August 07, 2018

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Trading recommendations:

According to the 15M time frame, I found that price found resistance at the pivot resistance 1 ($7,067), which is a sign that buying looks risky. I also found a low close doji pattern and bearish cross on the stochastic oscillator, which is a sign of weakness. My advice is to watch for potential selling opportunities. The downward targets are set at the price of $6,936 and at the price of $6,811.

Support/Resistance

$7,067 – Intraday resistance

$6,936– Intraday support

$6,936 – Objective target 1

$6,811 – Objective target 2

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

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Gold analysis for August 07, 2018

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Recently, the Gold has been trading upwards. The price tested the level of $1,215.71. Anyway, according to the M15 time frame, I found that price pivot resistance 1 at $1,214.20, which is sign that buyers are in control. I also found high doji close pattern and oversold condition on the stochastic oscillator, which is another sign of strength. My advice is to watch for potential buying opportunities. The upward targets are set at the price of $1,217.30 and at the price of $1,221.38.

Resistance levels:

R1: $1,221.38

R2: $1,221.38

R3: $1,225.49

Support levels:

S1: $1,202.89

S2: $1,198.90

S3: $1,191.60

Trading recommendations for today: watch for potential buying opportunities.

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

Analysis of GBP / USD pair. Divergences as of August 7. British pound may take a little rest

4h

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On the 4-hour chart, quotations of the GBP / USD pair continue its decline in the direction of the Fibo level of 261.8% at 1.2638. Bullish divergence in the CCI indicator allows the pair to turn in favor of the British pound and begin the growth process in the direction of the correction level of 200.0% at 1.3047. The consolidation of quotations under the last low of divergence will work in favor of continuing the fall of the pair's quotations.

The Fibo grid was established on boundaries from March 1, 2018 and April 17, 2018.

1h

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On the hourly chart, the pair underwent fixation under the correction level of 100.0% at 1.2958. s a result, the process of falling prices can be continued in the direction of the next correction level of 127.2% at 1.2888. Brewing divergences are not observed in any indicator today. Fixing the quotes of the pair above the Fibo level of 100.0% can be interpreted as a reversal in favor of the British pound and expect a certain increase in the direction of the correctional level of 76.4% at 1.3018.

The Fibo grid was established on boundaries from July 19, 2018 and July 26, 2018.

Recommendations for traders:

Purchases of the GBP / USD pair can be carried out for the purpose of 1.3018 level and a stop loss order under the correction level of 100.0% if it closes above the Fibo level of 1.2958 on the hourly chart.

The GBP / USD pair can now be traded with a target of 1.2888 and a Stop Loss order above the correction level of 100.0%, as there was a close under the Fibo level of 1.2958. The material has been provided by InstaForex Company - www.instaforex.com

Fundamental Analysis of USD/CAD for August 7, 2018

USD/CAD has been quite corrective with the bearish momentum recently which is expected to lead to certain bullish intervention in the coming days. Though USD has been quite impulsive with the recent gains over most of the majors in the market, it failed to gain momentum over CAD ahead of the Employment report to be published this week.

This week on Friday, CAD Employment Change and Unemployment Rate report is going to be published which is expected to have an optimistic outcome in the coming days. Though no official forecasts have been provided yet but having Trade War tension fading off with NAFTA, CAD is expected to perform better having better GDP result published last with an increase to 0.5% from the previous value of 0.1% and better Trade Balance result as well with an increase to -0.6B from the previous figure of -2.7B. Today CAD Ivery PMI report is going to be published which is also expected to have an optimistic result with an increase to 64.2 from the previous figure of 63.1.

On the other hand, ahead of PPI and CPI report to be published this week, today USD JOLTS Job Opening report is going to be published which is expected to increase to 6.74M from the previous figure of 6.64M and IBD/TIPP Economic Optimism is also expected to increase to 57.2 from the previous figure of 56.4.

As of the current scenario, both currencies of the pair are awaiting the upcoming high impact economic reports to be published which is expected to inject certain volatility in the pair with definite momentum on either side. If CAD manages to provide better economic results in the coming days further bearish pressure is expected in the pair or else USD is expected to continue with a strong counter leading to impulsive bullish momentum in the pair for the coming weeks.

Now let us look at the technical view. The price has formed a Bullish Continuous Divergence along the corrective phase which is expected to push the price higher towards the resistance area of 1.33-1.34 in the coming days. As the price residing above 1.2900-50 support area with a daily close, the bullish bias is expected to continue further.

SUPPORT: 1.2900-50

RESISTANCE: 1.3300, 1.3400

BIAS: BULLISH

MOMENTUM: VOLATILE

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EUR/GBP Testing Resistance, Prepare For Reversal!

EUR/GBP is testing its resistance at 0.8932 (61.8% Fibonacci extension, 61.8% & 76.4% Fibonacci retracement, horizontal swing high resistance) where a reversal to its support at 0.88911 (61.8% Fibonacci extension, 61.8% Fibonacci retracement, horizontal swing low support) is expected.

Stochastic (89, 5, 3) has reversed off its resistance at 95% where a corresponding drop is expected.

