EUR / USD pair: plan for the US session on October 5. Unemployment in the US fell to 3.7%

To open long positions on EUR / USD pair, you need:

The increase in the number of people employed in the United States turned out to be worse than economists' forecast. However, a decline in the overall unemployment rate to 3.7% did not lead to a serious drop in the US dollar against the euro, as a result, trades remained at the same morning levels. As for purchases of the European currency today, the most optimal area will be a weekly minimum of around 1.1463 in the second half of the day. The profit in such a scenario can be fixed at the middle of the channel 1.1500 or at the maximum of the day around 1.1541.

To open short positions on EUR / USD pair you need:

Sellers managed to prove themselves before the approach to the resistance of 1.1541, which indicates the desire to keep the pair in a downtrend. The main objective for short positions in the afternoon will be at least around the weekly 1.1463, where taking profits are recommended. In the case of the euro rising to short positions, you can again return on a false breakdown from resistance 1.1541 or to rebound from a maximum of 1.1588.

Indicator signals:

Moving Averages

The price is stuck between 30 and 50 average, which indicates market uncertainty

Bollinger bands

Even after the release of data on the US, a surge in volatility did not occur, which plays on the side of sellers.

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Description of indicators

  • MA (moving average) 50 days - yellow
  • MA (moving average) 30 days - green
  • MACD: fast EMA 12, slow EMA 26, SMA 9
  • Bollinger Bands 20
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EUR / USD pair: plan for the European session on October 5. Non-Farm Employment Change Report May Rise Euros

To open long positions on EUR / USD pair, you need:

Today, all attention will be focused on the Non-Farm Employment Change report, bringing a quite low volatility n the first half of the day market. Buyers will most likely try to keep the support level of 1.1498 and the formation of a false breakdown on it will be a signal to buy euro in order to return to the resistance of 1.1541 and its breakdown. Poor data on the US labor market, which is unlikely, will lead to growth above 1.1541 and an update of the maximum of 1.1588, where taking profits are recommended. In the event of a decline in the euro under the support level of 1.1498, you can take a closer look at purchases from the week minimum of 1.1463 or open long positions for a rebound from 1.1399.

To open short positions on EUR / USD pair, you need:

Sellers will try to gain a foothold below the support of 1.1498 in the first half of the day, which will lead to a larger sale to the weekly minimum of 1.1463 and to update it with an output of at least a month in the area of 1.1399, where taking profits are recommended. It is important to pay attention to the fact that even a positive report on the US labor market may lead to an increase in the euro at the end of the day, since the big players can use it to take profits in the US dollar, which has been strengthening against the euro over the past few weeks. In this scenario, short positions can return on a false breakdown from 1.1541 or on a rebound from 1.1588.

Indicator signals:

Moving Averages

The price is stuck between 30 and 50 average, which indicates the uncertainty in the market, before the release of important fundamental data.

Bollinger bands

The Bollinger Bands indicator does not give signals when entering the market and only indicates a sharp drop in volatility in front of important data.

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Description of indicators

  • MA (moving average) 50 days - yellow
  • MA (moving average) 30 days - green
  • MACD: fast EMA 12, slow EMA 26, SMA 9
  • Bollinger Bands 20
The material has been provided by InstaForex Company - www.instaforex.com

GBP / USD pair: plan for the European session on October 5. The pound has grown, but the upside potential is limited.

To open long positions on GBP / USD pair, you need:

Today, pound buyers will focus on the resistance level of 1.3026, the breakdown of which will lead to a larger upward correction in the area of highs 1.3077 and 1.3110. A correction will be formed on exiting the stop orders of pound sellers. In the case of GBP / USD decline in the first half of the day, long positions can return to the test of the support level of 1.2975, from which the lower limit of the ascending channel will be formed or to rebound from the weekly minimum of 1.2926.

To open short positions on GBP / USD pair, you need:

Pound sellers will count on the formation of a false breakdown and a return below the resistance level of 1.3026, which may lead to a downward correction to the mid-channel area of 1.2975, where taking profits are recommended. A larger downward movement of the pound will depend on data on the US labor market, which is expected in the afternoon. In the case of growth above 1.3026 in the European session, short positions can be returned to the rebound from the highs of 1.3077 and 1.3110.

Indicator signals:

Moving averages

The 30- and 50-averages are on the same level with each other, indicating the formation of a side trend in the short term. A plus for buyers is the fact of above-average trading.

Bollinger bands

In the case of an attempt to grow the pound in the first half of the day, the upper limit of Bollinger Bands will be in the form of resistance, which is located around 1.3035, and from which you can see short positions.

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Description of indicators

  • MA (moving average) 50 days - yellow
  • MA (moving average) 30 days - green
  • MACD: fast EMA 12, slow EMA 26, SMA 9
  • Bollinger Bands 20
The material has been provided by InstaForex Company - www.instaforex.com

Washington maneuvers, wanting to keep everything

Washington continues to maneuver trade confrontation the conditions of trade confrontation with Beijing, interspersing the desire for a negotiation process with outright blackmail and threats.

After Wednesday, the US Vice President Mike Pence made it clear that he would come out with harsh criticism of China because he allegedly interfered in the presidential election. Once again, they promised Washington today through caricature, stating their desire to shorten the negotiation process on customs duties and the Americans believe that the success of negotiations between them, should be used as a model by Mexico and Canada.

We indicated immediately after the news of the signing of the agreement, the fact that Washington can use this achievement as a model. But the question arises: will China stand it? We have doubts about this. We believe that the Chinese will bravely fight for their interests, so for now, we should not hope that the main trade war on the planet will end in the near future, as long as the parties have not found a point of contact for reaching a compromise. Based on this, we believe that commodity currencies - the Australian and New Zealand dollars - will remain under pressure, and general concerns over the growth prospects of the world economy will support the dollar as a currency of refuge. In addition, the process of raising interest rates by the Fed will be a good complement to this picture.

Today, market attention will be focused on the publication of data on employment in the United States. It is expected that the growth of new jobs in the American economy will be 185,000 in September against 201,000 in August, according to the consensus forecast. It is also assumed that the unemployment rate will drop to 3.8% from 3.9%.

It can be assumed that if the data does not disappoint, then there will be a good reason for the US dollar to have a local growth against the major currencies.

Forecast of the day:

The EUR/USD pair is trading below 1.1520. It is under pressure from the economic situation in Greece, which could lead to a resumption of a serious debt crisis in the region. Positive news from the US in terms of the number of new jobs may trigger a price decline to 1.1400.

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The AUD/USD pair is trading below 0.7085. It remains under pressure amid the lack of agreement on the terms of trade between the United States and China. Positive data on employment in the US will have a local pressure on the pair, which may fall to 0.7000 or even lower to 0.6965.

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Review of the currency market on 10/05/2018

Yesterday's statements by Michel Barnier, who is in charge of negotiations between the European Union and the United Kingdom, saying that parties had reached the final stage of the negotiations, gave optimism to market participants. The prospect that the United Kingdom's Fourth Reich epic is coming to a logical end, reducing uncertainty because the parties must come to some kind of agreement that regulates trade relations. It may be bad, but it's better than not. Moreover, this development led to the fact that investors simply did not pay attention to the American statistics because the number of applications for unemployment benefits in the United States decreased by 21 thousand. The number of initial applications for unemployment benefits fell by 8 thousand, and again for another 13 thousand, predictions came out the same, slightly different result. The number of applications is expected to remain unchanged due to a decrease in the number of initial applications for unemployment benefits and an increase in the number of repeated applications. Also, production orders increased by 2.3%. So the American statistics was extremely positive.

