EUR / USD: bulls are not able to break the bearish trend yet

The yield of 10-year-old treasures, Italian bonds and the rate of the Chinese yuan, all these fundamental factors play today the "first fiddle" in determining the motion vector of the euro / dollar currency pair. In turn, these factors depend on the negotiation process between Rome and Brussels, as well as the US-China relations. One more circumstance will soon be added to this "bouquet", the local elections in Germany, where radical Euroscepticism can win.

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The dollar index yesterday slowed its growth, stopping at 95.82 points. Greenback reacted to the dynamics of the treasuries, whose profitability also began to decline gradually, although, at the moment, it still exceeds the 3% barrier. The European currency also took advantage of the respite, since the yield of Italian securities moved away from the highs. Although again, the budget issue is not yet resolved, so this rebound can be considered temporary. The euro was also indirectly supported by rumors around Brexit. Another piece of information from American journalists increases the likelihood of a deal. According to preliminary data, a draft version of the future agreement will appear next Monday.

Considering the list of the above fundamental factors, it can be concluded that the growth of the EUR / USD currency pair is uncertain, and it is still too early to talk about the trend reversal. Trump once again warned yesterday that he would not ignore China's actions if Beijing decides to retaliate. In this case, Washington may impose additional duties of 267 billion dollars.

In other words, the US-China trade conflict continues to fester and could ignite with a new force at any moment. The actions of the People's Bank of China, as well as the renminbi, suggest that Beijing feels the negative effects of a trade war, but prefers the use of protective measures to negotiations. It is likely that the Chinese took a wait-and-see position before the elections to the US Congress, after which the political situation in the country could change significantly, affecting the position of the White House. But at the time of "here and now", the parties do not demonstrate a desire to agree. Therefore, the dollar is in demand as a kind of "island of security."

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In addition, one cannot talk about any restoration of the EUR / USD price as long as there is a problem with the Italian budget. This question still remains in limbo, while the rhetoric of the official Brussels and Rome is only getting tougher. Literally, today, the head of the Ministry of Internal Affairs of Italy and one of the leaders of the ruling party "Lega Nord" Matteo Salvini said that the Italians will not stumble from the stated budget deficit and will not compromise on the issue of pension reform and tax payments. In turn, the European Commission is preparing for the first time in the history of the EU to reject the national budget of the Alliance member country. If the parties do not make concessions, then in October-November, the European currency will be under a constant pressure of this problem.

According to some experts, the Italians will eventually cut the budget deficit after the European Commission returns the rejected document to them. It is likely that the populist politicians themselves construct this scenario. In this case, responsibility for non-fulfillment of election promises can be shifted to Brussels, and the reduction of the budget deficit can be justified by possible sanctions from the European Commission. Such political games are very dangerous, since the yield spread of Italian government bonds relative to comparable German bonds has already exceeded 300 basis points and, according to some estimates, will reach 400 basis points. Such an imbalance will cause a domino effect in the markets, which may lead to a full-scale crisis.

The gloomy fundamental background threatens the ECB's intentions to follow the path of normalizing monetary policy. If representatives of the European regulator start talking about a possible extension of QE, then the euro will significantly fall in price across the entire market, including paired with the dollar. So far, the decline in the pair is due only to the rising dollar and market concerns about the prospects for the development of the Italian problem. If the worst assumptions of traders begin to be realized, even a hypothetical weakening of the US currency will not help the EUR / USD bulls, bearish sentiment will prevail in the pair.

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However, there is good news for the pair bulls. Despite yesterday's price decline, they managed to keep the euro above 1.1440. That is, above the bottom line of the BB indicator on the daily chart. While the price is above this price target, there is a chance for further corrective growth to the levels of 1.1545 and 1.1575 (lower and upper boundaries of the Kumo cloud, respectively). But further price recovery looks unlikely for now. Until Rome and Brussels agree, any northern movement will be temporary and unreliable.

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EUR / USD and GBP / USD: Donald Trump criticized the Fed policy. Pound rises again on rumors on Brexit

The pound rose again strongly against the US dollar and managed to reverse its downward trend formed after the next increase in interest rates in the United States.

UK and Brexit

Rumors and talks that the EU and the UK have made progress in the Brexit negotiations have once again supported us. Whether this is in fact the case remains unclear, but, judging from yesterday's statements, the terms of the agreement may be approved in the near future. Of course, the pound is no longer responding to this news as it was before, but it is still clear that investors remain optimistic in reaching a deal by the deadline.

The EU and the United Kingdom intend to outline the future of trade relations by November of this year, although there are still a number of contradictions regarding the Irish border. As noted in yesterday's statements, the EU and the UK are close to resolving all other contradictions regarding exit conditions, and if an exit agreement is reached, it is expected that the EU will voice its views on future relations next week.

Again, all these statements were made without any specifics, which provided only temporary support to the British pound, which was going to another fall against the US dollar, practically losing all the advantage gained last week.

As for the technical picture of the GBP / USD currency pair, we should pay attention to today's data on the growth of the UK economy, since it will depend on them whether the pound will continue to grow in the short term or the current upward potential will be limited by resistance around 1.3175. Only a breakthrough in this area will open the way to new weekly highs and lead to a resistance test of 1.3270 and 1.3350.

Donald Trump and the Fed

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The US dollar fell against the euro in the afternoon after the Fed representatives made statements related to the credit policy made by the US president.

Yesterday, Donald Trump expressed his views on the actions of the Fed in relation to interest rates, saying that he does not like what is happening and should not be in such a hurry to raise interest rates.

It is clear that in the current situation, Trump does not want even a slight slowdown in the economy, which is likely to happen if the committee continues to adhere to the plan to normalize monetary policy.

Trump also said that he did not speak with Fed Chairman Powell on this topic, because he wants to remain uncomplicated in this situation, but believes that the normalization of monetary policy is quite a reasonable step.

A speech at the end of the day by President of the Federal Reserve Bank of Dallas, Robert Kaplan, also put pressure on the dollar, even though Kaplan spoke more about the prospects for further rate increases, unlike his colleagues.

As stated by the Fed, inflation will remain under control, and the prospects give the Fed flexibility in terms of the rate of increase in interest rates. He is also confident that he should continue to raise the federal funds rate, and at least three more rate increases seem completely unreasonable.

Robert Kaplan is also not yet ready to judge whether the Fed will have to pause the rate hike next year or the increase will continue at current rates. Everything will depend on the incoming statistics at the end of this year. Let me remind you that in December of this year, another increase in interest rates is planned by the US Federal Reserve.

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GBP / USD. October 10th. The trading system "Regression Channels". The British Parliament is preparing to vote on the Brexit

4-hour timeframe

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Technical data:

The senior linear regression channel: direction - up.

The younger linear regression channel: direction - up.

Moving average (20; smoothed) - up.

