Fundamental Analysis of AUD/JPY for October 11, 2018

AUD/JPY moved higher quite impulsively today despite an impulsive bearish daily close recently below 80.50 area. AUD strengthened against JPY thanks to positive economic data and events, held today. On the other hand, JPY is struggling to gain momentum despite upbeat reports as well.

AUD was being dominated by JPY since the price bounced back from 82.00 area which lead the price to reside below 80.00 area recently. Today Australia's MI Inflation Expectations report was published unchanged at 4.0% which did not quite affect the growth of AUD, but Reserve Bank of Australia's Assistant Governor Ellis was quite optimistic with her speech today. Ellis predicted expansion of the Australian economy both in the short and long run that changed the market sentiment from bearish to bullish. Moreover, tomorrow Australia's Home Loans report is going to be published which is expected to decrease to -0.9% from the previous value of 0.4% and RBA Financial Stability Review is due which expected to provide the currency with support.

On the JPY side, despite positive economic data, it struggled to gain sustain the momentum it had over AUD earlier. Today Bank of Japan Lending report was published with an increase to 2.3% from the previous value of 2.2% which was expected to decrease to 2.1% and PPI was unchanged at 3.0% which was expected to decrease to 2.9%.

Meanwhile, JPY is struggling to keep momentum despite upbeat economic reports. This indicates a directional bias or shift of market sentiment which is currently in favor of AUD. As AUD continues to perform better amid upcoming economic reports, further bullish momentum is expected in this pair, leading to higher volatility.

Now let us look at the technical view. The price is currently quite impulsive with the bullish gains while Bullish Convergence in line indicates further bullish momentum in the pair with a target towards 82.00 area in the future. The current trend is still bearish, though with bullish spikes and higher volatility. The price is expected to climb higher in the coming days before continuing with the trend to push lower in the coming days. As the price remains below 82.00 area, the bearish bias is expected to continue.

SUPPORT: 78.50

RESISTANCE: 80.50, 82.00

BIAS: BEARISH

MOMENTUM: VOLATILE

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EUR / USD. Panic in the stock markets and criticism form Trump reduced the demand for the dollar

A significant decline in US stock markets has already been called a "collapse", but I would not hurry with such categorical conclusions. Indeed, stock indexes ended the day with a sharp fall. The Dow Jones Industrial Average fell by 830 points (almost two-month low), Standard & Poor's 500 fell by 95 points (the strongest decline since February), and the Nasdaq Composite fell by 315 points, updating the record of this year.

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Despite such a significant downturn, experts are in no hurry to give in to the panic that prevails in the markets now. According to them, such a reaction was expected and even unavoidable, given the dynamics of growth in yield of treasuries, which, in turn, was due to the "hawkish" position of the Fed. In addition, stocks of the number of companies declined for their own reasons, without regard for the general fundamental background. In particular, Twitter and Starbucks fell due to negative profit forecasts, and Sears Holdings due to the retailer's possible bankruptcy.

However, the general dynamics of stock markets alerted the traders of the foreign exchange market, especially after the comments of US President Donald Trump, who again found a reason to criticize the Fed. He said that even Chinese countermeasures do not do as much harm to the American economy as the Fed's actions. Let me remind you that Trump has already criticized the Fed after the regulator raised the rate in July. Now his comments sound much tougher. Moreover, for the first time, the American president actually accused the Fed of provoking a collapse in the stock market.

The reason for such criticism is rather strained. It is hard to call a rollback in stock markets long overdue on the collapse, but in this context, a causal relationship is important. The growth in the yield of government bonds inevitably leads to two things. First, the cost of borrowing increases, and secondly, the demand for treasuries to the detriment of the stock market increases. And since the growth in the yield of government bonds largely depends on the Federal Reserve's hawkish policies, it is the main "culprit" of yesterday's events. At least, this is exactly how Donald Trump presented the situation, who, it seems, was only looking for an occasion for the next criticism of the department.

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The reaction of the foreign exchange market to the statements of Trump is extremely emotional. Judging by the rhetoric of Jerome Powell and the position of the Fed as a whole, the regulator defies verbal pressure from the American president, emphasizing its independence. Moreover, Powell recently made it clear that next year, the Fed could accelerate the pace of tightening monetary policy, exceeding even the level of a neutral rate, the size of which has not yet been fully determined. Trump's position was completely ignored by Powell, despite the unprecedented voiced accusations. Therefore, following this logic, it is fair to assume that the regulator will also ignore yesterday's statements made by Trump.

But there is one "but". It is likely that the Fed can independently pay attention to the relationship between the growth of the interest rate and the situation on the stock markets, especially if such collapses repeat or increase. The dynamics of the Shanghai Composite Index during the Asian session confirms the "domino effect", which led to a general decline in global stock markets. The Chinese index has lost more than five percent, this is the sharpest collapse since February of the year before last. Therefore, the decline in the dollar is more likely to be connected not with Trump's comments, but with the Fed's possible reaction to recent events. If representatives of the American regulator express concern about this, then there will be no trace of the former optimism, even the December rate increase may be questionable. Finance Minister Steven Mnuchin hastened to reassure the markets, saying that we are only dealing with the correction of the markets, but his comments were not able to extinguish the traders' emotional reaction.

In addition, the dollar was under pressure after an unexpected statement by the official Beijing. The Chinese Ministry of Commerce announced that they are ready to resume negotiations with Washington and want to settle all existing differences through dialogue. Such an unexpected turn surprised traders, after which the demand for the American currency decreased.

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Thus, the general weakening of the dollar, the criticism of Trump and the decline in stock markets allowed the EUR / USD bulls to continue corrective growth. The pair is currently testing the first resistance level of 1.1550, this is the lower limit of the Kumo cloud on the daily chart. It is very likely that the price will overcome this barrier and go to the next resistance level, which is very close to 1.1580 (the upper limit of the above cloud). If the bulls consolidate above the designated targets, then the next target of the northern movement will be the price of 1.1620. This is the middle line of the Bollinger Bands indicator, which coincides with the Kijun-sen line on D1. Overcoming this level will open the way to the 18th figure, but for now, it is too early to talk about it.