The most important event of the day will be the publication of a report by the US Department of Labor, the content of the forecast was recently revised to the worse. Thus, the unemployment rate should of course decrease from 3.9% to 3.8% that should happen due to the fact that 185 thousand new jobs were created outside agriculture versus 201 thousand in the previous month. However, the growth rate of the average hourly wage should slow down from 2.9% to 2.8%. Of course, in terms of employment growth, it is rather difficult to expect wage growth, but the fact of wage cuts does not bode well since the potential for inflation growth has been greatly reduced. this will surely give rise to new conversations that the Fed will revise its plans for increasing rates and refinancing rate. Thereby, if forecasts are confirmed, it is worth waiting for a negative market reaction.

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In the UK, Halifax data for housing prices have already been released. The growth rates of which have slowed from 3.7% to 2.5% and such a significant decrease in them have already led to a halt in the growth of the pound. Given that the real estate market is one of the main criteria for determining the investment attractiveness of the UK, this is not surprising. But the report of the US Department of Labor is much more important, thus, the pound can resume its growth and reach the level of 1.3000 towards the end of the day.

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Bitcoin analysis for October 05, 2018

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Trading recommendations:

According to the H1 time - frame, I found that price broke the supply trendline in the background, which is a sign of the strength. Most recently, I have found the intraday bullish fag in creation, which is a sign of consolidation before the potential upward continuation. Watch for the breakout of bullish flag pattern to confirm further upward continuation. The upward target is set at the price of $6.750.

Support/Resistance

$6.555 – Intraday resistance

$6.472– Intraday support

$6.750– Objective target

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

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EUR / USD pair: an important report on Non-Farm Employment Change, the EU Court on the bond purchase program and the downgrade

Despite the good fundamental data on the US, the greenback fell against the euro yesterday against the background of a profit taking before the release of an important report on the US labor market, which is expected today in the afternoon.

The political measures of Italy can significantly damage the credit rating, which will lead to a collapse and an increase in the yield of government bonds. Yesterday, Italian authorities gave statements saying the budget deficit for 2020 and 2021 will be reduced to a significant extent, which will only provide temporary support to government bonds. However, this will not be enough to maintain a credit rating of "BBB".

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As economists predicted, leading rating agencies may downgrade Italy's credit rating by one notch by the end of October. This will happen due to the fact that the Italian authorities decided to increase the budget deficit to 2.4% of GDP in the next year.

Interesting statements were made yesterday by the EU legal adviser, who noted that the bond purchase program that the European Central Bank conducted since 2015 does not violate EU legislation. Let me remind you that a lawsuit was filed earlier by the German scientists and politicians in the EU court, which focused on the illegality of the above program. An adviser to an EU court said yesterday that the program for purchasing ECB government bonds is completely legal, and purchasing ECB bonds does not violate the ban on emission financing.

Basic data

A speech by the US Economic Advisor, Larry Kudlow, yesterday provided some support for the US dollar after it was announced that the US administration might take a tougher line on government spending. Kudlow also noted that WTO needs to implement reforms to strengthen trade rules, adding that Donald Trump should not be blamed for the broken trading system and trade conflicts.

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As for the report on the labor market, it became known yesterday that the number of Americans who first applied for unemployment benefits has decreased. According to the US Department of Labor, the number of initial claims for unemployment benefits fell by 8,000 to 207,000 from between September 3 to 29. Economists predicted that the number of applications would be 215,000.

Today, it is necessary to pay attention to an important report on the number of people employed outside the US agricultural sector, which may lead to a resumption of demand for the US dollar, but on condition that the data are better than economists' forecasts. The number of employed is expected to increase by 185,000 in September from 201,000 in August of this year.

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Orders for US manufactured goods rose in August. According to the US Department of Commerce, orders for US manufactured goods rose by 2.3% from the previous month, reaching 510.47 billion US dollar. Economists had expected an increase in orders of 2.2%, but excluding the transport sector, production orders in August rose by 0.1%.

EUR / USD Technical picture

Most likely, trade will be conducted mainly in the middle of the channel 1.1500 until the release of data on the labor market and only after the publication of the report will we be able to talk about the continuation or change of the downward trend in the trading instrument. Repeated test of support at 1.1465 will indicate the resumption of the fall for EUR/USD pair with access to new lows of the month in the area of 1.1400 and 1.1350.

A rise above the resistance of 1.1540 will lead to a reversal of the downward trend and the renewal of weekly highs at 1.1590 and 1.1640.

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EUR/USD analysis for October 05, 2018

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Recently, the EUR/USD pair has been trading sideways at the price of 1.1505. According to the M30 time – frame, I found the potential end of the downward correction (abc flat) in the background, which is a sign that selling looks risky. My advice is to watch for a potential breakout of the supply trendline to confirm a further upward movement. I placed Fibonacci expansion tool to find potential upward targets. Upward take profit levels are set at the price of 1.1565 (FE 100%) and at the price of 1.1610 (FE 161.8%). There is also a fake breakout of the yesterday's low at the price of 1.1492, which is another sign of the strength.

Trading recommendation : Watch for opening buy deals above the supply trendline.

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GBP/USD analysis for October 05, 2018

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Recently, the GBP/USD pair has been trading upwards. As I expected, the price tested the level of 1.3059. According to the H4 time – frame, I found the breakout of the supply trendline in the background, which is a sign that buyers are in control. Most recently, I have found the breakout of 20-hour balance, which is another sign of the strength. My advice is to watch for buying opportunities. Take profit levels are set at the price of 1.3117 and at the price of 1.3210.The material has been provided by InstaForex Company - www.instaforex.com

Intraday technical levels and trading recommendations for GBP/USD for October 5, 2018

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On September 13, the depicted daily downtrend line which came to meet the pair around 1.3025-1.3090 failed to offer enough bearish pressure on the pair. Since then, the GBP/USD pair has been demonstrating a successful bullish breakout so far.

However, On H4 chart, the market failed to maintain its uptrend within the depicted bullish channel on H4 chart. The lower limit of the depicted channel (which came to meet the GBP/USD pair around 1.3190) failed to offer sufficient bullish demand.

Therefore, the GBP/USD short-term outlook turned to become bearish towards 1.3010 (50% Fibonacci level) and 1.2940 (recent demand level).

Moreover, the price level of 1.3190 (the backside of the broken bullish channel) offered significant bearish rejection which initiated the recent bearish decline towards 1.2940.

Recently, the price level of 1.2900-1.2940 (the backside of the broken uptrend) is demonstrating significant bullish recovery where the current bullish movement was initiated.

On the other hand, regarding the price levels (1.3010-1.3090) corresponding to 50% and 61.8% Fibonacci levels. Currently, these price levels turned to become supply levels to be watched for bearish price action on retesting.

The current bearish decline below 1.3010 (50% Fibo level) should be defended to pursue towards lower bearish targets(1.2900-1.2940). Otherwise, further bullish advancement towards 1.3090 (61.8% Fibo) would be expected.

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Intraday technical levels and trading recommendations for EUR/USD for October 5, 2018

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On the weekly chart, the EUR/USD pair is demonstrating a high-probability Head and Shoulders reversal pattern where the right shoulder is currently in progress (recent bearish engulfing weekly candlestick).

Recently, the price level of 1.1500 offered temporary bullish recovery. Another bullish movement was demonstrated towards the upper limit of the price range (1.1750). However, the EUR/USD bulls failed to pursue towards higher bullish targets.

Instead, evident bearish rejection is being demonstrated on the daily chart. Recent bearish movement is currently taking place below 1.1520 (the lower limit of the consolidation range).

As for the bearish side of the market to be dominant, the EUR/USD pair should be able to keep moving below 1.1520. First bearish target would be located around 1.1420.

Otherwise, the EUR/USD pair would remain trapped within the depicted consolidation range (1.1520-1.1750) if no strong bearish momentum is demonstrated below 1.1520.