CCI: 137.1769

The currency pair GBP / USD on October 10 continues to move up exclusively on rumors and expectations. In the near future, the UK will take a vote on the so-called plan "Checkers". This plan was developed by Theresa May and does not yet find support either in the European Union or within the British Parliament. Thus, it is likely that the vote will fail. The UK thus remains in limbo. There are two options: either vote for Theresa May's plan or leave the EU without a "deal". As the information comes from the political sphere of the Kingdom, both options do not suit the majority. Thus, it is even difficult to imagine what exactly the whole story will end with the UK leaving the EU. Moreover, the main negotiators on both sides regularly feed the markets with information that the negotiations are successfully moving forward and the parties are gradually approaching consensus. However, it is not reported on which concessions the parties make. Therefore, all this information looks unconvincing, which makes one doubt the successful outcome of the negotiations between London and Brussels. Traders continue to buy pounds, waiting for success in the negotiations. If the negotiations fail (until November there is not much time), it can put a lot of pressure on the pound sterling and send it to a new long downward rally.

Nearest support levels:

S1 - 1.3153

S2 - 1.3123

S3 - 1.3092

Nearest resistance levels:

R1 - 1.3184

R2 - 1.3214

R3 - 1.3245

Trading recommendations:

The currency pair GBP / USD continues to move up, as indicated by the purple bars. Thus, it is now recommended to continue to remain long positions with targets at 1.3214 and 1.3245 until Heikin Ashi turns down.

Sell positions will become relevant again only after the price is fixed below the moving average. This can happen if the market receives negative information about the negotiations on Brexit, and the pair may begin to form a new downtrend.

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 the 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.

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EUR / USD pair: plan for the European session on October 10. The downgrade of Italy does not scare buyers

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

Updating the lows of the week and a quick return back to the side channel indicates the presence of large European currency buyers in the market. Today, we can consider new long positions after a decline and a formation of a false breakdown in the support area of 1.1483. In the event of a breakdown of this range, you can buy the euro immediately to rebound from a minimum of 1.1434. The main task of buyers will be to update the resistance of 1.1541 and fixation on it, which will lead to a larger upward impulse for the euro with a test of highs at 1.1588 and 1.1648, where taking profits are recommended.

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

It is best to expect short positions in the euro in the morning after updating the resistance of 1.1541 with the formation of a false breakdown there. The main task will be to reduce and consolidate below the support level of 1.1483, where the 30-day and 50-day average are also located. This clearly signals to open new short positions in the euro with an update of the minimum at 1.1434, where taking profits are recommended. In case of growth above 1.1541, you can sell the EUR / USD pair immediately to rebound from a maximum of 1.1588.

Indicator signals:

Moving averages

The price returned above 30 and 50 average, but finding the average at one level indicates only the lateral nature of the market.

Bollinger bands

You can consider short positions after testing the upper limit of the Bollinger Bands indicator in the area of 1.1537, and returning to purchases is best from the lower boundary of the indicator in the 1.1440 area. While trading is conducted above the middle of the channel, the advantage remains on the side of euro buyers.

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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. October 10th. The trading system "Regression Channels". The pair is adjusted again, but the dollar leadership

4-hour timeframe

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Technical data:

The senior linear regression channel: direction - sideways.

The younger linear regression channel: direction - down.

Moving average (20; smoothed) - down.

CCI: 27.5011

The second trading day of the week was not much different from the first. The currency pair EUR / USD, having no fundamental support, started a new round of corrective movement, stronger than the previous one. Thus, in the coming hours, the tool can work out a moving average line. Around the MA will decide the fate of the euro in the coming days. The rebound from the MA will provoke a resumption of the downward trend, which has weakened a bit in recent days, as there are no new fundamental factors for the growth of the dollar. Moreover, for the first two days of the week, there were no high-profile statements or important macroeconomic reports. On Wednesday, October 10, no important data was planned again in the European Union and the States. The producer price index in the United States has a certain interest in future inflation. However, this is not an indicator that can cause a strong market reaction. Thus, traders can only rely on technical factors when making trading decisions. Moreover, the unconditional leadership of the US dollar after the Fed meeting fades a little. Thus, we expect the Heikin Ashi indicator to turn down to open new short positions. And if traders overcome a moving average line, purchase orders will become relevant.

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 is being adjusted once again. Thus, the signal for the opening of new short positions will be the color of 1-2 bars in blue color from the indicator Heikin Ashi. The targets in this case will be the levels of 1.1475 and 1.1414.

It is recommended to open long positions after overcoming the moving average line. In this case, for some time, the trend in the instrument will change to ascending, and the target for the upward movement will be the level of 1.1597.

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

Euro and pound are moving in different directions

The US dollar was under pressure from trading on Tuesday because of the threat of a new financial crisis.

The index of economic optimism from IBD / TIPP rose in October to 57.8p. against 55.7p. A month earlier, the result confidently exceeded the forecast but failed to support the dollar. Markets are concerned about a marked increase in the likelihood of a new wave of economic crisis, clear signs of the approach of which are expressed in a simultaneous decrease in stock and debt markets.

The yields of 10-year treasures reached 3.26%, which is more than the 7-year maximum, and the yields of European, British, and Japanese bonds increase proportionally. By 2020, the US budget deficit will exceed $ 1 trillion; there is no reason to expect stabilization in the foreseeable future. The situation is aggravated by the approach of elections to Congress, the two main options for the development of the crisis, depending on who wins, are reduced to one final result. The growth of public debt, the growth of interest payments, the budget deficit and the rapid recession.

On Wednesday, the dollar looks weak, sales may continue against most competitors.

Eurozone

The budget crisis in Italy remains the center of attention in Europe. Despite the fact that Italy is only the third largest economy in the eurozone, the problem goes far beyond the Apennine Peninsula, primarily because it revealed an extremely negative trend.

Since the opening of the ECB PSPP program, the only source of financing for the Italian deficit has been Banca D'Italia. Since February 15, it has acquired 100% of Italian debt. In other words, there is currently no investor in the world willing to finance the Italian government, and the question is, who will finance the budget deficit after the ECB stops buying bonds at the end of the year?

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If the issue is not resolved, in order to avoid a default, Italy will have to follow the path of Greece, but given the size of the Italian economy, this path is unacceptable for the ECB. Money simply cannot be found. It should also be borne in mind that the development of the crisis will cast doubt on the ECB's long-term plan for exiting soft monetary policy and push the date for the first rate increase from the summer of 2019 into uncertainty.

A reduction in the expenditure side of the budget will inevitably lead to a government crisis, new elections, and in the end, it will, in the same way, put pressure on the euro.

On Tuesday, a negative report on the foreign trade of Germany added, the reduction in exports and especially imports significantly exceeded forecasts.

Today, EUR / USD will trade sideways. Its own problems will not allow the euro to develop an upward correction, but a weak dollar will compensate for this factor. The resistance of 1.1525 and 1.1590, the achievement of more distant is unlikely, support of 1.1474 and 1.1432.