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Geopolitical correction: an accurate description of the collapse of markets

Following the defeat on the stock markets of the United States and Asia on Wednesday in the red zone and European markets opened. The stock exchanges in Germany, France, and the UK are losing from 2 to 3%, the demand for defensive assets, primarily government bonds, has sharply increased, which is also reflected in a sharp drop in yields.

Such a strong fall is very similar to the long-predicted collapse, which may precede the next, even more destructive, phase of the global crisis. In 2008, in order to stop the negative trends, the leading central banks of the world actually zeroed interest rates and flooded the markets with cheap liquidity. Since the structural problems were not solved, the tightening of monetary policy, initiated by the Fed and supported by the largest central banks, leads to a new wave of crisis.

In a semi-annual IMF report published on October 10, it is noted that there is a noticeable increase in the likelihood of a broad correction in capital markets and a sharp tightening of financial conditions, which investors are not fully aware of. The head of the consulting company Eurasia Group, Ian Bremmer, spoke even more definitely. The world is entering into a "geopolitical recession", which heralds the end of the world order under the leadership of the United States.

Large-scale sales in the markets are usually accompanied by an increase in defensive currencies, primarily the Japanese yen, and second, the US dollar. The yen has indeed strengthened across the entire spectrum of the foreign exchange market, which cannot be said about the dollar. It has slightly declined against the currency basket. The development of events suggests that in the short term, the dollar will look weaker than its competitors.

Eurozone

Today, the focus will be on the minutes of the last meeting of the ECB. The most interesting are the estimates of the average wage growth rate in the eurozone and related inflation.

The currency pair EUR / USD has chances to continue to grow, testing the resistance level of 1.1590 is likely during the day.

The United Kingdom

The pound continues to play rumors about the growing likelihood of a compromise in the negotiations on Brexit, macroeconomic data on this background play a secondary role. Growth is likely during the day to the level of 1.3260 and further to 1.3298.

Russia

On the whole, the Russian ruble calmly reacted both to the sharp decline in oil and to the collapse of world stock markets, which is quite unusual under current conditions. Capital outflow in the third quarter reached $ 19.2 billion, which is the maximum since 2015, and volumes direct investment in the non-financial sector.

Last week, the Ministry of Economic Development published a forecast until 2024. The government, in turn, approved the main areas of work for the same period. At the same time, the State Duma and the government are working together on the budget 2019/21.

According to the forecast, in 2021 / 24g. Russia's GDP growth should exceed 3% per year, while the economy should grow by 17% over the next 6 years.

o496-9i3_WQK92QSyg8TY5TSP8M7n2JI0JOC8M2MA breakthrough in GDP is planned for 2021, when a recession is possible in the United States, predicted by the inversion of the yield curve, and even the Fed's official forecasts indicate a slowdown in economic growth. Global risks are expected to increase by this time, it is quite likely that commodity prices will fall, but the Ministry of Economic Development does not see any problems here. It is planned to change the growth model from raw materials to innovation.

The second factor, which lies in the new development strategy, is the reorientation for the next 2 years of the basis for growth from the consumer market to the investment market, which will be supported by the government. In other words, the reforms imply a decrease in consumer activity and a simultaneous increase in the flow of investments at the expense of the budget. This is an extremely ambitious task, the solution of which directly follows from the rejection of the consumer model of the economy and demonstrates the expectations of strong shocks in the global economy in the coming years.

The practical conclusion from this forecast is that the growth of investment in the economy ceases to depend critically, including on the inflow of private foreign capital. This means that the increased outflow of capital from the financial markets of Russia, according to the calculations of the government, will not lead either to economic problems or to serious pressure on the ruble.

Until the end of the week, the USD / RUB trade will be in a wide range of 66.15 - 67.09, with the more likely to the lower border.

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Fundamental Analysis of AUD/USD for October 11, 2018

AUD/USD has been quite indecisive and volatile after breaking below 0.7150 area with a daily close recently. USD has been the dominant currency in the pair since the recent rate hike. USD is expected to gain further momentum against AUD in the long run though certain AUD pressure may be observed in the coming days.

Today Australia's MI Inflation Expectations report was published unchanged at 4.0% which did not quite affect the growth of AUD. Reserve Bank of Australia's Assistant Governor Ellis was quite optimistic in her speech today. Ellis predicts expansion of the Australian economy in both short and long run which altered the market sentiment from bearish to bullish. Moreover, tomorrow Australia's Home Loans report is going to be published which is expected to decrease to -0.9% from the previous value of 0.4% and RBA Financial Stability Review is going to be presented as well, which expected to porvide the currency with support.

On the other hand, despite mixed NFP data recently, USD managed to sustain its bearish momentum in the meantime. Today US CPI report was published with a decrease to 0.1% which was expected to be unchanged at 0.2% and Core CPI was unchanged at 0.1% which was expected to increase to 0.2%. Additionally, Unemployment Claims also increased to 214k which was expected to be unchanged at 207k.

Meanwhile, ahead of macroeconomic reports from Australia and amid positive recent data, AUD is expected to gain quite strongly over USD despite worse-than-expected readings. Until the US comes up with solid results, AUD is going to extend its strength.

Now let us look at the technical view. The price pushed higher quite impulsively today after an engulfing bearish candle yesterday with a daily close. Though the trend is bearish, the price is expected to rise higher towards 0.7150-0.7200 area before it continues with the bearish momentum to sink deeper in the coming days. As the price remains below 0.7300 area, the bearish bias is expected to continue.

SUPPORT: 0.6850, 0.7000

RESISTANCE: 0.7150, 0.7200, 0.7300

BIAS: BEARISH

MOMENTUM: VOLATILE

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EUR / USD and USD / JPY: Major fall in the US stock market, criticism of Donald Trump and sharp rise in the yen

The US dollar fell against the European currency and other assets yesterday amid the largest drop in US stock markets. There is also a sharp increase in the yield of the US government bonds, which indicates the outflow of capital from the markets.

  • The Dow Jones Industrial Average fell by 831 points, or 3.2%, to 25598 points.
  • The S & P 500 fell 94 points, or 3.3%, to 2785 points.
  • The Nasdaq Composite lost 315 points, or 4.1%, to 7422 points.