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Technical analysis of GBP/USD for October 05, 2018

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Overview:

The GBP/USD pair fell from the level of 1.3056 towards 1.2950. Now, the price is set at 1.2959. On the H4 chart, the resistance is seen at the levels of 1.3056 and 1.3176. Volatility is very high for that the GBP/USD pair is still expected to be moving between 1.3000 and 1.2811 in coming days. In the short term, we expect the GBP/USD pair to continue to trade in a bullish trend from the new support level of 1.2979 to form a bullish channel. Besides, it should be noted that major resistance is seen at 1.3056, while immediate resistance is found at 1.2979. According to the previous events, the pair is likely to move from 1.2979 towards 1.2906 and 1.2811 as targets. In the H4 time frame: However, if the pair fails to pass through the level of 1.2979, the market will indicate a bearish opportunity below the level of 1.2979. So, the market will decline further to 1.2906 in order to return to the first support. Moreover, a breakout of that target will move the pair further downwards to 1.2811.

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Technical analysis of USD/CHF for October 05, 2018

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Overview:

Pivot : 0.9870

The USD/CHF pair continues to move upwards from the level of 0.9809. The pair rose from the level of 0.9809 to a top around 0.9865. Today, the first resistance level is seen at 0.9865 followed by 0.9922, while daily support 1 is seen at 0.9743 (61.8% Fibonacci retracement). According to the previous events, the USD/CHF pair is still moving between the levels of 0.9809 and 0.9922; so we expect a range of 113 pips. Furthermore, if the trend is able to break out through the first resistance level at 0.9865, we should see the pair climbing towards the second resistance (0.9922) to test it. Therefore, buy above the level of 0.9865 with the first target at 0.9922 in order to test the daily resistance 2 and further to 0.9963. Also, it might be noted that the level of 0.9963 is a good place to take profit because it will form a new double top. On the other hand, in case a reversal takes place and the USD/CHF pair breaks through the support level of 0.9809, a further decline to 0.9743 can occur which would indicate a bearish market.

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BITCOIN Analysis for October 5, 2018

Bitcoin is still quite corrective and volatile while residing above $6,500 area with a daily close. The price has been consolidating at the edge of $6,500 for a few days now which is expected to lead to certain bullish pressure in the coming days. The price is currently being held as support by the dynamic levels of 20 EMA, Tenkan and Kijun lines, whereas there is no sign of Bearish Divergence along the way which does indicate that as the price remains above $6,500 and the dynamic levels as well as Kumo cloud, the price is expected to push higher with a target towards $7,500 and later towards $8,000 area in the future.

SUPPORT: 6,000, 6,500

RESISTANCE: 7,500, 8,000

BIAS: BULLISH

MOMENTUM: VOLATILE

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Fundamental Analysis of EUR.GBP for October 5, 2018

EUR/GBP is currently residing at the edge of 0.8850 area after an impulsive bearish momentum in the pair. The price has been rejected from the resistance area of 0.8950 wih a daily close. Both EUR and GBP has been showing mixed dynamics amid the recent economic reports. Nevertheless, GBP has the upper hand in the currency pair.

Today German Factory Orders report is going to be published which is expected to increase to 0.7% from the previous negative value of -0.9%, German PPI is expected to be unchanged at 0.2%, and Italian Retail Sales are expected to increase to 0.2% from the previous negative value of -0.1%. Moreover, today French Government Budget Balance is going to be published which previously was at -82.8B.

On the GBP side this week, the UK also posted some economic reports which came in line with expectations. Today UK Halifax HPI report is going to be published which is expected to increase to 0.2% from the previous value of 0.1%. After predictable Services PMI report, GBP gained certain momentum which is expected to push further on the GBP side if GBP outperforms EUR.

Meanwhile, EURO may show resilience against GBP ahead of a series of macroeconomic reports from the eurozone which are due later today. The reports are expected to reveal solid readings.

Now let us look at the technical view. The price has reached the edge of 0.8850 support area from where having a Bullish Divergence in place, the price is expected to push higher towards 0.8950 area in the coming days. As the price remains above 0.8850 with a daily close, the counter momentum is expected to push the price higher in the process.

SUPPORT: 0.8850

RESISTANCE: 0.8950

BIAS: BEARISH

MOMENTUM: VOLATILE

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Fundamental Analysis of USD/CHF for October 5, 2018

USD/CHF has been quite impulsive and non-volatile amid the bullish momentum which lead the price to push higher above 0.9850 area with a daily close. USD has been the dominant currency in the pair since the recent rate hike and ahead of the US NFP today. Thus, the pair is likely to trade with higher volatility today.

Throughout the week, CHF has been trading in a mixed manner in light of statistics from Switzerland. So, CHF has been able to show resilience to USD. Today Switzerland's Foreign Currency Reserves report is going to be published which is expected to increase from the previous figure of 731B and CPI report is also expected to increase to 0.2% from the previous value of 0.0%.

On the other hand, today US Average Hourly Earnings data is going to be published which is expected to decrease to 0.3% from the previous value of 0.4%, Non-Farm Employment Change is likely to decrease to 185k from the previous figure of 201k, and Unemployment Rate is expected to decrease to 3.8% from the previous value of 3.9%. Moreover, Trade Balance is assumed to decrease to -53.4B from the previous figure of -50.1B. Besides, FOMC Member Bostic is going to speak about the interest rates and future monetary policies, though his speech will hardly make an impact on the market today.

Meanwhile, CHF is quite optimistic and positive on the back of the economic reports, published today. On the other hand, USD is expected to halt its rally for a while. If USD is hurt by the economic data, then CHF might get certain momentum, which is expected to be quite short-lived. However, if the US non-farm payrolls reveal better-than-expected readings, USD will be struggling for gains against CHF.

Now let us look at the technical view. The price has been quite indecisive yesterday after breaking above 0.9850 area with a daily close recently. The price is currently quite bullish but as per mean reversion theory, the price is expected to retrace towards the dynamic level, i.e. mean, before pushing higher again with the trend. As per current structure, the price is expected to retrace towards 0.9850 area to retest and reject the bears while also pushing higher with target towards 0.9980-1.00 resistance area in the coming days. As the price remains above 0.9850 area with a daily close, the bullish bias is expected to continue.

SUPPORT: 0.9850, 0.9550

RESISTANCE: 0.9980, 1.0050

BIAS: BULLISH

MOMENTUM: IMPULSIVE

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BITCOIN Analysis for October 4, 2018

Bitcoin has been extremely volatile and indecisive recently. The price is climbing higher above $6,500 amid impulsive pressure recently, labeling the price action below $6,500 earlier as a false break. The price used to be quite volatile and indecisive earlier. However, the bullish momentum is currently quite strong because of a break above $6,500 and because of a Dynamic levels cross of 20 EMA, Tenkan and Kijun line. The price has retraced a bit throughout the day but remains above Kumo Cloud. Support by the dynamic levels above $6,500 is an indication of further bullish pressure with a target towards $7,500 and later towards $8,000 in the future. As long as the price remains above $6,000-6,500 area, the bullish bias is expected to continue.

SUPPORT: 6,000, 6,500

RESISTANCE: 7,500, 8,000

BIAS: BULLISH

MOMENTUM: VOLATILE

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Technical analysis of Gold for October 5, 2018

Gold price remains inside the trading range. Gold price made a move higher yesterday towards $1,207 but did not break above resistance of $1,211. Prices reversed strongly back below $1,200 at the upper boundary of the long-term bearish channel.

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Red lines - trading range

Green lines - bearish long-term channel

Gold price is in a neutral trend. Only a clean exit out of the trading range could provide some momentum. Today after the NFP announcement we could see a break of the trading range. A rejection at $1,200 and a move below $1,184 will open the way for a move towards $1,140. A break above $1,207 will increase the chances of exiting the trading range to the upside towards $1,220-40.

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Technical analysis of EUR/USD for October 5, 2018

Eurusd is trying to break out above and out of the downward sloping wedge pattern. Price has short-term support at 1.1480 and resistance at 1.1545. Today we expect the announcement of the US Non-Farm Payrolls one hour before the US markets open, so this should increase volatility.