The United Kingdom

The pound is trying to develop corrective growth amid reports of positive outcomes of the Brexit talks. The likelihood that the parties will be able to reach a compromise is growing, a positive result will be a long-term driver to recover the pound.

The Bank of England Financial Policy Committee issued a regular quarterly report in which it claims that the UK financial system is resistant to a wide range of risks. The aggregate ratio of tier one capital in large British banks is about three times more than a decade ago; levels of family and corporate debt in the UK relative to income remain substantially below the 2008 level.

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Today, a report on industrial production and foreign trade is expected in August. Expectations are neutral, strong deviations from forecasts are capable of changing the pound movement vector. In the meantime, GBP / USD has a chance to test the nearest resistance at 1.3217 and further 1.3297, support 1.3104.

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Simplified Wave Analysis. AUD / USD review for the week of October 10

Wave pattern on the H4 chart:

An incomplete wave of this scale forms the last part of the downtrend trend on D1 timeframe.

Wave pattern on the H1 chart:

From September 21, a new downward zigzag wave appears on the chart. A high wave level of movement indicates a transition to a larger scale.

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Wave pattern on the M15 chart:

From October 5, the price goes up. In the hourly wave, this area will be a correction.

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Recommended trading strategy:

The low potential of an increase in the current price of the pair makes purchases risky. In the area of the calculated resistance, it is recommended to track the reversal signals to search for an entry into the short.

Resistance zones:

- 0.7170 / 0.7220

Support areas:

- 0.7060 / 0.7010

- 0.6850 / 0.6870

Explanations to the figures:

A simplified wave analysis uses a simple waveform, in the form of a 3-part zigzag (A-B-C). Three main timeframes are used for the analysis. The last incomplete wave for every timeframe is analyzed. Zones show the calculated areas with the greatest probability of a reversal.

Arrows indicate the counting of wave according to the technique used by the author. The solid background shows the generated structure and the dotted exhibits the expected wave motion.

Note: The wave algorithm does not take into account the duration of the tool movements in time. To conduct a trade transaction, you need to confirm the signals used by your trading systems.

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

GBP / USD: plan for the European session on October 10. Traders are waiting for important data on UK GDP

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

Open long positions on the pound for the breakdown of the resistance level of 1.3173 is possible only after the publication of a good report on the growth of the UK economy, the output of which is scheduled for today in the morning. In this case, the target buyers will be the new highs in the region of 1.3217, where I recommend fixing the profits. In the event of a decrease in the pound on the report, the support will be provided by the area of 1.3125-1.3133, as well as the 30-day moving average, which is located just below this level.

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

A weak report on the economy and the formation of a false breakdown at 1.3173 will be a direct signal to the opening of short positions in the pound with the first goal of reducing and updating the support area of 1.3125-1.3133, where I recommend fixing the profits. In the event of no demand for a pound in this range, a repeated test of 1.3125 may lead to a continuation of the downward trend with the release of at least 1.3090. When the growth scenario is above 1.3173 in the first half of the day, it is possible to open short positions in GBP / USD to rebound from the resistance of 1.3217.

Indicator signals:

Moving Averages

The price returned to the 30-day and 50-day moving average, which indicates continued growth of the pound while trading will be higher than the moving ones.

Bollinger bands

Volatility is very high. The upper border of the Bollinger Bands, which is located in the 1.3208 area, will act as resistance in the event of a pound increase, while the middle of the bands in the 1.3133 area will provide support with a decrease.

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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

Analysis of the divergence of EUR / USD on October 10. The bullish divergence helps the euro once again

4h

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The formation of a new bullish divergence on the current chart allowed the EUR / USD currency pair to make a new reversal in favor of the European currency and consolidation above the correction level of 61.8% - 1.1497. As a result, on October 10, the growth process can be continued in the direction of the next correction level of 50.0% - 1.1558. Fixing the quotations of the pair below the Fibo level of 61.8% can be interpreted as a reversal in favor of the American currency and count on the resumption of the fall in the direction of the correction level of 76.4% - 1.1424.

The Fibo grid is built on extremes from August 15, 2018, and September 24, 2018.

Daily

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On the 24-hour chart, after fixing the quotes under the correction level of 100.0%, the fall process can be continued in the direction of the next correction level of 127.2% - 1.1285. There are no maturing divergences on the current chart. Fixing the pair above the Fibo level of 100.0% - 1.1553 will work in favor of the EU currency and will allow to expect some growth in the direction of the correction level of 76.4% - 1.1789.

The Fibo grid is built on extremums from November 7, 2017, and February 16, 2018.

Recommendations to traders:

Purchases of the EUR / USD currency pair can be made now with the goal of 1.1558 with a Stop Loss order below the Fibo level of 61.8%, since the pair completed closing above the correction level of 1.1497.

Sales of the EUR / USD currency pair can be carried out with the target of 1.1424 with a Stop Loss order above the Fibo level of 61.8% if the pair closes below the 1.1497 level.

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

Analysis of the divergence of GBP / USD on October 10. The pound received support from the divergence

4h

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The GBP / USD currency pair reversed in favor of the British currency after the formation of a small bullish divergence in the CCI indicator. As a result, a new growth began in the direction of the correctional level of 38.2% - 1.3316. New emerging divergences October 10 is not one indicator. Rebounding the course of the pair from the Fibo level of 38.2% will make it possible to expect a reversal in favor of the US dollar and a slight drop in the direction of the correction level of 23.6%.

The Fibo grid was built according to extremums of April 17, 2018, and August 15, 2018.

1h

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The hourly chart also formed a bullish divergence at the CCI indicator, which allowed the pair to reverse in favor of the pound sterling, start to grow and close above the Fibo level of 61.8% - 1.3153. Thus, the growth process can be continued in the direction of the next correction level of 76.4% - 1.3208. At the same time, the bearish divergence is brewing at the MACD indicator. The education will allow traders to expect a reversal in favor of the American currency and some decline.

The Fibo grid was built according to extremums of September 20, 2018, and October 4, 2018.

Recommendations to traders:

Purchases of the GBP / USD currency pair can be made now with a target of 1.3208 and a Stop Loss order under the correction level of 61.8%, since the closing above the Fibo level of 1.3153 (hourly chart) has been completed.

The currency pair of GBP / USD can be sold with a target of 1.3110 and a Stop Loss order above the level of 61.8% if the pair closes below the Fibo level of 1.3153 (hourly chart) or if there is a bearish divergence with MACD.