Donald Trump and the White House critic

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Immediately after this, a number of statements were made by the representatives of the US presidential administration and by Donald Trump himself. He once again criticized the actions of the Federal Reserve System, which, in his opinion, impede the healthy growth of the country's economy.

A spokeswoman for the White House, Sarah Sanders, released a statement after a sharp drop in the stock market, saying that the fundamentals and prospects for the US economy remain extremely strong, and Trump's economic policies have created a stable base for further growth. This had little effect on the situation.

Following this, Donald Trump expressed his opinion about the fall of the stock market, saying that the Fed lost its head, and the fall of the stock market was just a correction that we had been waiting for a long time.

As for the European currency, its strengthening continued against the backdrop of a fall in the US dollar due to data on inventories.

According to a report by the US Department of Commerce, wholesale inventories rose by 1.0% in August 2018 compared with the previous month, while economists had expected stocks to grow by 0.8%. Sales in August rose by 9.2% compared with the same period of the previous year. The ratio of stocks to sales in August was 1.26 against the same level in July.

6KBpoL1O4NhtyAoP8PZ-_1f51sngYgjLyGDytE2QAs for the technical picture of the EUR / USD currency pair, the bet on the continuation of the growth of the euro will be made in the support area of 1.1540, to which buyers climbed yesterday. Hold this level will keep the upward wave in the euro, which will lead to an update of the resistance levels of 1.1590 and 1.1640. In the case of a larger euro decline, long positions can be considered in the region of the lower boundary of the upward channel of 1.1515.

Japanese Yen

Meanwhile, a sharp drop in stock markets and a decline in the US dollar led to a return in demand for the Japanese yen, as investors refused to risk and rely on the European currency, which now has so many of its problems.

The USD / JPY currency pair fell from 113.20 to 112.20 today at the beginning of the European session.

Following such a sharp increase in the yen, a statement was made by a member of the board of the Bank of Japan Sakurai, who said that further significant easing of the policy is justified, as the uncertainty around the global economy increases. Let me remind you that the Japanese government does not need a strong yen, as this will further contain inflationary pressure.

Sakurai also noted that at present the main risk factors are protectionist policies and capital outflows from emerging markets.

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GBP / USD. October 11. The trading system "Regression Channels". Speech by Mark Carney may slightly clarify the situation

4-hour timeframe

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Technical details:

The senior linear regression channel: direction - up.

The younger linear regression channel: direction - down.

Moving average (20; smoothed) - up.

CCI: 135.6125

The currency pair GBP / USD on October 11 continues a confident upward movement based on rumors that the Brexit talks will end with the conclusion of a "deal". We continue to draw the attention of traders, that there was no official information about this either. Thus, nothing has been decided yet, or at least nothing is known to the general public. There is not much time left before the deadline, and according to Theresa May, the last round of negotiations failed. This is an official information. Meanwhile, the UK GDP report fell through. In August, a zero increase in GDP was recorded, while forecasts predicted an increase of 0.1%, which is still lower than the previous month, where an increase of 0.3% was recorded. However, this important report was completely ignored by the market, which once again indicates that traders are now focused on the Brexit theme and are confident in the positive outcome of the negotiations. Mark Carney will be giving a talk today, who can just share new information on the Brexit topic. In addition, in the United States, a report on inflation will be published, but in the current environment, the market reaction can be very restrained on this information. Any information or rumors about negotiations between the EU and Britain can further increase the demand for the British pound. We continue to emphasize that if the "deal" will not be signed, most likely, the pound is waiting for a new prolonged fall.

Nearest support levels:

S1 - 1,3214

S2 - 1.3184

S3 - 1.3153

Nearest resistance levels:

R1 - 1.3245

Trading recommendations:

The currency pair GBP / USD continues to move up, as indicated by the indicator Heikin Ashi. Thus, it is now recommended to continue to remain in long positions with a target of 1.3245 until the Heikin Ashi indicator turns down.

Sell orders will become relevant only after traders overcome the moving average line, for which, under current conditions, a fair amount of negative on Brexit will be required. Thus, at least today, such consolidation is not expected.

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

GBP / USD pair: plan for the European session on October 11. Speech by Mark Carney can lead to a decrease in pounds

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

Today, the pound buyers need to keep the level of 1.3184, where the 30-day moving average is located. the formation of a false breakdown around 1.3217 will be a direct signal to buy the pound in order to reach the highs of 1.3269 and 1.3315, where taking profits are recommended. In the case of a larger downward correction, traders of long positions can return on the rebound from the support of 1.3147. Attention should be focused on the speech of the head of the Bank of England.

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

A breakout and consolidation below the support of 1.3217 will be the first sell signal for the pound, but a larger downward correction can begin only after the decline and breakdown of the 1.3184 area, which will lead the GBP / USD to yesterday's minimum level to 1.3147, where taking profits recommended. In the case of further growth of the pound trend, you can sell on a rebound from the maximum of 1.3269.

Indicator signals:

Moving averages

As long as trade is conducted above the 30-day and 50-day average, the demand for the euro will remain. Support in case of decline will have a 30-day average in the region of 1.3180.

Bollinger bands

In the event of a decline, the middle border of the Bollinger Bands indicator around 1.3205 will support the pound. A break of the upper border around 1.3245 will be a signal to open new long 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
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EUR / USD. October 11. The trading system "Regression Channels". Inflation may weaken the dollar in the short run.

4-hour timeframe

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4-hour timeframe

Technical details:

The senior linear regression channel: direction - sideways.

The younger linear regression channel: direction - down.

Moving average (20; smoothed) - sideways.

CCI: 168.9320

The technical picture of the EUR / USD instrument has changed. The price has fixed above the moving average line, so the trend has changed to ascending. There were no important macroeconomic events yesterday during the day. However, the pair continues to be adjusted against the previous fall against the background of the absence of new factors supporting the dollar, as well as due to technical need. Thus, the upward movement may continue, which is still evidenced by the purple bars. Today, October 11, the calendar of macroeconomic events in the eurozone is again empty, and in the United States will report on inflation. According to experts, the consumer price index will slow to 2.4% in annual terms. A rather significant slowdown in inflation (from 2.7%) may put even more pressure on the US currency, which, among other things, is under pressure because of a possible further escalation of the trade conflict with China. Thus, the inflation report is the key event of the last but one trading day of the week. Also, do not lose sight of the situation with Brexit. To a greater extent, this issue concerns the UK, but the signing of a "deal" for the withdrawal of Britain from the EU can have a beneficial effect on the European currency.