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Red lines - wedge pattern

Red line - bullish divergence

EUR/USD could still make one more new lower low towards 1.1420 today before the big upward reversal we are expecting. Key resistance that if broken will make me forget the new lows scenario is at 1.1590. Only a break above this level will make me confirm that the low is in and that the entire decline from 1.1815 is over. I'm biased to the upside favoring bullish positions. Longer-term view is bullish where I will be risking a break of 1.13 (stop) for a move towards 1.19 and higher.

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Trading plan for 05/10/2018:

Night trade was typical for a day with an NFP report, which means not much volatility. The currency market remained relatively stable, but with an indication of the appreciation of the USD, as the weaker market sentiment encourages us to escape into the dollar. AUD, NZD and CHF are doing the worst. The first two reflect pressure on emerging markets and risky assets. The EUR / USD stopped close to 1.15, with no sign of an advantage. USD / JPY was pushed down to 114 with the correction on the stock market. Wall Street scored a downward trend after 6 days of increases. (SP500 at -0.8% yesterday), which spillover to Asian markets: Japanese Nikkei225 loses 0.6% today. Oil prices bounce after the Thursday correction indirectly caused by signals from Russia and Saudi Arabia, which are ready to partly compensate for shortages of supply resulting from sanctions imposed on Iran. WTI and Brent are gaining around 0.5% today.

On Friday, the 5th of October, the main event of the day is, of course, the NFP-Payrolls data release, together with Unemployment Rate, Average Hourly Earnings and Participation Rate. The other important data scheduled for release today are Canadian Unemployment Rate, Employment Change and Trade balance data, CPI data from Switzerland, PPI and Factory Orders form Germany and Trade Balance data from France.

USD/JPY analysis for 05/10/2018:

Overnight Japan published data on household spending in August. The data turned out to be better than expected, in annual terms they increased by 2.8% with the expected flat result. In monthly terms, the increase was 3.5% (0.4%). This is a survey of both wage-earning and non-working households, such as those classified as single-member, unemployed, or retired. The headline figure is the percentage change in average spending per household from the previous year. Increases in household spending are favorable for the Japanese economy because high consumer spending generally leads to higher levels of economic growth. Higher spending is also a sign of consumer optimism, as households confident in their future outlook will spend more. At the same time, accelerated growth exerts inflationary pressure, which can lead to interest rate increases in the future.

Let's now take a look at the USD/JPY technical picture at the H4 time frame. The pair was above the level of 114.00, but then it weakened and is now back around 113.90. Nevertheless, the market is still in an uptrend, moving steady inside of the upsloping channel. The nearest technical support is seen at the level of 113.50 and 113.37. The next technical resistance is seen at the level of 114.09 and then at the swing high at 114.55.

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Global macro overview for 05/10/2018

The Ivey Institute operating by Western University has published its own index of purchasing managers index (PMI) measuring the monthly change in business activity in Canada. Although analysts expected the index to rise to 62.3 from 61.9 previously, the September results of PMI Ivey turned out to be much worse and amounted to only 50.4. It is also the worst reading for over 2 years.

The Ivey Purchasing Managers Index (PMI) is provided in two formats: unadjusted and seasonally adjusted. It shows responses to one question: "Were your purchases last month in dollars higher, the same, or lower than the previous month?" A figure above 50 shows an increase while below 50 shows a decrease. The Ivey Purchasing Managers Index is often referred to as the Purchasing Managers Index, or PMI and is sponsored by the Richard Ivey School of Business and the Purchasing Management Association of Canada (PMAC). The PMI includes both the public and private sectors and is based on month-end data Ivey PMI panel members indicate whether their organization's activity is higher than, the same as, or lower than the previous month across the following five categories: purchases, employment, inventories, supplier deliveries and prices.

Let's now take a look at the USD/CAD technical picture at the H4 time frame. The depreciation of CAD is clear as the market rose towards the level of 1.2932, which is 50% of the previous swing down. Just above this Fibo level, there is technical resistance level as well, which makes this a tough resistance zone to break. The nearest support is seen at the level of 1.12885 and the nearest resistance, in a case of the up move continuation, is seen at the level of 1.2973, just above the 61% Fibo at 1.2967.

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Technical analysis: Intraday levels for EUR/USD, Oct 05/2018

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When the European market opens, some economic data will be released in the eurozone such as Italian Retail Sales m/m, French Trade Balance, French GovBudget Balance, German PPI m/m, and German Factory Orders m/m. The US will present a series of economic data too such as Consumer Credit m/m, Trade Balance, Unemployment Rate, Non-Farm Employment Change, and Average Hourly Earnings m/m. So, amid the reports, EUR/USD will move with medium to high volatility during this day.

TODAY'S TECHNICAL LEVELS:

Breakout BUY Level: 1.1573

Strong Resistance:1.1566

Original Resistance: 1.1555

Inner Sell Area: 1.1544

Target Inner Area: 1.1517

Inner Buy Area: 1.1490

Original Support: 1.1479

Strong Support: 1.1468

Breakout SELL Level: 1.1461

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.

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Technical analysis: Intraday levels for USD/JPY, Oct 05/2018

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In Asia, Japan will release some economic reports such as the Leading Indicators, Average Cash Earnings y/y, and Household Spending y/y. The US will also release a series of economic data: Consumer Credit m/m, Trade Balance, Unemployment Rate, Non-Farm Employment Change, and Average Hourly Earnings m/m. So, there is a probability the USD/JPY pair will move with medium to high volatility during this day.

TODAY'S TECHNICAL LEVELS:

Resistance 3: 114.60

Resistance 2: 114.38

Resistance 1: 114.16

Support 1: 113.87

Support 2: 113.65

Support 3: 113.43

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.

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Global macro overview for 05/10/2018

At the beginning of the week, the market consensus for employment change in the non-agricultural sector in the United States assumed an increase of 190,000, but the data this week fueled expectations for a positive surprise. The ADP report on the change of employment in the private sector indicated an impressive increase of 230,000 (versus expected 184,000). In addition, in the ISM reports for the industrial and service sectors, employment sub-indices improved in September. The sub-index in services made a special impression (this sector generates over 80% of jobs in the US economy), which jumped to a record 62.4 from 56.7 in August. On this basis, the consensus in the Bloomberg survey (currently 184,000) may be underestimated and opens the field for positive surprises. Nevertheless, there is a high chance that significant deviations of the reading will be met with a greater reaction of the market. The increase in new jobs is currently not an important subject of assessing the condition of the US economy, but it is wages.

A month ago the dynamics of hourly wages on 0.4% m / m dropped above expectations and raised annual dynamics to 2.9% - at the most since 2009 The question before the September reading is whether we are dealing with a new, faster wage growth trend? The obstacle, however, is the strong base effects from September 2017 (0.5% m / m) and even with a solid reading of 0.3% m / m now the annual dynamics may slow down to 2.8%. It will still be strong data that will build momentum for the next month, when base effects will be favorable (-0.2% m / m in October 2017). Positive risks for reading create difficulties in running the business in the south-eastern part of the US due to hurricanes. Similarly to a year ago, business interruptions mean a lower number of worked hours, which may boost the conversion of hourly wages.

A positive surprise in wages data will trigger the strongest reaction of the market, as it will be a confirmation that wage pressure is picking up momentum. As a result, it is justified to revise upwards expectations regarding the target level of interest rates in this cycle of tightening the Fed's policy, and therefore there are also arguments for the rally in Treasury bond yields and USD appreciation. For the same reason, investors will not draw far-fetched conclusions from the disappointing readings. At the same time, however, taking into account the strong US bond and dollar yield, poor data will be a pretext for the sell-off. The unemployment rate will attract the least attention. With a strong increase in employment, the unemployment rate is the most likely drop by 0.1 percentage point. up to 3.8%.