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

The review of the pound on October 10, 2018

Yesterday, the dollar continued to strengthen steadily, although no macroeconomic data came out. Of course, partly market participants are preparing for the release of data on inflation in the US, for which the expectations are rather optimistic. The story with Brexit also contributed to the investor sentiment. The leader of the Scottish nationalists said that Britain's withdrawal from the European Union was a reason for re-raising the issue of Scotland's independence, and announced preparations for a new referendum. Naturally, the pound with a new force began to lose its position and followed by the single European currency. After all, this issue will inevitably lead to an increase in tension between the UK and the European Union, which will make serious and negative adjustments both to the negotiations themselves and to the final version of the divorce agreement. At the very end of the day, the dollar began to rapidly lose its position as soon as it became known that, due to the approaching hurricane, oil production in the Gulf of Mexico could be suspended. Considering that the dollar has been strengthening for quite a long time and clearly turned out to be overbought, the slightest excuse was needed for correction, and although the news from Europe is not encouraging, investors had enough new horror stories about oil.

Today in the UK, there are data on industrial production. The growth rate of which can accelerate from 0.9% to 1.0%, which will clearly lift the mood of market participants. In the US, there are data on producer prices, the growth rate of which should remain unchanged. The main thing is that these data anticipate tomorrow's publication of data on inflation, which should increase. The piquancy of the situation gives the fact that inventories in the warehouses of wholesale trade should once again increase by 0.8%. However, inventory data is not as important as inflation. Nevertheless, we should not forget about the hurricane, which has already become the reason for the evacuation of some people living on the coast. It can be a reason for the further growth in oil prices, which will adversely affect the dollar. The British government must somehow respond to statements about the referendum on the independence of Scotland, and the reaction is unlikely to be complacent.

If no new information about oil production and the hurricane follow, then the pound will consolidate at 1.3150. If the hurricane fills the entire information space, then the pound can rise to 1.3225. If Theresa May will be harsh in her statements about the next approaches to the independence of Scotland, it is worth waiting for the reduction of the pound to 1.3100.

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The dollar is adjusted, but is unlikely to fall

As a result of Tuesday, the dollar fell against all major currencies without exception in the foreign exchange market. Continuing tensions in the markets, as well as statements by Fed members that it is necessary to continue the process of raising interest rates, did not support the US currency rate.

We can explain the decline of the dollar in the foreign exchange markets by the banal profit taking due to its local technical overbought. The "American" noticeably added last week in relation to all major currencies with the exception of the British, which continues to be at the mercy of the UK exit process (Brexit) and actually responds only to the news on this topic. Also, the dollar can be adjusted in the wake of the absence of a new negative with regard to the trade confrontation between Washington and Beijing, as well as new attacks on President D. Trump on the eve of the midterm elections to Congress.

Despite the local weakening of the US currency, we believe that it has potential after correction for new growth. This is primarily due to the expectation of continuing the process of raising interest rates by the Fed, which was unambiguously reported on Tuesday by Fed President Dallas R. Kaplan, who said he supports further "gradual" increase in interest rates, and President of the Federal Reserve Bank of New York J. Williams, who said that he would like to continue raising rates, which will return to a neutral level "relatively quickly" over the next year or "around it."

At the same time, against the background of tensions around the trade war between the US and China, we do not expect that the Central Bank of Australia and New Zealand will go to raise the cost of borrowing, which will generally put pressure on them in pairs with the US dollar. It seems that the Euro currency is unlikely to receive significant support, despite the decision of the ECB to stop stimulus measures this year. The euro will be adversely affected by the occasional debt problems of Italy and Greece, as well as the risks from Brexit.

Any increase in tensions in geopolitics and the global economy will support the demand for US government treasury bonds and, through them, the dollar, which will also be in demand as a currency of refuge. On this basis, we believe that it is necessary to buy it at the local weakening.

Forecast of the day:

The AUD / USD currency pair is trading below the level of 0.7135, growing on a wave of profit-taking. If the pair overcomes this mark, it may recover against the background of technical factors to 0.7230, but if this does not happen, we should expect the resumption of its fall to 0.7000.

The currency pair NZD / USD is trading below the level of 0.6500. It also rises in the wake of closing short positions. If the pair does not rise above 0.6500, it may turn around and fall to 0.6420, but overcoming this mark may lead to its limited growth to 0.6535.

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Fractal analysis of major currency pairs on October 10

Dear colleagues.

For the Euro / Dollar currency pair, the development of the downward structure of October 3 is expected after the price passes the range of 1.1431 - 1.1414. For the Pound / Dollar currency pair, the upward structure of October 4 is considered as a medium-term structure. For the currency pair Dollar / Franc, we are following the development of the upward cycle from September 21 and we expect further uptrend after the breakdown of 0.9925. At the moment, the price is in the correction. For the currency pair Dollar / Yen, we are following the downward cycle of October 3 and the continuation of which we are expecting after the breakdown 112.70. For the currency pair Euro / Yen, we are following the development of the downward structure of September 25. For the currency pair Pound / Yen, we continue to follow the formation of the downward structure from October 8 and the level of 149.00 is the key support.

Forecast for October 10:

Analytical review of H1-scale currency pairs:

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For the Euro / Dollar currency pair, the key levels on the scale of H1 are: 1.1594, 1.1564, 1.1527, 1.1498, 1.1455, 1.1431, 1.1414 and 1.1364. Here, we continue to monitor the downward structure of October 3. The short-term downward movement is possible in the range of 1.1455 - 1.1431, where we expect a key upward reversal. The range of 1.1431 - 1.1414 and the passage of its price will allow to count on a pronounced movement to the level of 1.1364.

The consolidated movement is expected in the range of 1.1498 - 1.1527 and the breakdown of the last value will lead to a deep correction. Here, the target is 1.1564 and this level is the key support for the downward structure of October 3. Its breakdown will have to form the initial conditions for the upward cycle. Here, the target is 1.1594 .

The main trend is the local structure for the bottom of October 3.

Trading recommendations:

Buy 1.1530 Take profit: 1.1562

Buy 1.1565 Take profit: 1.1592

Sell: 1.1455 Take profit: 1.1433

Sell: 1.1414 Take profit: 1.1366

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For the pound / dollar currency pair, the key levels on the scale of H1 are: 1.3292, 1.3263, 1.3211, 1.3181, 1.3114, 1.3081, 1.3024 and 1.2999. Here, we consider the ascending structure of October 4 as a medium-term structure. The short-term upward movement is possible in the range of 1.3181 - 1.3211 and the breakdown of the latter value will lead to the development of a pronounced movement. Here, the target is 1.3263. The potential value for the top is considered the level of 1.3292, upon reaching which we expect consolidation, as well as a rollback to the top.

The short-term downward movement is possible in the range of 1.3114 - 1.3081 and the breakdown of the latter value will lead to a prolonged movement. Here, the target is 1.3024 and the range of 1.3024 - 1.2999 is the key support for the upward structure.

The main trend is the upward cycle of October 4.