EUR/GBP is testing its resistance where we expect to see a reversal.

Sell below 0.8932. Stop loss at 0.8959. Take profit at 0.8891.

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USD/JPY Approaching Support, Prepare For A Bounce!

USD/JPY is approaching its support at 110.59 (61.8% Fibonacci extension, 50% Fibonacci retracement, horizontal swing low support) where we expect price to bounce to its resistance at 112.18 (100% Fibonacci extension, 61.8% Fibonacci retracement, horizontal overlap resistance).

Stochastic (89, 5, 3) is approaching its support at 4.8% where a corresponding bounce is expected. Ichimoku cloud is also showing signs of downward pressure.

Buy above 110.59. Stop loss 109.96. Take profit at 112.18.

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#theforexarmy #forexsigns #forexsignals #forexfamily #forexgroup #forexhelp #forexcourse #forextrade #forexdaily #forexmoney #forexentourage #forextrading #forex #forexhelptrading #forexscalping #babypips #forexfactory #forexlife #forextrader #financialfreedom #daytrader #scalper #swingtrader #fx #currency #pips #technicalanalysis #forexmarket

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

Fundamental Analysis of EUR/JPY for August 7, 2018

EUR/JPY is currently quite impulsive with the bullish gains which occurred after the recent impulsive bearish pressure in the pair. As of the recent economic reports on the EURO side as well as the Trade War and Brexit tension, JPY has been quite stronger over EURO earlier.

Despite the worse economic reports, today EURO managed to gain certain momentum in the process which is expected to lead to further gains in the coming days. Today EURO German Industrial Production report was published with decrease to -0.9% from the previous value of 2.4% which is expected to be at -0.5%, German Trade Balance decreased to 19.3B from the previous figure of 20.4B which was expected to be at 21.4B and French Trade Balance was also published with decrease to -6.2B from the previous figure of -6.0B which was expected to increase to -5.6B.

On the JPY side, today JPY Household Spending report was published as expected at -1.2% increase from the previous value of -3.9% and Average Cash Earnings increased to 3.6% from the previous value of 2.1% which was expected to decrease to 1.7%. Later JPY Leading Indicators report was published with a decrease to 105.2% from the previous value of 106.9% which was expected to be at 105.4%.

As of the current scenario, JPY economic reports were far better than of the EURO's but failed to maintain the momentum it had earlier which does indicate the shifting of the market sentiment at the current market situation. Despite certain tensions, the gains of EURO is currently indicating further bullish momentum in the pair for the coming days.

Now let us look at the technical view. The price is currently residing at the support area of 128.50 where the Kumo Cloud support also working as confluence for the situation as well. The market is quite volatile but being above 128.50 area with a daily close after an indecisive candle is expected to push the price higher with strong momentum in the coming days. As the price remains above 128.50 area with a daily close, the bullish bias is expected to continue further with target towards 1.3100-1.3200 area.

SUPPORT: 1.2850

RESISTANCE: 1.3100, 1.3200

BIAS: BULLISH

MOMENTUM: VOLATILE

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

Trading plan for 07/08/2018

After a sleepy Monday, low volatility remained a topic also during Asian trade. The only night's event was the decision of the RBA, which, however, did not surprise at all. The stock market is picking up bullish, oil and gold are slightly bouncing.

EUR / USD stopped at 1.1550, GBP / USD wants, but it can not go back over 1.2950, and USD / JPY drifts at 111.30.

The Asian stock market is backing up with the help of solid financial results from Wall Street companies that helped that market and set the direction for investors from China and Japan. Shanghai Composite is growing 1.6% today and Japanese Nikkei225 gaining 0.6%.

On Tuesday the 7th of August, the event calendar is light in important data releases during the London and US session, but the market participants should keep an eye on Trade Balance and Industrial Production data from Germany, Halifax House Price Index data from the UK, Ivey Purchasing Managers Index data from Canada and JOLTs Job Openings data from the US.

AUD/USD analysis for 07/08/2018:

The Reserve Bank of Australia decides to keep the interest rate unchanged at the level of 1.50 as expected.

The statement published together with them was more interesting. GDP in this and next year is expected to increase slightly above 3%. The policy of low-interest rates positively affects the economy of the country. No change is in line with the current market situation. We will be able to talk about the hike only when inflation reaches the assumed target.

Inflation forecasts for the next two years speak of a gradual rise in prices. The reason for concern is the low wage growth, this situation on the labor market may persist for some time. Although inflation is rising, the year may end at a lower level than expected at the end of 2017.

Real estate prices slowed down in Sydney and Melbourne. Strengthening banking regulations allowed to control the risks associated with the real estate market. Household consumption remains a source of uncertainty. The Australian dollar is in the same range as in the last few years.

Let's now take a look at the AUD/USD technical picture at the H4 time frame. The market is currently trading at the technical resistance at the level of 0.7414 and it looks like this resistance will be violated. The next target for bulls is seen at the level of 0.7440 - 0.7445. The momentum is above its fifty level and points to the north, together with the stochastic oscillator, so the upward bias remains intact. Please keep an eye on the golden trend line resistance around the level of 0.74500.