Let's now take a look at the EUR/USD technical picture at the H4 time frame to see what are the important levels for the NFP-Payrolls data release. The EUR/USD is moving down as the local trend continues. The nearest technical support is seen at the level of 1.1445 - 1.1432 and the nearest technical resistance is seen at the level of 1.1525. The market conditions are now oversold and there is a visible bullish divergence forming between the price and the momentum indicator.

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Bitcoin analysis for 05/10/2018

A recent report by a research company for technological research, ReportLinker, shows that Blockchain technology in the manufacturing sector in the US is expected to grow significantly in 2020-2025. During the preparation of the report, its authors share the application of Blockchain according to the application, end-use and territory. The research then divided the Blockchain industry into the production market based on final use, for energy, industry, automotive, pharmaceuticals, aerospace and defense, food and beverages, textiles and clothing, and other sectors.

According to the research, Blockchain on the production market is expected to increase by 80 percent by 2025. It will simplify business processes and ensure transparency and consistency, eliminating intermediaries in logistics and the supply chain. The authors report several factors driving growth, among which the most important is the development of block-like-as-service (BaaS) solutions for enterprises and a significant increase in venture capital and Initial Coin Offerings (ICO) investments.

However, the report states that the uncertain regulatory situation and the lack of a uniform set of standards prevent the development of the blockchain in the production market. The MAPI Foundation, which conducts research and issues policy recommendations on the conditions of the US manufacturing sector, said in March that since January 2018 industrial production was 4.7 percent lower than in December 2007. Despite the recession crisis in 2008, MAPI forecasts that the manufacturing sector in the US will regain full lost production by April 2019.

In August, Blockchain Deloitte study in 2018 showed that technology is gaining significant driving power at the executive level of enterprises in various industries. 74 percent of survey respondents said that their executive team believes that there is a "convincing business case" in the use of Blockchain technology, 34 percent say that some forms of Blockchain implementation were already under development within the organization.

Let's now take a look at the Bitcoin technical picture at the H4 time frame. The market was trying to rally above the technical resistance zone established between the levels of $6,550 - $6,603, but was capped at the level of $6,560 and dropped back towards the weekly pivot level. The horizontal cycle is still in progress and it is getting tight in here for both of the market participants, so the breakout soon occurs soon. Please notice, that the larger time frame trend remains bearish, so the chances for a downside breakout are higher.

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Elliott wave analysis of EUR/NZD for October 5, 2018

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We have seen a nice strong rally out of the 1.7484 low as we expected. This rally does look a bit stretched and we should not be surprised to a temporary set-back 1.7722 and maybe even closer to the broken resistance-line, that's now is acting as support. This line is currently sitting near 1.7660. Once this possible correction is complete more upside towards 1.8030 and 1.8369 will be expected as the next upside targets.

R3: 1.8030

R2: 1.7900

R1: 1.7825

pivot: 1.7754

S1: 1.7722

S2: 1.7660

S3: 1.7598

Trading recommendation:

We are long EUR from 1.7500. We will take half profit at 1.7795 for a nice profit of 295 pips. We will re-buy EUR at 1.7675.

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Elliott wave analysis of EUR/JPY for October 5, 2018

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EUR/JPY dipped below support at 130.94, but did not have the power to challenge the 130.69 low, this indicate to us, that a possible low now is in place at 130.69 has we expected all along and renewed upside pressure is building. To confirm that blue wave (4) has completed and blue wave (v) is developing a break above resistance at 131.57 and more importantly a break above 131.97 that confirms blue wave (5) is unfolding towards 133.96.

Even if support at 130.74 is taken out, then the potential downside should remain very limited. However, we do not expect it will.

R3: 131.98

R2: 131.57

R1: 131.37

Pivot: 131.18

S1: 131.02

S2: 130.74

S3: 130.69

Trading recommendation:

We are long EUR from 131.50 with our stop placed at 130.65. If you are not long EUR yet, the wait a buy a break above 131.97 and start by using the same stop at 130.65.

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AUD/USD. The pair is approaching the stronghold of bulls - 0.7000

The Australian dollar paired with the US currency weakened to 2.5-year lows, entrenched in the 70th figure. This dynamics is associated not only with the strengthening of the greenback, although the rhythm of today's trading is set by the US dollar. "Hawkish" comments of the head of the Federal Reserve provoked an increase in the yield of 10-year treasuries, and this fact in turn influenced the dynamics of dollar pairs.

Despite the clear dominance of the US currency, in the context of the AUD/USD pair, it is worth considering that it will be difficult for traders to break through the base of the 70th figure and go lower. The last time such a maneuver was in January 2016 - but even then the bears of the AUD/USD could not keep the price within the 69th figure for more than one week. Therefore, short positions should be treated with extreme caution: the pair is too close to a strong support level.

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The long weekend in China (the country celebrates Independence Day throughout the week) shifted the focus of AUD/USD traders' attention to other fundamental factors. The theme of the US-China trade conflict has faded into the background, as the parties have so far "dispersed in the corners of the ring", also due to the national holiday in China. The Australian dollar did not get any benefit from this fact - on the contrary, now the pressure of the US currency has increased due to the tougher rhetoric of the Fed representatives.

And it's not just about Jerome Powell, who yesterday quite transparently hinted at the acceleration of the rate hike. In particular, speakers in recent days, Charles Evans, Eric Rosengren, Lael Brainard stated the need for further tightening of monetary policy ,and Brainard even allowed the possibility of accelerating the pace of the rate hike. Jerome Powell spoke about this, however, not directly, but in very clear hints. The meaning of its position is difficult to distort: apparently, the Fed will raise the interest rate three or four times next year and only in 2020 will it think about the level of the neutral rate.

The overall strengthening of the US dollar has not spared the AUD/USD pair. The yield spread between 10-year US and Australian bonds expanded to record levels in favor of the United States: the last time such dynamics was observed as much was 37 years ago. By and large, at one point connected many factors, the combination of which had a strong pressure on the Australian dollar.

The Reserve Bank of Australia is also not an "ally" of the Australian, as the devaluation of the national currency plays only into the hands of inflationary processes. The regulator has repeatedly stated this fact, each time voicing their concerns, if the AUD/USD exchange rate was approaching the region of the 80th figure. At their last meeting, which took place this week, the members of the RBA took a wait-and-see position, confirming the general expectations of the market about the prospects of monetary policy. According to the majority of traders, the issue of raising interest rates may not be considered until the second half of next year, and RBA members are in no hurry to dissuade the market from this.

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Thus, the Australian currency does not have its own strength to resist, so the "aussie" is entirely dependent on the dynamics of the US dollar. In turn, this means that the motion vector of the AUD/USD in the short term depends on the Nonfarms, the release of which is scheduled for tomorrow. If the number of employed in the non-agricultural sector exceeds the 200,000 mark, the unemployment rate will drop to 3.8%, and the dynamics of the average wage will remain within 0.3-0.4%, the US currency will continue its offensive in all dollar pairs (except for the pound-dollar pair, where the subject of Brexit dominates).

Technically, the AUD/USD pair also shows a clearly bearish picture, and on the "higher" timeframes (daily, weekly and monthly chart). On each of them the price is on the lower or between the middle and lower lines of the Bollinger Bands indicator. Ichimoku Kinko Hyo indicator shows a strong bearish "Parade of lines" signal, and oscillators also signal the priority of the downward movement.

You can define several goals of the downward scenario, depending on the timeframe: D1 – 0,7070 (the goal is almost reached); W1 – 0,7055 and MN – 0,7005. When passing the above values, the pair will target the main "price stronghold" – the mark of 0.7000. Here it should be noted that the above support levels are not a reliable stronghold – the main battle will unfold for a decrease in the 69th figure.