Trading recommendations:

Buy: 1.3181 Take profit: 1.3210

Buy: 1.3214 Take profit: 1.3260

Sell: 1.3114 Take profit: 1.3084

Sell: 1.3079 Take profit: 1.3030

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For the Dollar / Franc currency pair, the key levels on the scale of H1 are: 1.0010, 0.9965, 0.9923, 0.9875, 0.9842 and 0.9793. Here, we continue to follow the development of the ascending cycle of September 21. The short-term upward movement is possible in the range of 0.9923 - 0.9965 and the breakdown of the latter value will lead to movement to the potential target of 1.0010, from this level we expect a rollback downwards.

The short-term downward movement is possible in the range of 0.9875 - 0.9842 and the breakdown of the latter value will lead to a prolonged correction. Here, the target is 0.9793 and this level is the key support for the upward structure.

The main trend is the upward structure of September 21.

Trading recommendations:

Buy: 0.9924 Take profit: 0.9963

Buy: 0.9967 Take profit: 1.0010

Sell: 0.9875 Take profit: 0.9844

Sell: 0.9840 Take profit: 0.9796

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For the Dollar / Yen currency pair, the key levels on the scale of H1 are: 113.98, 113.60, 113.28, 112.27, 112.38, 112.18 and 111.77. Here, we are following the downward cycle of October 3rd. The downward movement is expected after breakdown of 112.72. In this case, the goal is 112.38 and in the range of 112.38 - 112.18 is the price consolidation. The potential value for the bottom is considered the level of 111.77, after reaching which we expect a rollback to the top.

The short-term upward movement is possible in the range of 113.28 - 113.60 and the breakdown of the latter value will lead to a prolonged correction. Here, the goal is 113.98 and this level is the key support for the downward structure.

The main trend: the downward cycle of October 3.

Trading recommendations:

Buy: 113.28 Take profit: 113.60

Buy: 113.63 Take profit: 113.98

Sell: 112.70 Take profit: 112.40

Sell: 112.16 Take profit: 111.80

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For the Canadian dollar / Dollar currency pair, the key levels on the scale of H1 are: 1.3106, 1.3059, 1.3034, 1.2993, 1.2953, 1.2926 and 1.2886. Here, we are following the ascending structure of October 1. The upward movement is expected after the breakdown of 1.2993. In this case, the target is 1.3034 and in the range of 1.3034 - 1.3059 is the consolidation. The potential value for the top is considered the level of 1.3106, upon reaching which we expect consolidation and rollback downwards.

The consolidated movement is possible in the range of 1.2953 - 1.2926 and the breakdown of the latter value will lead to a prolonged correction. Here, the target is 1.2886 and this level is the key support for the upward structure from October 1.

The main trend is the ascending structure of October 1.

Trading recommendations:

Buy: 1.2995 Take profit: 1.3034

Buy: 1.3060 Take profit: 1.3104

Sell: 1.2953 Take profit: 1.2928

Sell: 1.2924 Take profit: 1.2887

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For the Australian dollar / dollar currency pair, the key levels on the scale of H1 are: 0.7168, 0.7135, 0.7112, 0.7092, 0.7073 and 0.7040. Here, we are following the formation of the ascending structure of October 8. The continuation of the movement upward is expected after the breakdown of 0.7135. In this case, the goal is 0.7168 and up to this level, we expect the registration of the expressed initial conditions for the top.

The short-term downward movement is expected in the range of 0.7092 - 0.7073 and the breakdown of the latter value will have to the development of a downward structure. In this case, the goal is 0.7040.

The main trend is the formation of the ascending structure of October 8.

Trading recommendations:

Buy: 0.7135 Take profit: 0.7165

Buy: Take profit:

Sell: 0.7092 Take profit: 0.7075

Sell: 0.7070 Take profit: 0.7045

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For the Euro / Yen currency pair, the key levels on the scale of H1 are: 130.94, 130.34, 129.97, 129.43, 129.07 and 128.35. Here, we continue to monitor the downward structure of September 25. The short-term downward movement is possible in the range of 129.43 - 129.07, hence the probability of a upward reversal. The breakdown of the level of 129.07 will allow us to count on the movement towards a potential target of 128.35, after reaching which we expect a rollback to the correction.

The short-term upward movement is possible in the range of 129.97 - 130.34 and the breakdown of the latter value will lead to a prolonged correction. Here, the goal is 130.94 and this level is the key support for the downward structure.

The main trend is the downward structure of September 25.

Trading recommendations:

Buy: 129.98 Take profit: 130.32

Buy: 130.37 Take profit: 130.90

Sell: 129.41 Take profit: 129.10

Sell: 129.03 Take profit: 128.40

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For the Pound / Yen currency pair, the key levels on the scale of H1 are: 149.50, 149.00, 148.50, 147.36, 146.97, 145.94 and 145.41. Here, we are following the formation of the downward structure of October 8. A downward movement is expected after the price passes the range of 147.36 - 146.97. In this case, the target is 145.94. The potential value for the downward structure is considered the level of 145.41, near which we expect consolidation, as well as a rollback to the top.

The short-term uptrend is possible in the range of 148.50 - 149.00. The breakdown of the latter value will have to form the initial conditions for the top. Here, the potential target is 149.50.

The main trend is the formation of the downward structure of October 8.

Trading recommendations:

Buy: 148.50 Take profit: 149.00

Buy: 149.05 Take profit: 149.50

Sell: 146.95 Take profit: 146.00

Sell: 145.90 Take profit: 145.44

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Intraday technical levels and trading recommendations for GBP/USD for October 10, 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.

On September 21, the GBP/USD pair failed to demonstrate sufficient bullish momentum above 1.3296. The short-term outlook turned to bearish within the depicted H4 bearish channel to test the backside of the broken uptrend.

Recently, the price level of 1.2900-1.2940 (the backside of the broken uptrend) demonstrated significant bullish recovery which led to the recent bullish breakout of the depicted H4 channel.

As for the bullish breakout scenario to remain valid, the price level of 1.3090 (61.8% Fibo level) should provide significant bullish demand for the GBP/USD pair, so that a further bullish advance can occur towards 1.3210 and 1.3290.

On the other hand, bullish persistence above 1.3200 (SELL-ZONE) is needed to maintain sufficient bullish momentum. Otherwise, the pair would remain trapped between 1.3200 and 1.3090.

Any bearish breakdown below 1.3090 invalidates the bullish breakout scenario allowing further bearish decline towards 1.3010 and probably 1.2910 (previous weekly low).

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Intraday technical levels and trading recommendations for EUR/USD for October 10, 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).

On September 10, the price level of 1.1500 offered temporary bullish recovery. A quick 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 momentum is being demonstrated on the daily chart. The current bearish decline is currently taking place below 1.1520 (the lower limit of the consolidation range) towards the price level of 1.1420.

As for the bearish side of the market to remain dominant, the EUR/USD pair should achieve bearish breakdown below the price level of 1.1420.

The first bearish target would be located around 1.1275 if sufficient bearish momentum was demonstrated below 1.1420.

However, early signs of bullish recovery were demonstrated around 1.1430 yesterday. This brings the EUR/USD pair again towards 1.1520 for retesting.