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Global macro overview for 07/08/2018

The season of quarterly results in the US is almost behind us, but it was full of unexpected events that surprised investors. The results of companies from the technology sector, including those from the so-called FANG basket, which includes Facebook, Amazon, Netflix, and Google were widely commented on in the financial press.

The biggest surprise was the publication of weaker than expected growth in the number of Facebook users. The price of the company's shares dropped almost 25%. Slower growth was also a factor that contributed to the decline in Netflix and Twitter shares, which in turn amounted to 12% d 25 percent The unexpected slowdown of these companies may cause a revision of forecasts regarding the long-term dynamics of the companies 'expansion by analysts, which may translate into further deterioration of investors' sentiment. On the other hand, such a significant and sudden fall in quotations may be perceived as a too pessimistic reaction to worse results, which may be a very good opportunity to buy over-valued securities of leaders of the technology sector. However, it should be remembered that after weaker forecasts announced by the mentioned companies, sudden improvement of sentiment in the short term may not take place.

Let's now take a look at the NASDAQ technical picture at the H4 time frame. After the publication of the worse than expected results, the index plummets from the all-time high at 7935 to 7500, but currently, the bulls are still raging on and pushing the market higher: the gap down between the levels of 7735 - 7935 was almost filled now and the blue trend line was not violated significantly. This is a strong bullish market in a strong uptrend, so new high should be expected soon.

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

Technical analysis of USD/CHF for August 07, 2018

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Overview:

The USD/CHF pair is still set above the pivot point of the price 0.9857. The USD/CHF pair faced resistance at the level of 0.9943. The strong resistance has been already formed at the level of 0.9943 and the pair is likely to try to approach it in order to test it again. However, if the pair fails to pass through the level of 0.9943, the market will indicate a bearish opportunity below the new strong resistance level of 0.9943 (the level of 0.9943 coincides with a ratio of 50% Fibonacci and 61.8%). Moreover, the RSI starts signaling a downward trend, as the trend is still showing strength above the moving average (100) and (50). Thus, the market is indicating a bearish opportunity below 0.9943, so it would be good to sell at 0.9940 with the first target of 0.9795. It will also call for a downtrend in order to continue towards 0.9733. The daily strong support is seen at 0.9733. On the other hand, the stop loss order should always be taken into account, for that it will be reasonable to set it at the level of 1.0053.

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

Global macro overview for 07/08/2018

The People's Bank of China announced on Friday that it imposes mandatory reserves of 20% for forwarding transactions on USD/CNY, which according to the bank's position is to "stabilize the exchange rate of the yuan". The actions are undoubtedly aimed at strengthening the currency and stopping the outflow of capital from the local market. In the result, we see an increase in USD/CNY drops at 6.83, and the reversal of the earlier depreciation of the Chinese currency is reflected favorably on other currencies from emerging markets.

This is a surprising decision, which has a stronger impact, that goes into the shallow holiday market. It can be seen that the PBOC has raised concerns about the outflow of capital from the local market, but the artificial control of the currency market brings only short-term benefits. A negative side effect is limiting liquidity on the domestic market, as it limits the flexibility in the activities of local banks and institutions active on international markets.

Because the subject of China and their position in the trade dispute with the US is very important for the market participants, the yuan's rebound helps in improving the prices of other currencies against USD. Hence the last EUR/USD rise above 1.16, or GBP/USD return above 1.30 (coinciding with the publication of the NFP report). Nevertheless, the majors should not note a clear retreat in response to the one-off decision of the PBOC. Fading concerns about the prospects of the Chinese economy will be possible only when there are signs of improvement. As long as the concerns remain, it is real that investors will use such raises to renew their long positions in USD.

Let's now take a look at the US Dollar Index technical picture at the H4 time frame. The market is again trying to break out above the swing high at the level of 95.66. So far the local high was made at the level of 95.53, which was the important technical resistance for the price. Currently, the market is consolidating the gains and the level of 95.25 will now act as a technical support.

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

Technical analysis of EUR/USD for August 07, 2018

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Overview:

The EUR/USD pair continues to move downwards from the level of 1.1639. Last week, the pair dropped from the level of 1.1639 (this level of 1.1639 coincides with the ratio of 32.8% Fibonacci) to the bottom around 1.1549.

Today, the first resistance level is seen at 1.1589 (the weekly pivot point) followed by 1.1639, while daily support 1 is found at 1.1508.

Also, the level of 1.1589 represents a weekly pivot point, for that it is acting as minor resistance this week.

Amid the previous events, the pair is still in a downtrend, because the EUR/USD pair is trading in a bearish trend from the new resistance line of 1.1589 towards the first support level at 1.1508 in order to test it.

If the pair succeeds to pass through the level of 1.1508, the market will indicate a bearish opportunity below the level of 1.1508 with the next traget at 1.1460 in the coming hours.

However, if a breakout happens at the resistance level of 1.1639, this scenario may be invalidated.