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Tomorrow's Nonfarms can impulsively reduce the price to the base of the 70th figure, but this price breakthrough should be treated with caution. In the area of multi-year lows, the pair can gradually buy back, and in the first trading days of the next week it can move away from record lows. Short positions in this case are appropriate only in the range of 0.7090-0.7010 or when the pair is fixed in the 69th figure. But to participate in the "battle" for a breakthrough in the 69th figure is very risky, since its outcome is not predetermined.

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Burning forecast 04/10/2018

Burning forecast 04/10/2018

EURUSD: there is a down trend signal.

On the night of Wednesday to Thursday at an inopportune time for strong movements, the EUR/USD rate broke down (on the second attempt) the strong resistance level of 1.1500 and consolidated below.

Technically, this is a strong signal to move down.

The first goal is the lows of the year at 1.1300.

An alternative option is a turn up and in case of growth above 1.1625 - return to the range - and then an attempt to grow to 1.1800 and above.

We keep selling euros from 1.1503, stop 1.1548, target of 1.1300.

Alternative: buy from 1.1800 when breaking up.

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Trading Plan for 10/04/2018

It seems that it is simply impossible to stop the dollar, and it confidently continues a victorious March. And this is despite the fact that the forecasts on the content of the report of the Ministry of Labor have been revised for the worse. Moreover, even when data on retail sales growth in Europe were released, which accelerated from 1.0% to 1.8%, market participants continued to sell the single European currency. This can be understood, since the tension caused by Italy and its budget deficit has not gone away. And in the UK, not everything is so clear with this thrice-damned Brexit. So no one has any confidence in how events will develop in the eurozone, and this has a negative impact on the single European currency and the pound. In addition, although the European services PMI rose from 54.4 to 54.7, the composite PMI declined from 54.5 to 54.1. And all this is due to the decline in industrial production. Data from the UK also could not please anyone, as the index of business activity in the services sector decreased from 54.3 to 53.9. And Theresa May at the Conservative party conference said something indistinct about the plan to secede from the European Union. From her words, it was extremely difficult to understand what conditions of interaction between the United Kingdom and the European Union would replace the current one.

The US statistics turned out to be quite positive. Thus, according to ADP, employment grew by 230 thousand against 163 thousand in the previous month. Moreover, they predicted growth of 185 thousand. However, the index of business activity in the service sector decreased from 54.8 to 53.5, but expected it to decline to 52.9. The picture is similar with the composite index of business activity, which was to be reduced from 54.7 to 53.4, and fell only to 53.9.

Today, data are released only in the US, and forecasts for them are multidirectional. Of course, the volume of production orders can show an increase of 2.1%, but the number of applications for unemployment benefits should increase by 3 thousand. The most important thing is that if the number of primary applications can be reduced by 1 thousand, the number of repeat applications should increase by 4 thousand and do not forget that tomorrow the report of the US Department of Labor will be published, the forecasts for which are quite sad. So the data on applications for unemployment benefits can be a reason for a rebound on the dollar.

The euro/dollar currency pair on the general background has managed to overcome the range level of 1,1510/ 1,1550, showing an active interest downwards. It is likely to assume that, near the primary point of support at 1,1440 the quotation will experience a temporary support, slowing down the quote for the rearrangement of trading forces.

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The pound/dollar currency pair continued its downward movement, overcoming the range level of 1.3000/1.3050. Likely to assume a slowdown in the framework of 1.2940/1.2980 due to the rearrangement of trading forces.

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EUR / USD: plan for the US session on October 4. Traders are in no hurry to return to the market

To open long positions on EUR / USD, you need:

Euro buyers returned to the level of 1.1501, to which I drew attention in my morning review, and are preparing a technical structure for its breakdown, which is a good signal to buy euro in order to update the maximum of 1.1541, where I recommend fixing the profits. In the case of EUR / USD decline in the second half of the day, long positions can be returned on a false breakdown from the week minimum of 1.1463 or on the rebound from the support of 1.1399.

To open short positions on EUR / USD, you need:

An unsuccessful consolidation and return under the resistance level of 1.1501 will be another signal to open short positions in the euro with the aim of retesting and breaking the minimum of 1.1450, which will resume the downtrend and lead to a test of new support levels of 1.1399 and 1.1351, where I recommend fixing the profits. In the case of growth above resistance 1.1501, you can sell the euro immediately to rebound from a maximum of 1.1541.

Indicator signals:

Moving Averages

The price returned under the 30- and 50-average, which indicates the further formation of the downward trend. As long as trading is below average, pressure on the euro will continue.

Bollinger bands

The resistance will be the upper line of the Bollinger Bands, from which you can watch the euro sales immediately to rebound, based on the formation of a false breakdown of the level of 1.1501 in the afternoon.

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Description of indicators

MA (moving average) 50 days - yellow

MA (moving average) 30 days - green

MACD: fast EMA 12, slow EMA 26, SMA 9

Bollinger Bands 20

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GBP / USD: plan for the American session on October 4. Buyers are trying to reverse the downward trend.

To open long positions on GBP / USD, you need:

Pound buyers today managed to cling to the resistance level of 1.2970 and entrenched themselves on it, which holds hope for a continuation of the upward correction, which at any time could lead to a break in the downward trend. The main target for long positions in the second half of the day will be the resistance of 1.3022, where I recommend fixing the profits. In the event of a return of the pound under the support of 1.2970, you can rely on purchases again from the minimum of the week, 1.2926.

To open short positions on GBP / USD, you need:

Pound sellers need to build the upper limit of the downward price channel, which is viewed just around the level of 1.3012. Until then, while trading will be conducted below this range, there is no need to worry about changing the trend. The return of GBP / USD under the support level of 1.2970 will be a confirmation of the preservation of the bearish trend towards the support of 1.2926 and 1.2872, where I recommend fixing the profits. In the case of growth of the pound in the afternoon, you can immediately sell on the rebound from the resistance of 1.3022.

Indicator signals:

Moving averages

The pair is stuck in the region of 30- and 50-medium, which indicates a short-term confusion of the market with further direction. However, in general, the trend remains bearish.

Bollinger bands

The upper limit of the Bollinger Bands indicator in the area of 1.2998 has already fulfilled itself, not letting the pair go higher. Its breakdown will lead to a new wave of growth in the area of resistance 1.3022.

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Description of indicators

MA (moving average) 50 days - yellow

MA (moving average) 30 days - green

MACD: fast EMA 12, slow EMA 26, SMA 9

Bollinger Bands 20

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Everything is good, and even better: the head of the Fed hinted at an acceleration of the rate increase

The American currency is at the height of glory. The dollar is in high demand against the background of a record increase in the yield of 10-year treasuries to perennial highs, as well as due to increased geopolitical tensions in the world. The dollar index settled at 95 points, and most likely will not stop its growth until the end of the week, unless Nonfarm does not disappoint traders. But, judging by the latest report from the ADP agency, the labor market is in excellent shape, like many other elements of the American economy.

According to data published yesterday by ADP, in September, 230 thousand jobs were created. These figures are much higher than the forecast level (185 thousand), which reflect the most effective increase since February of this year. In addition, the agency's experts revised the August data upwards, confirming the positive dynamics of the labor market. It is worth noting that the data from ADP do not always find their confirmation in the official release of Nonfarm but at the same time, they correctly indicate the general dynamics of the indicators.

And although lately, traders are cool about the reports of this agency, yesterday, the dollar bulls took advantage of the excuse and increased the demand for greenbacks. Moreover, the positive picture of the day was reinforced by another indicator, the ISM composite index for the non-production sphere. This indicator unexpectedly jumped to 61.6 points, this is the strongest result in the last 20 years. Such an abnormal dynamics could not be ignored by the market, so the dollar strengthened its position over the course of yesterday.