Re-closure above the price level of 1.1520 brings the EUR/USD pair back inside the depicted consolidation range (1.1520-1.1750) for more sideway consolidations until a breakout occurs in either direction.

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Bitcoin analysis for October 10, 2018

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Trading recommendations:

According to the H1 time - frame, I found that price did fake breakout of the support ($6.361), which is a sign that sellers got trapped. I also found potential end of the downward correction (abc flat), which is another sign of strength. My advice is to watch for potential buying opportunties on the dips. The upward take profit levels are set at the price of $6.616 and at the price of $6.748.

Support/Resistance

$6.456 – Intraday resistance

$6.349– Intraday support

$6.616 – Objective target 1

$6.748 – 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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EUR/USD analysis for October 10, 2018

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Recently, the EUR/USD pair has been trading sideways at the price of 1.1488. According to the H1 time – frame, I found a breakout of the key supply trendline in the background, which is a sign that buyers are taking control. I also found the successful test of the supply after the breakout, which is another sign of strength. My advice is to watch for buying opportunities. Take profit levels are set at the price of 1.1550 and at the price of 1.1590.

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GBP/USD analysis for October 10, 2018

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Recently, the GBP/USD pair has been trading upwards. The price tested the level of 1.3184. According to the H4 time – frame, I found the end of the downward correction (irregular flat), which is a sign that buyers are in control. I also found the breakout of the supply trendline in the background and the hidden bullish divergence on the MACD oscillator, which is another sign of strength. My advice is to watch for buying opportunities. The upward targets are set at the price of 1.3216 and at the price of 1.3292.

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Technical analysis of EUR/USD for October 10, 2018

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Overview:

Bearish outlook:

The EUR/USD pair continues to trade downwards from the zone of 1.1620 and 1.1559. The pair dropped from the level of 1.1620 to 1.1500 which coincides with a ratio of 38.2% Fibonacci on the daily chart. Today, resistance is seen at the levels of 1.1559 and 1.1620. So, we expect the price to set below the strong resistance at the levels of 1.1620 and 1.1559; because the price is in a bearish channel now. The RSI starts signaling a downward trend. Consequently, the market is likely to show signs of a bearish trend. So, it will be good to sell below the level of 1.1559 with the first target at 1.1422 and further to 1.1360 in order to test the daily support. If the USD/CHF pair is able to break out the daily support at 1.1559, the market will decline further to 1.1422 to approach support 2 today. However, the price spot of 1.1620 and 1.1559 remains a significant resistance zone. Thus, the trend is still bearish as long as the level of 1.1620 is not breached.

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Technical analysis of USD/CHF for October 10, 2018

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Overview:

The USD/CHF pair continues to trade upwards from the level of 0.9875. The pair rose from the level of 0.9875 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 0.9875 and 0.9999; so we expect a range of 124 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 0.9875 , a further decline to 0.9743 can occur which would indicate a bearish market.

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Technical analysis: Intraday levels for EUR/USD, Oct 10/2018

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When the European market opens, some economic data will be released such as German 10-y Bond Auction, Italian Industrial Production m/m, and French Industrial Production m/m. The US will release a series of economic data as well such as Treasury Currency Report, 10-y Bond Auction, Final Wholesale inventories m/m, Core PPI m/m, and PPI m/m. So, amid the reports, EUR/USD will move with low to medium volatility during this day.

TODAY'S TECHNICAL LEVELS:

Breakout BUY Level: 1.1560

Strong Resistance:1.1553

Original Resistance: 1.1542

Inner Sell Area: 1.1531

Target Inner Area: 1.1504

Inner Buy Area: 1.1477

Original Support: 1.1466

Strong Support: 1.1455

Breakout SELL Level: 1.1448

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 10/2018

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In Asia, Japan will release the Prelim Machine Tool Orders y/y and Core Machinery Orders m/m. The US will release a series of economic reports such as Treasury Currency Report, 10-y Bond Auction, Final Wholesale Inventories m/m, Core PPI m/m, and PPI m/m. So there is a probability the USD/JPY pair will move with low to medium volatility during this day.

TODAY'S TECHNICAL LEVELS:

Resistance 3: 113.62

Resistance 2: 113.40

Resistance 1: 113.18

Support 1: 112.90

Support 2: 112.68

Support 3: 112.46

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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EUR and GBP: Euro and Pound are weak

The euro fell today against the background of weak fundamental statistics, which did not allow buyers to return to the market and collapsed risky assets to the new monthly minimums. The slowdown in the growth of the German economy amid a reduction in exports of goods in August of this year could hit the European currency in the future even more.

According to the Federal Bureau of Statistics of Germany, exports of goods in August declined by 0.1% compared with the previous month, while imports decreased by 2.7%. The overall surplus of Germany's foreign trade in August rose to 18.3 billion euros, while experts expected a balance of 19.0 billion euros.cy

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The optimism of small business owners in the United States remains at its peak. According to the National Federation of Independent Business NFIB, the small business optimism index in September was at the level of 107.9 points, whereas in September last year, the figure was 103 points. Compared with August, the index fell slightly from a mark of 108.8 points. The NFIB said that the prospects remain bright as the business flourishes.

Today, a forecast from the International Monetary Fund was published, which also had a negative impact on the European currency.

According to the data, the IMF lowered its forecasts for global economic growth for 2018, citing protectionist measures and volatility in emerging markets. The IMF is now forecasting a growth of the global economy this year at 3.7%, whereas in April of this year growth was expected at 3.9%. With regard to the forecast for the growth of the US economy, it is expected to 2.9% year on year.

As for the technical picture of the EUR / USD currency pair, the downward trend remains, although a surge in volume after the renewal of weekly lows is noticeable, which can lead to an upward correction in the short term. However, for this, it is necessary to return to the resistance level of 1.1500.

The British pound today fell against the US dollar after the publication of the report of the Financial Policy Committee of the Bank of England, which again identified the risks associated with Brexit.

As stated in the statement, the UK banking system is strong enough to withstand the consequences of Brexit, and currently, no additional capital buffer is required for British banks in the case of the toughest scenario. The Bank of England also called on EU politicians to take action to prevent Brexit from undermining the derivatives markets, since inaction would be costly for EU companies.

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Technical analysis of Gold for October 10, 2018

Gold price remains trapped inside the trading range. Gold price got back in the bearish long-term channel and continues to move sideways.

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Green lines - bearish long-term channel

Red lines - short-term trading range

Gold price has remained inside the trading range yesterday as well. Price is very close to the lower range boundary and support is found at $1,184. If broken we expect prices to move towards $1,175-70 minimum. Resistance is at $1,193. If broken we could see another run towards $1,200. For a break out and a move towards $1,220-40 we need to break above $1,207-11. Until this happens, price is vulnerable even for new 2018 lows.