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

Bitcoin analysis for 07/08/2018

Turkey has set up the country's first Blockchain Center at the university level, aiming to close the gap of the blockchain expertise and ensure the widespread use of technology.

Istanbul Blockchain and the Innovation Center (BlockchainIST Center) was opened at the Bahcesehir University (BAU). According to the director of the center, Bora Erdamara, BlockchainIST is to be the most important research, development, and innovation center in Turkey, in which research and publications are carried out in blockchain technologies. Erdamar said: "Turkey may have a chance to become a leading country in technology that will change humanity". He stressed the importance of cooperation with other educational institutions, companies and government institutions in order to conduct appropriate Blockchain-based research and to investigate possible cases of its use.

Meanwhile, some other universities in different places around the world have already benefited from the advantages of distributed accounting technology by offering Blockchain training courses, intelligent contracts, and cryptocurrency courses. Only this year, Stanford University has set up a Blockchain Research Center, supported in part by the Ethereum Foundation, and the main Brazilian university Fundacao Getulio Vargas began offering the country's first master's degree in crypto-finance. Ripple also donated 50 million dollars to 17 universities around the world to support education in Blockchain and cryptocurrency.

While the director of BlockchainIST stressed that Turkey is becoming digitized and makes a lot of effort to keep up with the rest of the world in terms of digital transformation, the Turkish authorities have shown an ambiguous position towards the crypto industry. In November last year, the government of the country took a firm stance on the Bitcoin case, when the legislators of the State Directorate of Religious Affairs said that Bitcoin is incompatible with Islam. However, in February this year, the deputy chairman of the Nationalist Movement Party of Turkey not only proposed market regulations but also mentioned the possibility of introducing a national digital currency, called TurkCoin.

Let's now take a look at the Bitcoin technical picture at the H4 time frame. The price has hit the technical support at the level of $6,782 and bounced a little after the Pin Bar candlestick formation was made. This bounce is still too small in price and time to be considered important. Nevertheless, the downward momentum is decreasing, so there is a chance for a better, bigger and stronger bounce that might once again test the level of $7,176. On the other hand, a lack of this kind of price action will lead to a breakout lower towards the next technical support at the level of $6,400.

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Technical analysis of Bitcoin for August 7, 2018

Bitcoin got rejected at the resistance we previously noted as the most important level bulls need to break in order for the trend to continue higher. The price, on the other hand, got rejected, bulls were not strong enough and the price is now challenging cloud and Fibonacci retracement support levels.

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Black rectangle - resistance

On a daily basis, the price has entered the Kumo (cloud) and this is not a good sign. Support is at the 61.8% Fibonacci retracement level. Price is inside the Kumo. Bulls need to reverse to the upside from current levels. Next support that bulls must hold is at 6,700$. A bounce from this area could be the start of the breaking move above the black rectangle resistance area.

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Ichimoku cloud indicator analysis on EUR/USD for August 7, 2018

The EUR/USD bounced today towards 1.1550 after making new lows around 1.1530. The trend remains bearish. Price is below the Ichimoku cloud and inside the bearish channel. Bulls will need at least to break above 1.1570 to give some hope for a bigger bounce. Trend changes only with a break above 1.17.

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Red lines - triangle pattern

Blue lines - bearish channel

The EUR/USD remains in a bearish trend below the 4-hour Ichimoku cloud resistance. Price remains trapped below the broken triangle pattern and inside the bearish channel. Short-term resistance is found at 1.1570 and next at 1.1630. Support is found at 1.1530-1.15. A break below it can open the way for much lower towards 1.13.

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Technical analysis of Gold for August 7, 2018

Nothing new for Gold today. Gold remains in a bearish trend inside a downward sloping wedge pattern. There are bullish divergence warning signs but as long as the Gold price is below $1,225 trend will remain bearish.

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Black lines - wedge pattern

Blue line - RSI resistance

Red line - Bullish divergence

The Gold price has short-term resistance and trend change level at $1,225. However, a break above $1,217 will also be a bullish sign that will increase the chances of breaking above $1,225 dramatically. Support is at $1,185 where we find the lower wedge pattern boundary. The bullish divergence signs by the RSI and the fact that the RSI price remains above the red trend line support, make me not chase the bearish side of any trade but wait for a bullish reversal and follow the bounce towards $1,265-75 at least.

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Global macro overview for 06/08/2018

Last week we would undoubtedly be called a week of central banks. This is, of course, related to the large number of monetary decisions that we have learned over the past days. In addition, the attention of investors around the world was also focused around Friday's publication of the report of the American Labor Office (BLS) on the change of employment in non-agricultural sectors (NFP) in July 2018. As usually happens, the beginning of the new month brought with it numerous readings regarding PMI.

There are two main entities responsible for the publication of the indicator in the world. The first of them is the Markit Group publishing readings for 30 countries around the world. The second - Institute of Supply Management (ISM) - focuses, however, only on the American market.

PIT Markit reports are always published at the beginning of each month. PMI of the industrial sector on the first day, PMI of the second construction sector, and PMI of the services sector on the third working day of each month. The index published today illustrates the activity of the industrial sector and describes the current situation in the economy.