Nearest support levels:

S1 - 1,1536

S2 - 1,1475

S3 - 1.1414

Nearest resistance levels:

R1 - 1.1597

R2 - 1.1658

R3 - 1.1719

Trading recommendations:

The EUR / USD currency pair has overcome the moving. Thus, it is now recommended to open long positions with the first goal of 1.1597. Particular attention should be paid to the report on inflation, during the publication of which a reversal or increase in the movement may occur.

Short positions will again become relevant only after the price is fixed back below the moving average with the first target of 1.1475. But for this, the dollar will need serious fundamental factors.

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 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

Intraday technical levels and trading recommendations for GBP/USD for October 11, 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 failed to demonstrate sufficient bullish momentum above 1.3296. The short-term outlook turned to become 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.

Evident Bullish momentum was demonstrated above 1.3010 and recently above 1.3090 (61.8% Fibo level) which led to the current bullish movement towards 1.3200.

As for the bullish breakout scenario to remain valid, bullish persistence above 1.3200 (SELL-ZONE) is needed to maintain sufficient bullish momentum initially towards 1.3280.

Any bearish breakdown below 1.3200 invalidates the bullish breakout scenario allowing further bearish decline towards 1.3090 (61.8% Fibo level) and probably 1.3010 (50% Fibonacci level).

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Intraday technical levels and trading recommendations for EUR/USD for October 11, 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. 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 was being demonstrated on the daily chart. Recent bearish decline took 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 keep trading below the price level of 1.1520.

However, this week, early signs of bullish recovery were demonstrated around 1.1430. This brought the EUR/USD pair again above 1.1520.

This brings the EUR/USD pair back inside the depicted consolidation range (1.1520-1.1750) for more sideway consolidations until bearish breakout occurs later.

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Analysis of the divergence of EUR / USD on October 11. The growth of the euro continues but may be limited to the level of

4h

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After the formation of a bullish divergence at the CCI indicator, the EUR / USD currency pair has completed growth to the correctional level of 50.0% - 1.1558. Rebounding quotes from the Fibo level of 50.0% will allow traders to count on a reversal in favor of the American currency and a slight drop in the direction of the 61.8% correction level of 1.1497. The ripening divergences on October 11th are not observed in any indicator. Fixing the pair above the Fibo level of 50.0% will increase the chances for further growth in the direction of the next correction level of 38.2% - 1.1620.

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, the pair quotes returned to the correction level of 100.0% - 1.1553. Rebounding the pair from this level will allow us to expect a reversal in favor of the US dollar and a resumption of decline in the direction of the correctional level of 127.2% - 1.1285. Fixing quotes above Fibo 100.0% will work in favor of continuing growth in the direction of the next correction level of 76.4% - 1.1789. There are still no divergences.

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

Recommendations to traders:

New purchases of the EUR / USD currency pair will be possible with the goal of 1.1620 with a Stop Loss order below the Fibo level of 50.0% if the pair closes above the 1.1558 correction level.

Sales of the EUR / USD currency pair can be carried out with the target of 1.1497 with a Stop Loss order above the Fibo level of 50.0% if the pair bounces off the 1.1558 level.

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

Analysis of the divergence of GBP / USD on October 11. Divergence effect persists

4h

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The currency pair GBP / USD continues the process of growth in the direction of the correction level of 38.2% - 1.3316 after the formation of a bullish divergence in the CCI indicator. The end of October 11 quotations from the Fibo level of 38.2% will allow traders to expect a reversal in favor of the US currency and a slight decline in the direction of the correction level of 23.6% - 1.3067. New emerging divergences in the current chart are not observed in any indicator.

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

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On the hourly chart, three bearish divergences were formed at once, and all of them were at the MACD indicator. Each of them allowed the pair to make a small fall, after which the growth process was resumed. As a result, the pair completed closing above the Fibo level of 76.4% - 1.3208 and, thus, the growth process can be continued in the direction of the next level of correction 100.0% - 1.3298. Fixing quotations below the Fibo level of 76.4% will work in favor of some fall in the direction of the correction level of 61.8% - 1.3153.

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

Recommendations to traders:

New purchases of the GBP / USD currency pair can be made with the target at 1.3398 and the Stop Loss order under the correction level of 76.4% if the peak of the last divergence is completed (hourly chart).

Selling of the currency pair GBP / USD will be possible with the target of 1.3153 and a Stop Loss order above the level of 76.4% if the pair closes below the Fibo level of 1.3208 (hourly chart).

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

Markets are finally aware of the risks to global growth

It seems that investors around the world are beginning to understand that not only the ten-year economic cycle comes to an end after the collapse of 2008, which could end with the start of a new recession, but that the instigation of US trade conflicts has already begun to bring this process closer.

On Wednesday, global stock markets experienced a real shock, showing a widespread negative trend. At the auction today, the main Chinese stock index of the Shanghai Comp collapsed by almost 5.0%. The trigger for investors to realize that the "games" in trade wars are unlikely to contribute to the growth of the world economy. Against this background, the IMF announced that it was waiting for the global economy to slow down both in the current and next year, this led to a strong drop in the risk appetite of market players, accompanied by an increase in demand for defensive assets. By the way, under pressure were not only the shares of companies, but also the quotations of commodity and commodity assets. For example, crude oil prices, which have been growing since mid-August, have sharply turned down, and even US sanctions against Iran can no longer support them, which was the main reason for their growth due to the expectation of a drop in black gold supply on the world market.

As a result of Wednesday, defensive assets were clearly in demand, the Japanese yen, the Swiss franc, and the US dollar, and, of course, government bonds of economically developed countries. So, for example, the benchmark yield of 10-year-old treasuries "confidently" falls from the beginning of the week after reaching the level of 3.260% and at the time of writing the article falls by 2.16% to 3.155%.