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Technical analysis of EUR/USD for October 10, 2018

EUR/USD made new lows yesterday at 1.1432 very close to our target area of 1.14-1.1420. EUR/USD bounced above 1.15 afterwards. There are high chances that the bearish trend is complete and a new up trend has started. However for this to be confirmed we will need more signs of strength.

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Orange dots - medium strength resistance

Red dots - maximum strength resistance

In the 4-hour chart as shown above EUR/USD has stopped its rise at the medium strength resistance level of 1.1520-1.1530. Bulls will need to break and close today at least above this level. However the most important short-term resistance is at 1.1560-1.1570 area. In order to call a bottom and a reversal bulls will need to break this level. Otherwise another rejection at current levels will bring EUR/USD to new lower lows closer to our initial target of 1.14-1.1420. EUR/USD is near the end of the bearish trend. I do not believe this is the time to be bearish EUR/USD for more than a day.

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Wave analysis of GBP / USD for October 9. The news background still supports the pound, but how long will it last?

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Wave counting analysis:

In the course of trading on October 8, the GBP / USD currency pair fell by several dozen points, while remaining presumably at the stage of building the wave 5 of the uptrend trend. If this is true, then the increase in quotations will continue with targets that are near 100.0% of the Fibonacci level, built on the size of wave 4, and higher. Breaking the minimum of the expected wave 4 will complicate the entire uptrend of the trend and will require adjustments to the current wave marking.

The objectives for the option with purchases:

1.3295 - 100.0% of Fibonacci

1.3397 - 127.2% of Fibonacci

The objectives for the option with sales:

1.2922 - 0.0% of Fibonacci

General conclusions and trading recommendations:

The currency pair GBP / USD presumably continues to build wave 5 of the uptrend trend. Thus, now I recommend continuing to buy a pair with targets located near the estimated marks of 1.3295 and 1.3397, which corresponds to 100.0% and 127.2% in Fibonacci. I recommend selling the pair only on condition of a successful attempt to break through the level of 0.0% according to Fibonacci, which will lead at least to the complication of the whole part of the trend.

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Trading plan for 10/10/2018

On Wednesday, the 10th of October, the event calendar is busy with important data releases. Market participants should focus on the UK data release: GDP, Industrial Production, Manufacturing Production and Visible Trade Balance. The other important data will be released from the US in form of PPI and PPI Core figures. There are spechees scheduled for today from MPC Member Andy Haldane and FOMC Member Charles Evans.

GBP/USD analysis for 10/10/2018:

The Gross Domestic Product is a comprehensive measure of an overall production and consumption of goods and services. GDP serves as one of the primary measures of overall economic well-being. While GDP announcements generally conform to expectations, unanticipated changes in this metric can move markets.

Robust GDP growth signals a heightened level of economic activity and often a higher demand for the domestic currency. At the same time, economic expansion raises concerns about inflationary pressures which may lead monetary authorities to increase interest rates. Thus better than expected GDP figures are generally bullish for the Euro, while negative readings are generally bearish.

Let's now take a look at the GBP/USD technical picture at the H4 time frame. The market has broken above the 61% Fibo retracement and currently, is heading towards the level of 1.3191, which is a part of the technical resistance zone situated between the levels of 1.3191-1.3217. The nearest technical support is seen at the level of 1.3132. The move up was made on strong and positive momentum, so there is a chance for a breakout higher if the today's UK data will beat the expectations. The target above the resistance zone is seen at the level of 1.3292.

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Global macro overview for 10/10/2018

Overnight, Japan published the data on machine orders in September. The data (Japan machinery orders received from the private sector excluding volatile orders) beat the market participants expectations, in monthly terms, the increase was 6.8% instead of the expected decline of 3.9%. Year to year, orders grew by 12.6% with 1.8% forecasts.

The high value of orders is a good sign for capital expenditure. Japanese companies should stay strong this fiscal year, which was already suggested by the Bank of Japan report from last week. The trade war between the US and China remains a risk factor for forecasts, as it may lead to an indirect decline in Chinese purchases, which means that some Japanese producers may opt out of buying new equipment. Manufacturers are sensitive to the development of the global trade situation because a large part of the machines and parts are exported to China, which in turn produce ready-made goods for sale to the United States and other markets.

Let's now take a look at the USD/JPY technical picture at the H4 time frame. After the price has fallen out of the channel, it found the support at the level of 112.86 and now is bouncing from it. Nevertheless, the bounces are shallow and the bears are continuing to increase to pressure on bulls, so the price might drop even more towards the next technical support at the level of 112.40 - 112.50. Please notice, the market conditions ar enow oversold, but the momentum remains negative and weak, so the continuation of the move down is still in play.

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Global macro overview for 10/10/2018

FED Chairman Jerome Powell gave recently speech in Indonesia. He said that the US labor market is "very strong" and inflationary pressure is not yet visible. Transparency and open communication are the keys to minimizing the global misunderstanding of policies and market problems.

The normalization of monetary policy is beneficial for everyone because it reduces the imbalance in the financial markets. So far, the United States has not been repulsed by the Chinese in the trade war. Williams believes that there is currently a large disproportion between the economic situation in the US and the rest of the world. Nevertheless, the FED will likely continue to increase the interest rates as the economy prosper. According to CME FED watch tool, the target possibilities for 8th November FOMC meeting are at the level of 98% for a rate range of 2.00-2.25%, but for the 19th December FOMC meeting are at the level of 81% for a rate hike to 2.5.%.

Let's now take a look at the EUR/USD technical picture at the H4 time frame. The price of the dollar slightly weakened last night against the euro, but rather it was not influenced by the words of the FOMC member. EUR/USD has found a few pips above 1.15. The next technical resistance is seen at the level of 1.1543 - 1.1550. The momentum is currently neutral as the RSI is on its fifty level, but the move up is a rection for the bullish divergence between the price and momentum. Please notice, the market is bouncing from the oversold conditions, so the move up might be only short-lived.

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Bitcoin analysis for 10/10/2018

According to today's, the Japanese online conglomerate GMO Internet Co. Ltd confirmed plans to issue a cryptographic stablecoin associated with the Japanese yen. GMO, which entered the Japanese cryptocurrency market in May last year, intends to start issuing tokens, called GMO Japanese Yen (GJY), in the financial year 2019. This message draws another potential player on the stablecoin market, in addition, several other corporations signal that they intend to launch their own assets. GMO confirmed that the main incentive to make this decision was to reach international remittances: "We have banks and licenses in Japan, so we will spend (GJY) in Asia, but we can also store assets in Japan. If that happens, no one will be worried about Tether; it can be said that GMO has a bank there, in which it keeps fiat currencies" - said the founder and president of GMO Masatoshi Kumagai.

The GMO Internet also noted that with GJY it is highly likely that it is an ideal currency that combines high creditworthiness, low fees and speed of communication. By issuing a currency based on yen, GMO Internet will continue to support credible transactions without borders.