The market participants also got acquainted with the results of the US PMI index illustrating the activity of the industrial sector in the United States - the first was published by IHS Markit, the second one by ISM. As usual in this case, the second is more important for US traders.

According to the IHS Markit report, the PMI index for the industrial sector was in July this year. at 55.3, which is a reading of 0.2 pp worse than expected and 0.1 pp worse than the previous publication (55.4).

"The manufacturing sector in the US continued to grow well in July, but it shows signs of fighting supply shortages, rising prices, and deteriorating exports," commented Chris Williamson, Chief Economist at IHS Markit.

The data published by the ISM institute were even worse. This report shows that despite the already pessimistic forecasts assuming a decline in the value of the index to 59.4 from 60.2, the final reading indicated a drop to the level of 58.1 points.

Let's now take a look at the SP500 technical picture after the reports were published. After the gap between the levels of 283.28 - 284.44 was filled, the market is still trading around the recent top at the level of 286.58. The move up was made on a positive and strong momentum, despite the fact that the market conditions remain overbought. The nearest support is seen at the level of 280.62 and the longer time frame trend remains up.

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Ethereum analysis for 06/08/2018

Ethereum analysis for 06/08/2018:

Ethereum has concluded a contract with the provider of comprehensive domain services Minds + Machines Group Limited (MMX), through which Ethereum Name Service (ENS) will receive the name of the top-level domain, according to a press release from August 3.

According to the contract, Ethereum customers will be able to register their addresses in the .luxe top-level domain (shortcut "Let U Xchange Easily"), which will be launched soon. The .luxe extension will be available for sale in October.

Any domain registered in the .luxe zone may be reportedly integrated with Blockchain Ethereum and all related services such as decentralized applications (DApps), distributed memory or intelligent contracts. Users will be able to choose any user-friendly domain name that will contain all of Ethereum's person identification features.

We already know from the Ethereum test in its unapproved ICANN zone that there is a real proven need for verbal identifiers that work on the basis of Blockchain [...]. We look forward to working with ENS to enable the same registrants to apply for their .luxe name before the company introduces .luxe for sale to the general public at the end of October- said Toby Hall, general manager of MMX.

In May 2017, ENS was launched in the main net, which enabled automatic registration allowing anyone to easily and cheaply register names ending in ".eth" using the auction process. Essentially, ENS by providing clear addresses was Ethereum's first step towards mass adoption of cryptocurrencies. ENS allows anyone to create a much more user-friendly address, such as JohnDoe.eth.

Let's now take a look at the ETH/USD technical picture at the H4 time frame. The market has broken out of the horizontal channel and currently is trading around the recent swing low at the level of $393. The nearest technical resistance is seen at the level of $414. The momentum remains weak and is still below its fifty level, so all the upwards pull-back is only temporary. Downtrend continues.

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Global macro overview for 06/08/2018

The US labor market report is close to expectations. The unemployment rate in July fell to 3.9% (as expected), the hourly wage increased by 0.3% m/m and 2.7% y/y, although June data was revised down from 0.2% up to 0.1%. Employment increased by 157,000, which is a disappointment compared to 193,000 expected in the forecast, but the June reading was raised from 213,000 at 248,000, which balances the weaker figure for July.

In the other news, the PMI index for the services sector was in July this year at 56.0, which is a reading of 0.2 pp worse than expected and by 0.5 pp worse than the June result, when the indicator was at 56.5. The negative effect of this publication is also increased by the result of the collective PMI index, which despite the forecasts assuming maintaining its value at 55.9, slipped in July to 55.7. At the beginning of the third quarter, the growth rate of economic activity was only slightly slower than in June. Strong domestic demand contributed to further improvement in the level of orders and a significant increase in wages in July. However, the expectations of enterprises in the entire service economy fell to the lowest level in six months. The respondents pointed to concerns about the increase in costs and friction in trade, as well as difficulties in maintaining the pace of development of new enterprises in the second quarter of 2018.

Overall the data is solid and supports the Fed's arguments for next hikes in September and December, but in general, the report does not surprise anyone.

Let's now take a look at the EUR/USD technical picture at the H4 time frame after the PMI Services and NFP-Payrolls data were published. The market has fallen below the technical support at the level of 1.1574 towards the next support at 1.1540. The zone between the levels of 1.1540 - 1.1507 is the key technical support zone and if this one is violated, then the sell-off will accelerate. The neatest technical resistance is seen at the level of 1.1590 and 1.1611. The momentum is negative and still points to the downside in oversold market conditions.

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Technical analysis of Litecoin For Aug 06, 2018

If we look at the 4-hour chart we can see that the Litecoin is still in a Bearish bias. This condition can be confirmed by the price still moving bellow the Moving Average 50 Periods and still moving orderly in the down slope channel. Basing on this fact as long as the Litecoin does not break out and close above its critical level at 89.60, it will continue moving in a Bearish bias.