Everything that happens indicates that investors are seriously worried about the prospects for sustainable demand for risky assets. Evaluating such emerging moods, we believe that their preservation will continue to support the demand for defensive assets. On this basis, we believe that it is necessary to buy the American dollar in pairs with commodity and commodity currencies, as well as the yen and the franc against the dollar.

Forecast of the day:

The USD / CHF currency pair is trading at 0.9865. Overcoming this mark and fixing below it may lead to a continuation of the fall in prices amid the demand for protective assets to 0.9790.

The USD / JPY currency pair is trading at the level of 112.10. It also has prospects for a decline to the support line for the short-term uptrend of 111.50-55 in the wake of continuing concerns about the growth prospects of the global economy.

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Fractal analysis of major currency pairs on October 11

Dear colleagues.

For the Euro / Dollar currency pair, the price is close to the cancellation of the downward structure of October 3, for which a breakdown of 1.1564 is necessary. For the Pound / Dollar pair, we should continue the upward movement after passing by the price of the range of 1.3181 - 1.3211. For the currency pair Dollar / Franc, the price is in the correction. For the currency pair Dollar / Yen, we are following the downward cycle from October 3 and currently, we are waiting for the movement to the level of 111.77. For the Euro / Yen currency pair, we consider the level of 128.35 to be a potential value for the downward trend and we consider the movement upwards as a correction. For the currency pair Pound / Yen, the descending structure of October 8 is still relevant for setting goals.

Forecast for October 11:

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, 1.1455, 1.1431, 1.1414 and 1.1364. Here, the situation has entered an equilibrium state and the range of 1.1527 -1.1564 is the key support for the downward structure of October 3. Its price passage will have to fix the initial conditions for the upward cycle. The short-term downward movement is possible in the range of 1.1455 - 1.1431, from here we expect a key upward reversal. The range of 1.1431 - 1.1414 and the passage of its price will allow counting on a pronounced movement to the level of 1.1364.

The main trend is the equilibrium state.

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 are following the ascending cycle of October 4th. 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 monitor the development of the upward cycle of September 21. At the moment, the price is in the correction. 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, we expect a rollback downwards from this level.

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, the stage of correction.

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: 113.31, 112.72, 112.38, 111.77, 111.48, 111.02 and 110.38. Here, we are following the downward cycle of October 3rd. At the moment, we expect to reach the level of 111.77 and in the range of 111.77 - 111.48 is the consolidation. The breakdown of the level of 111.48 will lead to the movement to 111.02, near this level is the consolidation of the price. The potential value for the bottom is considered the level of 110.38, after reaching which, we expect a rollback to the top.

The short-term upward movement is possible in the range of 112.38 - 112.72 and the breakdown of the latter value will lead to a prolonged correction. Here, the goal is 113.31 and this level is the key support for the downward structure.

The main trend is the downward cycle of October 3.

Trading recommendations:

Buy: 112.38 Take profit: 112.70

Buy: 112.75 Take profit: 113.30

Sell: 111.75 Take profit: 111.50

Sell: 111.46 Take profit: 111.04

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For the Canadian dollar / Dollar currency pair, the key levels on the scale of H1 are: 1.3141, 1.3106, 1.3068, 1.3034, 1.3005, 1.2964 and 1.2926. Here, we are following the ascending structure of October 1. The continuation of the upward movement is expected after the breakdown of 1.3068. In this case, the goal is 1.3106, near this level is the consolidation. The potential value for the top is considered to be the level of 1.3141, upon reaching which we expect consolidation and rollback downwards.

The short-term downward movement is possible in the range of 1.3034 - 1.3005 and the breakdown of the last value will lead to a prolonged correction. Here, the target is 1.2964 and this level is the key support for the upward structure from October 1. Its breakdown will have to form the initial conditions for the downward movement. Here, the target is 1.2926.

The main trend is the ascending structure of October 1.

Trading recommendations:

Buy: 1.3068 Take profit: 1.3104

Buy: 1.3108 Take profit: 1.3140

Sell: 1.3032 Take profit: 1.3007

Sell: 1.3002 Take profit: 1.2966

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The currency pair Australian dollar / Dollar, the key levels on the scale of H1 are: 0.7130, 0.7110, 0.7092, 0.7073, 0.7040, 0.7010 and 0.6975. Here, the price draws up the local structure of October 10 to continue moving downwards. The continuation of the downward trend is expected after the breakdown of 0.7040. In this case, the goal is 0.7010, near this level is the consolidation. For the time being, we consider the level of 0.6975 as a potential value, upon reaching which we expect a rollback to the top.

The short-term upward movement is expected in the range of 0.7073 - 0.7092 and the breakdown of the latter value will lead to the movement to the level of 0.7110, which is the key support for the downward structure.

The main trend is the formation of a local structure for the bottom of October 10.

Trading recommendations:

Buy: 0.7073 Take profit: 0.7090

Buy: 0.7092 Take profit: 0.7110

Sell: 0.7040 Take profit: 0.7012

Sell: 0.7008 Take profit: 0.6977

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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, the descending structure of October 8 is still relevant for setting goals. 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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Trading Plan for 10/11/2018

For the first half of the day, the dollar was not only doing well but keeps on trying to strengthen. Although the growth rate of industrial production in the UK accelerated from 1.0% to 1.3%, the pound at least had a reason for growth. But all the same, the dollar confidently gained points in anticipation of the publication of data on producer prices, which became the reason for its rapid weakening. The fact is that the growth rates of producer prices slowed down from 2.8% to 2.6%, and remain unchanged, as expected. Moreover, inventories at wholesale warehouses increased by 1.0%, hence, they have been growing for ten consecutive months. The combination of a slower growth in producer prices and a constant increase in stocks obviously does not inspire optimism about rising inflation and, consequently, the policy of the Federal Reserve System.

Donald Trump added fuel to the fire when he wasn't busy with attacks on his planet's neighbors, he immediately attacked the Federal Commission on Open Market Operations. So yesterday, in his next tweet, he lashed out at the Fed's actions to tighten monetary policy. In his opinion, a further increase in the refinancing rate only harms the American economy, which he himself is trying to make great again day and night. Of course, the owner of "Trumpunkt" account does not have leverage on the members of the board of the Fed, but investors do not get any safer.