However, the main reason for the dollar appreciation throughout the market lies elsewhere. The US currency yesterday received strong support from Fed Chairman Jerome Powell, who this week announced his position for the second time publicly. Yesterday's speech confirmed the assumptions of analysts that the Fed is preparing the market to accelerate the pace of tightening monetary policy. If in his first speech this week, Powell only positively assessed the dynamics of economic growth. Yesterday, he said that the regulator "is still far from the level of neutral rates." This is a very important phrase, which largely lowered concerns that the Fed would soon pause the process of normalizing monetary policy.

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It should be recalled here that the debate about where this notorious neutral level is located, at which monetary policy does not slow down, but does not disperse the economy, has been going on for a long time (including among Fed members), and the likely bar is gradually increasing. If at the beginning of this year, members of the regulator said that this level is "just below three percent," then later, most of them agreed that the three percent target would still be exceeded. At the moment, their estimates are in the range of 2.75-3.5%. The position voiced yesterday by Powell suggests that the regulator is leaning towards the upper bar of the above range, and this means that next year, the rate of increase may be increased.

Moreover, at the last meeting of the Federal Reserve, Jerome Powell admitted that the regulator could exceed the level of the neutral rate, "if the economic situation demands it". Yesterday, he repeated this phrase along with other theses of a "hawk" character. For example, he stated that the negative effects of the trade war between China and the United States "are not yet observed," and inflation is in the target 2 percent level, amid a record-low unemployment rate. Summarizing his speech, Powell stressed that he was "extremely pleased" with the current state of the American economy.

It is not surprising that after such a "luscious" performance, the yield on 10-year-old treasuries jumped to 3.202%, updating the 7-year maximum. The results of the September Fed meeting and subsequent speeches by Jerome Powell suggest that the regulator will exceed market expectations and take a tougher stance next year. The head of the Federal Reserve did not mention either global risks or weak wage growth rates, focusing only on positive aspects. Such unambiguous signals were perceived by the market accordingly, intensifying the demand for the dollar.

Thus, Jerome Powell gave impetus to the next rally of the American currency. If tomorrow, Nonfarm does not disappoint the market, then the dollar will receive an additional reason for strengthening. Now, the strong figures of key indicators will be viewed through the prism of the intentions of the Fed chairman to accelerate the rate of increase.

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From the point of view of technology, the EUR / USD currency pair on the daily chart is in a downward channel, as evidenced by the price location under all the lines of the Ichimoku Kinko Hyo indicator, which formed the bear signal "Parade of lines". In addition, on D1 and W1, the pair is between the middle and lower lines of the Bollinger Bands indicator, which also indicates the priority of the southern movement. The nearest support level is at 1.1420 (the bottom line of the Bollinger Bands indicator on the weekly chart). If the bears consolidate under this mark, then the next support will be the price of 1.1301, this is the price minimum of this year.

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Wave analysis of GBP / USD for October 4. News continues to pull the pound down

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Wave counting analysis:

During the trading on October 3, the GBP / USD currency pair lost another 40 percentage points. Thus, the estimated wave c, 4, continues its construction, despite the elongated appearance. An unsuccessful attempt to break through the 76.4% of Fibonacci level can lead to the completion of the construction of this wave. However, as mentioned earlier, the news background is of great importance for the pair now. In particular, any information on Brexit. Since for the most part, this information is now negative, the British currency continues to fall, not paying attention to the fact that, based on the wave marking, the decline should end.

The objectives for the option with purchases:

1.3301 - 161.8% of Fibonacci (senior grid)

The objectives for the option with sales:

1.2908 - 76.4% of Fibonacci

1.2786 - 100.0% of Fibonacci

General conclusions and trading recommendations:

The currency pair GBP / USD continues to build the estimated wave c, 4. Thus, now I recommend remaining in sales with targets located near the levels of 1.2908 and 1.2786, which corresponds to 76.4% and 100.0% of Fibonacci. An unsuccessful attempt to break through the level of 1.2908 may lead to the completion of this wave and the transition of the pair to the construction of wave 5 of the upward trend section. This can prevent news from the UK about the unsuccessful progress of negotiations on Brexit.

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Wave analysis of EUR / USD for October 4. Descending wave takes an elongated appearance

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Wave counting analysis:

During the Wednesday's trading, the EUR / USD currency pair lost another 70 percentage points more. Thus, it confirms the option in which the instrument moved to the stage of building a new downtrend trend, at least a three-wave one. If this is true, then in the near future, the pair should proceed to the construction of a correctional wave b. It should also be noted that there remains a rather high probability that the current decline is the wave b of the corrective uptrend of the trend originating from August 15.

The objectives for the option with sales:

1.1446 - 161.8% of Fibonacci

1.1361 - 200.0% of Fibonacci

The objectives for the option with purchases:

1.1641 - 76.4% of Fibonacci

1.1674 - 61.8% of Fibonacci

General conclusions and trading recommendations:

The currency pair continues to build a downward wave. In general, the wave pattern is now ambiguous, and the entire trend section after August 15 may take a more complex form. But now, in any case, a transition is expected to rise in the pair. Either within the wave b of the downward trend segment, or within the upward wave. However, since the attempt to break through the mark of 127.2% according to Fibonacci was successful, the descending wave may take an even longer view, and we will need a new signal about its possible completion.

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GBP / USD: plan for the European session on October 4. The pound is falling amid certainty with Brexit

To open long positions on GBP / USD, you need:

Yesterday, British Prime Minister Theresa May once again called for support for her Brexit plan. While trading is conducted above the support level of 1.2926, buyers will be active, but the main task is to break down and consolidate above the resistance level of 1.2970, which will lead to an upward correction in the area of 1.3011, where I recommend fixing the profits. In the case of a decline below the level of 1.2926, the return to the market of buyers can be expected only after updating the minimums of 1.2897 and 1.2872.

To open short positions on GBP / USD, you need:

Pound sellers will expect a false breakdown and a return below the resistance level of 1.2970, which can lead to a larger downward trend with a break of 1.2929 support, below which the pound will fall to the minimum of 1.2897 and 1.2872, where I recommend fixing the profits. In the case of GBP / USD growth in the first half of the day above 1.2970, I recommend to take a look at short positions from the resistance level of 1.3011 or sell a pound to rebound from a maximum of 1.3036.

Indicator signals:

Moving averages

The price returned under the 30- and 50-average, which indicates the further formation of the downward trend. As long as trading is below average, the pressure on the pound will continue.

Bollinger bands

Support the pound, in the case of further decline, may have a lower limit of the Bollinger Bands in the region of 1.2907. Sellers will begin to show activity after the test of the middle of the channel in the region of 1.2958.

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Description of indicators

MA (moving average) 50 days - yellow

MA (moving average) 30 days - green

MACD: fast EMA 12, slow EMA 26, SMA 9

Bollinger Bands 20

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

EUR / USD: plan for the European session on October 4. The level of neutral interest rates in the United States is still

To open long positions on EUR / USD, you need:

The euro collapsed on Wednesday evening after the Fed chairman announced that it was still far from the level of neutral interest rates, hinting at their further increase. Currently, customers can only rely on the formation of a false breakdown with a divergence on the MACD indicator from the level of 1.1450, which will lead to a larger upward correction in the area of 1.151 and 1.1541, where I recommend fixing the profits. In the event of a further decline in the euro under the level of 1.1450, it is best to return to purchases after updating the lows in the area of 1.1399 or to rebound from 1.1351.

To open short positions on EUR / USD, you need:

An unsuccessful consolidation and return under the resistance level of 1.1501 will be another signal to open short positions in the euro with the aim of retesting and breaking the minimum of 1.1450, which will resume the downtrend and lead to a test of new support levels of 1.1399 and 1.1351, where I recommend fixing the profits. In the case of growth above the resistance level of 1.1501, you can sell the euro immediately to rebound from a maximum of 1.1541.

Indicator signals:

Moving averages

The price returned under the 30- and 50-average, which indicates the further formation of the downward trend. As long as trading is below average, pressure on the euro will continue.