(Disclaimer)

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Technical analysis of Bitcoin for Aug 06, 2018

At the 4 hour charts the Bitcoin is still running bellow the Moving Average 21 periods. This means the Bearsih bias still control this Cryptocurrency, as long as it does not break out and close above 7,254.76 the Bitcoin will still go down.

(Disclaimer)

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Technical analysis: Intraday Level For EUR/USD, Aug 06, 2018

When the European market opens, some Economic Data will be released such as Sentix Investor Confidence and German Factory Orders m/m. The US will release the Economic Data too, such as Loan Officer Survey, so, amid the reports, EUR/USD will move in a low to medium volatility during this day.

TODAY'S TECHNICAL LEVEL:

Breakout BUY Level: 1.1618.

Strong Resistance:1.1611.

Original Resistance: 1.1600.

Inner Sell Area: 1.1589.

Target Inner Area: 1.1561.

Inner Buy Area: 1.1533.

Original Support: 1.1522.

Strong Support: 1.1511.

Breakout SELL Level: 1.1504.

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

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

Fundamental Analysis of USD/JPY for August 7, 2018

USD/JPY has been quite volatile and corrective between the price range of 112.00 to 110.50 for a few days. USD has been quite impulsive with the recent economic reports, but failed to gain such momentum against JPY in the process as JPY has been quite stronger with the economic reports as well.

After the USD NFP report, USD attracted good amount of sentiment throughout other majors. Ahead of PPI and CPI reports to be published this week, today, USD JOLTS Job Opening report is going to be published which is expected to increase to 6.74M from the previous figure of 6.64M and IBD/TIPP Economic Optimism is also expected to increase to 57.2 from the previous figure of 56.4.

On the other hand, ahead of the Prelim GDP and BOJ Summary of Opinions report this week, today, JPY Household Spending report has been published as expected at -1.2% increasing from the previous value of -3.9% and Average Cash Earnings has increased to 3.6% from the previous value of 2.1% which was expected to decrease to 1.7%. Moreover, today, JPY Leading Indicators report is going to be published which is expected to decrease to 105.4% from the previous value of 106.9%.

As of the current scenario, both currencies in the pair is quite strong with the economic reports while higher impactful economic reports are yet to be published this week. As the time unfolds, the corrective phase is expected to continue a bit further, but overall, USD is a bit stronger than JPY in comparison to the recent results and upcoming economic forecasts.

Now let us look at the technical view. The price is currently residing at the edge of the dynamic level of 20 EMA between the price area of 110.50 to 112.00. Recent bearish pressure off the 112.00 area has been quite impulsive and is expected to push the price towards 110.50 in the coming days before the price continues with the bullish trend in the process. As the price remains above the 110.50 area, the bullish bias is expected to continue further.

SUPPORT: 110.50

RESISTANCE: 112.00

BIAS: BULLISH

MOMENTUM: VOLATILE AND CORRECTIVE

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Technical analysis: Intraday level for USD/JPY, Aug 06, 2018

In Asia, Japan today will not release any Economic Data, but the US will release some Economic Data such as Loan Officer Survey. So there is a probability the USD/JPY will move with a low to medium volatility during this day.

TODAY'S TECHNICAL LEVEL:

Resistance. 3: 111.80.

Resistance. 2: 111.58.

Resistance. 1: 111.36.

Support. 1: 110.08.

Support. 2: 110.86.

Support. 3: 110.65.

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

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

BITCOIN Analysis for August 6, 2018

Bitcoin has been indecisive recently after breaching below the 50% area of the previous impulsive bullish momentum it formed earlier. The price is currently residing below $7,000 area which is quite alarming for the investors as more downward momentum can be observed in the coming days. Though the price is still within the bullish bias and expected to push the price higher with a target towards $8,000 and later towards $10,000 area. The corrective indecision price action does also indicate the intervention of the bulls in the bearish impulsive pressure which also communicates certain bullish momentum for the future. As the price remains above $6,500 area with a daily close, the bullish bias is expected to continue.

SUPPORT: 6,500

RESISTANCE: 8,000, 10,000

BIAS: BULLISH

MOMENTUM: VOLATILE

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Bitcoin analysis for August 06, 2018

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Trading recommendations:

According to the H1 time frame, I found that price is trading inside of the downward channel, which is a sign that sellers are in control. I also found a breakout of the support trendline and rejection from the Fibonacci retracement 38.2%. My advice is to watch for potential selling opportunities. The downward targets are set at the price of $6.732 and at the price of $6.495.

Support/Resistance

$7.090 – Intraday resistance

$6.860– Intraday support

$6.732 – Objective target 1

$6.495 – Objective target 2

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

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Analysis of Gold for August 06, 2018

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Recently, the Gold has been trading downwards. The price tested the level of $1,207.90. According to the H1 time – frame, I found the rejection of the Fibonacci retracement 61.8% in the background (confluence). MACD oscillator is also showing that sellers are in control, which is another sign of weakness. I have placed Fibonacci expansion to find potential downward targets. I got Fibonacci expansion 100% at the price of $1,195.95 and Fibonacci expansion 161.8% at the price of $1,181.20.