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Today, we are waiting for a very busy day, and the first thing you should pay attention to is the performance of Mark Carney. From the head of the Bank of England, they are once again waiting for at least some specifics about the further actions of the regulator, naturally on the issue of the refinancing rate. Moreover, the completion of the divorce process is not far off, and some even say that an agreement will be signed on Monday between the UK and the European Union. Thus, it is extremely interesting to all how the policy of the Bank of England will be built after the break with continental Europe.

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Old Europe itself will not let you get bored either, as there are data on inflation in France and Spain, but in both cases, it should remain unchanged, which casts doubt on the statement that inflation will grow steadily. And, of course, the minutes of the meeting of the Board of the European Central Bank are published. given that there is less and less faith in the market that the ECB will minimize the effect of the quantitative easing program, everyone is waiting for specifics on this issue in the text of the meeting minutes. Knowing the habit of Mario Draghi and his department, a lot of things to say and say nothing concrete, the content of the protocol will be like that. Also, given the reluctance of inflation to grow, investors will make an unequivocal conclusion that this time the ECB will find a reason not to fulfill its promises.

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However, the main event of the day will be the publication of data on inflation in the United States, which may slow down from 2.7% to 2.4%. This really raises the question of the possibility of revising plans for the rate of increase in the refinancing rate. And even if the Bank of England and the European Central Bank disappoint market participants, slower inflation in the United States will not allow the dollar to take advantage of this opportunity. analytics5bbef6b380511.png

The euro/dollar currency pair rushed up towards the range level of 1.1510 / 1.1550, after testing the periodic level of 1.1440. It is likely to temporarily assume fluctuations within the range level due to the regrouping of trading forces.

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The pound/dollar currency pair showed an active upward interest, reaching the periodic level of 1.3200 and leaving a pulse move behind. We can consider a rollback of 1.3170 if the bullish sentiment persists and there will be stagnation.

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GBP / USD Forecast for October 11, 2018

GBP / USD pair

Yesterday, the UK showed weak economic indicators for August and the US stock market lost more than 3 percent. Yet, the pound took advantage of the general weakening of the dollar while investors were assessing the criticality of the moment. The British GDP for August showed zero growth against expectations of 0.1%. The volume of production in the construction sector lost -0.7% against the forecast of -0.4%, although the actual industrial production increased by 0.2% with the expectation of 0.1%. However, the negative trade balance only increased to -11.2 billion pounds against the forecast of -10.9 billion and -10.4 billion pounds in July. Moreover, it was revised to diminish from -10.0 billion.

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Today, the balance of house prices from RICS for September showed -2% against the forecast of + 2%. Meanwhile, the Bank of England Governor Mark Carney speaks on environmental topics in Bali.

Hence, the pound has reached a nested trend line in a large downward price channel. The signal line of the Marlin oscillator on the four-hour chart lay either in the lateral range or formed a wedge. Both of these formations warn about turning down. We accept such a scenario as the main one with a turn from 1.3240 to the target level 1.3027.

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Nevertheless, pushing up the prices are possible The goal of such is the range of 1.3362-1.3410. In the case of a standard false breakdown in such situations, the range may not be reached. Today or later we are waiting for the price to turn down.

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Technical analysis of NZD/USD for October 11, 2018

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Overview:

The NZD/USD pair dropped from the level of 0.6540 to bottom at 0.6483 nowadays. Today, the NZD/USD pair has faced strong support at the level of 0.6483. So, the strong support has been already faced at the level of 0.6483 and the pair is likely to try to approach it in order to test it again and form a double bottom. Hence, the NZD/USD pair is continuing to trade in a bullish trend from the new support level of 0.6483; to form a bullish channel. According to the previous events, we expect the pair to move between 0.6483 and 0.6390. Also, it should be noted major resistance is seen at 0.6575, while immediate resistance is found at 0.6539. Then, we may anticipate potential testing of 0.6390 to take place soon. However, if the pair succeeds in passing through the level of 0.6539, the market will indicate a bullish opportunity above the level of 0.6539. A breakout of that target will move the pair further upwards to 0.6575. Buy orders are recommended above the area of 0.6539 with the first target at the level of 0.6575; and continue towards 0.6604. On the other hand, if the NZD/USD pair fails to break out through the resistance level of 0.6575; the market will decline further to the level of 0.6390 (support 2).

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Technical analysis of AUD/USD for October 11, 2018

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Overview:

The AUD/USD pair faced resistance at the level of 0.7146, while minor resistance is seen at 0.7107. Support is found at the levels of 0.7043 and 0.6980. Also, it should be noted that a daily pivot point has already set at the level of 0.7107. Equally important, the AUD/USD pair is still moving around the key level at 0.7107, which represents a daily pivot in the H1 time frame at the moment. The AUD/USD pair continued to move upwards from the level of 0.7043. The pair rose from the level of 0.7043 (this level of 0.7043 coincides with the double bottom) to the top around 0.7146. In consequence, the AUD/USD pair broke resistance, which turned strong support at the level of 0.7146. The level of 0.7043 is expected to act as major support today. From this point, we expect the AUD/USD pair to continue moving in the bullish trend from the support level of 0.7043 towards the target level of 0.7146. If the pair succeeds in passing through the level of 0.7146, the market will indicate the bullish opportunity above the level of 0.7146 in order to reach the second target at 0.7179. However, if a breakout happens at the support level of 0.7043, then this scenario may be invalidated.

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Technical analysis: Intraday levels for EUR/USD, Oct 11, 2018

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When the European market opens, the economic calendar is nearly empty, expect for French Final CPI m/m. The US will release a seruis of economic reports such as 30-y Bond Auction, Crude Oil Inventories, Natural Gas Storage, Unemployment Claims, Core CPI m/m, and CPI 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: 1.1589

Strong Resistance: 1.1582

Original Resistance: 1.1571

Inner Sell Area: 1.1559

Target Inner Area: 1.1533

Inner Buy Area: 1.1506

Original Support: 1.1495

Strong Support: 1.1484

Breakout SELL Level: 1.1477.