Bollinger bands

The euro can be supported by the lower limit of the Bollinger Bands around 1.1450, the test of which will be a signal to buy the euro.

analytics5bb5bd134e499.png

Description of indicators

MA (moving average) 50 days - yellow

MA (moving average) 30 days - green

MACD: fast EMA 12, slow EMA 26, SMA 9

Bollinger Bands 20

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

GBP / USD. The 4th of October. The trading system "Regression Channels". May's new performance lowers the pound again

4-hour timeframe

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Technical data:

The senior linear regression channel: direction - sideways.

The younger linear regression channel: direction - up.

Moving average (20; smoothed) - down.

CCI: -121.8195

The currency pair GBP / USD on October 4 continues its downward movement. The demand for the US currency is already quite high now, but the pair is also falling down due to regularly received information on the Brexit topic. Theresa May spoke yesterday and said that the UK is not afraid to withdraw from the EU without a "deal". According to her, there are politicians who believe that it is necessary to exclude the option of Brexit without a "deal" with the EU. However, May believes that such a position would weaken the UK in negotiations with Brussels. Also, traditional for such speeches were the words that "you need to unite in such a difficult time" that "the life of the British should not become worse after Brexit". However, all experts understand that if there is no deal, then life will become worse. The UK is already losing $ 500 million each week due to Brexit, which has not even been completed yet. The absence of a "deal" will lead to the introduction of a number of duties at the borders and reduce the investment attractiveness of the UK. In general, May was in a stalemate. Her support is deteriorating every day, and even within her own party, there are already enough politicians who are dissatisfied with her actions. Against the background of such a development, it is not surprising that the pound continues to decline.

Nearest support levels:

S1 - 1,2939

S2 - 1,2878

S3 - 1.2817

Nearest resistance levels:

R1 - 1.3000

R2 - 1.3062

R3 - 1.3123

Trading recommendations:

The currency pair GBP / USD resumed its downward movement after a slight correction. Thus, the short positions remain relevant for the purpose of Murray's level "3/8" - 1.2878. Heikin Ashi's upward reversal will serve as a signal to reduce short positions.

Buy positions are recommended to be considered if traders overcome the moving average. In this case, the bulls may again try to form an uptrend, although taking into account the fundamental component, it will be quite difficult to implement.

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

Explanations for illustrations:

The senior linear regression channel is the blue lines of unidirectional movement.

The lower linear channel is the purple lines of unidirectional movement.

CCI is the blue line in the indicator regression window.

The moving average (20; smoothed) is the blue line on the price chart.

Murray levels - multi-colored horizontal stripes.

Heikin Ashi is an indicator that colors bars in blue or purple.

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

EUR / USD. The 4th of October. The trading system "Regression Channels". US macroeconomic statistics supported the already

4-hour timeframe

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Technical data:

The senior linear regression channel: direction - sideways.

The younger linear regression channel: direction - sideways.

Moving average (20; smoothed) - down.

CCI: -152.9550

The EUR / USD currency pair, after the minimal upward correction, resumed a strong downward movement and completed the Murray level "4/8" - 1.1475. Retail sales for the euro area, published the day before, in annual terms exceeded the forecast value (1.8% vs. 1.7%). Although this factor had no special significance for the market. But the ADP report on the change in the number of workers in the private sector, which also exceeded the forecast, caused additional demand for the US dollar. All indices of business activity across the States, published yesterday, also turned out to be better than market expectations and further increased the desire of traders to buy the dollar. Thus, it can be said that macroeconomic statistics for America had a strong impact on the market. No important news is scheduled for Thursday, October 4th. However, there is every reason to assume a further decline in the pair, since the demand for the dollar is now extremely high. The key question now is what will Donald Trump do with the new round of strengthening the national currency? As he has repeatedly pointed out, he does not need a strong dollar and damages the country's economy. However, the position of Trump is not too worried about traders, they continue to invest in the currency of the country, whose economy shows the highest results.

Nearest support levels:

S1 - 1,1475

S2 - 1,1414

S3 - 1.1353

Nearest resistance levels:

R1 - 1.1536

R2 - 1.1597

R3 - 1.1658

Trading recommendations:

The EUR / USD currency pair has resumed its downward movement. Thus, it is still recommended to trade short with a target of 1.1414. Heikin Ashi's upward reversal will signal a new round of corrective movement.

It is recommended to consider long positions not earlier than traders overcome the moving average line. In this case, the trend in the instrument will change to ascending, and the target will be the level of 1.1658.

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

Explanations for illustrations:

The senior linear regression channel is the blue lines of unidirectional movement.

The junior linear regression channel is the purple lines of unidirectional movement.

CCI - blue line in the indicator window.

The moving average (20; smoothed) is the blue line on the price chart.

Murray levels - multi-colored horizontal stripes.

Heikin Ashi is an indicator that colors bars in blue or purple.

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

Global macro overview for 04/10/2018

Yields of 10-year US Treasury bonds jumped yesterday 12 bps to 3.18%, and today added another 5 bp. Such a high-interest rate has not been since 2011. In the case of 30-year-olds, the 30-year peaks have been established at 3.38 %. The unprecedented move came from the interruption of the overall calmness in which the market has been in place for weeks, without responding to a wave of positive information. It seems that you can not end the strong surprises in the macro data without saying that "it's already in the price". Yesterday, however, was a special day of combining hit. Strong ADP readings and the ISM index for services from the US raise expectations before Friday's NFP report. Moreover, the Fed president Jerome Powell said that he is "very pleased" with the economic developments and the Fed may raise interest rates even above the neutral level. Finally, technical aspects have accelerated the increase in profitability. The combined impact of these three factors determined the scale of the profitability rally. From the side of foundations, it is important, however, that the market is finally beginning to believe that the Fed is ready to raise rates more than three times (in December and twice in 2019). And not just because the Fed promises so: the economy does not slow down and real wage and inflationary pressures are becoming real. The first one is additionally conquered by Amazon's declarations of increasing the minimum wage, the second - unrelenting oil prices.

Let's now take a look at the US Dollar Index technical picture at the H4 time frame. The market spiked higher towards the technical resistance at the level of 96.12, but was capped there and now is testing the broken technical support at the level of 95.56. The market conditions are clearly overbought and there is a visible bearish divergence between the price and the momentum oscillator, which indicates a possible pull-back towards the level of 95.26.

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

Global macro overview for 04/10/2018

British Prime Minister, Theresa May, will meet representatives of the European Union for a joint dinner on October 17. According to commentators, it is then that the finalization of the Brexit agreement will be finalized, which could be signed by both parties a month later.

The May administration would like to ratify the Secession Agreement two weeks after its signature. This would mean that the British Parliament would have really little time to make any amendments to the agreement, which turned out to be more complicated than it seemed.

After a series of failures and crises, it seems that both sides have finally found a common language and agreement on the UK leaving the European Union will finally be signed. Since the memorable referendum in June 2016, we have had a situation on several occasions in which it seemed that both sides would not want to compromise. One of the last risk factors of the border issue was with remaining Ireland in the Union.

May must fight with both Brexit supporters and opponents. The former accuse the prime minister of the fact that the terms of secession established by her administration are unacceptable. Euro-enthusiasts, in turn, do not want to hear about Brexit and demand a second referendum on this matter.

The biggest threat to May is the possibility of not being supported by her own political party. In theory, the opposition of just seven Tories could have put an end to the work on the contract. Jacob Rees-Mogg, who leads the party's European Research Group, warns that he is able to convince even 80 parliamentarians that they will reject the proposals of the May administration.

Let's now take a look at the GBP/USD technical picture at the H4 time frame. The market has hit the 38% Fibo retracement of th previous swing down at the level of 1.3034, but the bears are now pushing the price back down again. The nearest support is seen at the level of 1.2977 and 1.2964, but the momentum is still below its fifty level, so the move down is still more probable.

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