Resistance levels:

R1: $1,220.38

R2: $1,227.70

R3: $1,235.85

Support levels:

S1: $1,204.90

S2: $1,196.75

S3: $1,189.45

Trading recommendations for today: watch for potential selling opportunities.

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Elliott wave analysis of EUR/JPY for August 7, 2018

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EUR/JPY tested triple support at 128.50, where it made a backtest of the broken resistance-line, which now acts as support. It backtested the broken S/H/S bottoms neckline, which now acts as support too, and finally tested the 61.8% corrective target of wave i/. So the odds for a corrective low for wave ii/ is pretty good here and there is a chance for wave iii/ to take over and start rallying towards 135.79 as the next upside target.

EUR/JPY has been locked inside an ascending channel for the past two years and this channel is still dominating the larger picture calling for more upside pressure. Ultimately, the peak of wave (D) at 135.55 should be broken for a rally towards 205.

R3: 129.62

R2: 129.18

R1: 129.00

Pivot: 128.77

S1: 128.50

S2: 128.11

S3: 127.69

Trading recommendation:

We are long EUR from 128.72 with our stop placed at 128.45.

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Technical analysis: Intraday Level For EUR/USD, Aug 07, 2018

When the European market opens, some Economic Data will be released such as French Trade Balance, German Trade Balance, and German Industrial Production m/m. The US will also release the Economic Data such as Consumer Credit m/m, IBD/TIPP Economic Optimism, JOLTS Job Openings, and Mortgage Delinquencies, so amid the reports, EUR/USD will move in a low to medium volatility during this day.

TODAY'S TECHNICAL LEVEL:

Breakout BUY Level: 1.1614.

Strong Resistance:1.1607.

Original Resistance: 1.1596.

Inner Sell Area: 1.1585.

Target Inner Area: 1.1557.

Inner Buy Area: 1.1529.

Original Support: 1.1518.

Strong Support: 1.1507.

Breakout SELL Level: 1.1500.

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

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

Technical analysis: Intraday level for USD/JPY, Aug 07, 2018

In Asia, Japan will release the Leading Indicators, Average Cash Earnings y/y, and Household Spending y/y. The US will also release some Economic Data such as Consumer Credit m/m, IBD/TIPP Economic Optimism, JOLTS Job Openings, and Mortgage Delinquencies. So there is a probability the USD/JPY pair will move with low to medium volatility during this day.

TODAY'S TECHNICAL LEVEL:

Resistance. 3: 111.88.

Resistance. 2: 111.66.

Resistance. 1: 111.44.

Support. 1: 111.16.

Support. 2: 110.93.

Support. 3: 110.73.

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

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

Elliott wave analysis of EUR/NZD for August 7, 2018

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Our preferred count remains that support at 1.7115 continues to protect the downside for a break above resistance at 1.7224 for a continuation higher towards 1.7510 and longer term much higher towards 1.8310.

However, as long as resistance at 1.7224 is able to cap the upside, the alternate count does allow for a slightly deeper corrective decline from 1.7384 towards the 1.7033 - 1.7066 area before completing wave ii/ and setting the stage for the next impulsive rally in wave iii/.

R3: 1.7224

R2: 1.7180

R1: 1.7155

Pivot: 1.7137

S1: 1.7115

S2: 1.7094

S3: 1.7066

Trading recommendation:

We are long EUR from 1.7226 with our stop placed at 1.7110.

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

Trump's trade policy continues to work

The euro continued to decline against the US dollar in the morning of Monday, August 6, amid the lack of important fundamental statistics, as well as expectations of further interest rate hikes in the United States.

Data on the sharp decline in orders in Germany put pressure on risky assets.

According to a report by the German Ministry of Economy, production orders in Germany declined sharply in June this year due to falling demand from countries outside the eurozone. This suggests that the current tensions in trade relations are already affecting the indicators, which will further exacerbate tensions between the US and the EU.

As indicated in the report, orders in the manufacturing sector in Germany in June 2018 fell by 4.0% compared to May, while economists had forecast a decline in orders by 0.5%. The ministry confirmed the fact that the uncertainty of the prospects of trade policy played a key role.

External orders in the German manufacturing sector in June fell by 4.7% compared to May, while domestic production orders decreased 2.8% compared to the previous month.

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As I noted above, a particular decrease in orders was observed from countries that are not members of the eurozone. Here the figure fell by 5.9%. Compared to the same period of the previous year, orders in the German manufacturing sector decreased by 0.8%.

As for the technical picture of the EUR/USD pair, then, most likely, the pressure on the euro will continue. The breakthrough of support of 1.1530 will lead to new large sales in risky assets, with an exit to the lows of the month in the area of 1.1480 and 1.1440. The only hope of buyers in the short term is a return to the resistance of 1.1565, which will lead to an upward correction in the area of 1.16 and 1.1630.

The British pound continued to decline, ignoring the report on the volume of consumer lending in the UK, which in June this year has not changed compared to may. This shows that consumer spending will continue to grow in the future.