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 11,2018

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In Asia, Japan will release the 30-y Bond Auction, PPI y/y, and Bank Lending y/y. The US will also provide release a batch of economic data such as 30-y Bond Auction, Crude Oil Inventories, Natural Gas Storage, Unemployment Claims, Core CPI m/m, and CPI 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: 112.71

Resistance 2: 112.49

Resistance 1: 112.27

Support 1: 112.01

Support 2: 111.78

Support 3: 111.56

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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Forecast for EUR / USD pair on October 10, 2018

EUR / USD pair

Yesterday, strong mixed news came to the markets and there were a lot of them, including the aggravation of the situation around the Italian budget, the pessimistic IMF forecasts regarding the global economy, the fall in US government bond yields as a result of investor risk aversion and the news about the possible achievement of Brexit conditions by the beginning of next week. As a result, the dollar index still closed the day with a decrease of 0.08% and the euro has not changed a single point. The price made a false breakdown of the control level at 1.1460 and, up to the current moment, it went above the MACD line to the daily and above the balance line to H4. The convergence of the oscillator with the H4 price was pronounced triple. Now, under the condition that the price did not fall, you can consider options for growth. There are two main immediate growth goals of 1.1570, which is the resistance of the balance line on a daily scale (the line itself grows a little) and the correction level of 50% on the fall line from September 24 is 1.1624. But first, the price needs to overcome the resistance of the trend line indicator on H4 near 1.1545.

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Technical analysis of Gold for October 11, 2018

Gold price remains inside the trading range of $1,180-$1,210. Price is trying to make higher highs and higher lows. Bulls could see $1,220-40 area if we break above $1,207-11. Support so far is held but a break below $1,183 would be a bearish sign and could give Gold a push lower by at least 10$.

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Green lines - long-term bearish channel

Red lines - trading range

Gold price although it is moving out of the long-term bearish channel, will need to break above $1,211 to make a strong bounce higher. As long as price is below $1,211 there is still a danger of pushing to new lows. Support is at $1,183. Resistance is at $1,207 and next at $1,211.

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Technical analysis of EUR/USD for October 11, 2018

EUR/USD is showing more signs of strength as price is staying above 1.15. Short-term trend is about to change to bullish. EUR/USD has made a low very close to our target of 1.1420-1.14 and has reversed to the upside as we expected from our previous analysis.

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Red lines - bullish divergence

EUR/USD formed a bullish hammer candlestick pattern 2 days ago and the follow through remains supportive of a trend change. EUR/USD reached as high as 1.1572 and a daily close above 1.1560-1.1570 would be an ideal bullish signal for today. There are a lot of chances the low is in at 1.1432. I remain bullish EUR/USD.

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EUR and GBP: The pound has stumbled over GDP data. US producer prices coincide with the forecast

In the morning, there was data that limited the upward potential in the British pound, recruited after yesterday's news on Brexit. This is a report on the growth of the UK economy, which, in quarterly terms, although it showed an increase, however, compared with the previous month, the growth was zero.

UK economy

The growth of the economy was due to an increase in retail sales and housing.

According to the National Bureau of Statistics ONS UK, GDP from June to August of this year grew by 0.7% compared with the previous 3-month period. Compared to the same period of 2017, the growth was 2.8%.

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As I said above, in August of this year, compared with July, the growth was zero, which may adversely affect the final annual indicator. As noted in the ONS, the maximum increase in GDP was provided by good retail sales, as well as housing construction in the summer months.

Also today, a report was published from ONS, in which it was stated that the negative trade balance of Great Britain in August of this year increased to 11.2 billion pounds from 10.4 billion pounds in July, while from June to August, there was a decrease in the negative trade balance.

Industrial production in the UK showed more modest growth in August than in July of this year.

According to the data, production increased by 0.2%, while compared to the same period in 2017, the growth was 1.3%. Manufacturing output fell by 0.2%. Fall is observed for the second month in a row. Only the production in the mining and oil and gas industry distinguished, which grew by 0.2%.

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From June to August compared with the previous three months, industrial production increased by 0.7%.

As for the technical picture of GBP / USD, it remained unchanged compared with my morning forecast. The upward potential is still 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.

US Inflation

Data on producer price index in the United States led to the fall of the US dollar, as they completely coincided with the forecasts of economists and did not please the traders. On the other hand, maintaining inflation at acceptable levels will help the Federal Reserve System to more systematically approach the increase in interest rates in the future without fear of a sharp inflation jump.

According to a report by the US Department of Labor, PPI producer price index rose by 0.2% in September compared with the previous month. Economists also expected the index to increase by 0.2% in September.

As for core inflation, excluding volatile categories of food and energy, prices in September rose by the same 0.2% compared with the previous month, which also coincided with economists' forecast. Compared to the same period last year, inflation rose by 2.6%.

As for the technical picture of the EUR / USD pair, the current growth potential is limited by the resistance around 1.1540, the breakthrough of which will lead to the formation of a larger upward wave. The main support now is the level of 1.1480, a breakthrough of which can seriously affect further corrective prospects for the growth of risky assets.

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Trading plan for 11/10/2018

The main impact goes through the stock market with the index in Shanghai losing at some point 5.0%. Drops also affect the raw materials, but already on currency market nervousness is felt to a lesser extent. There is no one direct reason for market panic, or rather there is a fuss about China, high US debt yields and Hurricane Michael striking the US. Hurricane Michael reached Florida with a wind speed of 250 km / h, making him the strongest hurricane at the US coast since 2004.

Chinese Shanghai Composite lost 5% in the morning, although now we see some recovery (-4.4%). In Japan, Nikkei225 drops 4.1%. The stock markets are continuing the sale of Wall Street, where Nasdaq fell by 4.4%, and the SP500 lost 3.3%. It is the largest one-day sale from February.

Yields of 10-year treasury bonds suffered market tensions and profits from recent increases pushed them by 7bp to 3.15%. This has been weighing on the value of USD, where this correlation has recently been the main driving force behind the rises. As a result, EUR / USD rebounded to 1.1570, and GBP / USD was at 1.3220. USD / JPY reaches up to 112.20 on a combination of a falling stock market and lower yields. Despite this, forex changes are relatively small (<0.5%) compared to the stock market. Generally, it can be considered that risk aversion manifests itself by escaping not to safe havens, but from "crowded" positions.