Kumagai added that GMOs will try to get GJY listing on many international exchanges.

Let's now take a look at the Bitcoin technical picture at the H4 time frame. After reaching the technical resistance zone the market has consolidated for some time and then dropped suddenly to hit the technical support at the level of $6,358. Currently, the price is bouncing towards the local resistance at the level of $6,455, but overall the move down looks strong. To confirm the downtrend is resuming, the market would have to break below the level of $6,056 and for now, it is far from it.

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Elliott wave analysis of EUR/NZD for October 10, 2018

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The correction in blue wave ii is unfolding as expected. Support is seen near 1.7705 and then in the 1.7652 - 1.7664 zone. The corrective decline from 1.7929 does not yet look complete and more downside pressure is expected short-term.

Only a direct break above resistance at 1.7847 will indicate a premature low has been seen for blue wave ii and blue wave iii is taking over for the next impulsive rally towards 1.8030 and later 1.8369.

R3: 1.7847

R2: 1.7800

R1: 1.7774

Pivot: 1.7750

S1: 1.7719

S2: 1.7705

S3: 1.7652

Trading recommendation:

We will look for a buying opportunity at 1.7675 or upon a break above 1.7847.

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Elliott wave analysis of EUR/JPY for October 10, 2018

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EUR/JPY spiked slightly lower than the ideal target at 129.49 and dipped to 129.31 before tuning higher. We think the possibility of blue wave (2) has completed is high, but we need a break above minor resistance at 130.23 as a first strong indication that this indeed is the case. While a break above resistance at 131.42 will confirm blue wave (2) has completed and blue wave (3) towards 138.10 is developing.

Short-term support is seen at 129.53 and then at 129.31.

R3: 131.45

R2: 130.88

R1: 130.58

Pivot: 130.23

S1: 129.88

S2: 129.53

S3: 129.31

Trading recommendation:

We are long EUR from 130.70 with our stop placed at 129.25. If you are not long EUR yet, then buy near 129.53 or upon a break above 130.23 and use the same stop at 125.25

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Ethereum analysis for 09/10/2018

After the September 12 price of the ETH/USD reached a low at the level of $172, interest grew strongly. Such low levels were seen in June 2017. Falling ETH prices since the beginning of the year meant that the owners and investors were wary of using the digital currency as a safe medium of exchange.

Increased activity may also be due to the fact that Ethereum currently only uses 50 percent of its daily bandwidth, which in turn made network fees drop below one cent (USD), even after last week's processing of 600,000 transactions. In the case of a sharp increase in the number of transactions, one can expect increases in ETH.

The increase in the number of ETH transactions can be attributed to the newly available network capacity, releasing many of its GAS resources, with a daily limit of 8 million GAS. On average, one ETH transaction via a "smart" contract requires approximately 21,000 GAS units. Another possible explanation for the increase in transactions is that investors could have accumulated more digital currency, given relatively low prices. More ETH means more use of the token.

Let's now take a look at the Ethereum technical picture at the H4 time frame. Currently, prices have stabilized in a narrow range of 200- 240 USD as the market continues the horizontal trend. The next technical resistance is seen at the level of 235 USD and the nearest support is seen at the level of 205 USD. The key technical support, however, is still located at the level of 164 USD and to get there, the bears will have to break through the support zone between the levels of 205 - 199 USD, so it will not be easy.

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Global macro overview for 09/10/2018

Financial markets remain in a mood of gloom at the informational sphere focused on the problems of China and Italy. Poorly Chinese yuan, which sends bad vibrations among others towards AUD and emerging markets.

Investors focus on the negative aspects of the decision of the People's Bank of China to lower the RRR rate. In the longer term, what may translate into support for economic growth (lower interest rates are more lending), for the time being, the move is interpreted as preventing the negative implications of US trade wars and increasing the pressure on the yuan's weakening. It is also a signal that the Beijing government allows the increase in USD / CNY above 6.90 - a few months ago it was treated as a pain threshold that China would want to prevent. The continued depreciation of the yuan, on the one hand, confirms that China intends to mitigate the effects of trade wars in this way; but on the other - they are opening the way to strengthening pressure on the sale of other currencies of emerging economies.

Let's now take a look at the USD/CNY technical picture at the daily time frame. The market is again testing the swing high at the level of 6.93, but the conditions are now overbought. The larger time frame tren dis still up so there is a chance for another leg higher towards the level of 6.95 and even 7.00, but the bearish divergence between the price and the momentum indicator is suggesting a short-term pullback might happen any time now.

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Wave analysis of EUR / USD for October 9. The market is putting pressure on the euro and does not allow the rising wave to

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Wave counting analysis:

During the trading on Monday, the EUR / USD currency pair lost about 30 base points again. Thus, the absence of the withdrawal of quotes from the reached minimums brings the instrument closer to the variant with the continuation of wave a with targets located near the estimated marks of 161.8% and 200.0% of Fibonacci. If this is indeed the case, then the construction of the estimated wave b (or, maybe, even from the upward part of the trend, which starts on August 15) is postponed.

The objectives for the option with sales:

1.1446 - 161.8% of Fibonacci

1.1361 - 200.0% of Fibonacci

The objectives for the option purchases:

1.1588 - 100.0% of Fibonacci

1.1641 - 76.4% of Fibonacci

General conclusions and trading recommendations:

At the moment, we can say that the pair is not ready to build wave b. In general, the wave picture is not completely unambiguous now, and the trend section after August 15 may take a more complex form. I still expect to build an upward wave with targets located near the estimated marks of 1.1588 and 1.1641. An unsuccessful attempt to break through the 161.8% Fibonacci mark can still lead to the completion of wave a.

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EUR / USD pair: plan for the European session on October 9. Euro buyers have the last chance

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

The buyers of the European currency have the last chance to reverse the formation of the downward trend. To do this, you need to get above the resistance of 1.1500, which will be a signal to buy euros in order to update the weekly maximum around 1.1541, where taking profits are recommended. In the event of a decline in EUR / USD, it is possible to count on new purchases in the area of 1.1463 but only after the formation of a false breakdown there. In a different scenario, it is best to open long positions to rebound from a new low of 1.1399.

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

Sellers will try to form a false breakdown in the area of 1.1500, which will lead to another wave of euro decline. The main goal will be the breakdown and consolidation below the support level of 1.1463, which will resume the downward trend and allow testing the new monthly minimums of 1.1399 and 1.1351, where taking profits on short positions are recommended. If the euro rises above 1.1500 in the first half of the day, you can immediately return to sales to rebound from a maximum of 1.1541.

Indicator signals:

Moving averages

The price is stuck between 30 and 50 average, which indicates the uncertainty in the market. However, sellers have the advantage as the downward direction of averages.

Bollinger bands

The Bollinger Bands indicator does not give signals when entering the market and indicates that the volatility remains low. The lower border, located in the 1.1470 area, will be another support in case of a decline in the euro.

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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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