According to the Bank of England, in June 2018, net consumer lending to consumers in June amounted to 5.4 billion pounds against 5.3 billion pounds in May. Credit cards in June amounted to 1.6 billion pounds. As for mortgage loans, the number was at the level of 65,619.

As for the technical picture of the GBP/USD pair, the recovery prospects are also quite far. Brexit and uncertainty with a further increase in interest rates in the UK continue to weigh on the pound.

The current main goal of the sellers of the pound is the lows of 1.2890 and 1.2815. If we talk about the prospects for an upward correction, then, apparently, it will be limited in the area of resistances 1.2960 and 1.3000.

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Control zones of GBP / USD 06.08.18

The downward movement remains a priority, as at the end of the last week the a control zone of 1.3084-1.3072 was broken. The purpose of the decline is the weekly control zone of 1.2956-1.2930, the test of which will require partial fixation of sales.

After the breakdown of the a control zone of 1.3084-1.3072 in the previous week, sales came to the fore with the goal of a weekly short-term outlook of 1.2956-1.2930. While this zone is not tested, it is unprofitable to consider purchases. The main plan for today is to hold a short position or to find favorable prices for the sale of the instrument. If the weekly short-term test occurs before the correction model is formed, the further decline will continue if the today's US session closes below 1.2930.

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After the part of the position is closed on the target zone, the rest can be transferred to a breakeven, which will give an additional profit in case of continued weakening of the rate of the British pound.

The growth model will develop in the event that short-term demand leads to a sharp increase in demand. Closure of today's trading should be above the opening level, which will allow us to consider both correctional and reversal models. The first target of the growth will be 1/2 control zone of 1.3116-1.3103, where the priority will be determined for the current week. It is important to note that within the weekly control zone is the July minimum, which determines the zone.

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The daytime CP is the daytime control zone. The zone formed by important data from the futures market that change several times a year.

The weekly CP is the weekly control zone. The zone formed by marks from important futures market which change several times a year.

The monthly CP is the monthly control zone. The zone is a reflection of the average volatility over the past year.

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Dollar is the leader of the foreign exchange market again

The July report on the US labor market published on Friday is expected to be strong. The number of new jobs was less than forecast (+ 157k against + 190k), however, this gap was compensated by the revision of the previous months to + 59k. The unemployment rate and the participation level in the workforce were unchanged, which makes it possible to expect the growth of the average wage already in the next report.

The report allows the Fed to adhere its desired plan to gradually raise the rate, but this factor will not have a significant merge on the dollar.

Meanwhile, the Fed continues to reduce the balance, the last major write-off of $ 28.5 billion occurred on July 31. The dollar reacted with such growth, offsetting the negative factor from the disappointing inflation report. The next write-off will take place on August 15 and $23.1 billion will be liquidated, the reduction of the monetary base is still behind the balance, but the gap is expected to be reduced. While the largest decline in the monetary base was recorded on the second half of 2016, which coincided with a sharp increase in the dollar. There is a reason to believe that this factor will contribute to the demand growth for the dollar, especially in the near future.

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The dollar will continue to trade in the sideways range against most competitors, but changes in monetary policy seems favorable for its further growth.

Eurozone

The euro did not receive any new benchmarks last week. PMI Indices from Markit for July came in line with expectations generally and is slightly worse than the dynamics of retail sales, but not so much as to cast doubt on the forecasts for consumer demand.

Secondary factors, such as sluggish Brexit negotiations or Italian elections cannot change the investors' mood who are inclined to the weaker euro because of the absence of any bullish drivers.

The EUR/USD pair close again to the 1.15 support, and the probability of a decline to this level remains high.

United Kingdom

The Bank of England increased the rate by a quarter of a percent, which was already expected by the market, but the strong unanimity of the Cabinet members was a strong surprise. This factor could be considered hawkish but the market decided that the BoE's confidence is rather ostentatious, as key macroeconomic forecasts do not contribute to higher rate growth rates than the market expectations. The volume of purchases remained at the level of 435 billion pounds, while the balance reduction is not yet done as the rate reaches until 1.5% and it is necessary to see at least 3 increases in the coming years.

The economic growth forecast for 2018 and 2019 had increased, but the pound is unlikely to take advantage of this factor. In the inflation report, the BoE predicts a smoother curve for the rate for the UK and the eurozone in the coming years. While according to the opinion of the bank, the Fed's actions maybe slightly more aggressive than the market expectations. This forecast indicates that the dynamics of the yields spread will increase in favor of the dollar, which puts a big question mark before the bulls on the pound.

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The pound declined in the results of the meeting which indicates the unconvincing position of the Bank of England, unable to convince the markets in economic prospects. By Monday, the pound has fallen again below 1.30 and the formation of a new low is at 1.2940 would likely happen during the day, the attempts at growth will be inconclusive.

Oil

Despite the fact that oil production in the United States has declined, as well as reports that Saudi Arabia had a reduction in production in July, oil continues to trade in the lateral range. The growth is hampered by the likely escalation of the US-China trade war, which the market regards as a possible reduction in the energy demand from China.

Brent will try to leave above 73.70, but positive news for the market is still not enough.

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

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