On Thursday, the 11th of October, the event calendar is busy with important data releases. The main event of the day is ECB Meeting Minutes release. Except this, France will post Consumer Price Index data, the same will post Spain. The UK will present BoE Credit Conditions Survey data and Canada will release New Housing Price Index data. And last, but not least, the US will post Consumer Price Index data, Unemployment Claims data and Crude Oil Inventories data. There are spechees scheduled for today as well from BOE Governor Mark Carney and MPC Member Gertjan Vlieghe.

Crude Oil analysis for 11/10/2018:

On the commodity market, supply prevails. WTI oil prices are currently falling 1.5% after 3.2% drop yesterday. However, it should be remembered that due to a hurricane part of the drilling platforms in the Gulf of Mexico has been closed, therefore there are reasons for the prices to remain at an elevated level.

The API report pointed out that last week US crude oil inventories increased by 9.75m bbl - much more than expected before today's DoE report of 2.17m bbl. For today there is a scheduled Crude Oil Inventories data release and the market participants expect a drop to 2,3 mln barrels.

Let's now take a look at the Crude Oil technical picture at the H4 time frame. The market is still trying to resume the uptrend after the trend line was broken. The bounce from the level of 66.85 has reached the level of 70.15, which is just below the technical resistance at the level of 70.37. Nevertheless, to continue with the uptrend, the bulls must break through the high at the level of 71.40 and move even higher. Today's data might trigger this kind of move up as the market is not yet completly overbought.

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Global macro overview for 11/10/2018

The Wednesday session was quite calm in terms of significant macroeconomic events. One of the most important publications was undoubtedly the revised data on the dynamics of the British Gross Domestic Product in September 2018. The latest Office for National Statistics data (UK statistics office) indicate that British GDP was 0.0% in September, compared to an average forecast by economists at 0.1% and 0.4% in August. This means that the market value of all manufactured goods and services remained at its current level. Still, out of the main currency basket, the pound sterling gained the most anyway.

The latest news related to the Brexit agreement may be responsible for strengthening the pound. British and EU diplomats said that intense negotiations over the next five days could lead to a temporary agreement on this matter. However, although this is a positive change, many issues remain unresolved.

Let's now take a look at the GBP/USD technical picture at the H4 time frame chart after the data were published. The pair is still in the uptrend as it approaches the level of 1.3292, which is the next target for bulls. In the meantime, the price has managed to break through the technical resistance zone between the levels of 1.3191 - 1.3217 with a local high at the level of 1.3244. This zone will now act as a support for the price. Please notice, there is no divergence between the price and momentum just yet, but the market conditions are overbought at the time frame.

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Global macro overview for 11/10/2018

The Wednesday session turned out to be tragic on Wall Street. All important indexes lost over 3% of the value:

SP500 -3.29%, closing at 2,785 points

Dow Jones Industrial Average -3.15%, closing at 25 598 points

Nasdaq -4.08%, closing at 7,422 points

For the first two indices, it was the largest one-day drop since February 8, and Nasdaq has been worse off lately after announcing the results of the vote in the Brexit case. Although yesterday's session was not so devastating again, it casts a shadow on the stock market rally driven by great economic data and a reduction in taxes for enterprises. In last week, new highs on indices have been set, and here there has been such drastic depreciation. Wall Street may suffer because of the increasing cost of employment and more expensive loans related to tightening the policy by the FED - yesterday's reaction of investors is just a kind of realization that the policy of low-interest rates has already ended.

Let's now take a look at the SPX technical picture at the H4 time frame. The index has hit the 61% Fibo retracement at the level of 278.11 but has closed below it anyway. The nearest technical resistance zone is seen between the levels of 279.48 - 280.62. On the other hand, the next technical support is seen at the level of 276.48 and in a case of the sell-off extension lower - at the level of 273.94. The sell-off might last longer as the momentum oscillator is deep below its fifty level and it is pointing down.

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

Bitcoin analysis for 11/10/2018

The American technology giant IBM has officially launched a food tracking network, Food Trust, based on Blockchain technology. After 18 months of testing, the company disclosed this information in a press release. In the same communication, the corporation revealed that another large network - Carrefour - joins their ecosystem. A French company that serves more than 12,000 stores in 33 countries will first test Blockchain in its own stores. According to IBM's press release, Carrefour plans to extend Blockchain to all of its brands around the world by 2022.

IBM Food Trust was first announced in 2016 as a Blockchain solution that would connect various entities in the food industry. During the trial period, which began in August 2017, the company collaborated with Nestle SA, Dole Food Co., Driscoll's Inc., Golden State Foods, Kroger Co., McCormick and Co., McLane Co., Tyson Foods Inc. and Unilever NV.

According to IBM, during the testing period, retailers and suppliers used the Blockchain Food Trust to track "millions of individual food products." The American trading company Walmart was one of the first companies to join IBM in experiments in this field - in 2016, it used Blockchain to identify and remove discontinued food products that customers complained about.

Let's now take a look at Bitcoin technical picture at the H4 time frame. The market has dropped suddenly toward the level of $6,000. The slide down was stopped at the level of $6,027 so far, just a little below the level of technical support at $6,060. Currently, the bulls are trying to bounce higher towards the level of $6,245 or even $6,298 where the next technical resistance is. Please notice, that the area of $6,000 was tested many times and so fat it held, but any breakout below it will directly expose the last important level of support at $5,700.

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

BITCOIN Analysis for October 10, 2018

Bitcoin pushed lower impulsively today but could not sustain the bearish momentum below $6,500, which caused a bearish false break. Currently the price is residing above $6,500 area amid moderate bullish pressure, so thta the price might find support from the dynamic level of 20 EMA in the process. Moreover, the Kumo Cloud resistance is currently quite thin which can be broken above quite easily even by the corrective bullish pressure. As the price remains above $6,500 area, the bullish bias is expected to continue. However, breaking above $6,600 area will lead to impulsive bullish momentum.

SUPPORT: 6,000, 6,500

RESISTANCE: 7,500, 8,000

BIAS: BULLISH

MOMENTUM: VOLATILE

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